Moves

The potential for selling to several gas-fired merchant powerplants in the area is what prompted Denver-based Western GasResources to enter California’s increasingly crowded natural gasmarket by getting an option to buy a Shell-Mobil gathering anddelivery system in northern California. Included in the proposeddeal that should be wrapped up by year-end are 170 miles oftwo-inch- and 10-inch-diameter pipelines crossing more than a dozenlocal gas fields between the Sacramento Airport north of thecapital and the industrialized north Contra Costa County to thesouthwest, where there are substantial existing and proposed largeindustrial loads.

CMS Gas Transmission and Storage Co. said the Fort Union GasGathering partnership has secured all of the rights-of-waynecessary to construct its planned 106-mile natural gas gatheringsystem in the Powder River Basin of Wyoming. CMS is the managingmember in the partnership, which also includes Enron Capital &ampTrade Resources Corp., Western Gas Resources and CIG Resources Co.

CMS Gas Transmission and Storage Co. said the Fort Union GasGathering partnership has secured all of the rights-of-waynecessary to construct its planned 106-mile natural gas gatheringsystem in the Powder River Basin of Wyoming. CMS is the managingmember in the partnership, which also includes Enron Capital &Trade Resources Corp., Western Gas Resources and CIG Resources Co.

New Jersey Governor Christine Todd Whitman signed an energyderegulation bill last week, clearing the way for statewideelectric unbundling to occur by Aug. 1 and statewide, residentialgas unbundling to be in place by Dec. 31. The bill was passed bythe state’s legislature late last month (See NGI, Feb. 1).

Giving gas unbundling efforts in California a shot in the arm,FERC last week approved a major agreement to restructure thelong-term transportation and gas sales arrangements that haveenabled Southern California Gas (SoCalGas) over the years toreceive imports of Canadian gas through its paper pipelineaffiliate, Pacific Interstate Transmission Co. (PITCO).

Fueled by what one veteran trader called one of the mostdramatic price moves in the history of the natural gas market,futures prices rallied Monday as the prompt January contractsettled up 12.3 cents to $2.101. But that daily change paled incomparison to the enormous advances seen in the cash market wheredaily gains registered more than a half-dollar for many pipes.Forecasts calling for cooler temperatures for most of the countryand undervalued cash prices were reasons for the market strength,sources agreed.

In an effort to strengthen its ties with regulators, nationalpolicy makers and member companies, the American Gas Association(AGA) announced plans last week to move its headquarters next Marchfrom Arlington, VA, to downtown Washington, D.C. The associationwill take up residence on the fourth floor of the Hall of the Statebuilding’s south tower at 400 N. Capitol Street, which is twoblocks away from the Capitol building and four blocks from FERC.

Canadian approvals are expected to fall into place within thenext three months after the U.S. leg of the Alliance PipelineProject earned its environmental seal from FERC last week. “Thisputs us firmly on track,” Alliance spokesman Jay Godfrey said.FERC’s approval of the final environmental impact statement (FEIS)firmed up a schedule that – following a one-year delay due to aprolonged fight before Canada’s National Energy Board – calls forconstruction of the C$3.7-billion (US$2.6-billion), 1.3 Bcf/dpipeline to start next spring. That will be in time for completionand a start on deliveries in the fall of 2000, Godfrey said.

Avista Energy said it’s quickly moving up in the gas and powermarketer rankings, increasing its power sales by 90% in the firstquarter of 1998 compared with the fourth quarter of last year andgrowing gas trading volumes by 42% over the same period.