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

**Office of Energy Assurance**

**ENERGY ASSURANCE DAILY**

###### March 1, 2004

**Highlights / Major Developments**

**Tanker Carrying 3.2 Million Gallons of Ethanol Sinks 50 Miles Off
Virginia**

Most of the ethanol on a tanker that exploded and sank off the coast of
Virginia Saturday has already evaporated, the U.S. Coast Guard said. The
tanker, owned by Norwegian shipper Odfjell ASA and registered in
Singapore, was en route to Houston from New York. The vessel was also
carrying 198,000 gallons of lubricant oil and 48,000 gallons of diesel
fuel, which were both used to motor the vessel. The ethanol onboard the
39,000 deadweight-ton ship is a water-soluble alcohol of the kind used
as a solvent in the manufacture of varnishes and insecticides, Odfjell
spokesman Jan Hammer said yesterday in a telephone interview.

Bloomberg News 13:52 March 1, 2004
<http://www.cnn.com/2004/US/South/02/29/tanker.explosion/index.html>

<http://biz.yahoo.com/rc/040229/crash_tanker_explosion_4.html>

**Mississippi River Pass Reopens to 2-way Traffic**\
The Mississippi River\'s Southwest Pass that is the passageway for ships
to enter and leave the Gulf of Mexico reopened to two-way traffic early
Monday for the first time since two ships collided more than a week ago,
the U.S. Coast Guard said. Between Wednesday afternoon and Friday night,
a total of 155 ships moved through the Southwest Pass channel, the only
deep-draft passage between the Gulf and the Mississippi, after it
reopened to one-way traffic only. A massive traffic jam of ships at the
Gulf of Mexico entrance to the Mississippi River had been cleared by
Saturday.
<http://biz.yahoo.com/rm/040301/energy_mississippi_river_2.html>

**Electricity**

#### Catawba 1 Nuke Does Not Return to Service on Saturday as Planned

Duke Power's 1,129 megawatt Catawba 1 nuclear unit in South Carolina
returned to 17 percent power by early Monday after exiting a brief
outage. The plant was supposed to be back at full power on Saturday
February 29^th.^ Reuters 13:24 March 1, 2004

**Oconee 3 Nuke Back at Full Power Monday Following Turbine Trip**

Duke Power's 846 MW Oconee 3 nuclear unit in Seneca, South Carolina was
back at full power Monday exiting a February 26 outage.

Reuters 13:24 March 1, 2004

**TVA\'s Ala. Browns Ferry 3 Nuke Cut to 30 Percent Power**

Tennessee Valley Authority\'s 1,118 megawatt Browns Ferry 3 nuclear unit
in Alabama was cut to 30 percent of capacity by early Monday, the
Nuclear Regulatory Commission said in its power reactor status report.
On Friday, the unit was operating at 84 percent of capacity. Some
traders noted the unit could be preparing to shut for a refueling outage
expected for this spring. Based on past refueling outages, the traders,
however, said they had expected the unit to shut in early April. Reuters
07:21 March 1, 2004

**Peach Bottom 2 Nuclear Plant at Full Power, Company Says**

Excelon Nuclear's 1,100 MW Peach Bottom 2 nuclear units returned to full
power this weekend following trouble-shooting and repairs involving a
vacuum leak.

Bloomberg News 11:45 March 1, 2004

**Conectiv To Build Two Power Lines In NJ, Del By Summer 2006**\
Pepco Holding Inc.\'s Conectiv utility unit said it plans to install a
new 230-kilovolt transmission line in New Jersey by summer 2005 and
another in Delaware the following summer. The lines are needed to keep
pace with growing electric demand in the utility\'s service area,
Conectiv spokesman Bill Yingling said Friday, after Pepco executives
mentioned the projects during an earnings conference call.
<http://biz.yahoo.com/djus/040301/1106000616_2.html>

**Arizona Public Service Finds Leak and Shuts Nuke**\
Arizona Public Service shut the 1,270 megawatt Palo Verde 3 nuclear unit
in Arizona after finding a coolant system leak, the company told the
Nuclear Regulatory Commission in an event report on Monday. A spokesman
for the utility stressed \"very strenuously\" that the leak was not near
the reactor vessel\'s lid. Boric acid residue was found outside of the
reactor coolant system during an inspection made Sunday,
<http://biz.yahoo.com/rm/040301/utilities_pinnaclewest_paloverde_4.html>

**Alabama Power\'s Joseph M Farley in SERC tripped early Monday**
Genscape Weekend Update, March 1, 2004

**Bonanza in WECC tripped Friday**

The plant has since returned to service and is running near previous
levels early Monday. Genscape Weekend Update, March 1, 2004

**High Desert in WECC tripped midday Saturday**

The plant began ramping its generator back online early Monday. Genscape
Weekend Update, March 1, 2004

**Petroleum**

Nothing to report.

