Thought

Just when you thought the news about the controversial contractarrangement between El Paso Natural Gas and its marketing affiliateEl Paso Merchant Energy Co. had died down, California regulatorscome out with a request from left field asking FERC to rescind the$38.5 million contract transaction for 1.22 Bcf/d of firm capacityon the pipeline.

Just when you thought the news about El Paso Natural Gas’contract arrangement with marketing affiliate El Paso MerchantEnergy Co. had died down, California regulators came out yesterdaywith a request from left field asking FERC to rescind the $38.5million transaction for 1.22 Bcf/d of firm capacity on thepipeline.

Horsepower problems at the Grand Chenier (LA) Compressor Stationare more extensive than originally thought, ANR said, and willdelay completion of required repairs until Dec. 21. ANR hadpreviously expected to complete the work, which is reducing thestation’s normal capacity of 750 MMcf/d by about 150 MMcf/d,Wednesday (see Daily GPI, Dec. 10).

Producers must have thought the Grinch was stealing Christmasearly when they saw the abyss-like depths to which December swingprices were sinking Monday. “I’ve never seen it [the spot market]dump so hard in my life!” exclaimed a Midcontinent trader.

Gas marketers said last week a preliminary unbundling ruling bythe Connecticut Department of Public Utility Control (DPUC) allowsthe state’s local distribution utilities to erect “insurmountablebarriers to entry” into the retail gas market and will snuff outwhat little competition exists today.

If you thought a new pooling system on El Paso Natural Gas wouldbe approved in time for summer vacation, it looks like you may haveto sweat it out for another season. After months of hair pullingscrutiny and debate, FERC has decided to reject El Paso’s March 16filing for scheduling gas pooling transactions on its system andconvene yet another technical conference on the complex matter.

ÿBetter late than never, bullish traders must have thought onTuesday. After posting a extremely light trading session on Monday,the spot August Nymex futures contract exploded 8.0 cents higher tosettle Tuesday at $2.469. The contract managed to hit a high of$2.485 amid a session when a robust 52,644 estimated totalcontracts changed hands.

Anyone who thought that the meager 0.1 cent gain the June Nymexcontract turned in on Tuesday would lead to a boring expiration daywas dead wrong. June managed to spew out one more major pricedecline on Wednesday, as the contract went off the board down 7.8cents for the day to settle at $2.017.