As NGI sources had expected, Thursday’s rise of about a dime in natural gas futures proved sufficient to outweigh moderating weather and the usual demand slump of a weekend period, producing moderate price gains at most eastern points Friday. In the West, however, Waha and PG&E-related points were the only ones to join the overall firmness. Most of the West ranged from flat to down about a nickel, although San Juan-Bondad recorded a whopping 36 cent plunge. Scattered eastern points were flat, but the majority rose by about a nickel to 15 cents.
Articles from Proved
KeySpan Energy affiliate Houston Exploration said it purchased 42 Bcfe of proved reserves in South Texas from subsidiaries of Burlington Resources for $48.1 million in cash. The producing and undeveloped properties total 24,800 gross acres in four fields in Webb, Jim Hogg, Wharton and Calhoun counties. The properties currently are producing 16 MMcfe/d. “Our expansion in South Texas is a direct result of our historical operating performance and the investment in 3-D technology that continues to improve drilling and development results,” said CEO William G. Hargett. “These new properties will continue providing operating efficiencies to our South Texas operations as they are adjacent to existing operations in the Charco Field.” The acquisition will increase Houston Exploration’s South Texas production by 15% to an average of 123 MMcfe/d and grow its total reserves by 10%. The 146 wells in the acquisition are located in the following fields: Northeast Thompsonville, South Laredo, McFarlan and Maude Traylor. The acquisition will be financed through cash flow from the company’s previously announced $250 million capital budget.
Thursday, it was deja vu all over again for both majors and independents reporting fourth quarter earnings. For the majors, Phillips Petroleum Co. and its merger partner Conoco both reported earnings declines for the final quarter of the year, while independent Houston Exploration Co. also saw earnings fall despite record production figures.
El Paso Corp. said last week the market has proved wrong all charges that it manipulated California gas prices over the last year while its marketing/merchant power subsidiary held control over 1.2 Bcf/d of firm capacity on its affiliate pipeline, El Paso Natural Gas. El Paso Merchant relinquished control over most of that capacity on June 1 yet gas prices in California continued to be abnormally high in relation to prices elsewhere in the country, El Paso said.
Though additional wells need to be drilled before the total proved reserves are accurately measured, Murphy Oil Co. announced Thursday that its Front Runner South prospect in Green Canyon Block 339 offshore Louisiana has exceeded expectations. The reserve estimate is expected to be more than the pre-drill projection of 40-60 MMboe.
Monday’s cold weather-induced price rally proved to be short-lived, and few if any traders expect it to be revived anytime soon. Most eastern points fell between a nickel and 15 cents Tuesday, while declines tended to be larger in the Rockies/San Juan and California markets. Due to its frigid New England service area, Algonquin quotes essentially were flat.
To prepare for the coming peak period of electricityconsumption, the New York State Public Service Commission (PSC) hasannounced it will monitor the state’s wholesale electric marketduring this first summer of its operation. The market now isadministered by the New York Independent System Operator (NY ISO),an independent non-profit organization that operates the state’sbulk power system and administers a competitive wholesale marketfor electricity.
EOG Resources and Burlington Resources announced a deal to swapproducing properties with about 40 Bcfe of gas (or 6.5 million bblof oil equivalent) in proved developed reserves. The oil and gasproperties EOG will receive are located in the Permian Basin ofsoutheast New Mexico and West Texas. Burlington will receiveprimarily gas properties centered in its operating areas of theAnadarko Basin in northwest Oklahoma and Hemphill County, TX.
Although rumors that Energy America was in imminent danger ofloosing its marketer license in New Jersey proved untrue, theSempra Energy affiliate will have to go before the state’s Board ofPublic Utilities (BPU) this week to defend itself against claims ofunfair and unlawful marketing activities. According to the BPU,more than 350 complaints have been levied against Energy America asit tries to sign electric customers in New Jersey’snewly-deregulated electric market.
Florida Gas Transmission Company (FGT) proved last week thatit’s not going to give up its monopoly access to the rapidlygrowing Florida market without a fight. The Citrus Corp. subsidiaryfiled its second pipeline expansion application with FERC in a yearin an attempt to head off competition from several proposedgreenfield pipelines, including Williams Companies’ Buccaneerproject, Coastal’s Gulfstream pipeline and Duke Energy’s Sawgrassproject (see NGI, Oct. 4, and Oct. 19).