![](media/image1.jpeg){width="8.75in" height="3.6055555555555556in"}U.S.
DEPARTMENT OF ENERGY

**Office of Energy Assurance**

**ENERGY ASSURANCE DAILY**

###### May 19, 2004

**Electricity**

**Wisconsin Energy\'s Wis. Point Beach 2 Nuke Exits Outage**\
Wisconsin Energy Corp.\'s
(NYSE:[WEC](http://finance.yahoo.com/q?s=wec) -
[News](http://finance.yahoo.com/q/h?s=wec)) 517 megawatt Point Beach 2
nuclear unit in Wisconsin exited an outage and ramped up to 17 percent
of capacity by early Wednesday, the Nuclear Regulatory Commission said
in its power reactor status report. The unit had been shut since about
May 17 when a diver had a mishap by the water intake valves and the unit
had to be shut down for the diver to be able to surface.
<http://biz.yahoo.com/rc/040519/utilities_wisconsinenergy_pointbeach_1.html>
Bloomberg News, 1458 May 19, 2004

# Peabody Energy Signs Three Utilities to Invest in Coal-Fired Power Plant Peabody Energy Co. has signed up three electric utilities to invest in a large coal-fired power plant in Washington Township, Ill. The utilities will have a one-third interest in the \$2 billion plant and will use about one-third of the electricity. St. Louis-based Peabody, the largest coal producer in the country, has been planning to build a 1,500 megawatt Prairie State Energy Campus since late 2001. But Peabody has said it will not break ground until it has signed up users for 80 to 90 percent of the anticipated electricity, and investors for 50 percent of the construction cost. Prairie State will be a \"mine-mouth\" plant, where coal is fed from conveyor belts leading from the mines. Mine-mouth plants are comparatively inexpensive to operate because coal does not have to be delivered by rail or barge. Peabody is planning to build a similar plant in Kentucky. Bloomberg News contributed to this report. [**http://www.stltoday.com**](http://www.stltoday.com/) **St. Louis Post-Dispatch - May 19, 2003 <http://www.energycentral.com/centers/news/daily/article.cfm?aid=4867917>** [**http://biz.yahoo.com/rf/040518/utilities_peabody_prairiestate_1.html**](http://biz.yahoo.com/rf/040518/utilities_peabody_prairiestate_1.html)

####### 

####### Petroleum

**Bush Invokes \"War on Terror\" in U.S. Energy Debate**

U.S. President George W. Bush said on Wednesday he would not release
strategic oil stocks to curb record gasoline prices while he was waging
war on terror and accused Democrats of playing politics on energy. Bush
rejected any solution to the rapid rise in gasoline prices that would
use the Strategic Petroleum Reserve, a national emergency stockpile, to
give motorists relief at the pump. Ideas such as halting shipments to
the reserve or releasing some of its supplies would leave America
vulnerable in the event of a terrorist attack, Bush said.

<http://biz.yahoo.com/rm/040519/energy_bush_1.html>

Reuters, 1553, May 19, 2004

**Kerry and Democratic Senators and Governors Call for Bush to Take
Action on Gas Prices**

The Democratic Governors\' Association, led by Iowa\'s Tom Vilsack, is
calling for the Bush administration to do something about skyrocketing
gas prices. Vilsack said the price increases has resulted in a \$42
billion tax on Americans, and it\'s going to put a \"screeching halt to
job creation.\"

He was joined by Arizona Gov. Janet Napolitano and Michigan\'s Jennifer
Granholm during a conference call Tuesday which was, in part, organized
by the Kerry campaign. Senate Democrats have complained that their call
for the White House to release resources from a petroleum reserve in
Louisiana has gone unanswered. Energy Secretary Spencer Abraham said the
reserve is not there simply to change prices.

<http://www.theomahachannel.com/print/3319471/detail.html>

**Oil Resumes Its Climb**\
World oil prices resumed their relentless rise on Wednesday after a
slight build in weekly U.S. gasoline supplies failed to dispel fears
over tight inventories ahead of peak summer demand, traders said. NYMEX
crude oil futures ended above \$41 a barrel on Wednesday, just below
recent peaks, as traders said a modest increase in gasoline stocks last
week was not enough to thwart potential supply shortages this summer.
Crude for June delivery settled 96 cents, or 2.4 percent, higher at
\$41.50 a barrel, after leaping to a session high of \$41.55. The day\'s
low was at \$39.90. The prompt contract recovered from a \$1.01 loss on
Tuesday, which came after it shot up on Monday to \$41.85, the highest
price for prompt crude since NYMEX launched its crude oil futures
contract in 1983. Reuters, 1548 May 2004

<http://biz.yahoo.com/rm/040519/markets_energy_nymex_7.html>
<http://biz.yahoo.com/rb/040519/oil_markets_3.html>

**Mexico, Canada March Oil Exports to US Record-high**

U.S. crude oil imports in March rose by nearly a million barrels per day
from February as shipments from Canada and Mexico hit record highs, the
Energy Information Administration said Wednesday. Total U.S. oil imports
averaged 10.254 million bpd in March, up 996,000 bpd from the previous
month, according to data from importing companies provided to the Energy
Department\'s analytical arm. Canada remained the top supplier of
foreign crude to the United States in March, exporting 1.583 million
bpd, a record for the month. EIA said March imports from Canada
increased 97,000 bpd from the prior month. Mexico maintained its
second-place ranking with record shipments in March of 1.576 million
bpd, up 90,000 bpd from February. Saudi Arabia, normally America\'s top
monthly supplier of foreign crude, came in third place in March with
shipments of 1.478 million bpd.

