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Futures traders are always looking to historical price patternsto predict future trends, but last week they were particularlyfocused on the last 40 trading days and the average of thosesettlement prices. Referred to as the 40-day, the prompt month’s40-day moving average has been an increasingly important indicatorfor those looking to predict a price move in the market. But boththe magnitude and duration of those swings have decreased in thepast several weeks, leading traders to hypothesize some of thedynamics in the market could be changing. Some of those changeshave been evidenced by the December contract’s inability to sustaina move much above or below the 40-day moving average in recentweeks. And last Friday was no different when the December contractrebounded 6.5 cents to settle at $2.459, just 1.4 cents below the40-day.

In an attempt to deter other utilities in the state, Californiaregulators Nov. 5 slapped a $1.68 million fine on Pacific Gas andElectric Co. for allowing an unregulated energy services affiliateto violate newly created state rules earlier this year governingthe use of the parent company name and logo. The PG&ampE utilitycompany expressed disappointment and vowed to appeal the decision,which requires the penalty be paid out of shareholder funds.

The gas industry may feel swamped with all the notices ofproposed rulemaking and notices of inquiry that have been comingout of FERC within the last couple of months, but these arenecessary to accomplish restructuring in a comprehensive fashion,said James J. Hoecker.

El Paso Field Services said its Global Compression Project inthe San Juan Basin is now complete, providing producers with anadditional 40,000 horsepower of compression, new gas dehydrationfacilities and 54 miles of new pipeline looping.

MCN Energy Group Inc. said yesterday it will take a year-end,one-time charge of $10 million for the first phase of its corporatereorganization, which should remove $15 million a year from itscurrent operating expenses. The realignment establishes a morestreamlined organizational structure to enhance efficiency, linesof authority and internal customer responsiveness. It includes areorganization of some upper management positions, including theretirement, effective next April, of its Vice Chairman and CFOWilliam K. McCrackin.

Dauphin Island Gathering Partners (DIGP) has signed an uniquesupply and gathering agreement with producers Elf Exploration Inc.,Coastal Oil and Gas, Nippon Oil Exploration U.S.A. and PogoProducing, who are partners in the deep-water Virgo prospect.

Chalk up another Gulf storm as more sound than fury with a onlya short-term impact on the cash market. Even as Tropical StormFrances caused heavy flooding along the Texas and Louisiana coastsFriday (preventing a number of Houston traders from getting to theoffice), prices were flat to down a nickel or so at Eastern points.Sources said much of the softness Friday, following on average10-cent increases Thursday, was based on the belief that much ofthe Gulf production losses would be moderating over the weekend.

The cash market continued to muddle around with essentially nodirection for a second straight day Friday, leaving weekend numbersmostly unchanged. The few drops of about a nickel occurred atWestern points-intra-Alberta, Stanfield, Malin and SouthernCalifornia border-and chiefly resulted from the lifting of supplyand/or transportation constraints that allowed more gas back intothe market.

Tesoro E&P Company L.P., a wholly-owned affiliate of TesoroPetroleum Corp., announced earlier this week it purchased a 50%working interest from Sheridan Energy in the Stiles Ranch Fieldnorth of Amarillo, TX.