Made

Like an immovable object the downtrend weighed on the futuresmarket again on Thursday, completely erasing advances made earlierin the week. That left the September contract down 4.2 cents to$1.831, but more importantly the prompt month continues to plodtoward substantive support in the $1.78-81 area, causing tradersto wonder if that level will hold or be merely a speed bump.

The futures market made gains for the second day in a rowTuesday on what many sources are calling a bit of a technicalcorrection in an otherwise down market. That left the Septembercontract hovering within striking distance of the downtrend linethat has thwarted upward momentum since July 9. September finishedup 2.6 cents to settle at 1.895.

FERC made three small but significant changes to its pipelinerate of return policy this week, winning the praise of theInterstate Natural Gas Association of America (INGAA), whichrepresents the pipelines. INGAA President Jerald V. Halvorsen saidthe Commission’s action “should help pipelines compete in theincreasingly competitive financial markets for the capital to buildprojects that are necessary to meet projections of a 30 Tcf naturalgas economy by 2010.”

The futures market shrugged off the latest AGA storage reportand made modest gains Thursday in a session notably devoid of freshnews. The August contract was limited to a narrow 5-cent range,settling up 1.4 cents to $1.948.

Chevron and its Project Genesis partners made the first movetoward positioning the 28,700-ton hull of the Genesis drilling andproduction platform in waters 2,600 feet deep in the Gulf ofMexico, 150 miles south of New Orleans. Project teams from ChevronUSA Production, Exxon, PetroFina, and contractors last weekup-righted the 705-foot cylindrical steel hull, which will be thefoundation for the entire platform. The hull arrived by barge fromFinland earlier this year and was floated into position from itslaunch site in Ingleside, TX.

The Natural Gas Supply Association and Independent PetroleumAssociation of America made their displeasure clear over PresidentBill Clinton’s decision last week to extend a moratorium onoffshore drilling. “Cleaner air and increased use of affordable,clean-burning natural gas depend on access to the large natural gasfields off the nation’s coasts,” said NGSA President Nicholas Bush.”Continuing today’s severe restrictions on offshore natural gasproduction is simply not in the nation’s best interest.”

Amoco Corp. and Spain’s Repsol SA have made a proposal thatwould provide a guaranteed market for gas from Trinidad and Tobago,enabling the country to become one of the world’s top suppliers ofliquefied natural gas (LNG).

KN Energy made a decision to discontinue its mc2 retail energymarketing unit, which was acquired when KN purchased MidCon Corp.earlier this year. KN said mc2’s business strategy clashed withthat of KN Services and en-able, KN’s retail energy marketing andservices joint venture with PacifiCorp.

The cash market made more small gains Wednesday, but downturnsin late trading at many points led sources to believe this week’sprice rally has ended, at least for the time being. Prices ran up3-4 cents at the outset but then came off hard at the tail end inresponse to the screen, said a Gulf Coast trader. As long asfutures stayed up, though, cash stayed right there with them, headded.