Houston (Platts)--23Apr2009

Spot natural gas prices in California and in the Southwest on Thursday
fell by up to 10 cents compared with Wednesday as fundamentals and futures
markets lended no support.

Pacific Gas and Electric city-gate prices were the exception to the
downward trend, rising a couple of cents to average in the upper $3.20s/MMBtu
on the IntercontinentalExchange, more than 35 cents over Malin, Oregon, which
lost about a cent.

"Trading was pretty flat, another ho-hum day until the [US Energy
Information Administration] storage report came out on the high side, bringing
prices down late," a trader said, adding that the market "fell apart" when the
46-Bcf net storage injection came out for the week that ended Friday.

Southern California Gas' city-gate premium to Kern River Gas
Transmission-delivered stayed at around 5 cents as the city-gate averaged in
the mid-$2.90s/MMBtu for a loss of nearly 10 cents.

There was more than usual variation in prices at the SoCal Gas border
point, as SoCal Gas Ehrenberg averaged in the low $2.90s/MMBtu, about 5 cents
below SoCal Gas Needles--with both losing around 5 cents.

As Phoenix weather moderates from 100-degree temperatures over the last
few days, prices at El Paso Natural Gas' south mainline averaged with
Ehrenberg for a loss of more than 5 cents.

In the production basins, El Paso in the Permian Basin prices fell about
5 cents to average in the low $2.80s/MMBtu, while El Paso-San Juan's discount
to Permian came in to less than 10 cents as San Juan gained a couple of cents.

--Tom Castleman, tom_castleman@platts.com