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Gold/Mining/Energy : Anadarko Petroleum Cp -- Ignore unavailable to you. Want to Upgrade?

To: The Ox who wrote (15)	4/27/1999 12:21:00 PM
From: The Ox	Read Replies (1) \| Respond to of 129

US Natural Gas Producers Testify on Meeting Year 2013 Demand Washington, April 21 (Bloomberg) -- The U.S. natural gas industry can fill the expected demand of 30 trillion cubic feet in 2013 if the federal government opens more land to exploration while lowering tax and royalty costs, industry officials told Congress. ''Market expansion is not a given,'' Keith E. Bailey, chairman and chief executive of Williams Cos. Inc., the largest U.S. transporter of natural gas, told the Senate Committee on Energy and Natural Resources. ''Congress should move to make access to the resource base on public lands more available.'' While Bailey and gas producers disagreed on how the Clinton administration should set pipeline rates, they said Congress and the administration could make it easier to explore and drill. The industry says bans on offshore drilling have cut off 82 percent of the highest-potential sources. Mild weather has reduced demand for natural gas, and prices fell to a 3 1/2 year low on February 26. Low prices have discouraged investment in new production. Active oil and gas rigs in the U.S. and Gulf of Mexico have dropped to fewer than 600 from more than 1,000 a year ago, according to Baker Hughes Inc., the Houston supplier of drilling equipment and services. Increased use of natural gas in making electricity will help boost U.S. demand for natural gas from last year's 21 trillion cubic feet by 43 percent to 30 trillion in 2013, Jay Hakes, administrator of the U.S. Energy Department's Energy Information Administration, told the committee. Rising Canadian imports will help meet the demand, which will reach 32 trillion cubic feet by 2020, Hakes said. Prices at the wellhead will reach $2.55 per thousand cubic feet in 2013 and $2.68 in 2020, according to administration projections. ''The real price of natural gas is much higher than it was in 1955, exploration and production costs are lower in real terms, technology is better, and the regulatory environment is much more favorable to gas production,'' he said. Pipeline Rates An executive with a gas exploration company said the Federal Energy Regulatory Commission needs to set rates in a way that will hold down pipeline costs that are now excessive. Instead, the commission is considering rules that will increase costs, said Richard J. Sharples, president of Anadarko Energy Services Co., a subsidiary of Houston-based Anadarko Petroleum Corp. Another executive, H.G. Kleemeier, chief operating officer of Kaiser-Francis Oil Company in Tulsa, Oklahoma, said the proposal ''would provide pipelines with enhanced abilities to charge rates above a just and reasonable level and discriminate in the quality of service provided.'' Bailey, whose Tulsa, Oklahoma, company runs five interstate pipelines, disagreed, saying the carriers need rates of return of at least 13 percent, as the commission recently allowed, in order to attract investors. Natural gas for May delivery at the Henry Hub in Louisiana rose 3 cents, or 1.4 percent, to $2.174 per million British thermal units on the New York Mercantile Exchange. Apr/21/1999 17:55