Morning

Westcoast declared force majeure following a failure earlyMonday morning on its T-South transmission system. The pipelinesaid it is investigating the cause of the incident, which occurredon the 30-inch mainline between Compressor Stations 8A and 8B. The36-inch loop was unaffected. Capacity through the Huntingdon/Sumasexport point is limited to 1,400 MMcf/d as a result of theincident; however, based on current volume levels, Westcoast doesnot expect any impact on T-South deliveries.

Sonat reported being notified Tuesday morning that beginningtoday, Ocean Energy will be performing maintenance that requiresshut-in of the Main Pass 153 receipt point until further notice.Sonat declared a force majeure and said it will not schedule anynominations at the point during the outage.

Cash quotes for the last day of June tumbled Thursday,influenced by futures weakness in the morning and from the previousday and also by a general dearth of weather-related demand outsidethe West.

With a weaker screen during the morning and not a lot of solidweather load emerging from the weekend, most of the East was flatto down a few cents Monday. Western points continued a now-familiarpattern bracketing weekends: having suffered the biggest drops onFriday, they saw the biggest rebounds on Monday.

Building on modest gains achieved yesterday morning, the futuresmarket rocketed more than 20 cents higher Wednesday afternoon uponthe release of yet another bullish storage report. Finishing 27.1cents stronger at $4.378, the prompt July contract retraced morethan half of its Monday price slide yesterday and now stands closerto the upper limit of its $3.80-$4.60 trading range.

Florida Gas Transmission issued an Overage Alert Day noticeTuesday morning for that gas day and extended the notice through atleast today. Citing significant demand in its market area, FGTapplied the notice to the downstream segment east of Station 12 innorth-central Florida. The notice carried a 6% tolerance fornegative daily imbalances; however, FGT said if conditions do notimprove, it may cut the percentage prior to the start of today’sgas day.

Feeding off gains notched Friday morning, natural gas futurespushed to fresh highs yesterday as funds and locals added to theirlong holdings. With that, the June contract has advanced 16 centsin the last two trading sessions to move past and settle above itsprevious life-of-contract high with a $3.216 closing price Monday.Estimated volume was light at 51,288 contracts despite theimpressive price move. An average trading day would see roughly20,000 more in estimated volume.

Pacific Gas & Electric issued a customer-specific OFO totake effect today. As of Tuesday morning the utility was projectingabove-target linepack levels through Friday.

Texas Eastern plans minor maintenance for a few hours Thursdaymorning at the Grand Chenier (LA) Station. Operators may experiencehigher than normal pressures on the West Louisiana zone’s CameronSystem, but pressures are expected to return to normal by evening.