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

**Office of Energy Assurance**

**ENERGY ASSURANCE DAILY**

**September 28, 2004**

**Highlights/Major Developments**

**Crude Under \$50, but Still at a Record**\
Crude-oil futures closed under the key \$50-per-barrel level Tuesday,
but still marked a third record session with most analysts expecting
updates on U.S. petroleum inventories this week to show another round of
hefty declines The price climb was tempered a bit by some expectations
that supply concerns will ease following Saudi Arabia\'s promise to
boost output. Crude for November delivery climbed to a high of \$50.47
on the New York Mercantile Exchange. The contract then pulled back to
close at \$49.90, up 26 cents for the session.
[http://www.marketwatch.com/news/yhoo/story.asp?source=blq/yhoo&siteid=yhoo&dist=yhoo&guid=%7BD3AB8DB5%2D0DD9%2D45AB%2DA1CA%2D50F8081A7F45%7D](http://www.marketwatch.com/news/yhoo/story.asp?source=blq/yhoo&siteid=yhoo&dist=yhoo&guid={D3AB8DB5-0DD9-45AB-A1CA-50F8081A7F45})

### Gasoline Price Up 5.1 Cents, Diesel Hits Record Rising crude oil costs are taking a toll on U.S. consumers, as the national price for gasoline jumped 5.1 cents a gallon over the last week and diesel fuel hit a record high, the government said on Monday. The price at the pump for regular unleaded gasoline averaged \$1.917 a gallon, the highest since mid-July and up 33 cents from a year ago, according to the U.S. Energy Information Administration\'s weekly survey of service stations. [**http://news.yahoo.com/news?tmpl=story&u=/nm/20040927/us_nm/energy_gasoline_price_dc_1**](http://news.yahoo.com/news?tmpl=story&u=/nm/20040927/us_nm/energy_gasoline_price_dc_1)

**Hurricane Jeanne Information**

See the Hurricane Jeanne situation reports on the Office of Energy
Assurance website to get details on the number of power outages and the
status of the oil and gas infrastructure and the fuel situation in
Florida. A summary is copied below. For the full report and to see past
reports see <http://www.ea.doe.gov/hurricane_jeanne.html>

# ELECTRICITY Highlights for Hurricane Jeanne

# 

# • Currently, 1,267,339 customers in Florida remain without power. Georgia reports approximately 8,000 customers without power. No updates for North Carolina or South Carolina at this time. Outages from Hurricane Ivan have been reduced to 36,277. 

• Crews from out of state continue to assist Florida utilities with
their restoration efforts. Progress Energy expects that by Saturday,
more than 7,500 people from 33 states and Canada will be working to
restore power.

• Florida Power and Light reports that the total number of customers
restored now stands at 1,158,800 out of 1,737,400 total customers
impacted.

• Progress Energy reports 281,426 (18%) customers are without power,
down from a peak of 722,000. For Progress Energy Florida customers
affected by Hurricane Jeanne, the utility expects to restore power by
midnight Sunday to all customers capable of receiving power. Progress
Energy has more than 5,700 personnel working in the field to restore
power to customers. By Saturday, more than 7,500 people from 33 states
and Canada will be working to restore power.

• Tampa Electric reports 122,900 (20%) customer outages down from a peak
of 285,000. Tampa Electric expects to restore 95 percent of the
remaining customers by Sunday.

• Outages for Florida municipals are at 165,750, while cooperatives
report outages of 118,713 customers.

• Of the 8,000 outages in Georgia, Georgia Power has 1,511 customers
without power and EMC reports 6,000 customer outages. Recovery efforts
in GA have been very rapid.

#### OIL & GAS Highlights for Hurricane Jeanne

1.  

