Prices

As natural gas shortages become almost commonplace, and pricescontinued to stay perched at the higher end, it comes as nosurprise that producers such as Chevron, Texaco and Burlington haveincreased their capital and exploratory spending programs in 2001.

The Kansas City, MO, city government has voted to give naturalgas consumers some relief from high natural gas prices. The citycouncil in a special meeting voted to immediately repeal theresidential natural gas section of an emergency utility tax thathas been imposed on consumers since 1952. The tax, which wasenacted due to reasons that no one in the city council cancurrently recall, varied from 0.5%, up to 4% over the last 46years.

“It’s like prices are wandering aimlessly in the wilderness,”one trader remarked of Tuesday’s sharp reversal from the marketstrength that opened the week. All points were on the same downhillpage as declines ranged from about 15 cents to 90 cents but withmost of them clustered in the range of 30-50 cents.

The Kansas City, MO, city government has voted to give naturalgas consumers some relief from high natural gas prices. The citycouncil voted last week to immediately repeal the residentialnatural gas section of an emergency utility tax that has beenimposed on consumers since 1952. The tax, which was enacted due toreasons that no one in the city council can currently recall,varied from 0.5%, up to 4% over the last 46 years.

It appears increasingly likely that development of 35 Tcf of gasreserves in Alaska and another 6-9 Tcf in the Mackenzie Deltaregion of the Northwest Territories will be headed down parallelbut separate paths. Both projects, however, seem to be picking upspeed in reaction to the current favorable market situation.

For those who are still scrambling for explanations on why gasprices have reached record levels, Salomon Smith Barney (SSB)meteorologist Jon Davis offered a brief synopsis last week of whathappened with the weather last month. November 2000 was the secondcoldest November in 106 years and it was a complete reversal fromNovember 1999, which was the warmest November in 106 years.

Even with near record prices for oil and gas, theever-optimistic independent exploration outfits in California’straditionally fossil fuel-rich Kern County are having a hard timenailing down financing to continue exploring.

For those who are still scrambling for explanations on why gasprices have reached record levels, Salomon Smith Barney (SSB)meteorologist Jon Davis offered a brief synopsis last week of whathappened with the weather last month. November 2000 was the secondcoldest November in 106 years and it was a complete reversal fromNovember 1999, which was the warmest November in 106 years.

Two basis swap contracts based on NGI’s bidweek indexes atChicago and the Southern California border were among a number ofenergy products approved last week for listing on enymex, the NewYork Mercantile Exchange’s Internet-based trading system. Nymexexpects to launch the new system during the second quarter of 2001.