Volatility at the New York Mercantile Exchange has become so low the April contract was only able to trade within a narrow 3.5 centrange Tuesday, from $2.14-$2.175. The contract settled unchangedat $2.155.
Articles from Trade
The current North American Free Trade Agreement (NAFTA) tariffon gas imports into Mexico is holding up pipeline development fromthe U.S. to northern Mexico, said consultant George Baker of Baker& Associates. “The only people that have to pay this tariff arethe private industry who would contract with a U.S. gas supplier.If they buy [gas] from Pemex [Petroleos Mexicanos], however, it’s arolled-in price and they don’t pay it.” The tariff, originally 10%in 1991, is rolled back 1% a year and currently stands at 5%.That’s still too high for the private sector to feel confident itcan make money shipping gas to Mexico, Baker told attendees Tuesdayat the conference portion of Houston Energy Expo ’98, formerlyknown as Gas Fair. “That’s an important delay, and the origin of itis largely Pemex’s wanting to say, ‘we’re not ready for competitionyet.’ Some people say, ‘have you ever heard of a state monopolythat has acknowledged that it’s ready for competition yet.’ Mostpeople say no.”
Enron Capital & Trade Resources Corp. (ECT), SyntroleumCorp., and SLH Corp. contributed a total of $3 million to funddetailed engineering, land purchase and other development costs foran 8,000 barrel/d gas-to-liquids specialty product plant inSweetwater County, WY, to be developed by Syntroleum. Subject toconditions, ECT committed an additional $14.5 million for aminority interest in the plant.