Sank

Apparently any “storm hype,” which seemed to help buoy the market earlier in the week, was getting totally dismissed as prices sank at all but one point Friday, most often by double-digit amounts. Instead, the near-imminent diminution of most remaining cooling load and the weekend factor of considerably lower industrial demand were more persuasive to traders in sending cash prices lower.

Switzerland-based Transocean Ltd. — owner of drilling rig Deepwater Horizon, which burned and sank last month in the Gulf of Mexico (GOM) following an apparent well blowout — has received $481 million of an approximately $560 million in insurance proceeds it expects to receive this quarter, the company’s CFO told financial analysts Thursday.

Prices sank as low as about 35 cents into Northwest-South of Green River and to less than a dollar at a few other Rockies points as weakness returned to a majority of the cash market Monday. Seasonal springtime weather, with its lack of either heating load or cooling load to any significant degree, was chiefly responsible. The previous Friday’s drop of 2 cents by May futures was an additional bearish element.

Choosing to respond to renewed strength in the U.S. dollar instead of a bullish natural gas storage injection report of only 12 Bcf, December natural gas futures sank back below the $7 mark in Thursday morning trade. Thursday ended up bringing the contract’s streak of higher closes to an end at four as December futures finished at $6.979, down 27 cents from Wednesday’s close.

In its first regular session action as the prompt-month contract, July natural gas futures sank like a rock following news from the Energy Information Administration (EIA) that 87 Bcf was injected into underground natural gas storage for the week ended May 23. The contract recorded a low of $11.466 before closing out Thursday’s regular session at $11.474, down 52.1 cents from Wednesday’s close.

EnCana Corp. reported a huge jump in 1Q2008 operating profit and cash flow last week, but the company’s net earnings sank 81% after it lost a big bet on natural gas prices. North American gas output rose 10% to 3.7 Bcf/d, and U.S. production climbed 27% — aided by rising volumes from the Deep Bossier trend in East Texas.

EnCana Corp. reported a huge jump in 1Q2008 operating profit and cash flow on Tuesday, but the company’s net earnings sank 81% after it lost a big bet on natural gas prices. North American gas output rose 10% to 3.7 Bcf/d, and U.S. production climbed 27% — aided by rising volumes from the Deep Bossier trend in East Texas.

As results of the Alberta election sank in last week, a senior oil and gas business leader, faced with the very real possibility that oil and gas royalties will likely climb 20% next year, glumly described the industry as learning a hard lesson about its political standing.

As results of the Alberta election sank in Tuesday, a senior oil and gas business leader, faced with the very real possibility that oil and gas royalties will likely climb 20% next year, glumly described the industry as learning a hard lesson about its political standing.