Then

The July Fourth holiday only delayed by a day the inevitable whiplash that gas futures typically cause on Wednesdays. Thursday opened with bang as August futures gapped about 8 cents higher at the opening bell, but the contract proceeded to do a nosedive in anticipation of another large storage refill. When the American Gas Association reported the ninth 100+ Bcf storage injection in 10 weeks (105 Bcf), futures plummeted to a new low of $3.040. However, the contract encountered surprising support there and managed to rebound to $3.136, down only 6.5 cents for the day.

After a briefly checking below support at $4.00 and then back up into the low $4.10s, natural gas futures limped lazily sideways for much of the session Thursday as trade buying met almost equally with fund and local selling. At the closing bell the July contract was 7.4 cents lower for the session at $4.038. Estimated volume was relatively light, with only 67,994 contracts changing hands.

Pacific Gas & Electric extended into Sunday a Stage 3 high-inventory OFO that had been implemented Saturday, then expanded it Monday into a Stage 4 OFO with greatly increased penalties of $25/Dth for positive imbalances exceeding a 1% tolerance. No OFO was in effect Tuesday, but the utility reinstituted a Stage 3 order for today with $5/Dth penalties and an 8% tolerance.

Combustion problems with the #2 engine at ANR’s Grand Chenier (LA) Station are more extensive then originally thought (see Daily GPI, March 21), and the manufacturer has extended its estimate for completion of repairs until mid-April, the pipeline said. Volumes that can be received through Grand Chenier from HIOS and the West Cameron near-shore blocks will continue to be reduced by about MMcf/d until the repairs are finished.

In the first meeting of the newly-formed Alaska Highway Natural Gas Policy Council (AHNGPC) last week, Alaska Gov. Tony Knowles charged the 28-member panel of community, business and labor leaders with the task of looking into public policy questions surrounding the development and transportation of natural gas in the North Slope.

In the first meeting of the newly-formed Alaska Highway NaturalGas Policy Council (AHNGPC) last week, Alaska Gov. Tony Knowlescharged the 28-member panel of community, business and laborleaders with the task of looking into public policy questionssurrounding the development and transportation of natural gas inthe North Slope.

While the California governor’s press people were promising anannouncement and then reneging late Thursday afternoon, at leastone other power supplier, Williams, announced signing a 10-year,1,400-MW deal with the state water resources department (DWR).Meanwhile, supply shortages eased considerably yesterday for thefirst time in about six weeks.

Despite flurries of trading activity near the open and thenagain near the close, natural gas futures trading was extremelyquiet yesterday as most traders elected to morph their three-dayweekend into a four-day holiday.

Effective Saturday (Dec. 9) Northwest planned to move from itsthen-current Stage II (8%) Entitlement for delivery points north ofKemmerer (WY) Station to a Stage 1 (3%) Entitlement. Northwest saidit was taking the action to insure operational integrity “giventhat the system has been drafted for the last two days andextremely cold weather is predicted for most of Northwest’smarkets.”