Business briefs

U.S. rig count down 9 to 1,922
HOUSTON (AP) — Oilfield services company Baker Hughes Inc. says the number of rigs exploring for oil and natural gas in the U.S. declined by nine this week to 1,922.
The Houston firm said Friday in its weekly report that 1,591 rigs were exploring for oil and 330 for gas. One was listed as miscellaneous. A year ago there were 1,756 active rigs.
Of the major oil- and gas-producing states, West Virginia gained three rigs and California increased by one.
Alaska, New Mexico, Ohio and Texas each declined by two rigs while Colorado, Kansas and Oklahoma dropped one apiece.
Arkansas, Louisiana, North Dakota, Pennsylvania, Utah and Wyoming all were unchanged.
The U.S. rig count peaked at 4,530 in 1981 and bottomed at 488 in 1999.

Businesses won’t have to return BP spill payouts
NEW ORLEANS (AP) — A federal judge has ruled that BP must stand by the agreement made with the companies it compensated for losses after the 2010 Gulf oil spill despite the oil giant saying some claims were overestimated.
BP argued that a flawed funding formula enabled nearly 800 businesses to overestimate their spill-related claims.
One construction company hundreds of miles from the coast received $13.2 million, but deserved $4.8 million at most, BP said. Another company selling “animals and animal skins” was overpaid about $14 million, and about 50 others shouldn’t have been paid at all, the company said.
About 150 claimants should return a total of $185 million, and overpayments to the rest haven’t been calculated, attorney Kevin Downey argued.
U.S. District Judge Carl Barbier was not persuaded, thwarting BP’s latest attempt to control potential liabilities now approaching $50 billion.
The judge agreed weeks ago to change the compensation formula for any future payments, but ruled Oct. 1 that a deal is a deal when it comes to the money BP has already paid out. Under that deal, claimants agreed not to sue, and BP agreed that no future court action could change their payments.
“BP disagrees with today’s decision and will appeal it,” company spokesman Geoff Morrell said. “We asked the Court, as a matter of equity and fairness, to order the return of excessive payments.”

Regulator sought donation from California utility
SAN FRANCISCO (AP) — California’s largest utility has released an email saying the state’s top regulator privately asked the company to donate more than $1 million to support an environmental ballot initiative and a separate $100,000 to a celebration of the utility commission’s 100th anniversary.
Pacific Gas & Electric Co. said prosecutors have informed the utility that federal authorities are investigating the legality of five years of back-channel communications between PG&E and the utility commission, and an administrative law judge summoned a hearing Tuesday on earlier emails with top commission officials.
The U.S. attorney’s office said it would have no comment.
The email released Monday was the latest in a series released by the utility and others that allegedly show PG&E executives privately negotiating with California Public Utilities Commission officials on matters related to rate increases and financial penalties.
Consumer groups and others say the emails show too-cozy relations between the utility and regulators, and the commission says some of the private communications may have violated its own rules.
In one email released Monday, from May 2010, former PG&E Vice President Brian Cherry describes to PG&E colleagues a dinner he says he had just shared with commission President Michael Peevey.
“Mike stated very clearly that he expects PG&E to step up big and early” to oppose a ballot initiative that would have suspended the state’s historic climate change law, Cherry says in the email to another company executive. “Mike said ... we need to spend at least $1 million.”

ExxonMobil names Baton Rouge
plant manager
BATON ROUGE (AP) — ExxonMobil has named Bob Johnston as Baton Rouge chemical plant site manager, replacing Paul Stratford, who has begun a special assignment with the ExxonMobil Chemical Co.'s global operations.
Johnston was ExxonMobil's Beaumont chemical plant site manager in Texas since 2012.
Stratford, a native of Pennsylvania, worked as the Singapore chemical plant process manager, ExxonMobil Asia Pacific, before coming to Louisiana as Baton Rouge chemical plant manager in 2010.
Johnston is a native of Illinois and a chemical engineering graduate from the University of Illinois. He began his career with Exxon in 1987 in Linden, New Jersey.

