NGI All News Access

Panda Energy International inked a firm electrical transmissionagreement with Arizona Public Service to supply power from itsproposed natural gas-fired 2,000 MW plant to be located in the townof Gila Bend. The proposed plant is before the Arizona CorporationCommittee for review. Senior vice president of merchant plantdevelopment for Panda, Garry Hubbard, said that the firm contractis “a critical step forward for the plant.” The new plant is onschedule to commence construction later this year, with start up 18months later, he added. Powering the plant will be eight GeneralElectric 7 FA natural gas turbines operating in combined cycle.

Due to a compressor failure at its Riner Station, Williamsdeclared a force majeure situation on Line Segments 490 and 491.Necessary repairs are expected to be completed by next Monday’s gasday. Since capacity in the two segments has been reduced,maintenance originally scheduled for the week of Aug. 21 at theCheyenne and Ogallah Stations will be done this week to minimizedisruptions during August, Williams said.

It sure didn’t take long for the August aftermarket to jump wellabove indexes, one market observer said. Boosted by screen strengthand the anticipation of closer to normal summer weather eventuallyinvading key northern market areas, all points except Malinregistered double-digit gains Wednesday.

What a difference a week can make. After watching helplessly asprices plumbed fresh two and a half months lows last Wednesday,bulls at Nymex were back at the helm yesterday and with the help ofa neutral to slightly bullish storage report were successfuldriving prices up 5.7%. The prompt month experienced it secondstraight advance of more than 20-cents, bubbling 22.7 cents higherto finish at $4.214.

The Pennsylvania, New Jersey and Maryland (PJM) IndependentSystem Operator (ISO) has received approval for transmissionfacilities to interconnect over 40 new power generating sources tothe grid. In a meeting Aug. 1, the board of managers of PJMInterconnection approved the remaining elements of what is to bethe first coordinated regional transmission expansion under the PJMISO structure.

Most of the East was flat to slightly higher Tuesday, although afew points registered gains of more than a nickel. But westernprices softened by as much as a dime despite a continuation ofpower shortages in California.

Following the lead of both the over-the-counter and cashmarkets, natural gas futures erupted higher yesterday morning astraders covered shorts on the outside possibility that a tropicalstorm might develop in the Gulf of Mexico. The September contractwas the biggest mover, posting an impressive 21.3-cent gain tofinish at $3.987.

Facing more power alerts, near-record demand and strongpolitical pressure, the California Independent System Operator(Cal-ISO) Board Monday voted, 15-6, to lower the price cap to$250/MW for ancillary services, and spent another day discussingwhat combination of fixed-price supply deals and infrastructureupgrades can help the state avoid blackouts and rolling brownoutsthe rest of this summer. The price cap lowering is effective Aug.7.

Bringing oil and gas giants Exxon and Mobil Corp. together lastyear has gone more smoothly than management anticipated, pushingearnings to record levels, and management said yesterday it usethat extra money for new projects, more research and moretechnology that will improve the bottom line in the years to come.