Potentially

With at least 800 MMcf/d and potentially more than 1 Bcf/d ofgas supply to sell, the Minerals Management Service (MMS) will be amajor force in the gas market come October when its Gulf of MexicoRoyalty In-Kind (RIK) pilot program begins. MMS’ total royaltyshare of Gulf production is 2.5 Bcf/d and it expects at least athird of that will be taken in kind by next spring.

Attempting to gain access to a potentially plentiful Gulf ofMexico gas supply, KeySpan Exploration &amp Production announcedTuesday it agreed with Houston Exploration Co.to jointly drilland develop 55 leases in the Gulf’s outer continental shelf. The$300 million agreement has an effective date of Jan. 1, 1999.

Attempting to gain access to a potentially plentiful Gulf ofMexico gas supply, KeySpan Exploration & Production announcedTuesday it agreed with Houston Exploration Co. to jointly drill anddevelop 55 leases in the Gulf’s outer continental shelf. The $300million agreement has an effective date of Jan. 1, 1999.

Indiana regulators and FERC are weighing a potentiallygroundbreaking case that, in the end after court review, couldaward “complementary jurisdiction” to both states and the federalgovernment in instances where interstate pipelines are seeking tobypass local distribution companies (LDCs) in order to directlyserve end-use customers.

Indiana regulators and FERC are weighing a potentiallygroundbreaking case that, in the end after court review, could give”complementary jurisdiction” to both states and the federalgovernment in instances where interstate pipelines are seeking tobypass local distribution companies (LDCs) in order to directlyserve end-use customers.

Environmental activist Anne Marie Mueser has accusedCommissioner Curt Hebert Jr. of potentially compromising hisimpartiality in a case involving Southern Natural Gas Co.’s (Sonat) northern Alabama project – a proceeding that is scheduled forrehearing at FERC’s bi-monthly meeting today. She thinks Hebertshould consider recusing himself from the case.

In a reversal of an ALJ initial decision viewed as potentiallyprecedent-setting, FERC last week denied market-based rates fortransportation to Koch Gateway Pipeline after finding it fell farshort of substantiating its claim that it lacked market power. Itmarked the first time that the Commission had considered a requestfor market-based transportation rates on a major long-haul gaspipeline. In 1996, FERC approved similar rate authority for K NInterstate Gas Transmission’s Buffalo Wallow system, but thatinvolved short-haul transportation.

The Canadian natural-gas community sees potentially sharp priceincreases developing on its horizon, thanks to a happy coincidenceof pipeline expansions and economic conditions on the supply side.As the Alliance Pipeline accepted its final certificate for itsU.S. leg from the Federal Energy Regulatory Commission, risingprices were being predicted by prominent fixtures ranging fromPeters &amp Co., an investment boutique specializing in energystocks, to the dean of Canadian geological and engineeringconsulting houses, Sproule Associates.

The Canadian natural-gas community sees potentially sharp priceincreases developing on its horizon, thanks to a happy coincidenceof pipeline expansions and economic conditions on the supply side.As the Alliance Pipeline accepted its final certificate for itsU.S. leg from the Federal Energy Regulatory Commission, risingprices were being predicted by prominent fixtures ranging fromPeters & Co., an investment boutique specializing in energystocks, to the dean of Canadian geological and engineeringconsulting houses, Sproule Associates.