Lowered

Transwestern said the failure of a compressor unit at Station 4(Apache County, AZ) has lowered West of Thoreau capacity from850,000 MMbtu/d to about 750,000 MMbtu/d. The unit is expected toreturn to service Sunday.

Cash prices proved remarkably resistant Friday to the softnessthat usually accompanies lowered demand for a weekend period. TheGulf Coast and Northeast citygates were essentially flat, whilemost of the small declines were concentrated in the West andMidcontinent. Sources attributed the relatively firm pricing tomodest support from a slightly higher futures screen, along withtrader anticipation of a return to hotter weather morecharacteristic of June than last week’s below-normal thermometerreadings throughout much of the East.

Connecticut regulators, bowing to pressure from marketers, havelowered penalty rates and delayed opening of the market for smallindustrials and large commercial customers of state LDCs until Jan.1.

The Energy Information Administration has lowered its wellheadprice forecast for the year by several percentage points but saidwellhead prices during the first quarter of 1999 should show a hugeincrease (28%) from average prices during this year’s warm firstquarter.

The Energy Information Administration continues to be bearish ongas wellhead prices this year but expects prices to remain abovethe $2/Mcf mark because of the possibility that temperatures willbe higher than normal this summer and coal delivery problems maypersist in Texas. In its May Short Term Energy Outlook, the EIAsaid it expects wellhead prices to average $2.15/Mcf this year,down 3.6% from the $2.23/Mcf average in 1997.