A new natural gas well discovered in Oklahoma last week by Washington Gas Light Co. is producing almost one-tenth the amount of gas the company's customers consume on cold winter days like today, company officials disclosed yesterday.
News of the major gas discovery set off a gusher of interest in Washington Gas stock, and a record 169,000 shares changed hands yesterday on the New York Stock Exchange.
There were so many orders to buy the stock that trading had to be suspended for a while. The stock opened at $29 a share and closed at $31.25 after sales resumed later in the day.
Normally only about 1,500 shares of the Washington utility are bought and sold each day. The stock was trading for only $19.50 a share last Friday; since then it has jumped almost $12 a share.
Many long-time shareholders apparently have unloaded the stock to take advantage of the sudden jump in price, while speculators are purchasing the shares in hope the stock will go still higher.
Washington Gas spokesman Paul Young said the company "has received numerous requests for additional information about the discovery since the announcement last Sunday."
The well already is delivering gas to two pipelines but is putting out so much gas that not all of it can be used, Younger said. Part of the gas now is being "flared" or burned, but all of it will be captured as soon as a third pipeline can be connected.
Despite mechanical and weather problems, the well -- in Caddo Country, Okla. -- has produced gas intermittently at rates between 40 million cubic feet and 70 million cubic feet a day.
Indications are the well potentially could yield 75 million to 100 million cubic feet a day, said Young. The gas company's customers are burning 700 million to 750 million cubic feet of gas daily in this weather, he added.
A Washington Gas subsidiary, Crab Run Gas Co., owns 19 percent of the well in partnership with other companies.
The Oklahoma well will not supply gas directly to customers in the Washington area but should indirectly benefit local consumers, said Brian Lederer, District of Columbia People's Counsel, who represents the public on utility issues.
If, as expected, Crab Run makes money on the well, it will improve the profits of Washington Gas Light and reduce the need for raising local gas rates, he said. One reason the company has received rate increases recently is that Crab Run and other non-utility subsidiaries have lost money. "The ratepayers have been carrying these subsidiaries for years through the credit of the gas business, and they ought to get some of the benefit," Lederer said.
Young said, however, that the subsidiary was financed by Washington Gas's stockholders, not consumers, and "stockholders will get the benefits."