Record

While power demand hit record levels throughout the Northeastand power prices rocketed to $850/MWh last week, NRG Energycontinued to position itself as a major generator in thepower-hungry region. The subsidiary of Northern States Power landeda major power generation deal with Connecticut Light & Power ofHartford. NRG is snatching up 2,235 MW of generating capacity fromCL&P for $460 million.

While power demand hit record levels throughout the Northeastand power prices rocketed to $850/MWh yesterday, NRG Energycontinued to position itself as a major generator in thepower-hungry region. The subsidiary of Northern States Power landeda major power generation deal with Connecticut Light & Power ofHartford. NRG is snatching up 2,235 MW of generating capacity fromCL&P for $460 million.

Follow-through on last week’s gains and record-settingtemperatures put bulls squarely in control Monday in the Nymex gaspit. Locals and commercials were good buyers in the first hour oftrading yesterday as they buoyed the market to its highest level insix months. However, after the initial surge the market could notattract fresh buying and was left to chop sideways amid arelatively light 59,236 in estimated volume. The July contractfinished at $2.442, up 0.5 cents for the day.

Conoco yesterday held its first meeting of stockholders in 18years following the company’s record-setting $4.4 billion initialpublic offering in October 1998, that launched Conoco’s eventualseparation from DuPont. Conoco CEO Archie Dunham said the finalsplit-off from DuPont is expected to occur in the third quarter ofthis year when DuPont will offer its shareholders the opportunityto exchange DuPont shares for Conoco shares.

Despite advances in drilling technology that tripled the waterdepth record for gas and oil production to 5,376 feet in 1997,near-term gas production may suffer because of low 1998 gas pricesdue in part to the crude oil price collapse.

Despite record earnings last year, Coastal Corp. CEO David A.Arledge admitted in January that 1999 would be a “challengingyear.” Coastal began to prepare for that challenge last week bystarting a corporate belt-tightening program that will include awork-force reduction.

Not forecasts calling for cooling temperatures, nor record lowsset in the nearby heating oil contract could entice the natural gasfutures market to break out of its month long trading rangeTuesday, as many traders decided instead to play it safe and waitfor a more clearly defined price signal. The March contract drifted1.2 cents lower to settle at $1.795 after being limited to a narrow5-cent trading range.

The gas market actually did pretty well last year considering itwas the warmest year on record, but it may take an ice age toreduce the surplus storage gas bequeathed to 1999. Spotdelivered-to-pipeline gas prices in the U.S. averaged $2.02/MMBtuin 1998, down 41 cents, or 17%, from 1997. Some points fared betterthan others and the West generally did better than the East. Canadaactually came out ahead.

The gas market actually did pretty well last year considering itwas the warmest year on record, but it may take an ice age toreduce the surplus storage gas bequeathed to 1999. Spotdelivered-to-pipeline gas prices averaged $2.02/MMBtu in 1998, down41 cents, or 17%, from 1997. Some points faired better than othersand the West generally did better than the East. Canada actuallycame out ahead.