Prior

Maybe it was the urge to converge that had quotes droppingWednesday for both late-February and March bidweek deals. Theincremental softness remained on the mild side as a few pointsmanaged flat showings and most of the others were down by about anickel or less. Once again the bigger declines of 15 cents or morecame at Northeast citygates as they continued to retreat fromMonday’s cold weather-related price spikes.

Trading at the New York Mercantile Exchange for the month ofFebruary has featured tight but choppy ranges punctuated by smalldecreases when sellers slightly outnumbered the buyers in themarket. And yesterday’s expiration-day session was simply amicrocosm of that as the March contract was the focus of a fierce,and mostly balanced battle, which was ultimately decided by sellerslate in the day. The March contract concluded its reign as promptmonth with a 4.4-cent decline to settle at $1.666.

Taking its initial plunge into the Canadian Midstream market, Duke Energy announced Wednesday its subsidiary, Duke Energy Services Canada Ltd., acquired gas gathering and processing assets from Calgary-based Cometra Energy. Financial terms were not disclosed.

FERC yesterday upheld an administrative law judge’s partialinitial decision denying KN Interstate Gas’ (KNI) request to rollin the costs associated with the construction of its Pony ExpressLine and Kansas City Line.

Fidelity Oil Group of Bismarck, ND, the E&P unit of MDUResources Group Inc., production has grown at an average rate ofmore than 10%/year for the last 10 years while reserves have grownat an average rate of more than 8%/year, net of ongoing production.Gas reserves have increased most significantly, growing to morethan 110 Bcf in January after Fidelity’s acquisition of propertiesin Louisiana, Texas, Oklahoma, and Mississippi. The company targetsboth onshore and offshore properties in many of the major basins.Fidelity operations stretch from Canada through the central U.S.and into the Gulf of Mexico.

In its weekly outlook on gas storage levels, Salomon SmithBarney (SSB) raised its forecast of expected storage levels at theend of the winter heating season by 117 Bcf from the previous week.The firm, which has grown increasingly bearish because of theclimbing storage surplus, now expects there to be 1,423 Bcf ofworking gas in storage on April 3, which would be 522 Bcf more thanthe four-year average on that date and 364 Bcf more than the sametime last year. Working gas levels in storage as of Feb. 12 were at1,887 Bcf, which is 462 Bcf more than last year on the same date,according to the American Gas Association (AGA).

Exxon worldwide additions to proved oil and gas reserves totaled1.1 billion oil-equivalent barrels in 1998, replacing 106% ofproduction. “This year’s strong performance is the fifth year in arow that we’ve exceeded 100% replacement,” said Chairman LeeRaymond. “Over the last 10 years, we’ve added nearly 11 billionoil-equivalent barrels to proved reserves, more than replacingreserves produced. Long-term reserves portfolio management anddevelopment is a key area of emphasis in our business.”

A break in the flat price pattern that has dominated the overallcash market during February came Tuesday, and appropriately it wasto the downside, where many sources had long expected prices to beheaded because of mild weather, a softening screen and a massivestorage surplus for this late in the winter season.

All the ingredients were right for the futures market to spirallower yesterday-a softer cash market, continued bearish weatherforecasts, and an abundance of ready-to-expire March $1.65 and$1.70 put options. But for some reason, all of those factors werenot enough to inspire a sustained round of selling, leaving theMarch contract to chop to either side of unchanged before finishingwith a 0.6-cent gain to $1.71.