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

**Office of Energy Assurance**

**ENERGY ASSURANCE DAILY**

**December 23, 2004**

**Major Development**

**Winter Storm Snarls U.S. Midwest**

A winter storm created misery for holiday travelers, knocking out power
to hundreds of thousands of people and breaking snowfall records. In
Ohio an ice storm preceded a foot-deep snowstorm that knocked out power
to more than 300,000 customers, local utilities said. \"There are strong
winds and temperatures are dropping. Our crews are working in difficult
conditions,\" American Electric Power Co. Inc. spokeswoman Suzanne
Priore said. Some rural areas in southern Ohio may not see power
restored before Christmas Day, and shelters were set up for those
without heat, officials said. Records were broken in Evansville, where
19 inches of snow fell, 5 inches more than the southern Indiana city
usually gets in an entire winter. The 14 inches blanketing Paducah,
Kentucky, also broke a single-day record, forecaster Mike Palmerino of
Meteorlogix said.

Reuters, 13:18, December 23, 2004

<http://www.wchstv.com/newsroom/oh/news2.shtml>

<http://news.enquirer.com/apps/pbcs.dll/article?AID=/20041223/NEWS01/412240322/1077>

**Electricity\
**

**Exelon\'s Braidwood 2 Reactor in Illinois Automatically Shuts**

Exelon Corp.\'s 1,232-megawatt unit 2 at the Braidwood nuclear
generating station automatically shut yesterday, according to the U.S.
Nuclear Regulatory Commission\'s daily reactor status report. The unit
tripped following a reactor protection signal and the cause of the
signal is being investigated. The reactor, one of two units at the
Braceville, Illinois, plant, about 60 miles southwest of Chicago.

Bloomberg, December 23, 2004, 9:01

**Peach Bottom Nuclear Reactor in Pennsylvania Shut for Repair**

Exelon Corp.\'s 1,116-megawatt unit 2 at the Peach Bottom nuclear
generating station in automatically shut down yesterday because of
low-reactor pressure. The unit will remain shut while repairs are made
to the hydraulic system, which had directed steam away from the turbine,
causing the reduction in pressure. No estimate is available on when the
reactor will return to service. The Peach Bottom facility is located in
Delta, Pennsylvania, near the Maryland border.

Bloomberg, December 23, 2004, 8:42

**Salem 2 Operating at 100 Percent of Capacity**

Unit 2 of the Salem nuclear generating station of Public Service
Enterprise Group Inc. was operating at 100 percent of capacity early
Thursday morning. The unit was reduced to 80 percent of capacity on
Wednesday to allow for maintenance on a nearby transmission line.

Bloomberg, December 23, 2004, 7:44

**Salem 1 nuke back on line, up to 60 pct power**

Public Service Enterprise Group Inc.\'s 1,150-megawatt unit 1 at the
Salem nuclear generating station returned to service and ramped up to 60
percent of capacity by early Thursday. On December 20, the company took
the unit off line to work on a problem with a steam generator feed pump.
The Salem station is located in Salem, New Jersey about 40 miles south
of Philadelphia.

Reuters, 7:22, December 23, 2004

**Petroleum**

**Colonial Pipeline Reopens Oil Products Line 4 To Baltimore After 2-Day
Shutdown**

Colonial Pipeline on Wednesday night reopened its Line 4 oil products
pipeline to the Baltimore area, ending a two-day shutdown caused by
emergency maintenance, company officials said Thursday morning. Colonial
would not say what type of maintenance was done, but said there was no
leak.

Reuters, 9:22, December 23, 2004

**Colonial Pipeline Reopens Oil Products Line 4 To Baltimore After 2-Day
Shutdown**

Colonial Pipeline on Wednesday night reopened its Line 4 oil products
pipeline to the Baltimore area, ending a two-day shutdown caused by
emergency maintenance, company officials said Thursday morning. Colonial
would not say what type of maintenance was done, but said there was no
leak.

Reuters, 9:22, December 23, 2004

**MMS Updates Technically Recoverable OCS Natural Gas Estimate to 406.1
Tcf\
**Updating its estimates for undiscovered technically recoverable
resources (UTTR) underlying offshore waters on the Outer Continental
Shelf (OCS), the Minerals Management Service (MMS) said Tuesday that new
exploration activities in the Gulf of Mexico and in the Scotian Basin
offshore Canada has revealed that 76 billion barrels of oil and 406.1
Tcf of natural gas are technically recoverable from federal offshore
areas.

Natural Gas Intelligence, December 22, 2004

**Nigeria Oil Closures Bring Bonny Light Delays-Trade**

Stoppages in East Niger Delta oil production have caused 6-10 days of
delays for Nigeria\'s Bonny Light exports for the rest of December and
January, trading sources said on Thursday. Two and a half export
cargoes, or just under 2.4 million barrels of oil, had also been
cancelled in addition to the delays, trading sources said, citing a new
Bonny Light export program.

