All indications pointed to the futures market continuing higheron Wednesday: gains posted in the Tuesday evening Access session, awell bid over the counter market Wednesday morning, and inertiacoming off two days of advances. But when the market openedyesterday a vital component was missing, prompting a beleagueredbull to say “the buyers just didn’t show up [Wednesday] morning.”The September contract meandered down from its open, slipping 2.2cents to close at $2.873.
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Cash prices took a cue from the futures screen Thursday andpulled out of their headlong dive that has dominated the marketsince Monday. But sources considered the general leveling off ofprices, which leaned slightly to the softer side, as onlytemporary. Noting that Northern market areas already have startedcooling off from their recent temperature heights and that thecooling trend is expected to spread further this weekend, manytraders expect the general downturn to resume today.
The Gas Research Institute announced its newly created Canadiansubsidiary, GRI Canada, has been selected by Gas Technology Canadato manage a $5 million/year research, development andcommercialization program funded by the Canadian natural gasindustry.
MCN Energy Group announced last week it plans to exit theexploration business, and expects to take a second quarter chargeon earnings of $225 million because of low oil and gas prices andthe under-performance of certain exploration properties in theMidcontinent and Gulf Coast regions.
Wednesday’s last-day plunge in June futures had cash sellersrunning scared, sources said. However, basis differentials did notappear to be changing much if any, a Gulf Coast producer said, sobidweek deals done prior to Wednesday afternoon will tend to beanywhere from 6 to 10 cents above the current market. He was makingsales Wednesday at $2.00-02 for Henry Hub and $1.99-2.00 forColumbia Gulf-onshore.
A U.S. subsidiary of British-Borneo Petroleum Syndicate agreedto acquire 16.67% interest in Discovery Producer Services and itssubsidiary Discovery Gas Transmission. In addition, British-Borneohas the right to increase its ownership to 33.3% over the nextthree years. The transaction is valued at about $83.3 million.