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The Department of Transportation’s Office of Pipeline Safety(OPS) came under sharp attack last week on Capitol Hill, withcritics lashing out against the agency for its “poor record” ofensuring the safe operation of the hundreds of thousands of milesof natural gas and hazardous liquids pipelines that criss-cross thenation.

The Department of Transportation’s Office of Pipeline Safety(OPS) came under sharp attack yesterday on Capitol Hill, withcritics lashing out against the agency for its “poor record” ofensuring the safe operation of the hundreds of thousands of milesof natural gas and hazardous liquids pipelines that criss-cross thenation.

Although the Northeast power grid remained under heavy stressTuesday from an intense heat wave, hourly spot prices for electricitywere backing off from the peaks of $6,000/MWh hit Monday afternoon inthe ISO New England service area (see related story in this issue). Although gasprices continued to advance Tuesday, a large aggregator felt confidentin predicting they will be following power quotes lower today.

After rallying to new highs earlier last week, futures cameunder some selling pressure on Friday and prices slipped 0.9 cents,ending the week at $3.079. The high for the day was $3.100, a halfa cent less than the day prior and the low was $3.050 a half a centhigher than Thursday’s low. Despite the somewhat negative news, theMay contract failed to provide observers with a significant signalto start the new week.

Phase Two of Tengasco Inc.’s pipeline system is now underconstruction following permitting by the Tennessee Department ofTransportation. The 28-mile mile project will complete the 60-milesystem, which ties Tengasco’s Swan Creek gas field into end-usermarkets in Eastern Tennessee. The pipeline is the only intrastategas carrier in Tennessee.

NiSource Inc. and Columbia Energy Group filed last week with theFederal Energy Regulatory Commission (FERC) for merger approvalunder the Federal Power Act (FPA).

The second time was a charm for bears at Nymex yesterday whenthey succeeded in taking natural gas below key support afterfailing to do so earlier in the session. Sources pointed totechnical selling that entered the fray when the May contract wasunable to climb back to Monday’s $2.945 high as a major contributorto yesterday’s losses. However, declines were not limited to theprompt month as moderate losses pervaded the entire 12-month strip.The May and June each finished down 6.7 cents at $2.822 and $2.844respectively.

A federal district court has struck down a controversial part ofthe Interior Department’s 1997 royalty valuation rule under whichroyalties were calculated on the market price of the gas even if itwas a delivered price downstream from the lease, the IndependentPetroleum Association of America said yesterday.

Under a new agreement between The New York City HousingAuthority and Unitil Corp, gas provided to thousands of homes inNew York City will be purchased from a supplier in onlinetransactions.