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In Gas Price Spike, CenterPoint Conserves as Jones’ Company Notes Price Jump

4 min read

As natural gas prices skyrocketed in a winter power crisis and Dallas Cowboys owner Jerry Jones’ production company benefited from the price spike, gas utility CenterPoint Energy pleaded with customers to continue to conserve even as polar temperatures rise above freezing in many states for the first time in over a week.

CenterPoint wants customers, at least through Monday, to set their thermostats at 60 to 65 degrees while they’re awake and at home, and at 55 to 60 degrees when asleep or away from home.

The utility is seeking to continue reducing a demand spike that in some desperate areas made gas 150 times costlier than it was before.

“Even though temperatures are beginning to warm up, the extreme winter weather and high heating demand across many parts of the U.S. during the past week have put pressure on natural gas supplies,” CenterPoint, based in Houston, said in a news release from its Little Rock office early Friday. 

Customers enduring a bit chillier weekend “can help relieve demand on natural gas supplies so all customers may continue to receive gas service,” CenterPoint said.

It offers conservation tips online here.

Conservation could also save customers some shock when they see their bill for this period. Shocking spikes have driven hard-hit municipal gas customers like the town of Winfield, Kansas, to seek government relief. The town of 12,000 southeast of Wichita usually spends $1.6 million a year on natural gas; over the recent brutal cold, the bill was $10 million over six days, KSNW-TV of Wichita reported. “How does a community the size of Winfield pay for that?” Mayor Taggart Wall asked. He’s pleading for relief from Kansas and federal authorities.

This week’s electric power crisis, which forced rolling blackouts and caused a devastating disaster of broken water pipes and insurance claims, not to mention millions of people going without power and water for days in Texas, added pressure in the natural gas market as power generators desperately bid for fuel to run generators.

All of this, however, was at least a momentary boon for Arkansas native oil and gas man Jones, who made a multimillion-dollar fortune in the Arkoma Basin gas fields before buying the Cowboys in 1989.

Jones is the majority stockholder in Comstock Resources Inc., a publicly traded shale drilling company working in Texas and Louisiana that was already ramping up production in anticipation of higher gas prices. In the words of President and Chief Financial Officer Roland Burns, “this week is like hitting the jackpot,” NPR reported.

The frigid snowstorms that swept most of the nation cut gas supplies exactly at a time of peak demand, when utilities like CenterPoint are delivering more gas for home heating. As other operators cursed frozen wells and pipelines, Comstock reaped “super-premium prices” of  $15 per thousand cubic feet to as much as $179 per thousand cubic feet, Comstock reported. Last quarter, Comstock’s average price was $2.40 per thousand cubic feet.

However, one Comstock investor, Tim Pinter of Little Rock, pointed out Monday that the price spike was trasitory, and that natural gas prices have been low for years. “Any long term stockholder has hardly made any large profit,” he said in an email, noting that prices “shot up due to the shortage and extreme use — again, supply and demand.” He said the company got little sympathy when gas was selling for less than $2 per million BTU for most of 2020 and less thn $3 for the past three years. “This was a spike for a few days,” Pinter said in an email. “The price is already pretty much back to where it was in early February.”

Also Friday, Central Arkansas Water appealed for conservation as the ground warms and water pipes begin to thaw. The utility has no issues with water availability from the lakes it draws from, but it fears pressure losses as pipe breaks cause leaks, several of which were discovered overnight Thursday into Friday morning.

“Many of these breaks were in commercial buildings that have been unoccupied during this weather event,” the utility said in a bulletin. “CAW expects to see numerous breaks as the temperature changes over the coming days, exposing leaks or creating new leaks.” As they appear, “substantial water losses” make it harder to fill the system fast enough to keep up with customer demand. Crews are now fixing known leaks, and 140 employees were dispatched to that task at daybreak Friday, CAW said.

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