Pumping

Barring the imposition of a severance tax, Pennsylvania’s Marcellus Shale basin will continue to be a hotbed of activity, pumping an estimated $14.17 billion into the state’s economy in 2010 and creating more than 98,000 jobs, while generating $800 million in state and local revenues (minus royalties), according to an economic study by Pennsylvania State University that was released Monday.

With the near-term weather outlook pumping some life into the bulls’ case in Sunday’s overnight Access session and again on Monday morning, April natural gas futures on Monday ended up recording a high of $7.090 before settling at $7.007, up 36.1 cents on the day. The day’s close marked the first time since Feb. 24 that a prompt-month settled north of $7.

Canadian pipeline partnership Fort Chicago Energy Partners LP is pumping up its growing natural gas pipeline assets, following an agreement to purchase DTE Energy Co.’s 16.41% interest in the Portland Natural Gas Transmission System (PNGTS) for about C$31.3 million. The high-capacity interstate pipe connects the TransQuebec and Maritimes Pipeline at the Canadian border and the Maritimes and Northeast Pipeline at Westbrook, ME with the Tennessee Gas Pipeline System.

The senior executive bonuses for this year are gone, some of the long-term executive incentives have been eliminated, capital spending has been reduced even more, and up to $2 billion more in assets will be sold. As El Paso Corp.’s chairman noted, the interstate pipeline leader is not reacting, but rather responding to what shareholders and the marketplace now demand. “We are doing what management is supposed to do,” explained CEO William Wise on Thursday. “We are all sharing the pain.”