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

**Office of Energy Assurance**

**ENERGY ASSURANCE DAILY**

**January 15, 2004**

**Highlights / Major Developments**

**Houston Channel Opens to Inbound Ships After Closure for Fog** The
Houston Ship Channel partially opened to traffic after fog halted
shipping for over 4 hours. The channel, which was closed at 12:15 am
Wednesday morning, was opened at 9:15 am for inbound traffic. Some
outbound vessels were allowed to leave yesterday, but the channel was
closed again at 2:30 pm. About 700 vessels, including oil tankers,
barges, and tugboats, transit the channel daily. Bloomberg News, 1204
January 15, 2004

**Maine's Governor Declares State of Emergency Over Heating Fuel
Deliveries**\
Due to a fear that fuel oil drivers may not be able to make critical
deliveries, the Governor of Maine issued a State of Emergency yesterday.
With the cold temperatures and high demand for heating fuels, "many
drivers in the state are approaching their federal limit on hours of
operation, and may have to cease deliveries." The Declaration states
that the "State of Emergency will facilitate the granting of a waiver
from the Federal Department of Transportation to allow fuel oil delivery
drivers to operate additional hours."\
<http://www.maine.gov/tools/whatsnew/index.php?id=1269&topic=Portal+News&v=Ar>

**NH also Waives Limits on Heating Fuels Drivers**

Commissioner Flynn, NH Dept of Safety, has issued an exemption for
delivery and transport truck drivers (delivering fuel from terminals to
fuel delivery companies), 60/70 hour rule only, with clock restart after
24 hours. This applies to drivers of propane, natural gas and \"heating
fuels\" trucks, effective January 16, 2004 and terminating January 25,
2004.

Joseph C. Broyles, Energy Program Manager, Office of Energy and
Planning, Concord, NH

**New England Spot Power Hits \$920/MWh Wednesday, Retreats Thursday on
Bearish EIA Stock Draw** Wholesale electric power prices for delivery in
New England for Thursday hit a high of \$920/MWh by 6:00 pm because of
bitter cold and high spot gas prices. A large amount of gas-fired
generation has been forced off-line in the region because of soaring gas
prices. \"These natural gas units cannot be run because of the price of
gas, currently at \$70,\" one New England industry source said. Prices
for spot gas a Algonquin city gate have reached \$74/MMbtu, the New
England Independent System Operator\'s morning report showed outages
totaling nearly 8,500 MW Wednesday, up from 4,855 MW from Tuesday.
<http://www.platts.com/stories/electricpower4.html> Reuters, 1248,
January 15, 2004 Bloomberg News, 1318 and 1409, January 15, 2004

**ISO New England Requests Voluntary Electricity Conservation** ISO New
England Inc., operator of the region\'s bulk electric power grid,
requested electric customers across New England to take voluntary steps
to conserve electricity Wednesday evening until 8:00 p.m. and all day
today, January 15, 2004. This electricity conservation request is
voluntary. Due to extremely cold temperatures, regional electricity
demand is expected to set a new winter-peak. In addition, the severe
weather conditions have created high demand for natural gas which has
impacted a large number of gas-fired power plants operating in the
region..

ISO New England Inc., reported in Business Wire and Reuters January 14,
2004

**Hydro-Quebec Asks Customers to Cut Back on Power Use** Quebec set
records for power demand amid brutal cold the past few days. The weather
was some of the coldest in decades. Yesterday, Hydro-Quebec\'s 3.6
million customers used a record 35,137 megawatts of electricity,
breaking the previous high of 34,989 MW set on Jan. 22, 2003
Hydro-Quebec said it has seen two consecutive days of such severe cold
only three times in the past 60 years. Meteorologists forecast
temperatures in Quebec City would reach a high of just minus 23 degrees
C (-10 F) on Wednesday and Thursday with the wind chill making it feel
more like minus 40 (-40 F) both days. To help meet energy demand, the
province bought electricity from neighboring utilities in the United
States and Canada. Hydro-Quebec is one of the biggest power generators
in North America with some 33,000 MW of mostly hydroelectric capacity.
Over the weekend, meteorologists forecast high temperatures would rise
to a more normal minus 12 to minus 14 degrees (7-10 F).
[http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8knpp%5EZgnmopqvWTif%7D38%7Dbfej%5Bv](http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8knpp^ZgnmopqvWTif}38}bfej%5Bv)

**U.S. Northeast Sets Winter Electricity Demand Records Amid Cold** Some
of the records set yesterday are expected to be broken again today. ISO
-- New England and ISO -- New York both set new winter demands for
electricity yesterday. Prices at Transco gas pipeline's zone 6 which
shot up over \$47/ Million Btu yesterday dropped by about 50% today as
the extremely high prices scared away demand. Bloomberg News, 1143 and
1318, January 15, 2004

**ConEd, PSE&G Cut Gas Service to Industrial Users** Utilities owned by
Consolidated Edison in New York and Public Service Enterprise Group in
New Jersey cut natural gas service to almost 1,000 industrial customers
after frigid temperatures sent demand soaring. Bloomberg News, 1355
January 15, 2004

**Electricity**

See highlights and below.

