Dallas-based Atmos Energy Corp., which has made steady acquisitions for the past 18 years, made its biggest buy ever last week, announcing it will buy substantially all of the operations of TXU Gas Co., a subsidiary of TXU Corp., in an all-cash transaction valued at $1.925 billion. The deal will make Atmos the largest pure-play natural gas distribution business in the United States.
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S&P: Union Gas’ Credit Metrics Steady Despite Adverse Regulatory Ruling
Standard & Poor’s Ratings Services said the ratings and outlook on Union Gas (BBB/Stable) remain unchanged despite the adverse affects of a 2004 rate cut Thursday by the Ontario Energy Board (OEB).
Cash Market Returns to Mixed Price Movement
A steady trend since Monday toward greater price softness was partially reversed Thursday. Most points were essentially flat or recorded small gains or losses of less than a nickel; the more volatile ones ranged from 20 cents higher to about 15 cents lower.
Futures Fall as Weather Forecasts Fail to Materialize
Steady buying in the last 30 minutes of trading was not enough to overcome a massive sell-off on the opening bell and the January natural gas futures contract was left with a 22.9 cent decline on its last day as prompt contract at Nymex Monday. At $6.15, January’s final resting place is almost equidistant between its $7.55 spike high from earlier in the month and the December 2003 contract’s $4.86 closing price.
EEA: Pipe Expansion Steady Despite High Profile Setbacks
Tight financial markets, a lack of new gas demand, the power generation supply glut and state regulatory concerns have delayed or halted many of the proposed natural gas pipeline expansions announced in the past few years, but even with some high profile cutbacks, U.S. pipeline expansion overall has done “rather well,” according to a new report.
Raymond James: Increased Drilling Activity Fails to Up Gas Production
The 30% increase in U.S. drilling activity since last year has failed to stop the steady decline of natural gas production, which should continue to fall “well into 2004,” Raymond James analysts said in their latest “Stat of the Week.”
Patterson-UTI Sees Gains in Drilling Rig Business
With higher commodity prices and a continued steady increase in its number of rigs in operation, Patterson-UTI Energy, Inc. expects to see improved revenue and earnings in 2003 over 2002. The company, the second-largest operator of land-based oil and gas drilling rigs in North America, announced Tuesday it had acquired seven new rigs to take advantage of the expanding market.
Patterson-UTI Sees Gains in Drilling Rig Business
With higher commodity prices and a continued steady increase in its number of rigs in operation, Patterson-UTI Energy, Inc. expects to see improved revenue and earnings in 2003 over 2002. The company, the second-largest operator of land-based oil and gas drilling rigs in North America, announced Tuesday it had acquired seven new rigs to take advantage of the expanding market.
Industry Briefs
Public Service Co. of New Mexico (PNM) is warning its customers of potentially higher natural gas prices this winter, anticipating a continued steady rise in wholesale costs that the Albuquerque, NM-based combination utility has seen since last spring. Compared to last winter when prices never exceeded 28 cents/therm, PNM said they could range between 35 and 50 cents/therm this winter. The utility said it has hedged against gas price spikes by buying most of its supplies on a longer term, fixed-price basis. The supply portfolio saved its customers about $27 million in the price-spike period of winter 2000-2001, a PNM spokesperson said. Energy prices generally could rise considerably if the winter is colder-than-normal, the utility spokesperson said. And another factor bidding to influence price is the situation in the Middle East. If the U.S. is at war there, prices could be increased substantially. In preparation, PNM is urging it customers to take various energy-saving steps to mitigate against winter price spikes.
Raymond James Expects Flat Rig Count Until Next Year
Raymond James analysts are lowering their 2002 rig count forecast but holding steady their forecast for 2003. Despite the recent sharp increases in oil and gas prices, producers have not responded with increases in drilling. The apparent disconnect seems to be related to their desire to use increased cash flows to strengthen balance sheets rather than re-invest in the drill bit, said Raymond James’ Marshall Adkins.