The significant need for risk management tools in the energy market because of credit concerns and the loss of so many energy merchants and proprietary trading platforms has led to the apparent success of the New York Mercantile Exchange’s ClearPort trading and clearing system. In its first year of operation, the system has cleared three million off-exchange energy futures contracts, Nymex said on Thursday.
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Texas Storage Facility to Turn Off Spigot to Tractebel, Cites Credit Risk
Hill-Lake Gas Storage LP, a West Texas storage facility owned by Falcon Gas Storage, has notified Tractebel Energy Marketing Inc. (TEMI) that it plans to shut off natural gas storage service to the marketer effective Thursday and has put a lien on TEMI’s gas in storage for allegedly failing to comply with the creditworthiness requirements of its contract, a top Falcon Gas official said.
Underserved Risk Management Market Offers Opportunity
How the energy wholesale marketplace sorts itself out in the wake of the past year’s stream of bad news remains to be seen, but regardless, there is a “tremendous” need to market the natural gas of producers, and the growing, underserved wholesale market presents a myriad of opportunities, energy executives believe.
Supply Side Lagging; Keep Your Eye on Drilling
After building itself a growing customer base, it looks like the U.S. natural gas industry may not be able to service it all if the economy picks up this year. If the gas-directed rig count ramps up to 1000 by the end of the year — averaging about 900 rigs through 2003 — then supply available in the U.S. will only be down about 2 Bcf/d from 2002 levels, EOG Chairman Mark Papa estimates. He believes drilling will pick up, but if active rigs don’t hit that level “then production is going to fall harder.”
Supply Side Lagging; Keep Your Eye on Drilling
After building itself a growing customer base, it looks like the U.S. natural gas industry may not be able to service it all if the economy picks up this year. If the gas-directed rig count ramps up to 1000 by the end of the year — averaging about 900 rigs through 2003 — then supply available in the U.S. will only be down about 2 Bcf/d from 2002 levels, EOG Chairman Mark Papa estimates. He believes drilling will pick up, but if active rigs don’t hit that level “then production is going to fall harder.”
Buffett, CSFB Rescue CenterPoint with $1.31B Loan
Warren Buffett, the “Omaha Oracle” whose knack for investment risk has turned a mighty profit for believers, added another energy company to his hefty portfolio on Friday, as Buffett’s Berkshire Hathaway Inc. and Credit Suisse First Boston (CSFB) agreed to loan cash-poor CenterPoint Energy Inc. $1.31 billion. The three-year loan, which carries a 12.75% interest rate, ensures CenterPoint will make a Nov. 15 deadline to pay off a $400 million facility, and more important, allow it to maintain a $4.7 billion credit facility.
Questar On Target to Increase Gas Production by 12% for 2002
Questar Corp. said Wednesday that its low-risk development gas drilling programs have deliverability by 40% this year at its core Rocky Mountain plays in western Wyoming and eastern Utah. Despite intentionally curtailing Rockies production because of low prices and unprecedented basis differentials, the company is on track to grow production by 12% this year, said Chuck Stanley, executive vice president of Questar’s Market Resources (QMR) subsidiary.
Duke’s Trading Practices Concern Moody’s; Outlook to ‘Negative’
Moody’s Investors Service has changed the rating outlooks for Duke Capital and Duke Energy to “negative” from “stable” because of Duke’s report to the Securities and Exchange Commission this week that it engaged in 23 round-trip trades on electronic trading system IntercontinentalExchange (see Daily GPI, July 17 ). Although the $126 million in revenues from the trades “are not material relative to total sales, it causes some concerns about company trading practices and related controls,” Moody’s said.
Duke’s Trading Practices Concern Moody’s; Outlook to ‘Negative’
Moody’s Investors Service has changed the rating outlooks for Duke Capital and Duke Energy to “negative” from “stable” because of Duke’s report to the Securities and Exchange Commission this week that it engaged in 23 round-trip trades on electronic trading system IntercontinentalExchange (see Daily GPI, July 17 ). Although the $126 million in revenues from the trades “are not material relative to total sales, it causes some concerns about company trading practices and related controls,” Moody’s said.
Raymond James: Drilling Activity to Continue to Fall
Once again reducing its near-term oil and natural gas activity forecast, Raymond James & Associates Inc. said on Dec. 24 that the deteriorating oil and gas prices from two months ago still appear to be “weighing on the minds” of exploration and production companies.