NGI All News Access

For the first time in the last eight quarters, Chesapeake EnergyCorp. of Oklahoma City, OK, turned a profit. The improvement was inspite of decreased production.

Oneok Inc. plans to enter the electric generation and powermarketing businesses with an Oklahoma generating facility. Thecompany signed a contract with General Electric to buy four gasturbine generators with a capacity of 300 MW. A generation facilityencompassing the four units will be constructed and in service byJune 1, 2001.

Tossing aside an ongoing state regulatory investigation of someof its billing practices, California’s most aggressive independentenergy service provider (ESP), Commonwealth Energy, plans to moveinto Pennsylvania and New Jersey next month where it expects a morestraightforward and receptive marketplace for its residential andsmall business electricity products. While signing up more than60,000 customers in California’s daunting retail mass power marketsso far, Commonwealth has been able to pass on savings of up to fivepercent, emphasizing green power from environmentally benignsources, developing prospects for new green products and shoppingfor power generation operations of its own, in addition to eyeingother states as the next stage of its two-year-old development.

Frenetic activity continued in the natural gas pit yesterday ina see-saw battle that produced two rallies, two dips and oneenormous 11.5-cent trading range. By the time the dust had settledand the orders were processed, the battle-weary August contractmanaged a 3.2-cent advance to settle at $2.574 on its penultimatetrading day.

The Independence Pipeline and Millennium Pipeline projectscontend CNG Transmission Corp. is speaking with a forked tonguewhen it comes to the need for new pipeline capacity to supply thegrowth in gas demand that’s expected for the Northeast market.

Avista Energy had a difficult second quarter, bringing in abouthalf the net income ($8.5 million) it posted in the second quarterof last year ($15.6 million), mainly because of an $11.6 millionnet loss in its marketing and trading division and costs associatedwith expanding its non-regulated businesses. But CEO T. M. Matthewssaid he’s comfortable that earnings this year will fall within therange of securities analysts’ current estimates, which are between$1.25 and $1.35 per share. He also predicted the company is in forsome significant changes ahead.

Convergence is going to continue in the energy industry becauseit is what customers and financial markets want; the market signalsare unmistakable, according to an industry representative and aninvestment funds manager.

Separating itself from government-created organizations like theCalifornia Power Exchange, the privately funded California-basedAutomated Power Exchange (APX) yesterday (July 27) announced plansto set up shop with a cash-based exchange in Illinois this fallwhen customer choice begins (Oct. 1) in the electricity industry.The announcement was made in Chicago in conjunction with localinvestor-owned utility Commonwealth Edison, whose transmissionsystem will be used to create a competitive power market inIllinois.

The performance of Dynegy’s gas liquids business during thesecond quarter indicates the market is finally making aturn-around. Operating income from the liquids division grew 41% to$54.9 million, Dynegy reported. Its power marketing and generationdivision, including operating margin and equity earnings from jointventure power projects, also showed continued improvement with 28%growth in operating income to $56.8 million. But gas marketingsuffered a 31% decline in operating income to $21.8 millionprimarily because of “weak market conditions” in Europe, thecompany said. Dynegy posted a 19% increase in net income during thesecond quarter to $28 million compared with $23.4 million in 2Q98.It sold a total of 9.2 Bcf/d of gas (6.1 Bcf/d domestically), upfrom 8.2 Bcf/d in 2Q98, and sold 17.4 million MWh of power, down40% from the 28.9 million MWh sold in 2Q98. Dynegy also showed ahigh retail marketing loss of $2.4 million compared with $600,000in 2Q98 because of the expansion of its SouthStar retail marketingalliance with AGL Resources and Piedmont Natural Gas in Georgia.SouthStar markets gas under the name Georgia Natural Gas and hasbuilt one of the largest market shares in Georgia. Dynegyattributed the mounting losses to increased advertising inpreparation for the Oct. 1 deadline for retail customers to switchto buying gas from marketers.