Sending

FERC staff has begun sending out letters to pipelines askingthem to explain how their proposed projects will square with thenew policy statement that favors incremental pricing. NorthernBorder Pipeline Co. — the first pipe to receive such a letter —made clear its disdain for the pricing policy in its response.

FERC staff has begun sending out letters to pipelines askingthem to explain how their proposed projects will square with thenew policy statement that favors incremental pricing. NorthernBorder Pipeline Co. – the first pipe to receive a letter – madeclear its disdain for the pricing policy in its response last week.

Bears roamed the gas trading woods in full force Thursday,sending cash prices down by a dime or much more at nearly allpoints. The biggest declines of about 35-45 cents occurred at thepreviously high-flying Transco Zone 6 and Texas Eastern M-3citygates in the Northeast. Although some Zone 6-New York Citydeals were still being quoted above $3, the average there fell intothe mid $2.80s.

FERC is sending out mixed signals about its position onauctions. The Commission staff, on the one hand, has been workingsteadily since July towards developing an “efficient andcost-effective” auction structure for the market, yet last week ittold critics that the auction concept might not be the best routeto go. In fact, staff threw down the gauntlet challenging the gasindustry to come up with a better way to sell pipeline capacity inthe short-term market.

As an enticement to do business, Aquila Energy is sending giftsto about 2,000 large energy users as part of a $3 million-plusdirect marketing and national advertising campaign. The gifts are aphone, antique bank replica, or a weather radio and are being sentto prospects in Chicago, Denver, Pittsburgh, New York, Houston,Baltimore, and Washington, DC.

Bears roamed the gas price forest with impunity Friday, sendingall markets down at least a nickel or so and causing severalWestern points to crater. Continued steamy weather in the Southeastand Midcontinent was no match for relatively mild conditions in themajor market areas of the Northeast, Midwest and West Coast. Andthe screen’s drop of about 4 cents didn’t lend any support.