Resume

Prices were generally a bit higher Wednesday as traders with heavy hearts struggled to resume business as close as possible to normal. There was a decided lack of consistency as production-area numbers ranged from mildly softer to about a dime higher, and market-area deliveries were similarly varied.

Transco reported being notified that the North Terrebonne Gas Processing Plant in South Louisiana was able to resume operations over the weekend. The plant had shut down May 10 due to a propane leak on the suction side of one of the refrigeration compressors. Its operators indicated to Transco “that restart of the plant was delayed due to problems encountered in starting up the plant’s other refrigeration compressor. We are still experiencing some problems with this compressor. As a result of the plant’s restart, delivery points on Transco will see a cutback in the recent buildup of Btu content that started when the plant went down.

Prices emerged from the weekend to resume the slide that dominated much of last week’s market. Only the California border-SoCalGas managed to show a gain for the day as a terribly weak screen, continued lack of fundamental support and expectations of another big storage injection report this week combined to push nearly all points down between 10 and 20 cents Monday.

The offshore Destin Pipeline shut in about 600 MMcf/d of gasthat was flowing on its system Sunday but is expected to resumeflows sometime today pending repairs to a liquids pipelinedownstream of the Pascagoula gas processing plant.

Apparently the cash market was just taking a price-consolidationbreather for the weekend because it returned to a steep upwardtrack Monday. Only Florida citygates failed to rise by more than 30cents, and the highly volatile California and Pacific Northwestmarkets led the price charge with gains of 60 cents or more.

Williams said Thursday it expects to resume normal operationsSunday, one day earlier than previously anticipated, on Line Segments490 and 491. The pipeline had declared a force majeure for thesegments following a compressor failure at its Riner Station (seeDaily GPI, Aug. 3).

Warm weather forecasts and the large separation between cash andfutures prices spoiled the nice rally futures traders had goinglate last week. Prices opened down a nickel, made slight gains andthen slid the rest of the day. After opening at $2.600, Decemberposted a mid-day high at $2.635 and then collapsed to a low of$2.520. It settled down 12.5 cents at $2.524. January lost 10.7cents to settle at $2.681, and February slipped 8.5 cents to endthe day at $2.640/MMBtu.

Tennessee said Monday rehab work on the Sun Lateral in westernLouisiana will be completed ahead of schedule and it will resumetaking nominations at all Sun meters for Wednesday’s gas day. Thepipeline had earlier projected that the project would extend untilJuly 9 (see Daily GPI, June 22).

The Oklahoma Corporation Commission (OCC) Wednesday will resumea hearing on a negotiated settlement on rates, unbundling andcompetitive bidding between the commission and Oneok Inc. and itssubsidiaries Oklahoma Natural Gas (ONG) and Kansas Gas Service(KGS). The hearing began Friday.