Phase

Congress in two years should begin to phase out the moratoriums that have prevented producers from drilling in promising natural gas-prone areas of the Outer Continental Shelf (OCS), the National Petroleum Council (NPC) recommended in its much-anticipated study released Thursday.

As part of the second phase of an ongoing statewide natural gas regulatory proceeding, Pacific Gas and Electric Co. earlier this month asked California regulators for approval to expand its injection and withdrawal capacities in natural gas storage for its gas procurement program covering core customers. The objective by the utility is to increase its ability to respond to extreme peak demand situations.

As part of the second phase of an ongoing statewide natural gas regulatory proceeding, Pacific Gas and Electric Co. earlier this month asked California regulators for approval to expand its injection and withdrawal capacities in natural gas storage for its gas procurement program covering core customers. The objective by the utility is to increase its ability to respond to extreme peak demand situations.

Freebird Gas Storage LLC has filed an application at FERC seeking to carry out a Phase II expansion of the East Detroit Gas Storage Field in Lamar County, AL.

Sempra Energy Solutions, the retail marketing arm of San Diego-based Sempra Energy, announced that it dedicated the first phase of a new combined heat/power generating plant at the sprawling $900 million Food and Drug Administration headquarters complex in Silver Spring, MD. Sempra Solutions has a 20-year contract with the FDA under the federal energy department’s performance-based contracting program. Called White Oak, the consolidated FDA headquarters will include three million square feet of space on 130 acres and will be developed over 10 years. The energy plant is being developed in phases as a natural-fired cogeneration facility. The specific terms or value of the energy supply contract were not disclosed, but Sempra finances the centralized energy plant equipment and installation with no up-front cost to the federal agency, getting paid annually through the energy savings, which are estimated by the GSA to be about $2.5 million annually for the 6,200-employee complex in which all of the 14 buildings are interconnected.

The cash market followed Wednesday’s leveling-off phase with upward movement at nearly all points Thursday. Quotes ranged from flat to up nearly 20 cents, with gains in the range of 5-15 cents being most common. A couple of scattered points saw small losses.

With most markets either in or entering a thawing-out phase, a price retreat from the worst siege of weather in the overall mild winter of 2001/02 was in order Tuesday. Declines between about a nickel and a little more than a dime were most common. The biggest ones came at the points that had been soaring the day before: Northeast and Florida citygates. A minor OFO kept California numbers mostly flat.

The owners of the Sable Offshore Energy Project (SOEP), off Nova Scotia, announced Monday the awarding of contracts for Tier 2, or second phase, of the project that is expected to produce a total in excess of 600 MMcf/d and 24 thousand bbl/d of liquids by 2003 when both tiers are up and running, according to estimates by part-owner ExxonMobil. Current production averages 550 MMcf/d of sales gas and 20,000 bbl of natural gas liquids.

Florida Gas Transmission said it is ahead of schedule on turbine and pipeline maintenance work for its Phase V expansion. It will be able to schedule up to 1,600,000 MMBtu/d into its market area starting Wednesday rather than the 1,500,000 MMBtu/d it had expected earlier. The turbine work is scheduled to be completed by Nov. 18. On Nov. 22, it will begin a pipe upgrade at one of its throughput stations that will take four days, during which it will schedule up to 1,300,000 MMBtu/d into its market area. Starting on Nov. 26, it will upgrade additional piping at two other throughput stations. That work will take seven to 10 days, during which it will schedule up to 1,500,000 MMBtu/d into its market area. For details call Mike Bryant at (713) 853-4874.