#### 

#### Natural Gas 

**St. Mary Presses Ahead with Hanging Woman Coalbed Gas Project**

St. Mary Land & Exploration is pressing ahead with the development of
its Hanging Woman Basin coalbed methane project and is close to
finalizing a deal with a third party to build and operate a gas
gathering system. The Denver-based company expects to drill 100 wells
this year in the basin --- part of the Powder River Basin in northern
Wyoming and southern Montana --- with gas sales starting in early 2005.
Oil Daily March 1, 2004

**McMoRan Seeks to Build \$440 Million LNG Terminal in Gulf**

McMoRan Exploration Co., a U.S. oil and natural-gas producer, applied
for U.S. Coast Guard approval

to develop a \$440 million terminal for receiving liquefied natural gas
in the Gulf of Mexico amid declining North American production. The
terminal would be capable of receiving 1 billion cubic feet of the fuel
daily at an offshore terminal about 37 miles east of Venice, Louisiana,
said William Collier, a McMoRan

spokesman. The project has won support from Louisiana Governor Kathleen
Blanco and Senator Mary Landrieu, Collier said. Under the U.S. Deepwater
Port Act, the Coast Guard has 356 days to review the

company\'s plans. The facility could begin operating in the fourth
quarter of 2007, the company said.

Bloomberg News 11:25 March 1, 2004

**Other News**

**New York Utilities Didn\'t Contribute to Blackout, Report Says**

Consolidated Edison Inc. and other New York utilities didn\'t contribute
to the Aug. 14 blackout that left 6.3 million homes and businesses in
the state without power, the New York Public Service Commission said.
Legislation under consideration by the U.S. Congress would undermine the
reliability of New York\'s electric system by requiring all regions to
adopt standards that are more lenient than those in New York, the
commission said. The commission made several recommendations for
improving the state\'s response to future blackouts, such as installing
backup power systems at the New York Independent System Operator, which
manages the state\'s power grid, and at Verizon Communications Inc.,
which owns local telephone companies. The commission cited Consolidated
Edison Inc. for not having a plan in place to restore steam service
after a blackout and said cell-phone providers should \`\`examine what
could be done to improve call completions during periods of heavy
calling.\'\' Bloomberg News 12:55 March 1, 2004

**Chavez Oil Supply Threat \'Rhetoric,\' Analysts Say**

Buyers of Venezuelan oil and market analysts on Monday dismissed as
rhetoric a threat by President Hugo Chavez that Venezuela would cut oil
supplies to the United States, its best customer, if Washington invaded
or blockaded the OPEC nation. \"It looks like rhetoric. We\'re not going
to take any actions,\" a trader with one buyer of Venezuelan crude in
the United States said. \"We are not seeing anything negative from
(Venezuelan state oil firm) PDVSA.\" Chavez\'s warning came during a
fiery speech to supporters on Sunday in which he accused the
administration of George W. Bush of backing Venezuelan opposition
efforts to oust him. "Mr. Bush must know that if he gets the mad idea of
trying to blockade Venezuela, or, even worse, of invading Venezuela \--
if that happened, the people of the United States should know that not a
drop more would reach them from Venezuela,\" Chavez told supporters.
Reuters 11:29 and 13:20 March 1, 2004

**Shell-Chartered Crude-Oil Tanker Runs Aground in Suez Canal**

An oil tanker chartered by a Royal Dutch/Shell Group unit ran aground in
the Suez Canal with about 130,000 tons of crude oil onboard, less than
two months after the vessel was delivered from a shipyard. The Astro
Phoenix, carrying oil for Shell International Trading & Shipping Co.,
cracked its ballast tanks in the accident at about 4:15 p.m. yesterday,
said Stavros Hatzigrigoris, an official at Kristen Navigation, the
tanker\'s operator.

Bloomberg News 07:16 March 1, 2004

**Iraq Pipeline Sabotaged**

An Iraqi oil pipeline running between two refineries was on fire on
Friday after coming under

attack north of Baghdad, an official said. "We have dispatched crews to
put out the fire and assess the damage," an oil official told Reuters.
The pipeline runs from the Daura refinery near Baghdad north to the
Baiji plant through al-Jazeera, the Sunni area between the Tigris and
Euphrates rivers where most attacks against the US-led occupation forces
have come. Iraqi refineries have been raising output in the last two
months in an effort to beat petrol shortages. Sabotage has focused on
the north and targeting Iraq's internal network, running between oil
fields, refineries, and storage facilities, and the country's export
pipeline to Turkey, which has been shut since the war. A recent attack
on a pipeline near the holy Shiite city of Kerbala raised fears that
sabotage was spreading south. Oil Daily March 1, 2004

Nothing to report.

**Energy Prices**

+-------------------------------+-----------+-----------+------------+
|                               | **Latest  | **Week    | **Year     |
|                               | (         | Ago**     | Ago**      |
|                               | 3/1/04)** |           |            |
+-------------------------------+-----------+-----------+------------+
| **CRUDE OIL**                 | 36.68     | 35.61     | 36.76      |
|                               |           |           |            |
| **West Texas Intermediate     |           |           |            |
| US**                          |           |           |            |
|                               |           |           |            |
| \$/Barrel                     |           |           |            |
+-------------------------------+-----------+-----------+------------+
| **NATURAL GAS**               | 5.17      | 5.10      | 10.81      |
|                               |           |           |            |
| **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