Rocked

An early-morning explosion rocked Duke Energy’s Moss Bluff underground salt cavern storage facility on Thursday in Liberty County, TX, just northeast of Houston, sending flames high into the sky and forcing the company to cut off all natural gas service at the facility. No injuries or damage to the area surrounding the storage site were reported, the company said.

A Houston jury on Monday began hearing the first case that rocked the merchant sector in the past two years, but it didn’t involve Enron Corp. The jury seated Monday will determine whether a former Dynegy Inc. executive, who pleaded innocent, committed fraud with two fellow executives, who already have pleaded guilty.

An explosion rocked a portion of Colorado Interstate Gas Co.’s (CIG) mainline in Colorado on March 23, but it did not interrupt natural gas deliveries to the region or cause any injuries, according to the pipeline. On Friday, a spokesman for El Paso Corp., which owns CIG, said repairs on the damaged section of the pipeline had been completed, and the company was awaiting clearance from the federal Office of Pipeline Safety (OPS) to begin flowing gas through the affected line.

An explosion rocked a portion of Colorado Interstate Gas Co.’s mainline in Colorado Sunday evening, but it did not interrupt natural gas deliveries to the region or cause any injuries, a spokesman for the pipeline said Monday.

Rocked by investor concerns that have led to a liquidity crunch — and a drop in share value of almost 88% in a year — AES Corp. has approved a plan to massively restructure its operations, including a 41% cut in capital expenditures, a move to distance its exposure in Latin America, and withdrawing from electricity trading. AES’s share price plunged from $10/share on Feb. 13 to just above $4 on Friday in reaction to its Venezuela exposure, which forced CEO Dennis W. Bakke to sell almost seven million of his 32 million shares of stock on a margin call to prop up a $36 million personal loan. Two other officers also sold 400,000 shares because of margin calls.

Avista Corp., rocked by early cold weather and increased loads that reduced profit within its utilities division, now expects to report better-than-expected earnings for the fourth quarter, driven by its non-regulated energy trading arm, Avista Energy. The Spokane, WA-based company’s consolidated fourth quarter diluted earnings will exceed $.50 per share, based on results form the first two months of the quarter. The earnings would be well above the consensus figure of $.09, with earnings ranging between $.05 and $.17, according to seven analysts surveyed by First Call/Thomson Financial. The improved performance by the energy arm offset predicted losses within Avista Utilities, which “continues to be affected by cold weather that has increased loads.” The increased loads have led to higher purchased power costs that are not currently being recovered from customers or included in power cost deferrals. Ironically, Avista’s second quarter earnings, reported in June, were driven down by Avista Energy because of what the company called errors in its wholesale trading decisions made a few months earlier (see NGI, June 26). However, company officials predicted then that the energy arm would recover and lead the way toward better economic health for the entire company by the end of this year. Despite its comeback, there has been fallout within the company, with CEO Tom Matthews resigning in early November. Also last month, a federal investigation was launched into the trading practices of the company. Federal investigators have begun looking into possible energy futures trading rule violations that may have occurred two years ago at a Houston subsidiary.

Avista Corp., rocked by early cold weather and increased loadsthat reduced profit within its utilities division, now expects toreport better-than-expected earnings for the fourth quarter, drivenby its non-regulated energy trading arm, Avista Energy.

Although the power industry has been rocked by sharp pricerun-ups this summer, average real electricity prices are projectedto drop by more than 25% by 2015 largely due to improvedefficiencies and cost reductions brought about by electricityrestructuring, the Gas Research Institute (GRI) said in a new studyissued yesterday.