Sep. 6--Gustav showed that hurricanes can even mess with Minnesota, when it forced the Republican National Convention to cancel some events earlier this week.

Now the Twin Cities' two main utilities are hoping approaching Tropical Storm Hanna and Hurricane Ike don't damage key natural gas facilities in the Gulf of Mexico and send winter heating costs soaring.

Storm damage there could spell the difference between paying only 10 percent more this winter and up to 50 percent more.

Hurricane Gustav slammed the Gulf region on Labor Day, shutting down oil and natural gas production. But the industry was better prepared this time than three years ago when hurricanes Katrina and Rita wrecked production facilities.

On Thursday, natural gas for October delivery rose 12.7 cents to $7.449 per million British thermal units on the New York Mercantile Exchange, as traders watched the paths of Hanna and Ike.

The Gulf of Mexico is home to about 14 percent of U.S. natural gas output, but Hanna and Ike are believed to be heading up the East Coast, away from most of the production.

"As far as the hurricanes we're seeing now, it's a wait-and-see attitude," Xcel Energy spokesman Tom Hoen said.

Late this spring, as the price of natural gas began to climb, local utilities warned that this coming winter's heating bills could be as much as 50 percent higher than last year. Natural gas accounts for about 80 percent of a typical heating bill, and fuel costs are passed along to

customers.

Usually, natural gas is cheaper in the summer, so the higher prices early on were unnerving.

Since then, the price of natural gas has plummeted, just as the price of oil has, from their July peaks.

Xcel Energy, which serves St. Paul and much of the East Metro area, saw a 26.5 percent drop in the price of natural gas since paying $11.66 cents per million British thermal units for July delivery, Hoen said.

That was good news because Xcel buys about a quarter of its winter heating gas in the summer, said Tim Carter, director of natural gas policy for Minneapolis-based Xcel.

CenterPoint Energy, the state's largest natural gas provider, with customers concentrated in Minneapolis and the West Metro area, watched prices plunge from the $12-to-$13-per million British thermal units range in July to $8 per million BTUs by mid-August.

"It's one of the biggest drops I've ever seen," said Joe Klenken, regulatory specialist for Houston-based CenterPoint. The utility buys about 10 percent of its winter heating gas in the summer.

However, one bad storm in the Gulf during the hurricane season could jack those estimated increases back up to 45 percent, CenterPoint Energy spokeswoman Becca Virden warned.

"We're telling our customers to be prepared for that," she said.

Leslie Brooks Suzukamo can be reached at 651-228-5475.

-----

To see more of the Pioneer Press, or to subscribe to the newspaper, go to http://www.twincities.com.

Copyright (c) 2008, Pioneer Press, St. Paul, Minn.

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

NYSE:XEL, NYSE:CNP,