# • EPA extended the deadline in FL to October 5, allowing the use of high-sulfur diesel for on- road use.

There are also many press reports on damage and restoration efforts in
the aftermath of Hurricane Jeanne. Some of these referring to
restoration efforts are summarized below. The information reported in
the Energy Assurance Daily above does not come from press reports, but
comes from information collected from the Florida State Emergency
Operations Center and by other Federal, State and local officials
monitoring and coordinating response and restoration efforts. []{.mark}

**Progress Energy Expects to Restore Power to All Customers by Midnight
Sunday**
<http://www.progress-energy.com/aboutenergy/stormcentral/index.asp>

**Progress Energy's Power Outage Map** (Click on link below.) [View
Florida outage map by
county](http://www.progress-energy.com/aboutenergy/stormcentral/outagemaps/flaindex.asp)

**Tampa Electric Working to Restore Power**
http://biz.yahoo.com/prnews/040928/fltu022_1.html

**Florida Power and Light and Power Restoration** <http://www.fpl.com/>

**Electricity**

**All Four La Paloma Gas-Fired Plants in CA Back On-line Monday
Evening**\
All four units at the La Paloma gas-fired plant in California returned
to service on Monday evening, a plant spokesman said on Tuesday. The
units, which have a total capacity of about 961 MW, were shut down early
Monday due to a problem with the plant\'s ammonia system. Reuters, 1526
September 28, 2004

### FPL to Restart Florida Generators Idled by Hurricane Jeanne

The oil- and gas-fired units shutdown at the Riviera and Martin power
stations can produce 3,400 megawatts, enough power for 2.72 million
average U.S. homes. The shutdowns forced FPL to hold back about 250
megawatts of power from industrial customers Monday.

Bloomberg News, 1342 September 28, 2004

**PSEG Salem 1 Nuke Exits Outage**

In New Jersey, PSEG\'s Salem 1 nuke exited a short-term outage and
ramped up to 19 percent of capacity by early Tuesday. The company shut
the unit on Sept. 25 to work on part of the feed water system. Reuters,
1413 September 28, 2004

# Entergy Shuts Arkansas 2 Nuke

Entergy shut down the plant to repair a small crack in a weld on the
non-nuclear side of the plant. A spokesman at the company would not
comment on how long the unit would likely remain shut. Electricity
traders guessed the unit would return within a week.

Reuters, 1413 September 28, 2004

# 4 OPG Power Plants in Ontario Restart

OPG's Pickering 8 nuke, Lambton 3, and Lakeview 2 and 6 coal units had
been shut for short-term outages.

Reuters, 1413 September 28, 2004

# Duke\'s Calif. Moss Landing 7 Power Unit Shut

Duke Energy Corp.\'s 755-megawatt Moss Landing 7 natural gas-fired power
unit in California shut for an unplanned outage by late Monday, the
California Independent System Operator said in a report. The unit was
available for service early on Sept. 27 after exiting an outage begun on
Sept. 21 due to a tube leak in a startup auxiliary boiler.

Reuters, 0928 September 28, 2004

# 

# Sempra Shuts Down Mexicali Plant Again

<http://pro.energycentral.com/professional/news/power/news_article.cfm?id=5146583>

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### Wind Power Draws Interest as Practical Way to Diversify Energy Supplies PSE is paving the road, by announcing last week that it would pay up to \$300 million for the proposed Wild Horse Wind Power Project near Ellensburg. The purchase makes PSE the first utility in the state to buy a wind farm. And the Bellevue-based utility is just one of many in the Northwest trying to fulfill demand for power through wind, said Barrett Stambler, director of renewable business development of PPM Energy, which sells power. Portland General Electric, PacifiCorp and Avista also are looking for renewable power sources, he said. In all, he estimates, the utilities want to acquire about 2,500 megawatts by 2010. [**http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8knpp%5EZjrqrvwtUUmi%27%40%3E%20bfej%5B%21**](http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8knpp^ZjrqrvwtUUmi'@> bfej%5B!)

