Play

Until it is known how states and FERC are “going to play in the sandbox together” in a post-Public Utility Holding Company Act of 1935 (PUHCA) world, there are likely to be at least some potential merger candidates that will remain on the sidelines, a top official with Lehman Brothers said last Wednesday. Under the Energy Policy Act of 2005 (EPAct), PUHCA will be officially repealed in February 2006.

Prices continued to tumble Tuesday as bearish influences remained in play: widespread moderate weather, negative futures guidance and the growing lack of storage space to stash gas not needed for current burns.

As it moves toward a pure play exploration and production company, Kerr-McGee Corp. plans to separate its chemicals business through an initial public offering (IPO) in the fourth quarter.

Taking back a little of what it gave away on Tuesday, February natural gas futures climbed higher on Wednesday as its petroleum counterparts slipped. The natural gas prompt month notched a high of $6.33 before settling at $6.293, up 15.6 cents on the session.

Dallas-based Atmos Energy Corp. inched closer to becoming the largest pure-play natural gas distributor in the United States Tuesday after receiving final approval from the Missouri Public Service Commission (PSC) to acquire the gas distribution and pipeline operations of TXU Gas Co. Atmos, which is buying the largest gas utility in Texas for $1.925 billion, expects to close the deal by Oct 1.

In a move that will create the largest pure-play natural gas distribution business in the United States, Dallas-based Atmos Energy Corp. announced it will buy substantially all of the operations of TXU Gas Co., a subsidiary of TXU Corp., in an all-cash transaction valued at $1.925 billion.

Moderate softening continued in the swing market Thursday for the most part, but points here and there were flat or eked out tiny gains. Except for some lingering chill in the Upper Plains, Rockies and Western Canada, temperatures were converging toward pleasant levels appropriate for mid-spring in nearly all other regions (cooler in the Southwest and warmer in the Northeast). However, a cold front was due to move into the Midwest by the weekend.

Otter Tail Power Co. on Wednesday said that it will make a play to buy the South Dakota-based utility operations of NorthWestern Corp., which filed for bankruptcy in September 2003 (see Daily GPI, Sept. 17, 2003).

El Paso Corp. continues to play push-me pull-you as it works out a long-term plan to get debt levels in check without starving its remaining core businesses. CEO Doug Foshee stressed that the company should meet its divestiture target of $3.4 billion by the end of this year, but going forward, “we won’t be able to sell our way to prosperity. We have to grow our core businesses.”