Normal

Despite normal weather and no clear threat to the Gulf production area from tropical activity, natural gas futures prices surged higher Tuesday with the near-month contract adding 38.4 cents to settle at $7.008, near its daily high of $7.030. Brokers pointed to strong Henry Hub cash as part of the reason. Tropical Depression Four in the eastern Atlantic, meanwhile, served as a reminder that the hurricane season isn’t over just yet.

Citing the above-normal natural gas inventory levels this year, Columbia Gas Transmission Corp. is seeking authorization to increase on a temporary basis the maximum volume of gas in storage in 11 of its storage fields above the amount currently certificated by FERC.

Citing the above-normal natural gas inventory levels this year, Columbia Gas Transmission Corp. is seeking authorization to increase on a temporary basis the maximum volume of gas in storage in 11 of its storage fields above the amount currently certificated by FERC.

Mark-to-market changes on certain gas contracts, much warmer than normal weather and customer conservation due to high gas prices all contributed to a net loss of $27 million, or $0.12 per share, for Michigan-based CMS Energy in the first quarter compared to net income of $150 million, or $0.74 per share, in the same quarter of 2005.

Continued strength from the tension-filled petroleum sector combined with warmer than normal temperatures in the southern regions of the U.S. worked to buoy natural gas futures Tuesday as May natural gas finally broke out of its recent $6.65-7.65 trading range. Following a high of $8.10 in afternoon trading, the prompt month went on to settle at $8.008, up 43.1 cents on the day, bringing the week’s two-day total gain to 87.3 cents.

NOVA restored its imbalance tolerance range to the normal +4/-4 Tuesday.

Rainfall running almost 165% above normal so far in 2006 has triggered land movement between Washougal and Willard in the Blue Lake area of Washington state at approximately Mile Post 1192, Northwest said Friday. “Strain gauges installed in this segment have registered steady increases in stress on the pipeline in this area,” the pipeline added. “Although the stress levels require remediation soon, they are not such that immediate action is needed.” In order to ensure safety and reliability in this segment, Northwest plans to blow down and excavate the affected area to reduce line stress. It anticipates there will be no physical flow through the area for Wednesday’s gas day. “Based upon current weather forecasts and operating conditions, Northwest does not anticipate primary impacts to customers. Northwest will work with its interconnects and use its Jackson Prairie inventory in an attempt to eliminate customer impacts. However, if net nominations north through the Washougal Compressor [Station] increase significantly over the currently scheduled volume of 386,000 Dth/d, Northwest may be forced to declare a Deficiency Period. Customers can help mitigate market impacts by buying gas at Sumas,” the pipeline said. For the Feb. 22-24 gas days Northwest will only schedule primary nominations north through either the Roosevelt or Washougal Compressor Stations. If the stress on the line accelerates, remediation work may begin earlier than currently planned, it said. A Stage II entitlement remained in place until further notice.

Warmer-than-normal weather since the early December freeze across much of the nation has caused wholesale natural gas prices for February to drop 31% from last month’s levels for Pacific Gas and Electric Co. The San Francisco-based utility said there has been a “significant drop” in heating demand nationwide, and in California the utility’s more than four million natural gas customers “appear to be conserving above and beyond the dictates of weather.”

After returning to normal linepack levels over the weekend after a lengthy period of dealing with high linepack, Kern River was faced with a different problem Tuesday: low linepack in all four segments that the pipeline attributed to drafting of its system and loss of supply during the preceding 24 hours. “If drafting continues, Kern River will take whatever actions are necessary to ensure the integrity of the system is maintained,” it said.