Prompted

Continuing weakness in the gas market due to a sharp drop indemand prompted Lehman Brothers to lower its gas price forecastsfor the first quarter and for the years 2001 and 2002. However, itmaintained its gas price forecast for 2003 and raised its crude oilprice forecasts.

Slightly constructive long-lead weather forecasts and animportant technical signal prompted natural gas futures to arrestdownward momentum yesterday and eke out a narrow gain in a quietsession. Many traders elected to wait on the sidelines for aclearer price picture to develop.

Continuing weakness in the gas market due to a sharp drop indemand prompted Lehman Brothers to lower its gas price forecastsfor the first quarter and for the years 2001 and 2002. However, itmaintained its gas price forecast for 2003 and raised its crude oilprice forecasts.

A gas quality problem that prompted NGPL to halt schedulingSaturday at its Transok-Bryan interconnect in Bryan County, OK hasbeen resolved. NGPL resumed scheduling receipts there Monday.

Soaring California gas prices and rapidly rising gas demandmainly for power generation the Pacific Northwest and Californiahas prompted an expansion of the PG&E Gas TransmissionNorthwest (GTN) system. The pipeline said last week it plans tofile with FERC in April for a small initial expansion project fornext year but potentially could add 1 Bcf/d of capacity over thenext decade.

High power costs in the Pacific Northwest prompted Moody’sInvestors Service yesterday to change its outlook on securitiesissued by PacifiCorp (senior secured debt at A2) to negative fromstable.

Record high spot prices, cold weather and bullish supply anddemand projections prompted Lehman Brothers to raise by about 20%its Henry Hub spot gas price forecast for both 2001 and 2002.

Continued uncertainty surrounding the recovery of record highwholesale prices for electricity prompted the Fitch rating serviceTuesday to lower its rating outlook from “stable to negative” forCalifornia’s three major investor-owned electric utilities. Themove came in the midst of another week of late summer heatthroughout the state that is pushing up power prices and squeezingsupplies.

Unexpected delays have prompted Koch Gateway to postpone thestart of maintenance at the Baxter Wilson Power Plant measuringstation until May 30. The work previously had been scheduled tostart Monday (May 22) and last five days. No nominations at thepoint will be accepted during this maintenance.