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Gold/Mining/Energy : KOB.TO - East Lost Hills & GSJB joint venture -- Ignore unavailable to you. Want to Upgrade?

To: Natedog who wrote (3883)	8/9/1999 9:00:00 PM
From: Natedog	Read Replies (1) \| Respond to of 15703

Taken from yahoo part 2Globe and Mail on Natural Gas by: pylan (35/M/Canada) 363 of 364 Soaring prices for natural gas hit consumers - Rare summer price rise wows producers - Further increases expected this winter Natural gas prices are going through the roof, sending a chill through Canadian homeowners who face an unusual summer rate increase amid forecasts of further hikes to come in winter heating bills. Meanwhile, gas producers are enjoying their best overall market conditions in six years, with prices at a 15-year peak. Normally, gas prices drop sharply during the summer because the warm weather reduces demand from businesses and homes. But industry prices for Alberta natural gas so far this month are almost double last August's average. They've also risen 40 per cent in the past five months. The rate increases for consumers are occurring just weeks after motorists found themselves paying significantly more at the pumps -- also a reflection of climbing energy prices. This summer's price spike in natural gas has forced local distribution companies across the West and Cenral Canada to raise rates, or make plans to do so. Current tightened gas supplies across Western Canada and the prospect of growing demand from the United States this winter contributed to the unusual mid-year surge, said Timo Makinen, senior gas-supply planning engineer at BC Gas. Gas production in Western Canada should pick up this winter, but there has been a shortage of gas drilling so far this year because energy producers reduced their overall capital spending for 1999 due to weak oil prices earlier this year. As well, gas consumption jumped this summer during a heat wave in many parts of North America. People turned on air conditioners, which in many regions are powered by elecricity produced by gas-fired generation plants. Alberta natural gas prices have now soared past the important $3 barrier, averaging $3.18 a gigajoule -- a key industry measurement -- since the start of this month. Natural gas accounts for 35 to 45 per cent of the average utility bill, with the rest consisting of various distribution charges and taxes. The robust gas market is "good news for producers, but we just pass along the cost of gas to consumers. The petroleum industry, already thriving after the recent rally in crude oil markets, is on a roll as natural gas prices soar. It's great for the industry and terrible for consumers. But consumers have had wonderful prices for many years. It's now the industry's turn to enjoy natural gas prices," said Peter Linder, an analyst with CIBC in Calgary. Share prices for many Calgary-based gas producers have rallied since early March, including big increases at Anderson Exploration Ltd. (55 per cent), Alberta Energy (44 per cent), Bonavista Petroleum(132 per cent) and Poco Petroleums Ltd. (54 per cent). "If we get a semblance of a normal winter, there will be serious concerns about the adequacy of supply, and that's moving up the market," Mr. Linder said. "And if we get a colder winter than the last two winters, we're going to have a very high gas price."