For the second day in a row, the natural gas futures market wascaught in tug of war as traders weighed their options-either buyinto the recent rally or sell, expecting a return to thelong-standing downtrend. The indecision could be seen inyesterday’s price action where prices trended higher in the morningonly to turn sharply lower in the afternoon. The May contractfinished 4 cents lower at $2.096.
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Consolidated Edison and Orange and Rockland Utilities passed amilestone on their way to merging with approval of the transactionFriday by the New York Public Service Commission (NYPSC). Themerger also has been approved by the New Jersey and Pennsylvaniaregulators and FERC. Con Ed plans to acquire all O&R’s commonstock for $58.50 per share, or about $790 million. O&R willbecome a wholly-owned subsidiary of Consolidated Edison and willcontinue to operate as a separate company. The utilities areawaiting the approval of the Securities and Exchange Commission andcompletion of the Hart-Scott-Rodino Act review by the U.S.Department of Justice and expect to close the transaction by nextmonth.
INGAA, EEI Back Conference on Northeast Gas Demand
The leaders of a major pipeline association and a key electricutility group jointly have expressed their support for FERC toconvene a conference “in the near future” to assess post-2000natural gas demand in the Northeast and the need for new pipelinecapacity to serve customers, particularly power generators, in thatmarket. Meanwhile, a new study sees no need for new capacity to theNortheast until 2004 (See related story this issue).
MidAmerican, CalEnergy Get IUB Nod, Close Merger
CalEnergy Co. Inc. and MidAmerican Energy Holdings Co. formallyclosed their merger Friday, marking the first time that anindependent power producer has acquired a traditional gas andelectric utility. The Iowa Utilities Board’s (IUB) recent approvalof the deal cleared the way for it to be completed.
Maritimes Defends Proposed Project Changes
Maritimes &Northeast Pipeline sponsors defended their proposed pipeline certificate (Phase II) amendment last week against attack by some the project’s own shippers and others who say it is too large and too costly for the market it will serve. Project sponsors said the calls for a stay on the project and a hearing on its size are based on a misreading of its amendment filing and a misunderstanding of its agreements with its shippers (see NGI, Feb. 22 issue).
Oregon Eyes Lottery Funds to Build Pipeline
In an effort to attract large businesses to their districts, twoOregon state legislators introduced a bill recently that wouldprovide $20 million in lottery funds to help build a 64-milepipeline. No engineering study for the pipeline has been conductedso far. The bill’s main supporters, state Sen. Veral Tarno(R-Coquille) and Rep. Ken Messerle (R-Coos County), said some ofthe funds also could be used to build a high-voltage power line.
ScottishPower, PacifiCorp Merger Advances
ScottishPower and PacifiCorp jointly announced that their Dec.7, 1998 merger plan gained a large boost Tuesday when the FederalTrade Commission (FTC) waived the 30-day waiting period under theHart-Scott-Rodino antitrust law.
TX Producers Move Closer to Tax Relief
Texas producers laboring under the weight of low commodityprices are on their way to getting a temporary tax break from theTexas legislature. Last week, the Texas Senate passed S.B. 290,which grants a severance tax exemption to marginal gas and oilwells producing 90 Mcf/d or less or 15 barrels/d or less. Reliefwould kick in when gas drops below $1.80/MMBtu and/or oil dropsbelow $15/barrel for three consecutive months on the New YorkMercantile Exchange.
Streamline-QuickTrade Sets Volume Record
The recently joined Altra Energy Technologies and QuickTrade LLCposted record gas trading volumes Jan. 28 when their combinedtrading systems reached 30 Bcf in deals. Previous record volumesfor the stand-alone companies when combined were less than 30 Bcf,said Altra Chairman Rusty Braziel
Usual Suspects Jockey for Top Marketer Slots
The faces among the top half of Daily GPI’s ranking of the top20 gas marketers haven’t changed much but their volumes certainlyhave, in some cases showing substantial growth. And while only onecompany joins the top-10 for the first time, nearly every one ofthe biggest players saw its position change in the ranking. (Seepage 4)