Reclassification

The Energy Information Administration (EIA) reported Thursday morning that a bearish 106 Bcf — which included a 10 Bcf reclassification from base to working gas — was injected into underground natural gas storage for the week ended July 6. As a result, the natural gas futures market moved lower once again, recording a low of $6.330 before closing at $6.497, down 10.3 cents on the day.

The Securities and Exchange Commission (SEC) last week launched a formal non-public inquiry into the oil and gas reserves overbooking by Royal Dutch/Shell Group, which may lead to a broader investigation of other producers’ proved and probable numbers.

After many months of delay, the California Public Utilities Commission Thursday authorized Southern California Gas Co. to reclassify 14 Bcf of natural gas supplies in two of its underground storage fields as part of a reworking of the fields and sell the supplies for a combination of core, noncore and open market customers as a means of keeping downward pressure on wholesale gas prices in the state. The reconfiguration of the field was originally authorized by the CPUC in June 2001.