Cable Failure Caused Calif. Power Outage; Power Restored

Thousands of people in parts of San Francisco were without electricity
this morning (Wednesday) after an underground cable failed. A spokesman
with Pacific Gas and Electric, or PG&E, says about 7,600 customers in
parts of the Noe Valley, the Castro District and the Mission District
lost their power around 6:40 a.m. CST. PG&E says the power was
completely restored at 8:10 a.m. CST. The utility is still investigating
why the underground cable failed.

<http://online.wsj.com/article/0,,BT_CO_20040114_005116,00.html>

**Jim Bridger 560 MW Coal-fired Plant in Wyoming Tripped Mid-day
Wednesday** One of Pacificorp's four Jim Bridger Coal-fired plants in
Wyoming tripped about noon yesterday and by this morning was up and
running normally. Genscape Overnight Update, January 15, 2004

Five Studying Coal-Fired Power Plant In ND, SD Or Iowa

Five electric utilities have formed a coalition to study the idea of a
\$1.5 billion coal-fired power plant in North Dakota, South Dakota or
Iowa. Officials from Montana-Dakota Utilities, Basin Electric Power
Cooperative (BEP.XX), Minnkota Power Cooperative, Heartland Consumers
Power District and Missouri River Energy Services made the announcement
Wednesday. Dan Sharp, a spokesman for Bismarck-based MDU Resources Group
Inc., MDU\'s parent company (MDU), said the areas being considered for
the 600-megawatt coal-fired power plant are Gascoyne and Stanton in
North Dakota; Mobridge and Yankton in South Dakota and Modale, Iowa.
Officials said a site could be chosen within a year.

<http://online.wsj.com/article/0,,BT_CO_20040115_004344,00.html>

**Petroleum**

**See highlights.**

**Natural Gas**

**See highlights and below.**

**Mitsubishi to Start Building LNG Terminal Near Los Angeles in 2004 -
Report**

Mitsubishi Corp will start building a liquefied natural gas (LNG)
terminal near Los Angeles in 2004, the Nihon Keizai Shimbun reported,
without citing sources. The terminal, which is scheduled to begin
operating in 2008, will likely be the first terminal to receive LNG on
the US West Coast. It is expected to help relieve California\'s gas
shortage by bringing in LNG from Asia and South America, the newspaper
reported. The Japanese trading company plans to file an application to
build the terminal with the Federal Energy Regulatory Commission (FERC)
this month after consulting with the commission jointly with the Long
Beach Port Authority. The company now believes that FERC will issue an
approval by October 2004, the report added. Nihon Keizai Shimbun
newspaper, reported by China's Xinhua Financial News, January 14, 2004

**El Paso Wins U.S. Approval for Gulf Gas Transfer Port** El Paso Corp,
owner of the largest U.S. network of natural gas pipelines, won approval
to build a port in the Gulf of Mexico to transfer liquid gas from
tankers to pipelines. The port will be built 116 miles south of New
Orleans. Bloomberg News, 1353, January 15, 2004

**Other News**

**Power Plant Security Increased at Florida Power Plants** Antiterrorism
officers armed with 9 mm handguns, AR-15 semiautomatic rifles and
12-gauge shotguns now patrol power plants at Tampa Electric Co. in
Florida. The specially trained security force of about 32 began guarding
the utility\'s Big Bend, Gannon/Bayside and Polk power stations and
other facilities Sunday, January 11, to ensure the lights stay on in the
company\'s 2,000- square-mile territory in Hillsborough County and parts
of Pinellas, Pasco and Polk counties. They\'ll be deployed around the
clock. Tampa Electric spokesperson Ross Bannister said the heightened
security is the result of a greater emphasis on protecting the
company\'s infrastructure rather than any specific threats.
[http://hsweb01.screamingmedia.com/PMA/pma_newsarticle1_krt.h
tm?SMDOCID=knightridder_2004_01_13_krtbn_0000-0167-TM-UTILIT
Y-SECURITY&SMContentSet=0](http://hsweb01.screamingmedia.com/PMA/pma_newsarticle1_krt.htm?SMDOCID=knightridder_2004_01_13_krtbn_0000-0167-TM-UTILITY-SECURITY&SMContentSet=0)

**U.S. Court Rejects Bid to Halt FERC on Grid Rules** Southern Co., the
largest U.S. utility owner, and the states of Mississippi and Alabama,
lost a bid to block a FERC ruling that gives some power producers easier
access to the transmission grid. Bloomberg News, 1125, January 15, 2004

**Energy Prices**

+-------------------------------+-----------+-----------+------------+
|                               | **Latest  | **Week    | **Year     |
|                               | (1        | Ago**     | Ago**      |
|                               | /15/04)** |           |            |
+-------------------------------+-----------+-----------+------------+
| **CRUDE OIL**                 | 33.61     | 34.27     | 33.23      |
|                               |           |           |            |
| **West Texas Intermediate     |           |           |            |
| US**                          |           |           |            |
|                               |           |           |            |
| \$/Barrel                     |           |           |            |
+-------------------------------+-----------+-----------+------------+
| **NATURAL GAS**               | 6.02      | 6.41      | 5.21       |
|                               |           |           |            |
| **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)

Last Updated on January 14, 2004

**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)

Last Updated on January 15, 2004