Supported

California’s regulators, who supported a controversial PG&E bankruptcy settlement last year, cheered on state elected officials last week for producing a law that will allow the utility to continue with its final steps to full recovery.

Supported by the unmistakable profile of speculative fund buying, the natural gas futures market made it three in a row Wednesday as prices soared to their highest levels in nearly two months. After quickly filling in a gap on the daily chart, the January contract worked its way higher throughout the trading session on a steady diet of short-covering.

California regulators and state utilities said they supported El Paso Natural Gas Co.’s request for oral arguments and “expeditious resolution” of the capacity-withholding and affiliate-abuse complaint case against the pipeline, but they took issue with El Paso’s claim that a FERC judge’s ruling last month in favor of California was “misleading and misguided.”

In an answer to a complaint filed by Niagara Mohawk EnergyMarketing that was supported by a number of other power marketparticipants, the New York ISO told FERC last week that it is aware ofthe software problems that caused scheduled power exports to berejected in early May despite being commercially and economicallyviable. The rejection caused NMEM to lose $68,000 in four hours (seeDaily GPI, June 23). The ISO said ithopes to have repairs to its export software completed bymid-July. “Accordingly, the issues and requested relief in thecomplaint are essentially moot, and the complaint should therefore bedismissed,” the ISO told FERC. “The complaint suggests that thecurrent SCUC procedures were adopted in a deliberate effort todiscriminate against exports from New York. This is not true,” theISO said. “The SCUC protocols that caused the [Niagara Mohowk] exporton May 8 not to be scheduled were the result of the implementation ofassumptions made in the software development process in favor ofpreserving reliability…”

Prices responded accordingly Tuesday as just about everythingturned bullish for the spot gas market – chilly to very coldweather almost everywhere, rising futures in three importantcategories (gas, heating oil and crude oil), and expectations of alarge withdrawal volume in this afternoon’s storage report.

Supported by the largest increase in imported Canadian gas since1995, total natural gas imports rose for the 11th straight year in1998, according to a recent Department of Energy (DOE) report.

Supported by the largest increase in imported Canadian gas since1995, total natural gas imports rose for the 11th straight year in1998, according to a recent Department of Energy (DOE) report.

Transcontinental Gas Pipe Line defended its 700 MMcf/dMarketLink project against charges it is not supported by themarket because many of its contracts with shippers contain rightsto terminate under certain circumstances. Singling out the protestsand “motions to reject” of CNG Transmission and ConsolidatedEdison, Transco reminded the Commission many of its agreements arenot unlike those filed to support other projects. A few contracts,about 34% of its capacity, are , however, a little different thanwhat has arrived at the Commission in the past, the pipelineacknowledged.

People saw the screen start higher Monday morning and “everybodywas off to the races,” a Midcontinent marketer said. Priceincreases were across the board but by widely varying amounts, evenamong neighboring pipes in a region. Everything basically followedthe Henry Hub futures contract, according to a Northeast trader.However, he and other sources agreed that virtually every point wasbacking off near the end of activity. “People just quit buyingafter the screen run-up,” he said.