Record

It’s virtually certain that the Southern California border indexfor December will be record-setting. It had seemed likely when atrader reported physical border basis at plus 490 last Wednesday (seeDaily GPI, Nov. 27). But things werejust getting started then. The border basis bid-ask spread reachedplus 640-650 on a popular electronic trading service Monday, said awestern source.

The name “ICE” doesn’t seem to do the white-hot trading exchangejustice, after IntercontinentalExchange, which marketsover-the-counter energy and metals products, announced it tradedmore than 2 million MWh in one day — Thursday — just one monthafter going live with its complete energy portfolio.

Fort Worth, TX-based Quicksilver Resources reported that itsthird quarter earnings set a company best record with net incomerising 372%. Net income was $4.8 million ($0.26 per share) comparedto $1 million ($0.08 per share) during the third quarter 1999. Thecompany accredited the breakout quarter to higher prices andincreased volume production and sales of natural gas and oil. Thecompany’s net natural gas sales went from $10.4 million for 3Q 1999to $20.3 million for 3Q2000, a 96% increase. Gas production volumesalso jumped 65% between the two time periods to end up at 7 Bcf inthe third quarter of this year. Gas prices on average increasedabout 19%. Natural gas liquids (NGL) followed in tandem, growing to$957,000 with volumes growing 175% and prices by 213% when comparedto the same time period last year. Oil sales enjoyed similar leaps,growing 112% to $6.8 million over last year’s $3.2 million figure.Crude production also rose 41% higher to finish at 305 bbls. Theaverage crude oil price grew approximately 50%.

While not plunging quite as steeply as the day before, pricesfor the weekend continued to record double-digit declines Friday.There was considerably more consistency across all markets than onThursday as virtually all points fell between 15 cents and about aquarter.

The recent string of record warm winters may come to a closethis winter, as normal (cold) weather is likely to return,according to predictions from top weather experts at the NationalOceanic and Atmospheric Administration (NOAA) and Salomon SmithBarney.

The recent string of record warm winters may come to a closethis winter, as normal (cold) weather is likely to return,according to predictions from top weather experts at the NationalOceanic and Atmospheric Administration (NOAA) and Salomon SmithBarney.

Continued uncertainty surrounding the recovery of record highwholesale prices for electricity prompted the Fitch rating serviceTuesday to lower its rating outlook from “stable to negative” forCalifornia’s three major investor-owned electric utilities. Themove came in the midst of another week of late summer heatthroughout the state that is pushing up power prices and squeezingsupplies.

Flush with cash from an IPO early in the summer, aCalifornia-based micro-turbine pioneer yet to record a profit, ishoping to keep up with increasing demand and move into the blackfinancially by the end of next year, spurred along at leastpartially by this summer’s electricity supply and price problems.

In a somewhat stunning show of bullishness, natural gas futuresprobed higher yesterday as funds and locals followed the lead ofcommercial buying throughout the last hour of trading. On its firstday in the limelight, the new prompt month, October, received thelargest boost of any contract at Nymex, leaping 15.8 cents higherto close at $4.801. In doing so, it set a new all-time high dailysettlement for a prompt contract.