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TURN-AROUND IN NATURAL GAS MARKET EXPECTED TO IMPACT WINTER PRICES

 TURN-AROUND IN NATURAL GAS MARKET
 EXPECTED TO IMPACT WINTER PRICES
 CLEVELAND, Sept. 28 /PRNewswire/ -- After a 23 percent decline in natural gas prices over the past three years, East Ohio Gas customers can expect to see price increases following a recent nationwide surge in the cost of natural gas.
 Since late August, natural gas prices nationally have increased 79 cents per 1,000 cubic feet (Mcf) or 42 percent, reaching their highest level ever since the inception of the natural gas futures market in 1990. Locally, East Ohio Gas customers have seen price decreases totaling more than 80 cents (Mcf) since November of 1989. That price break may be over.
 Patrick A. Carney, vice president of public affairs, cites a dissipation in the so-called gas "bubble" as a reason for increased prices, noting that supply and demand are coming into balance.
 The price increases are also attributed to a tightening of supplies in the natural gas market nationwide due to increased natural gas demand for electric generation in the Southwest, lower than normal storage inventories, restructuring of the interstate pipeline network and supply interruptions due to Hurricane Andrew, Carney said.
 Like gas utility customers nationwide, East Ohio Gas customers have become accustomed to declining natural gas prices over the past three years. Wellhead prices had declined nationally, as three straight warmer-than-normal winters resulted in abundant natural gas supplies on a year-round basis. Increased supplies on the national market, in the face of lower-than-normal demand, drove natural gas prices lower and producers responded to lower prices by cutting natural gas production on wells when market prices fell below profitable levels.
 However, even with national price fluctuations, decreases in the Gas Cost Recovery (GCR) portion of East Ohio Gas customer bills over the last 12 quarters, brought the company's current gas costs to their lowest level since fall 1981. The quarterly GCR adjustments reflect the actual cost of gas purchased. The company does not make a profit on the GCR. The company will file its winter GCR adjustment on Oct. 6.
 Carney assured all East Ohio Gas customers that there is an adequate and reliable supply of natural gas for the 1992-93 winter heating season. The company has worked over the years to build a diverse supplier network and storage facilities, which enable the company to maintain reliable natural gas supplies for its customers.
 Cleveland-based East Ohio Gas is the largest subsidiary of Consolidated Natural Gas, headquartered in Pittsburgh. The 2,500 employees of East Ohio Gas serve more than one million customers in northeast Ohio.
 -0- 9/28/92
 /CONTACT: Terry Uhl of East Ohio Gas, 216-736-6222 or 800-556-4400, toll-free in Ohio/ CO: East Ohio Gas Company ST: Ohio IN: UTI SU:


KK -- CL006 -- 4027 09/28/92 14:45 EDT
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Publication:PR Newswire
Date:Sep 28, 1992
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