Second-quarter natural gas production fell only slightly — 0.7% — from the first quarter of 2002, according to a survey by Raymond James Energy, but the consulting firm is nevertheless predicting full-year results will be in line with its previous prediction of a minus 5-6%.
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Expected Return of Northeast Heat Boosts Most Markets
Prices ranged from flat to mostly moderately higher Friday in all regions except the Rockies. They got some follow-through momentum from Thursday’s screen run-up following a below-expectations storage report, and traders also were looking ahead to the return of Northeast temperatures in the 90s as this week begins.
September Inches Up 1.6 Cents in Quiet Day of Trading
After reaching the lowest levels since early March, the gas futures market got a boost last week from a smaller than expected storage injection and a downward revision to prior storage data on Thursday, which provided just enough steam for the September contract to end the week closer to its weekly high of $2.80 than Wednesday’s low of $2.64. However, September only managed to eke out a small 1.6-cent gain on Friday, ending the day at $2.761, just above its daily low of $2.755. Volume was light at 38,527, compared to 95,207 on Thursday.
Lehman Analyst Expects Total Gas Supply to End Year Down 3-4%
Lehman Brothers analyst Thomas Driscoll said that U.S. gas production was down about 0.2% in the second quarter from first quarter levels based on results from 44 large production companies. The decline was much smaller than the 2.9% sequential drop in the first quarter from 4Q2001. Driscoll said the results have led him to maintain his projection that full-year gas production will be down 4.5 to 5.25% compared to 2001 (production rose 0.7% in 2001, but fell 2% and 1.3% in 1999 and 2000, respectively).
PG&E NEG Cutbacks Won’t Impact Trading
PG&E Corp.’s Bethesda, MD-based merchant energy operator, the National Energy Group (NEG), announced Thursday it is launching cutbacks that will include laying off some of its top executives, but will not materially impact its trading operations.
UBS Warburg Energy May Cut up to Half of Houston Workforce
UBS Warburg Energy, which took over the EnronOnline trading platform earlier this year, has issued no public statements since February, when it completed a deal to obtain Enron Corp.’s exclusive license to the technology to operate the North American natural gas and power trading operations, but sources report that between a one-quarter to one-half — 120 to 250 — of its Houston staff are expected to be laid off.
Canadian Battle Over Sharing East Coast Reserves Expands
International conflict over natural gas produced offshore of Nova Scotia has spread to a new front, with Canadian demands for rights of first refusal clouding the outlook for the 80% capacity expansion proposed by Maritimes & Northeast Pipeline.
Draft Bill Would Enforce Derivatives Trading Rules on Energy Platforms
A draft bill in the Senate would give federal regulators the power to select a “registered futures association” to uncover and investigate abuses of rules for trading of over-the-counter (OTC) energy derivatives, and would significantly raise civil and criminal penalties for violators.
Rocky Mountain Energy Closes Second Asset Acquisition in As Many Months
Houston-based Rocky Mountain Energy Corp. said Friday it has closed on the acquisition of the 8,000-acre Ten Mile and Desert Spring Fields located in Sweetwater County, WY. The company said there are five current wells producing 1,000 Mcf/d of natural gas and 67 bbl/d of oil.
Oneok Settles With Southwest Gas for $3 million
Oneok Inc. announced Friday it has reached a definitive agreement to pay Las Vegas-based Southwest Gas Corp. $3 million in settlement of a lawsuit between the two parties. The action was almost the final one in a legal wrangle that has gone on for three years among the two companies and Southern Union. On Wednesday Southwest Gas agreed to pay Southern Union $17.5 million to settle a lawsuit involving Southern Union’s failed plan to buy the gas company (see Daily GPI, Aug. 8).