Ultimately

The global, multi-billion-dollar deal that California and Williams announced Monday that could ultimately include two other states and more than a dozen local governments, along with a series of class action plaintiffs, involves the state getting more control of its long-term power contracts and up to $417 million in separate payments from the energy company.

Almost exactly as it did Friday, natural gas futures opened higher, but ultimately tumbled lower Monday as technical factors and scale-up selling dictated the trading action. The August contract finished at $2.947, up 1.4 cents for the day, but more than a nickel below its mid-morning high at $3.00. Volume was heavy with an estimated 108,301 contracts changing hands.

Almost exactly as it did Friday, natural gas futures opened higher, but ultimately tumbled lower Monday as technical factors and scale-up selling dictated the trading action. The August contract finished at $2.947, up 1.4 cents for the day, but more than a nickel below its mid-morning high at $3.00. Volume was heavy with an estimated 108,301 contracts changing hands.

The New York State Public Service Commission last week approved several items that it says will ultimately benefit consumers, including a request to transfer ownership of two electricity generating facilities in the state and two items that would give refunds to natural gas customers this winter. PSC approved a joint request from Central Hudson Gas and Electric Corp., Consolidated Edison Co. of New York Inc., Niagara Mohawk Power Corp. and Dynegy Power Corp. to transfer ownership of the Danskammer and Roseton electricity generating facilities near Newburgh, NY to Dynegy for $903 million. Net proceeds from the sale, which will amount to about $364 million after deductions, would be used to benefit ratepayers of the three utilities involved. Danskammer and Roseton are fossil-fueled generating plants located adjacent to each other on the Hudson River. Danskammer is capable of generating 500 MW of electricity; Roseton is capable of producing 1,200 MW. NYPSC also approved an interim natural gas service plan to continue the competitive restructuring efforts of two New York downstate natural gas distribution companies, KeySpan Energy Delivery New York and KeySpan Energy Delivery Long Island. The interim plan, in effect from Jan. 1, 2001 through June 30, 2001, maintains current rates for delivery service and provides customers with a one-time winter bill credit if the costs of purchasing gas for customers in December exceed a predetermined price threshold. The commission also approved plans by Niagara Mohawk Power Corp. and Rochester Gas and Electric Corp. to accelerate refunds this winter to natural gas customers totaling $14.1 million for Niagara Mohawk and $5.7 million for Rochester Gas. Con Ed also was granted a delay on a gas surcharge until after the winter season and the commission approved another request by Niagara Mohawk to provide $110 in bill credits this winter to eligible low-income customers who heat with natural gas.

The New York State Public Service Commission yesterday approvedseveral items that ultimately will benefit consumers, including arequest to transfer ownership of two electricity generatingfacilities in the state and two items that would give refunds tonatural gas customers this winter.

Feeding off Wednesday’s strong close, natural gas futures spikedhigher yesterday morning, but ultimately finished lower in anextremely quiet session. After notching a new life of contract highat $2.90 shortly before noon (EST), April was hit with light profittaking which demoted the contract to $2.851, a 1.5-cent loss forthe session.

The May Nymex contract continued its strong charge higher onThursday, reaching a high of $2.605 before ultimately settling up6.1 cents at $2.562. More impressive than the increase, however,was the estimated volume figure. Coming on the heels of Wednesday’shigh trade volume, Thursday saw over 100,000 contracts tradinghands. This leaves little doubt speculators played a role in May’srise yesterday. Even though current Henry Hub prices are 15-20cents lower than that, the current heat wave is waking people up tothe possibility of extreme air conditioning demand this summer, ananalyst told GPI. “The supply/demand balance has been so tight forso long, that his extra demand is highlighting potential problemsthis summer. There are already problems with coal delivery inTexas, and if that continues into the summer, watch out,” he said.

Marking the start of construction related to projects thatultimately will increase pipeline capacity into New England by morethan 20%, Portland Natural Gas Transmission System (PNGTS) andMaritimes & Northeast Pipeline began a crossing of thePiscataqua River between Newington, NH, and Eliot, ME. The crossingis the first stage in the construction of the PNGTS/Maritimes JointFacilities Project, which represents the southernmost portion ofeach pipeline.