Long

Denver-based Western Gas Resources earlier this week exercisedits long-standing option to buy 170 miles of proprietary gaspipelines in the Sacramento Basin and promptly sold the network oftwo- and 10-inch-diameter pipes to California-based merchant powerplant developer Calpine Corp. No dollar figures on the deals willbe released, and both companies are expected to make formalannouncements later this week or early next week, according toWestern Gas and Calpine.

While recognizing that congested areas in part of California’senergy grid need a combination of potential mitigation measures,including distributed generation, the serious discussion at astatewide energy roundtable last week remained ambivalent about howfast, and whether, the decentralized approach can make a meaningfulcontribution.

With a striking new drilling success confirming that thelong-awaited time has arrived for making a start on developingnatural gas in the Canadian North, natives and authorities thereare laying out welcome mats.

In activity that was predictably very subdued for a day leadinginto the long Christmas weekend, prices ranged from flat to down afew cents Thursday. As one source commented, “Man, I’ve seen deadmarkets before, but this one seems to be rotting in the grave.”Somewhat in keeping with that remark, a marketer said many of hertrading partners had only “skeleton crews” in the office, andvirtually nobody was still around after lunchtime.

If Questar’s predictions concerning its Pinedale Anticline fieldhold true, then the Utah-based company is about to embark on one ofthe most significant exploration and production projects in itshistory. Although some drilling has already taken place at theSublette County, WY, field, Questar is preparing to launch amassive drilling program aimed at cultivating the projected 3 Tcfthe field holds.

Western Resources Inc. and Kansas City Power and Light (KCPL) -could be reaching the end of their long-fought merger battle as theKansas Corporation Commission (KCC) approved the merger with someconditions.

Standard & Poor’s today affirmed the ratings of Duke EnergyCorp. and related entities and assigned a negative rating outlook.

Buoyed by a much firmer screen and the pickup in load thatfollows a long Labor Day weekend, cash prices rose Tuesday by anickel or more at almost every point, with most of the increasesexceeding a dime. Not only did natural gas futures rise more than adime, but the crude oil futures contract for October also flexedits muscle with a jump of slightly over 60 cents, placing it wellabove $22/bbl, a marketer pointed out.

Rigel Energy, a medium-sized producer based in Calgary, got the desired results from its summer-long, self-advertising campaign last week in the form of a $C1.2 billion merger offer from Talisman Energy. Rigel’s board of directors said it will recommend acceptance of the offer to the company’s shareholders. Talisman is expected to mail its formal takeover bid offer on Sept. 2, and the offer will be open for acceptance for at least 21 days, Rigel said.