Settlement

Enron Corp. on Friday announced it had reached a $144 million settlement with Barclays in its so-called “MegaClaims” litigation. Enron’s settlements with eight financial institutions now total $928 million.

A string of consecutive higher daily settlement came to an end on the eighth day Wednesday as November natural gas futures pushed lower to close at $6.150, down 31.6 cents on the day. With forecasted cold air finally entering the Plains, some traders said Wednesday’s trade action was a classic example of “buy the rumor, sell the fact.”

Piedmont Natural Gas has reached a settlement in principle with the North Carolina attorney general’s office over the utility’s rate mechanism. North Carolina agreed to drop its appeal of the rate mechanism, and Piedmont agreed to share with its customers a portion of what is recovered through the mechanism, which could return up to $1.5 million a year to its customers through Oct. 31, 2008. The Charlotte, NC-based utility’s Customer Utilization Tracker (CUT) was approved and adopted in a 2005 rate case before the North Carolina Utilities Commission (NCUC). It separated the collection of utility margin from customer volumes, which vary depending on prevailing weather conditions, appliance efficiencies and customer conservation practices. The portion of funds to be shared with customers would be applied equally to the development of new conservation programs by Piedmont in consultation with the NCUC Public Staff and the attorney general’s office and to the reduction of rate increases associated with the CUT mechanism. Piedmont distributes natural gas to 990,000 residential, commercial and industrial utility customers in North Carolina, South Carolina and Tennessee, including 61,000 customers served by municipalities that are wholesale customers.

Elected officials in the historic town of Astoria, OR, with slightly less than 10,000 population and a legacy as the first permanent U.S. settlement west of the Rockies, voted last month to intervene at FERC in the proposed liquefied natural gas (LNG) terminal project slated for Bradwood Landing. The Astoria City Council voted 4-0 in a special meeting last Thursday to take the action Earlier in the week elected officials in a neighboring city and Clatsop County also took similar action.

After considering the results of an often contentious technical conference last fall and a settlement agreement, FERC approved new premium hourly firm transportation and daily balancing services proposed by El Paso Natural Gas to provide customers with greater flexibility to cover swings in demand while ensuring system reliability. However, the Commission made some modifications to the penalties El Paso intended to impose and to the tolerance levels for such penalties.

Sempra Energy’s San Diego Gas and Electric Co. utility announced Tuesday its customers would receive approximately $21 million from the settlement with Reliant Energy over issues outstanding from the state’s 2000-2001 energy crisis. In addition, SDG&E said it expects to receive another $20 million at a later date.

Apparently the screen’s meteoric rise of more than a dollar over the previous two days, culminating in Tuesday’s all-time intraday and daily settlement records for a prompt month contract, wasn’t all that impressive to cash traders Wednesday. Nor was heating load staying fairly heavy across northern market areas despite prospects for a bit of moderation from earlier in the week.

As the prompt month settlement price for natural gas reached a record level this week at $9.984/Mcf, the head of a municipal gas distribution group on Thursday called on the Senate Energy and Natural Resources Committee to immediately turn its attention to escalating natural gas prices when it returns from its August recess after Labor Day.

The New York State Public Service Commission (PSC) is taking comments on a settlement in National Fuel Gas Distribution Corp.’s (NFG) pending rate case that will reduce natural gas customer bills over the next two years and fix rates thereafter. Although base rates actually will increase under the plan, a rate reduction will be achieved by passing through the benefits of a tax change and previous tax overcollections, the PSC said in a statement.