Surged

Following a rest on Monday, the bulls were in control once again on Tuesday as September natural gas futures surged to a high of $7.040 before settling the day’s regular session at $6.940, up 14.6 cents.

New Orleans-based independent McMoRan Exploration Co. last week said its natural gas volumes in the first quarter surged 78% to 3.85 Bcf. However, the producer’s revenue growth was offset by higher production costs, which weighed on profits.

Natural gas volumes in the first quarter surged 78% to 3.85 Bcf for New Orleans-based independent McMoRan Exploration Co. However, revenue growth was offset by higher production costs.

Houston-based Marathon Oil Corp.’s profit surged in 3Q2006, pushed by strong oil prices and wholesale margins. However, worldwide natural gas sales volumes fell to 719 MMcf/d from 807 MMcf/d. In the United States, where more than half of its gas production is located, gas sales fell to 522 MMcf/d from 562 MMcf/d.

Despite normal weather and no clear threat to the Gulf production area from tropical activity, natural gas futures prices surged higher Tuesday with the near-month contract adding 38.4 cents to settle at $7.008, near its daily high of $7.030. Brokers pointed to strong Henry Hub cash as part of the reason. Tropical Depression Four in the eastern Atlantic, meanwhile, served as a reminder that the hurricane season isn’t over just yet.

ConocoPhillips on Wednesday reported that net profit surged in the first quarter, reaching $3.29 billion ($2.34/share), compared with profit of $2.91 billion ($2.05) in 1Q2005. To perhaps inoculate itself from criticism about soaring oil company profits, ConocoPhillips also reported that it reinvested 141% of the net income into developing new resources and its global refining business.

The Dallas-based Crosstex Energy LP on Friday reported 4Q2005 earnings surged 71%, boosted by a $2.3 million gain from mark-to-market valuation of derivatives bought to hedge against price changes from its South Louisiana processing business.

As it begins to settle in as a pure-play exploration and production company, Kerr-McGee Corp. reported Wednesday that natural gas output surged 51% over a year ago, mostly on the acquisition of Denver-based Westport Resources Inc. last year (see Daily GPI, April 8, 2004), and the ramp-up of production at Red Hawk in the deepwater of the Gulf of Mexico.

In its debut as Nymex prompt month, the July natural gas futures contract was a bull’s dream Friday as it surged higher to nearly erase losses suffered in sympathy with Thursday’s expiration-day June contract liquidation. A combination of speculative short-covering and end-user buying were cited as factors in the rally that propelled July up 15.8 cents to $6.370 Friday, two ticks shy of Wednesday’s $6.372 close. On Thursday, the June contract tumbled 19.2 cents to go off the board at $6.123.