Purchasing

Chesapeake Energy said last week that it is in the process of purchasing 289 Bcfe of proved gas and oil reserves and another 277 Bcfe of probable and possible reserves in the Permian Basin, South Texas and East Texas from four small independent production companies for about $686.4 million in cash.

Chesapeake Energy said Tuesday it is in the process of purchasing 289 Bcfe of proved gas and oil reserves and another 277 Bcfe of probable and possible reserves in the Permian Basin, South Texas and East Texas from four small independent production companies for about $686.4 million in cash.

In a favorable step for the state’s suspended electric direct access purchasing program, California’s Supreme Court last Thursday upheld the state regulatory commission’s authority and recent rules laid down for customers who were exempted from the state legislature’s restrictions imposed two years ago. About 15% of the three private sector electric utilities’ load is covered by large customers buying their own power supplies.

Two more Canadian firms, TransCanada PipeLines Ltd. and BPC Generation Infrastructure Trust of Toronto, have teamed with prior interest holder, Cameco Corp. of Saskatoon, Canada, to buy 79.8% of the massive Ontario-based nuclear power facility, Bruce Power L.P., from the financially ailing British Energy for an estimated $376 million.

Peoples Energy CEO Thomas M. Patrick said a review by the Illinois Commerce Commission (ICC) of the utility’s purchasing practices last year “will show that the company conducted its business prudently and that none of our practices increased costs to customers.” He added that the case is on a typical procedural schedule that would bring it to conclusion early in 2003.

Planalytics Inc. announced that Citizens Gas & Coke Utility has renewed its contract for Planalytics Gas Buyer(SM), a financial risk management tool for purchasing and hedging natural gas. “Planalytics Gas Buyer is a key part of our risk management strategy,” said Lindsay Lindgren, vice president of Gas Operations for Citizens Gas & Coke Utility. “The Gas Buyer’s year-ahead analysis of gas prices helps us sort through the day-to-day market volatility and bring increased price stability to our 262,000 customers.” The company’s Gas Buyer provides daily buying, selling or hedging actions designed to reduce risk and take advantage of opportunities presented by weather-driven effects on gas prices. The web-based tool combines long- range weather intelligence, weekly storage data, inventory change forecasts, real-time NYMEX futures contract pricing and advanced neural network technologies into an engine that determines if natural gas for any of the next twelve months is currently overvalued or undervalued. Planalytics said it is hosting a live Planalytics Gas Buyer web cast from 3:30 to 4:00 p.m. EST on Feb. 12 to show how its product works. The web cast can be accessed at www.planalytics.com/energy. Indianapolis, IN-based Citizens Gas & Coke Utility provides energy services to more than 262,000 residential, commercial, and industrial customers in Marion County, IN.

Even though a recent report by the National Association of Purchasing Managers (NAPM) has signaled that natural gas demand is moving toward recovery, industrial-related demand will “remain anemic” until inventory levels come down and production increases, according to last week’s Raymond James Energy’s Stat of the Week.

Even though a recent report by the National Association of Purchasing Managers (NAPM) has signaled that natural gas demand is moving toward recovery, industrial-related demand will “remain anemic” until inventory levels come down and production increases, according to Raymond James Energy’s Stat of the Week Monday.

California regulators may be scratching their heads about what to do with gas purchasing incentives for the state’s major utilities following Southern California Gas Co.’s filing that claims its purchases over a 12-month period ending last June were $223 million below market prices.