![](media/image1.jpeg){width="8.5in" height="3.5027777777777778in"}U.S.
DEPARTMENT OF ENERGY

**Office of Energy Assurance**

**ENERGY ASSURANCE DAILY**

###### July 8, 2004

**Highlight / Major Developments**

**UPDATE \-- Phoenix Faces Blackout Threat After Fire, Outage**

Phoenix was again faced with the threat of rolling blackouts on Thursday
with a key substation out of service and a forest fire blazing close to
a major power line. "There are a lot of things at play here. Today and
tomorrow are going to be critical. In the summer Thursday is a big day
for us in terms of load," Sheri Foote, spokeswoman for the state\'s
largest utility, Arizona Public Service, said. Foote said the utility
should know by mid-afternoon whether rolling blackouts may be needed.
Nevada Gov. Janet Napolitano canceled a trip to Chicago planned for
Thursday and Friday, citing the need to monitor forest fires and the
threat of power problems. Phoenix, located in the desert Southwest,
consumes a lot of electricity during its scorching summers due to heavy
use of air conditioning systems. The Weather Channel was forecasting the
city would peak at 106 degrees Fahrenheit on Thursday, only slightly
above its normal peak at this time of year of 105 degrees F.

<http://biz.yahoo.com/rc/040708/utilities_apso_phoenix_1.html>

[http://www.azdailysun.com/non_sec/nav_includes/story.cfm?sto
ryID=90240](http://www.azdailysun.com/non_sec/nav_includes/story.cfm?storyID=90240)

**Electricity**

**Workers At Mass. Pilgrim Nuke Seek Shutdown If Strike**\
Workers at the 670 megawatt Pilgrim nuclear power station in
Massachusetts asked the U.S. Nuclear Regulatory Commission to shut the
plant if they go on strike next week. Local 369 Utility Workers Union,
which represents about 300 of the plants 580 employees, was negotiating
a new contract with the plant's owner, Entergy Corp. The contract will
expire at midnight July 13. A spokesman for Entergy, Dave Tarantino,
said the company hopes to avert a strike but was prepared to continue to
operate the plant safely.

The Pilgrim station is located in Plymouth, Massachusetts, about 40
miles south of Boston. It is capable of generating power for almost
700,000 homes. Entergy, of New Orleans, has already submitted a plan to
the NRC detailing how the company would keep the plant operating in the
event of a strike. A spokeswoman at the NRC, Diane Screnci, said the
agency was evaluating Entergy's plan, and has \"so far\" found it
acceptable.

Reuters, July 8, 2004, 1154

<http://biz.yahoo.com/rf/040708/utilities_entergy_pilgrim_1.html>

**Southern's Ga. Hatch 1 nuke back at full power**\
Southern Co. 924 megawatt Hatch 1 nuclear unit in Georgia returned to
full power by early Thursday, the Nuclear Regulatory Commission said in
its power reactor status report. By early Wednesday, Southern had
reduced power at the unit to about 62 percent in order to check on a
problem in the transmission switchyard. One MW can power 1,000 homes.
The Hatch station is located in Baxley, Georgia, about 120 miles north
of Jacksonville, Florida.

Reuters, July 8, 2004 0747

<http://biz.yahoo.com/rc/040708/utilities_southern_hatch_1.html>

**Entergy's Vermont Yankee Nuke up to 80 Percent Power**\
Entergy Corp.'s 510 megawatt Vermont Yankee nuclear unit in Vermont
ramped up to 80 percent of capacity by early Thursday, the Nuclear
Regulatory Commission said in its power reactor status report. On
Wednesday, the unit was operating at 37 percent of capacity after
exiting a forced outage that started on about June 18. One MW powers
1,000 homes.
<http://biz.yahoo.com/rc/040708/utilities_entergy_vermontyankee_1.html>

**Petroleum**

**Oil Above \$40, Led by Strong Gasoline**\
U.S. crude oil hit \$40 a barrel on Thursday for the first time in over
a month, supported by a gasoline futures rally on supply concerns and
U.S. data that showed a lower-than-expected rise in weekly crude oil
stocks. Traders in New York also said a warning by U.S. Homeland
Security Secretary Tom Ridge that Al Qaeda may stage a \"large-scale
attack\" on the U.S. to disrupt upcoming elections unnerved markets,
although Ridge did not offer any details. U.S. light crude (CLc1) August
futures settled up \$1.25 at \$40.33 a barrel, after rising as high as
\$40.40 during the trading session. That was the highest level for U.S.
crude to trade since the \$40.85 hit on June 3, and was just about \$2
shy of the 21-year New York Mercantile Exchange record of \$42.45 a
barrel on June 2. Some analysts worry that crude at \$40 and above could
hurt global economic growth.

<http://biz.yahoo.com/rb/040708/markets_oil_6.html>

**Fire-damaged BP reformer at Texas City down for summer: sources**

The reformer at BP\'s 437,000 b/d Texas City, Texas, refinery that was
damaged in a March 30 fire will be down for the entire summer, market
sources said Thursday. The reformer, with a listed capacity of 65,000
b/d, was said to have been running above that, at 80,000 b/d, when the
fire occurred. BP, who declined to comment on the status of the
reformer, has been able to manage the outage by a combination of reduced
crude runs, diversion of naphtha to petrochemical units, and selling to
the open market, said sources. The Texas Natural Resource Conservation
Commission has not yet produced its final report on the March fire.

Platts, July 8, 2004

<http://www.platts.com/Oil/News/2146430.xml?S=n>

# UPDATE \-- US Senator Urges Shell to Do More to Sell Refinery

Democrat Sen. Dianne Feinstein of California urged Shell Oil Co. to try
harder to sell an oil refinery in the state instead of closing it, which
could boost already-high gasoline prices. Shell, the U.S. unit of Royal
Dutch/Shell Group, plans to shut its 70,000 barrel a day refinery near
Bakersfield this autumn because it says local sources of crude oil have
declined, making the plant unprofitable. Other companies have indicated
an interest in purchasing the refinery, but Feinstein accused Shell of
providing little information on the facility to potential buyers. \"I
understand that there are several willing buyers out there for the
Bakersfield refinery. Yet, I have heard that Shell has not made a good
faith effort to sell the refinery,\" Feinstein said in a letter on
Wednesday to Shell officials. Feinstein's letter was made public by her
office on Thursday, one day after the Federal Trade Commission announced
it was opening a formal investigation into possible antitrust violations
in Shell\'s decision to close the refinery. Shell spokesman Stan Hays
would not comment directly on Feinstein\'s letter, but he said the
company has received 28 inquiries regarding the potential purchase of
the refinery, and six of them progressed to the point where
confidentiality agreements were signed.

Reuters, July 8, 2004 1521

# Natural Gas

Nothing to report

**Other**

Nothing to report

**Energy Prices**

+-------------------------------+-----------+-----------+------------+
|                               | **Latest  | **Week    | **Year     |
|                               | (7        | Ago**     | Ago**      |
|                               | /08/04)** |           |            |
+-------------------------------+-----------+-----------+------------+
| **CRUDE OIL**                 | 39.44     | 38.74     | 30.32      |
|                               |           |           |            |
| **West Texas Intermediate     |           |           |            |
| US**                          |           |           |            |
|                               |           |           |            |
| \$/Barrel                     |           |           |            |
+-------------------------------+-----------+-----------+------------+
| **NATURAL GAS**               | 6.19      | 5.92      | 5.40       |
|                               |           |           |            |
| **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