El Paso Corporation (EP)

[rayrohn]

El Paso: Station Outage Halts Pipeline Deliveries -2-
Last update: 9/17/2007 2:38:48 PM

HOUSTON (Dow Jones)--An outage at El Paso Corp's (EP) Cheyenne Plains Compressor Station on Sunday has completely cut off deliveries on the Wyoming Interstate Company and Colorado Interstate Company gas pipelines, the company said in a Web posting Monday.

An analyst said gas futures traders on the New York Mercantile Exchange floor were viewing the outage as a potential threat to the amount of gas available to be injected into storage, driving futures prices higher.

"The primary impact potential depends on how long the primary outage is," a trader said. "It could affect injections into storage over next 30 days."

That idea was sending prices skyrocketing Monday afternoon. The front-month Nymex October natural gas futures contract was trading 33.3 cents higher, or more than 5%, at $6.610 a million British thermal.

Other market watchers said traders were "buying a rumor."
"In reality, it doesn't really have an impact," said a trader.

Shippers on those pipelines which run from Wyoming to Kansas include Anadarko Petroleum Corp (APC), BP PLC (BP) and ConocoPhillips (COP), among a host of others, according to the company's Web site.

Equipment that enables gas to flow into the Cheyenne Plains pipeline was damaged, said Richard Wheatley, an El Paso spokesman.

At the time of the incident, approximately 780 million cubic feet per day of natural gas was being transported from the Cheyenne Hub into the Cheyenne Plains Pipeline, he added.