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A three-member arbitration panel ruled that Oglethorpe PowerCorp.’s power marketing contract with LG&E Energy Corp. andLG&E Energy Marketing Inc. is valid and must be honored.LG&E began its challenge to the contract in 1998. The companysaid the decision will cause it to increase its fourth quarterafter-tax accrued loss on disposal of discontinued operations by$175 million. The loss stems from increased load demands, higherthan anticipated future commodity prices and other factors. Theincrease in the loss reserve will be recorded in discontinuedoperations.

Following a three-day, 30-cent price rally, the natural gasmarket cooled its heels yesterday as traders took profits amidtechnically oversold conditions and ahead of fresh storage data.That sell-off sent the January contract tumbling 9.9 cents lowerthroughout the session yesterday. By virtue of trading above, thenbelow Tuesday’s range it completed an outside-down day on the dailycharts to settle at $2.486.

National Fuel Gas’ storage subsidiary, National Fuel Gas Supply,announced three open seasons last week; a 9,750,000 Dth offering offirm storage service and associated firm storage transportation, a19,100 Dth/d offer for new firm transportation capacity and a150,000 Dth/d offer of firm transportation service from a proposednew interconnect with Empire State pipeline at Pendleton, NY. Allof the open seasons began on Nov. 29 and will end on Dec. 16. Ineach case, gas flow is expected to occur no later than April 1.

National Fuel Gas’ storage subsidiary, National Fuel Gas Supply,announced three open seasons last week; a 9,750,000 Dth offering offirm storage service and associated firm storage transportation, a19,100 Dth/d offer for new firm transportation capacity and a150,000 Dth/d offer of firm transportation service from a proposednew interconnect with Empire State pipeline at Pendleton, NY. Allof the open seasons began on Nov. 29 and will end on Dec. 16. Ineach case, gas flow is expected to occur no later than April 1.

Florida Gas Transmission extended maintenance at Station 14 in theFlorida Panhandle through Dec. 4, three days beyond the originallyprojected end date (see Daily GPI,Nov. 29). As previously posted, the work limits FGT’s market areato about 1.3 Bcf/d. Due to significant demand, the pipeline Wednesdayissued an Overage Alert Day notice for the system east of Station12. It carries a 6% tolerance for negative daily imbalances.

Three West Coast states are coordinating their efforts with theFederal Trade Commission to resolve the antitrust problemsassociated with BP-Amoco’s acquisition of Atlantic Richfield. Inthe event the issues can’t be worked out, the states said they willbring a lawsuit to block the $26 billion marriage.

The Canada-Nova Scotia Offshore Petroleum Board announcedwinning bids on eleven parcels (about three million acres) in theNova Scotia offshore area last week. PanCanadian was the majorwinner with a position in six of the eleven parcels. PanCanadianmore than doubled its net land holdings. Its six parcels cover morethan 1.7 million gross acres. In total, PanCanadian holds interestson more than four million gross acres across both the shelf anddeep waters offshore Nova Scotia. “We see offshore Nova Scotia asone of the most promising exploration regions in North America.”With the additions “we have clearly established a core explorationarea for PanCanadian,” said PanCanadian CEO David Tuer. In the landsale, conducted by the Canada Nova Scotia Offshore Petroleum Board,PanCanadian and its partners pledged to spend more than $48 millionon exploration over the next five years. Other winning biddersinclude Canadian 88 Energy Corp., Murphy Oil, Petro-Canada andRichland Minerals.

Northern Natural Gas took its Plains Turbine down Monday forabout three weeks of unplanned repairs. The outage affects 100,000MMbtu/d at nine points on the Hobbs System in southeastern NewMexico.

Williams’ Buccaneer Gas Pipeline became the first of threecompeting projects to serve Florida power generation demand to filewith the FERC yesterday. However, the other two greenfield projectsare anything but out of the race. And Florida’s only interstatepipeline to date, Florida Gas Transmission (FGT), also has plansfor two expansions under way that also target power generationdemand.