Mexico

The experience of existing U.S. liquefied natural gas (LNG) facilities during the recent Gulf of Mexico hurricanes has supported the designs for new terminals and demonstrated that onsite power generation is probably the single most important added consideration for the new projects, according to Sempra Energy COO Donald Felsinger.

If ordered by Congress to do so, the Interior Department could hold a lease sale in currently unavailable parts of the gas-rich eastern Gulf of Mexico as early as 2006, Secretary Gale Norton told a Senate panel Thursday.

Sen. Jeff Bingaman of New Mexico, the ranking Democrat on the Senate Energy and Natural Resources Committee, called on state regulators to follow the example of Oregon and structure utility rates in a way that would encourage energy efficiency and the conservation of natural gas as the winter heating season approaches.

Chevron Natural Gas, Sequent Energy Management LP and BP Energy Co. were the winning bidders in the Minerals Management Service’s most recent Gulf of Mexico royalty gas auction. More than 195,000 MMBtu/d of royalty gas was sold under five and 12-month terms starting Nov. 1.

There’s no question that natural gas prices will be higher this winter due to post-hurricane supply curtailments in the Gulf of Mexico. But FERC and the Commodity Futures Trading Commission (CFTC) “are committed to ensuring that prices don’t go higher still because of manipulation,” FERC Chairman Joseph Kelliher said last Wednesday as the two agencies signed a memorandum of understanding (MOU) pledging to work together to limit abuses in the gas market.

El Paso Corp. said last week about 80 MMcfe/d of its Gulf of Mexico production shut in during Hurricanes Katrina and Rita will not come back online until the first quarter of 2006. Burlington Resources Inc. and Newfield Exploration Co. also blamed storms for lower 3Q production and full-year output forecasts.

Williams said Thursday it has signed agreements to transport oil and natural gas for the life of the leases in the Blind Faith field in the deepwater Gulf of Mexico for joint owners Chevron Corp. and Kerr-McGee Corp. The field has an estimated gross resource potential of more than 100 million boe, and initial production is expected to be 30,000 bbl/d of oil and 30 MMcf/d of natural gas.

Dallas-based independent Pioneer Natural Resources Co., which is in the process of selling off its deepwater Gulf of Mexico assets, on Thursday announced a discovery on one of the blocks up for sale, the Clipper prospect in the Green Canyon. Pioneer operates the block and holds a 55% working interest.

There’s no question that natural gas prices will be higher this winter due to post-hurricane supply curtailments in the Gulf of Mexico. But FERC and the Commodity Futures Trading Commission (CFTC) “are committed to ensuring that prices don’t go higher still because of manipulation,” FERC Chairman Joseph Kelliher said Wednesday as the two agencies signed a memorandum of understanding (MOU) pledging to work together to limit abuses in the gas market.