**Petroleum**

**29% of Oil Production from Gulf of Mexico is Still Shut-in Two Weeks
After Ivan** <http://www.mms.gov/ooc/press/2004/press0928.htm>

[**Iraqi Reservoir Damage May Be
Long-Lasting**](http://www.energyintel.com/DocumentDetail.asp?document_id=131706)\
Iraq\'s leading oil field, Kirkuk, may have suffered irreparable damage
to its reservoir as a result of the reinjection of fuel oil, refinery
residue and gas-stripped oil over the last 15 years, according to Iraqi
industry sources. The reinjected products may amount to some 1.5 billion
barrels. The practice, widespread under the former regime of Saddam
Hussein, is still continuing, as Iraq struggles to balance its product
needs.

International Oil Daily, September 28, 2004

[**Shell Denies Production Losses as Tension Flares in
Nigeria**](http://www.energyintel.com/DocumentDetail.asp?document_id=131730)\
Royal Dutch/Shell on Monday denied reports that it has cut oil
production in Nigeria as a result of recent clashes between police and
militia forces north of Port Harcourt, home to its eastern division
operations. International Oil Daily, September 28, 2004

**Pogo Oil, Gas Output Still Off from Ivan**

Pogo Producing Co. said on Tuesday a \"meaningful\" part of its Gulf of
Mexico oil and natural gas production was still off line because of
damage caused by Hurricane Ivan. Pogo, which suspended offshore Gulf of
Mexico production on Sept. 14, estimated its third-quarter production
will be reduced by about 900 million cubic feet of natural gas and
400,000 barrels of oil due to the storm.

Reuters, 1154 September 28, 2004

# Valero Weighs Expansion of Aruba Refinery

Valero Energy Corp. is considering boosting the capacity of its Aruba
refinery to as much as 800,000 barrels per day from the present 225,000,
company executives said in a conference call on Tuesday. If it becomes a
retail products producer, it will be expanded to 800,000 bpd, Kleese
said. The expansion could take up to seven years and cost \$6 billion
and would require the addition of two gasoline-producing catalytic
cracking units, he said. Currently, the largest refinery is Venezuela\'s
Paraguana Refining Center with 940,000 bpd processing capacity. The
largest U.S. refinery is Exxon Mobil Corp.\'s 557,000 bpd Baytown,
Texas, plant.

Reuters, 1153 September 28, 2004

# Saudi Ready to Pump over 9.5 mbpd in Oct if Needed

OPEC power Saudi Arabia stands ready to pump more than 9.5 million
barrels per day (bpd) next month if customers require extra crude oil, a
Gulf source said on Tuesday.

Reuters, 0757 September 28, 2004

**Natural Gas**

# About 19% of Daily Production of Natural Gas in Gulf of Mexico is Still Shut-in

<http://www.mms.gov/ooc/press/2004/press0928.htm>

**Other News**

**Tesoro Opens its Own Power Generating Plant**\
Hoping to avoid major problems caused by power outages, Utah\'s largest
oil refinery has become \"electricity\" independent. Tesoro\'s own
\$25-million generating plant is now powering its Beck Street refinery.
With a ribbon cutting and much fanfare, Tesoro today dedicated the new
generating plant. And though the refinery here won\'t be depending on
Utah Power anymore, Utah Power and PacifiCorp are applauding the move.
<http://tv.ksl.com/index.php?nid=5&sid=122295>

**Energy Prices**

+-------------------------------+-----------+-----------+------------+
|                               | **Latest  | **Week    | **Year     |
|                               | (9        | Ago**     | Ago**      |
|                               | /28/04)** |           |            |
+-------------------------------+-----------+-----------+------------+
| **CRUDE OIL**                 | 49.90     | 47.11     | 28.21      |
|                               |           |           |            |
| **West Texas Intermediate     |           |           |            |
| US**                          |           |           |            |
|                               |           |           |            |
| \$/Barrel                     |           |           |            |
+-------------------------------+-----------+-----------+------------+
| **NATURAL GAS**               | 5.24      | 5.43      | 4.42       |
|                               |           |           |            |
| **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