Traders who hadn’t finished already wound up their July bidweekbusiness Tuesday and started looking for clues on aftermarketdirection. What they found in swing deals done for today only was amixed bag of flat to up or down slightly from bidweek levels. Butmany sources are expecting an overall strong aftermarket. There maybe some initial softness since the July Fourth holiday weekend isconsidered the lowest demand period of the year. But sources lookfor fundamental cooling load to support gas prices after that.
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Customers looking for services tailored to their specific needsare driving pipelines to seek lighter-handed regulation includingthe ability to negotiate and deliver those services on the spot-without lengthy FERC proceedings, according to Interstate NaturalGas Assoc. (INGAA) chairman John Riordan.
$2.40 gas proved to be too much for July on Wednesday, as thespot futures contract fell 5.5 cents to settle the day at $2.336.July opened at $2.41, but that turned out to be its high trade forthe day as sellers were quick to liquidate positions and takeprofits ahead of the contract’s expiration this Friday.
If pipeline and LDC rates continue their upward climb, the”inevitable result” will be a sharp decline in producers’ wellheadrevenues and a subsequent “significant loss” of natural gassupplies, an official of a major producer group said Monday.
The Natural Gas Supply Association and Independent PetroleumAssociation of America made their displeasure clear over PresidentBill Clinton’s decision last week to extend a moratorium onoffshore drilling. “Cleaner air and increased use of affordable,clean-burning natural gas depend on access to the large natural gasfields off the nation’s coasts,” said NGSA President Nicholas Bush.”Continuing today’s severe restrictions on offshore natural gasproduction is simply not in the nation’s best interest.”
Canadian natural-gas producers have opened up their wallets toshow they mean to make the Sable Offshore Energy Project (SOEP)live up to its billing as a “seed” development that will sprout agrowing new branch of the industry on the East Coast.
Amid a day one broker called “perhaps the most boring of any Iremember,” the spot June NYMEX contract nudged 0.4 cents lower tosettle at $2.200. The broker actually said the day was interestingin that a large amount of anticipated activity never materialized.”Every floor trader we spoke to expected when June broke below$2.18, tons of sell stops would kick in between $2.15-17. But therewasn’t diddly squat for stops. In fact, just the opposite happenedin that there was pretty good scaled-down buying once June hit$2.15,” he said.
Kentucky’s two largest electric utilities – Louisville Gas andElectric (LG&E) and Kentucky Utilities (KU) – announced theyclosed their merger deal yesterday, setting the stage for thecombined energy company to become a “more formidable” regionalutility competitor.
Crossroads Pipeline Co., East Ohio Gas and CNG Transmission saidthey received expressions of interest for 800,000 Dth/d of capacityon their proposed transportation project, which would bring gasfrom the Chicago hub through Crossroads’ existing system to marketsin East Ohio’s service territory and farther east via CNG’spipeline system. The proposed project initially would add 150,000Dth/d of firm capacity across all three systems.