U.S. predicts
lower heating
bills this winter
NEW YORK (AP) — Heating bills should be lower this winter because the deep freeze that chilled much of the nation last year is unlikely to return.
Last year, persistently low temperatures across the Midwest, South and East forced people to crank up the heat. The high demand jacked up the price of some fuels, especially propane. Heating bills soared.
This year, milder temperatures should reduce homeowners’ fuel use, according to the Energy Department’s annual prediction of winter heating costs. The price of propane and heating oil should be lower, helping those customers save even more.
“Temperatures are forecast to be warmer than last winter and that means less demand for heat,” said Adam Sieminski, administrator of the Energy Department’s Energy Information Administration, in a statement.
Lower energy costs give the economy a boost. This winter, some customers could see savings of nearly $800 on their heating bills, according to the EIA.
Gasoline prices are expected to soon drop below $3 per gallon on average in up to 30 states. Consumers will have more money to spend on other things, and consumer spending is 70 percent of the nation’s economy.
But it’s probably not wise to spend those hoped-for savings just yet. Some of the conditions that helped bring record-cold temperatures to the middle of the country still exist, according to Matt Rodgers of Commodity Weather Group, which forecasts weather and heating demand for energy companies.
The warm water in the North Pacific that helped push polar air south into the U.S. still remains, he says. There is also more moisture in the jet stream thanks to warmer water in the tropical Pacific that could generate more East Coast and Southeast snow.
The EIA, using forecasts from the National Oceanic and Atmospheric Administration, predicts the number of heating degree days — a measure of heating demand — will fall 12 percent this year.
Here’s the outlook for customers of the four most common heating fuels based on current forecasts.
NATURAL GAS
Nearly half the nation’s households heat with natural gas, and they will see a sharp increase in prices, especially in the Northeast. On average the retail price will rise 5.8 percent to $10.57 per 1,000 cubic feet. Northeast customers will see a rise of 6.8 percent, to $12.42 per 1,000 cubic feet, the highest in the country.
Natural gas wholesale prices are higher than they were last year, in part because last year’s cold winter drained gas in storage. Storage levels are 11 percent below their five-year average for this time of year. New England prices are higher because there is not enough space on existing pipelines to carry the increasing amount of gas needed in the region for heating and generating electricity.
The average natural gas bill for the October-to-March heating season is expected to fall, to $649 from $680 last year, because customers are expected to use less. Natural gas remains the cheapest heating fuel by far.
ELECTRICITY
Electricity prices are heavily influenced by natural gas prices, so they’re on the rise. But electricity customers should use less this winter, resulting in lower heating bills for many.
The natural gas pipeline constraints are pushing power prices sharply higher in the Northeast. The Energy Department predicts northeast power prices will rise 12 percent this winter. Electric utilities in Massachusetts and New Hampshire have warned customers that prices will rise up to 47 percent.
Average bills are expected to fall nationwide however, to $938 from $955. Thirty-nine percent of U.S. customers heat with electricity.
HEATING OIL
Heating oil customers will get a big break on their bills, both because of lower consumption and lower prices.
Lower global crude oil prices are helping push heating oil prices to their lowest level in four years. The Energy Department predicts the average price will be $3.63 per gallon, down from $3.88 last year.
Only 5 percent of U.S. households use heating oil, but they tend to be in very cold areas, especially in the Northeast.
Heating oil customers will pay $1,992 on average, $362 less than last year.
PROPANE
The propane market was thrown into chaos last year. Supplies were low going into the winter thanks to high demand for use in drying crops. Then the Midwest, where propane use is most prevalent, got socked by the cold, boosting demand even further.
Local distribution companies saw supplies fall sharply and prices skyrocketed.
The Energy Department says supplies going into this winter are higher than at any time since at least 1993 and demand is expected to be lower. That will lead to an average price of $1.99 per gallon in the Midwest, down 24 percent from last year’s record average of $2.61.
Propane customers in the Midwest will pay $1,500, a savings of $767.