Possibly

Transco alerted shippers that some production possibly could beinterrupted today on the Southeast Louisiana Lateral. The U.S. ArmyCorps of Engineers is expected to take about eight hours tocomplete matting of the western bank of the Mississippi River.Transco said it will make every operational effort to keep thiswork from impacting production, but curtailments are possible ifunforeseen events lengthen the operation.

KeySpan Energy, which has been focusing increasingly ondownstream and electric power activities, is considering the saleof its 64% ownership interest in E&P arm Houston Exploration.An announcement last week said KeySpan and Houston Exploration hadbegun a process to review “a full range of strategic transactions”and hired J.P. Morgan Securities Inc. as financial advisor.

As possibly the first step toward the formation of a multi-statewestern U.S. electricity transmission grid operator, the CaliforniaIndependent System Operator’s governing board has authorized theISO management to discuss with Nevada regulatory staff a deal underwhich the California nonprofit grid operator would expand itsoperations to handle Nevada. Public Utilities Commission staff inNevada raised the issue last month as an option for the state as itanticipates a new law that will open Nevada power markets nextspring.

A 270 MMcf/d reduction in San Juan Basin supply persisted intothe weekend-and possibly beyond-as El Paso reported it had founddamage to internal rotating components in its Blanco Plant’s “D”turbine that would require removal and inspection. The plant hadbeen scheduled to resume full operation Thursday. If the parts canbe repaired and reused, the turbine should return to service May31, El Paso said. But if the parts must be replaced, the projectedreturn date is June 5.

The majors have had their day, now it’s the independents’ turnin the merger mart, and analysts are targeting Burlington Resourcesand possibly even Mitchell Energy as companies in play.

PennzEnergy Co. and Sonat Exploration Co. formed a joint ventureto develop mineral interests underlain by coal bed methane at the700,000-acre Vermejo Park Ranch in northeast New Mexico.PennzEnergy has held the bulk of the mineral rights since 1970.

Interstate pipelines are expected to propose a “global”initiative on seasonal ratemaking and possibly negotiated terms andconditions of service at an industry-sponsored session in Houstonlater this week. Seasonal ratemaking, which would enable pipelinesto recover more fixed costs when capacity is in greatest demand, isemerging as the industry’s front-runner alternative to FERC’smuch-criticized auction mechanism for pricing pipeline capacity.

Chairman James Hoecker said this week FERC plans to hold onestaff workshop (possibly more) with the gas industry in mid-Octoberto flesh out the details involved in the auctioning of short-termcapacity. The workshop will occur prior to the deadline forindustry comments on the notice of proposed rulemaking (NOPR) thataddresses regulation of short-term capacity, specifically theauctioning of that capacity. The comments are due in earlyNovember.