Daily GPI

Tennessee reported Wednesday it had discovered a pinhole leak in a valve on its East Cameron 49B compressor platform. While repairs are made Thursday through Sunday, physical receipts will be suspended at 13 upstream meters. Other meters will experience higher than normal pipeline pressure.

The August aftermarket started out Wednesday flat to moderately up from end-of-July numbers in most cases, although the Rockies, California and some Northeast citygates dropped by varying amounts up to nearly a quarter. Comparisons to apparent first-of-month indexes were mixed, with swing prices tending to be above index by 10-30 cents in the East, but many western points falling short of index levels.

Buoyed by the one-two combination of hot weather forecasts and higher cash market prices, particularly in the Northeast, natural gas futures prices moved higher Wednesday on fresh commercial buying mixed with light speculative short covering. After trudging methodically to a $3.04 high at 1 p.m. EDT, the September contract fell in the last 90 minutes of the session as traders positioned themselves ahead of this mornings release of the weekly gas storage report. The prompt month closed at $2.954, up 6.3 cents for the day, but 8.6 cents off its daily high.

The Federal Energy Regulatory Commission Wednesday moved a step closer to the creation of a unified open access electric power market, to parallel the one for natural gas, voting on the near final version of its standard market design (SMD) proposal to “remedy undue discrimination in the use of the interstate transmission system and give the nation the benefits of a truly competitive bulk power system.”

The staff of the Federal Energy Regulatory Commission (FERC) provided misleading information about inadequate western energy infrastructure and rapid gas demand growth in a recent report that was used in support of Commission orders on California power market design, according to energy consultant James Wilson, principal at LEGC LLC in Washington, DC.

The West may have an excess of interstate natural gas pipeline capacity by the end of this year, and PG&E Gas Transmission Northwest (GTN) is retrenching on its 2003 expansion plans in the Pacific Northwest, according to Peter Lund, vice president of market development at the pipeline. In an interview with NGI, Lund said PG&E’s pipeline expansions, the new intrastate pipeline capacity additions, Kern River Gas Transmission’s 2003 expansion and multiple proposed LNG import terminals will dramatically alter the gas market in the West in the next few years.

A veteran energy consultant told a national meeting of state regulators Tuesday in Portland, OR, that the United States in the years ahead can expect higher natural gas prices that will dampen demand and declining gas resource base.

Despite a second straight day record electricity demand, and spiking New York City physical gas prices, natural gas futures traded quietly sideways Tuesday, as neither bull nor bear was willing to influence a move in either direction. On its first day as prompt contract, September slipped 1.4 cents to finish at $2.891, just 0.1 cents above its opening trade for the session and smack-dab in the middle of its $2.85-93 trading range. At 86,242, estimated volume was moderate to light.

Dynegy Inc.’s restructuring is on schedule, liquidity is improving, and investors are slowly showing a little more faith. Now, management wants to stabilize the once prosperous marketing and trading unit, and will disregard those who believe the energy merchant sector has been wiped out. “It’s awfully easy to get in a doom-and-gloom mood,” interim CEO Dan Dienstbier said Tuesday. “But I’m not pessimistic in our ability to complete our plan and move forward…Sometimes, you have to go home and say, ‘Hey, get a grip…This is a good, solid company, and we intend to be here when it is all sorted out.'”