Stemming

Ending an almost two-year-old argument over $6.8 million in levied penalties stemming from the winter of 2000-2001, the Virginia State Corporation Commission (VSCC) on Monday accepted a settlement between Columbia Gas of Virginia and its transportation customers, stating that the matter can now be part of the commission’s file for “ended causes.”

Enron Corp. has put 12 major energy assets, including Portland General Electric, Transwestern Pipeline, Northern Plains, Citrus Corp. and many other international assets, which make up nearly all of what is left of the company, formally on the auction block. The company has extended invitations to potential bidders to visit electronic data rooms containing information about its most valuable businesses and has executed confidentiality agreements.

The “root cause” of problems stemming from decremental bids for imbalance energy in California’s energy market is poor market design, FERC Commissioner William Massey said last Wednesday. At the Commission’s latest agenda meeting, he urged the California Independent System Operator (Cal-ISO) to tackle the decremental bid issue in a comprehensive market redesign proposal, which the grid operator has to file this spring at FERC.

Stemming a two-day, 22-cent price erosion, natural gas futures turned modestly higher in an abbreviated pre-holiday weekend session Friday, as profit taking gave way to a steady stream of end-user buying. The March contract looked poised to hit the $2.12 low notched last Monday, but after sellers ran out of gas early Friday the way was paved for a positive close. At 1 p.m. Friday the March contract settled 2 cents higher for the day and 1.5 cents higher for the week at $2.206.

Higher production volumes weren’t enough to halt the earnings decline stemming from substantially reduced prices among independent oil and gas producers in the third quarter, according to Energy Performance Review, which maintains a line-of-business financial and operating database.

Stemming the selling pressure set in motion by Wednesday’s storage report, the natural gas futures market rebounded mid-morning Thursday as traders contemplated a supply-demand balance that may be tighter than previously thought. In a rare twist, the 12-month strip gained more (9.5 cents) than either the winter strip (9 cents) or the prompt month (6.8 cents). November closed at $2.486, just off its daily high at $2.51.

Stemming a two-week, $1.25 price slide, natural gas futures rebounded last week amid neutral to bullish fundamental factors and increasing constructive technical clues. After carving out a fresh 19-month prompt month low by trading down to $2.255 earlier in the week, the October contract finished strongly at $2.50 Friday, up 6 cents for the session and just beneath its $2.53 high for the week.

Stemming a string of expiration-day losses at six, natural gas futures eked out a slim gain Friday as traders covered shorts ahead of the weekend and in anticipation of hot weather forecast for this week. The August contract went off the board without much fanfare, up 3.9 cents for the session and 21.2 cents for the week, but down 11.9 cents since it became the prompt contract back on June 27. Estimated volume was modest for an expiration day, with just 92,001 contracts changing hands.

LG&E Energy has reached a settlement with the Springfield,IL, City Water, Light, and Power Co. (CWLP) over a dispute stemmingfrom the city’s default on a 1998 electricity options contract. TheSpringfield City Council approved the $16.6 million settlementduring a special meeting Saturday following an agreement lastTuesday with representatives from Springfield, just days before thecase was scheduled to go to trial before U.S. District Judge JohnG. Heyburn in Louisville, KY. “We are pleased to settle this matterin a very favorable manner for our company. It clearly sends amessage that we will aggressively pursue parties who do not honortheir contractual obligations to us,” said Paul W. Thompson,LG&E Energy’s senior vice president of energy services. Pricesfor power spiked in the summer of 1998 as demand for powerincreased in the Midwest due to intense heat. CWLP did not honorits commitments with LG&E Energy Marketing (LEM) and laterattempted to argue that the contracts were void because the utilitydid not have the proper authority under Illinois law to enter intothem. Those defenses were argued before Judge Heyburn last Novemberand he ruled in LG&E Energy’s favor in certain summaryjudgement proceedings.