Reuters 11:48, December 23, 2004

**Study Says ANWR Drilling Likely by 2006**

A report by consultant Wood Mackenzie this week says ANWR could add 1
million barrels per day to US oil production by 2020. The battle over
permitting drilling in ANWR has been contentious for more than two
decades. Now, Wood Mackenzie predicts Congress' 2005 Reconciliation
Budget Bill will begin the process of leasing in ANWR and the first
lease sales will occur in the autumn of 2005. The first drilling would
most likely occur soon after the acquisition of seismic data in early
2006. The authors see the first discovery as early as 2008. ANWR oil
would first hit the market by 2016, and by 2020 total ANWR production
could be over one million b/d.

Oil Daily, December 23, 2004

**DOE Study Says LNG Tanker Safety Is Solid, But Some Risks Remain**

With terrorism a top concern following the Sep. 11 attacks and US
imports of liquefied natural gas (LNG) expected to continue to grow, the
debate around LNG tanker safety has intensified recently. The US
Department of Energy (DOE) this week released a 167-page report that is
the first to provide a "baseline process" to evaluate the risk of a
large LNG spill over water and its possible consequences for public
safety. The study assesses spills caused both by accident and possible
terrorist attacks. One conclusion is that "the risks from accidental
spills, such as collisions and groundings, are small and manageable with
current safety policies." As to spills induced by terrorism, the report
does not quantify the risks but says they "can be significantly reduced"
with appropriate planning and prevention measures.

The release of the report has attracted a lot of attention in different
sectors, especially with regard to its conclusions about the potential
consequences of a terrorist attack. Massachusetts Congressman Ed Markey
said in a statement that LNG shipments to the Everett terminal near
Boston "pose a risk to public safety" and that regulators need to
"reconsider whether the existing environmental impact statement for the
Everett terminal needs to be updated. However, a spokeswoman for the
Federal Energy Regulatory Commission (FERC), told trade press that "Our
Chairman is pleased that the information in the \[DOE\] study validates
our view that the risks are low and manageable and that LNG will be
delivered safely to the US." Rear Adm. Thomas H. Gilmour, Coast Guard
assistant commandant for marine safety, echoed FERC's view. He said the
DOE study "confirms that LNG tankers are very strong ships."

Oil Daily, December 23, 2004.

**Lukoil Boosts Oil Port Capacity to Supply U.S.**

Lukoil, Russia\'s biggest oil producer will increase crude and fuel
exports through a terminal on the Baltic coast, boosting supplies to the
company\'s network of more than 2,000 U.S. filling stations. Following
the expansion, the facility at Vysotsk will be able to load oil tankers
with a dead weight of 100,000 tons next month, up from 20,000-ton
vessels. Improved rail links to Vysotsk will enable the port to handle
12.5 million tons of oil by 2007 and eventually 17 million tons a year.

Bloomberg, December 23, 2004, 9:44

# Natural Gas

**Duke, NiSource Issue Gas-Pipeline Limits on Forecasts for Cold**

Duke Energy Corp. and NiSource Inc. told shippers using its Algonquin
and Texas Eastern pipelines to replace as much gas on the lines as is
taken off or face a penalty due to an anticipated extended period of
peak demand conditions throughout the service territory over the holiday
period,

Bloomberg, December 22, 2004, 12:34

**PECO, ConEd Record High Gas Send-Outs\
**Forecasts may be moderating, but two major eastern utilities reported
setting some new gas and power send-out records Monday. Consolidated
Edison (ConEd) pinpointed the average temperature in its New York City
area over the 24-hour period of Dec. 20 at 15 degrees Fahrenheit

Natural Gas Intelligence, December 22, 2004

### Northern Natural Gas Calls for System Overrun Limitation in all Market Areas

A SOL day is being called for the gas day of Thursday 12/24/04 due to
forecasted minimum temperatures of below zero in all Market Area zones.
<http://www.northernnaturalgas.com/infopostings/asp/atAGlanceNotices.asp?InetNoticeType=3>

**Other News**

**Work on Hillsboro coal mine to begin in 2005\
**The Montgomery County board has agreed to sell 120-thousand acres of
coal rights to establish a new mine in the Hillsboro (IL) area. The
county board voted 18-to-2 Wednesday to allow the sale of the rights to
Colt Coal, a subsidiary of the Virginia-based Cline Coal Group. Work and
engineering for permits will begin next year. Officials say the mine is
expected to produce five million tons of coal annually. Colt also wants
to build a 544 megawatt power plant by 2009 and a synthetic natural gas
plant by 2010.

<http://www.kmov.com/localnews/stories/kmov_localnews_041223_hillsboromine.39887e27.html>

**Energy Prices**

+-------------------------------+-----------+-----------+------------+
|                               | **Latest  | **Week    | **Year     |
|                               | (12       | Ago**     | Ago**      |
|                               | /23/04)** |           |            |
+-------------------------------+-----------+-----------+------------+
| **CRUDE OIL**                 | 44.05     | 44.16     | 33.72      |
|                               |           |           |            |
| **West Texas Intermediate     |           |           |            |
| US**                          |           |           |            |
|                               |           |           |            |
| \$/Barrel                     |           |           |            |
+-------------------------------+-----------+-----------+------------+
| **NATURAL GAS**               | 7.05      | 6.88      | 6.98       |
|                               |           |           |            |
| **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