Reuters, 1606 May 19, 2004

**Nigeria Says Exceeding OPEC Quota by 500,000 bpd**\
OPEC member Nigeria is producing crude oil nearly 500,000 bpd in excess
of its cartel quota, the OPEC News Agency on Wednesday quoted the head
of the country\'s national oil company as saying. Funsho Kupolokun,
Group Managing Director of the Nigerian National Petroleum Corporation
told OPECNA Nigeria was producing 2.4 million bpd of crude oil, well
above its 1.936 million bpd quota..
<http://biz.yahoo.com/rm/040519/energy_nigeria_production_1.html>

**Heating Oil Rises to 14-Month High as Refiners Slow Operations** New
York heating-oil futures rallied to the highest in more than a year
after the U.S. Energy Department said refiners slowed operations last
week, raising concern that production isn\'t gaining fast enough to meet
soaring demand. Bloomberg News, 1517 May 19, 2004

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#### Natural Gas 

**Officials Cite High Costs, Complexities of Importing LNG to US**

The costs and complexities of importing liquefied natural gas to the US
are so enormous that only a handful of large companies or consortia will
succeed---and only if a combination of key ingredients falls into place,
several industry officials said Tuesday.
[http://www.platts.com/Natural%20Gas/News/5066272.xml?S=n](http://www.platts.com/Natural Gas/News/5066272.xml?S=n)

**NYMEX Natgas Ends Up Sharply with Crude, Cash Slips**

NYMEX natural gas futures ended up sharply on Wednesday, driven by a
firmer crude market and warmer weather forecasts for Texas and the
Southeast early next week despite a softer cash, industry sources said.
June futures jumped 30.1 cents, or 5 percent, to close at \$6.455 per
million British thermal units after trading between \$6.14 and \$6.50.
July settled 30.3 cents higher at \$6.546. Other months ended up 7.9 to
29.5 cents. \"Yesterday we saw a teaser pullback. They tried to take it
down again early today but crude reversed (higher) and gas took off,\"
said one Texas-based trader.

Reuters, 1534 May 19, 2004

**Exxon, Shell Say Gas Rally Has Little Demand Impact**

Surging U.S. natural-gas prices are having little impact on demand,
setting the stage for even higher prices this summer as hot weather
stokes power plant consumption of the fuel, managers at Exxon Mobil
Corp., ChevronTexaco Corp. and Royal Dutch/Shell Group said. Most U.S.
power plants and factories aren\'t equipped to burn cheaper oil-based
fuels, which means there\'s little room for a slackening of demand if
prices continue rising, said Bill Hauhe, manager of global liquefied
natural-gas at ChevronTexaco, the No. 3 U.S. gas producer. Five to 10
percent of U.S. manufacturing plants and generators can burn gas or oil
to exploit price swings, according to the National Petroleum Council, an
advisory panel linked to the Energy Department in Washington.

Bloomberg News, 1423 May 19, 2004

####### Other

**GAO Report on Davis-Besse Nuclear Power Plant Safety** A GAO study was
released on May 17^th^ called "Nuclear Regulation: NRC Needs to More
Aggressively and Comprehensively Resolve Issues Related to the
Davis-Besse Nuclear Power Plant\'s Shutdown." Click on the links below
for highlights or for the full report.
<http://www.gao.gov/highlights/d04415high.pdf>
<http://www.gao.gov/new.items/d04415.pdf>

**Iraq Imports More Gasoline Ahead of Shutting Largest Refinery**

Iraq, Middle East\'s third-largest oil producer, started importing 1
million extra liters of gasoline a day from Kuwait as its largest
refinery is shut for maintenance on June 1, a U.S.-led occupation
authority official said.

Bloomberg News, 0439 May 19, 2004

**Energy Prices**

+-------------------------------+-----------+-----------+------------+
|                               | **Latest  | **Week    | **Year     |
|                               | (5        | Ago**     | Ago**      |
|                               | /19/04)** |           |            |
+-------------------------------+-----------+-----------+------------+
| **CRUDE OIL**                 | 41.63     | 40.30     | 28.84      |
|                               |           |           |            |
| **West Texas Intermediate     |           |           |            |
| US**                          |           |           |            |
|                               |           |           |            |
| \$/Barrel                     |           |           |            |
+-------------------------------+-----------+-----------+------------+
| **NATURAL GAS**               | 6.18      | 6.41      | 6.08       |
|                               |           |           |            |
| **Henry Hub**                 |           |           |            |
|                               |           |           |            |
| \$/Million Btu                |           |           |            |
+-------------------------------+-----------+-----------+------------+

> Source: Reuters

**This Week in Petroleum** from the Energy Information Administration
(EIA)

[*http://tonto.eia.doe.gov/oog/info/twip/twip.asp*](http://tonto.eia.doe.gov/oog/info/twip/twip.asp)

Updated on Wednesdays

**Weekly Petroleum Status Report** from EIA**\
**[*http://www.eia.doe.gov/oil_gas/petroleum/data_publications/weekly_petroleum_status_report/wpsr.html*](http://www.eia.doe.gov/oil_gas/petroleum/data_publications/weekly_petroleum_status_report/wpsr.html)

Updated after 1:00pm (Eastern time) on Wednesdays

**Natural Gas Weekly Update** from EIA

[*http://tonto.eia.doe.gov/oog/info/ngw/ngupdate.asp*](http://tonto.eia.doe.gov/oog/info/ngw/ngupdate.asp)

Updated after 2:00 pm (Eastern time) on Thursdays