Lost

Pacific Gas and Electric Co. (PG&E) lost twice Thursday as California regulators denied the utility’s appeal of a $16.7 million staff-imposed pipeline fine and assessed a separate $3 million penalty for shoddy record-keeping.

Chesapeake Energy Corp.’s stock lost more than 5% of its value on Wednesday after reports that CEO Aubrey K. McClendon has taken out $1.1 billion in personal loans secured by stakes that he holds in company wells that he then used to cover the operating expenses related to investing in the wells. Close to half of the personal loans apparently were provided by a significant investor in the corporation.

Most cash market points gained a few cents, lost a few cents or stood unchanged Wednesday, except for deliveries into the Northeast, where a handful of points posted double-digit gains due to cooler weather. Futures elected to go their own way and closed higher. At the closing bell April futures had risen 9.7 cents to $2.616 and May had improved 8.3 cents to $2.710. April crude oil rose 52 cents to $107.07/bbl.

Natural gas cash averages for the most part Thursday gained or lost a few pennies, but Northeast points saw double-digit gains as temperatures in New England were expected to drop and pipelines issued curtailments.

As Pennsylvania legislators continue to work out a compromise on natural gas drilling impact fee legislation, the Marcellus Shale Coalition (MSC) on Friday urged leaders in Harrisburg “to avoid the temptation of crafting policy in a vacuum and instead design a fee and regulatory structure that not only provides heightened safeguards to the public, but also a competitive investment climate.”

A bill recently introduced in the Pennsylvania General Assembly would require the state’s Environmental Quality Board (EQB) to develop standards for the construction of oil and gas well pads in the Marcellus and Utica shales, according to Rep. Fred Keller, a Republican from central Pennsylvania.

As the federal fiscal year comes to a close Friday, oil and gas leasing activity in the Rockies states declined markedly, according to the Denver-based Western Energy Alliance (WEA), a trade association for more than 400 exploration and production (E&P) companies. With the exception of North Dakota, all Rockies states leasing activity has declined since 2008, WEA said.

The Internal Revenue Service (IRS) lost a bid to collect close to $4 million from the estate of former Enron Corp. Chairman Kenneth Lay and his wife Linda. Kenneth Lay, 64, died of a heart attack in July 2006, six weeks after he was convicted on 10 fraud and conspiracy counts (see Daily GPI, July 6, 2006; May 26, 2006). The tax case dated to Sept. 21, 2001, when the Lays sold $10 million in annuities to Enron as part of an agreement for Kenneth Lay to retake the CEO position, which had been vacated by Jeffrey Skilling a month earlier. The agreement with Enron at the time stipulated that the annuities would be returned to Lay if he worked a 4.25-year term. However, Enron filed for bankruptcy protection less than three months later (see Daily GPI, June 21; May 3, 2006). The IRS contested the Lays’ contention in their 2006 tax filing that the annuities were sold to Enron for no monetary gain; in 2009 the IRS filed a notice of tax deficiency for $3.9 million. U.S. Tax Court Judge Joseph Goeke disagreed, ruling that the Lays’ transactions were legitimate and neither of the Lays nor the estate received any distributions or death benefit from the annuity.

Small gains at most points Tuesday turned into small losses at most points Wednesday as still-hot weather in many areas lost its price-boosting impact with some cooler temperatures looming down the road for some regions.