Protests

Ignoring protests from some shareholders who want a complete separation from Dynegy Inc., ChevronTexaco Corp. Tuesday offered its strongest public endorsement to date, writing down a total of $631 million in second-quarter earnings related to its stake in the marketer, and reiterating that all of its U.S. natural gas agreements remain in place and will remain in place for at least the near term. ChevronTexaco’s profits were down 78% compared to the second quarter a year ago, and part of the loss related to a $531 million special-item charge for the company’s investment in Dynegy’s common and preferred stock to its estimated fair value as of June 30, 2002, and $100 million related to its share of Dynegy’s own writedown.

Over the strong protests of its large public and private-sector electric generating customers, Sempra Energy’s two California utilities later this year will merge their natural gas buying operations as an efficiency move if state regulators okay a currently proposed decision from one of their administrative law judges. Although the two utilities are in the process of merging their management functions throughout each organization, the gas-buying combination has been a proposal since the time of the merger that eventually would form Sempra was announced in the fall of 1996.

Over the strong protests of its large public and private-sector electric generating customers, Sempra Energy’s two California utilities later this year will merge their natural gas buying operations as an efficiency move if state regulators okay a currently proposed decision from one of their administrative law judges. Although the two utilities are in the process of merging their management functions throughout each organization, the gas-buying combination has been a proposal since the time of the merger that eventually would form Sempra was announced in the fall of 1996.

El Paso Natural Gas and affiliate El Paso Merchant Energy are challenging FERC’s decision last month to re-open an investigation into allegations that the bidding for transportation capacity on the pipeline’s system was skewed to favor its merchant power generation affiliates.

El Paso Natural Gas and affiliate El Paso Merchant Energy have challenged FERC’s decision last month to re-open an investigation into allegations that the bidding for transportation capacity on the pipeline’s system was skewed to favor its merchant power generation affiliates.

Denver-based Western Gas Resources last week protested that itwas being forced to deliver 5,000 MMBtu/d of natural gas tocash-strapped Pacific Gas and Electric (PG&E) pursuant to theemergency orders of the U.S. Department of Energy.

Perhaps partially in response to recent customer protests (seeDaily GPI, Dec. 19, 2000 and Jan. 2), Northwest lifted Wednesday itsrealignment and must-flow OFOs through the Kemmerer (WY) CompressorStation but said it reserves the right to re-impose both OFOs upon 24hours’ notice. The pipeline said it determined that ending the orderswas feasible “as a result of more favorable pricing conditions,reduced northbound volumes and increased southbound volumes” throughKemmerer. The must-flow OFO was implemented Nov. 16 (see Daily GPI, Nov. 16, 2000) and had its originalrequirement of up to 10% of contract demand flowing south throughKemmerer revised several times. The realignment OFO was issued Nov. 10(see Daily GPI, Nov. 13, 2000).

While the sheer number of pending and projected natural gaspipeline projects may be staggering, that’s not what sets themapart from projects that preceded them. Rather, the distinguishingfactor is that they’re coming at a time when the “complexity andvolume” of environmental issues and the level of landowneranti-project sentiment have reached unparalleled heights, says atop FERC official.

Producers and utilities last week registered strong protests toTrunkline Gas Co.’s proposal to spin down 720 miles of its 26-inchdiameter natural gas mainline to an affiliate, saying that whilethis action may be in the pipeline’s best interest it’s not “in thepublic interest.”