Mitsui Indonesia Gas BV, a wholly owned unit of Mitsui & Co. Ltd., agreed to acquire BG Group's 50% interest in the Muturi production-sharing contract (PSC) in West Papua, Indonesia, for $236 million.
BG's interest in the Muturi PSC provides it with a 10.73% interest in the Tangguh LNG project, based on independently certified proved reserves. The deal is expected to become effective Jan. 1.
In other upstream news:
- Exco Resources Inc., Dallas, announced plans to acquire North Coast Energy Inc., Twinsburg, Ohio, in a tender offer worth about $164 million, or $10.75/share.
- Banco Santander Central Hispano SA (SCH) said the Netherlands Arbitrage Institute has ruled against the bank and in favor of Total SA regarding control of Spanish integrated oil company CEPSA Group.
In midstream, pipeline news:
- Enbridge Energy Partners LP, Houston, has agreed to acquire natural gas gathering and processing assets in North Texas from Cantera Resources Inc., an affiliate of Morgan Stanley Capital Partners, for $247 million.
Kinder Morgan Energy Partners LP (KMEP).acquired a 172 mile portion of a Texas pipeline from TEPPCO Partners LP for $30 million. KMEP intends to convert the line from oil to natural gas, which will serve Austin, Texas.
In contractor news:
- Oceaneering International Inc., Houston, recently announced two separate deals to buy remotely operated vehicles (ROVs) from Subsea 7 Group and Stolt Offshore SA, London. Together, the deals are worth $158 million. Subsea 7 is selling part of its UK-based remote technology operation.
- Unit Corp., Tulsa, acquired privately held Serdrilco Inc., Tulsa, and its subsidiary, Service Drilling Southwest LLC, a land drilling company based in Borger, Tex., for $35 million.
Mitsui Indonesia
BG estimates the "book value" of its investment in the Muturi PSC, which has not yet started production, at $103 million.
"Tangguh is a good project for the remaining owners, but our scope for influencing the technical and commercial development—core strengths of BG—has always been limited," said Dave Roberts, BG executive vice-president and managing director, Eastern Hemisphere.
The transaction is subject to Indonesian governmental approval and the waiver of preemption rights by the other Muturi PSC partners.
The other PSC partners are CNOOC Muturi Ltd. 44%, BP Muturi Holdings BV 1%, and Indonesia Natural Gas Resources Muturi Inc. (LNG Japan) 5%.
Exco
Exco's offer remains subject to the tender of shares representing at least 90% of North Coast Energy's total outstanding shares.
Nuon Energy & Water Investments Inc., which holds 86% of North Coast Energy's issued common stock, already agreed to tender its shares. The transaction is expected to close by Feb. 1, 2004.
Exco is a private company with principal operations in Texas, Louisiana, Colorado, and Alberta. North Coast Energy is a publicly traded independent focused on Appalachian basin gas.
Total-CEPSA
Total had requested arbitration, claiming that SCH violated a shareholder pact when it launched a bid in September for an additional 16% of CEPSA without consent of all the parties (OGJ Online, Oct. 14, 2003).
SCH's bid ended Nov. 24 with only 12.13% acquired.
Previously, SCH argued that new Spanish corporate governance law invalidated the shareholder pact. But Total argued that the pact remains in force.
On Nov. 25, the court asked the Spanish bank and Total to jointly manage their shareholders in CEPSA under the disputed shareholders pact, SCH said.
Total owns 45% of CEPSA. It owns 37% directly and 8.3% through holding company Somaen Dos SL. SCH owns 30% of CEPSA through Somaen Dos. Arbitrators froze the bank's 20% stake as well as the newly acquired 12.13% stake.
Enbridge
Enbridge Partners anticipates that the Cantera Resources acquisition will close by Dec. 31, subject to regulatory approvals. After closing, Enbridge Partners plans to name the facilities the North Texas System.
The system primarily serves the Fort Worth basin, including growing production from the Barnett Shale zone. Natural gas throughput on the system averages 170 MMcfd.
The transaction involves more than 2,000 miles of gas gathering pipeline and five active processing plants having an aggregate capacity of 217 MMcfd of gas.
Kinder Morgan
KMEP intends to convert the line from oil to natural gas, and also plans to construct a 5 mile lateral for the line.
The 24-in. intrastate natural gas pipeline will operate between Katy, Tex., and Austin, and the system will provide an additional 170 MMcfd to Austin.
Austin Energy, the city-owned electric utility, has entered into a long-term contract for firm transportation and storage services, primarily to provide gas supply to its Sand Hill power plant, which is now being expanded to 480 Mw from 180 Mw. A natural gas local distribution company also signed a long-term contract to support the project.
KMEP's Texas intrastate gas pipeline group comprises about 5,800 miles of pipeline with a peak capacity of about 5 bcfd of gas and more than 30 bcf of gas storage capacity.
Oceaneering
Oceaneering International agreed to acquire 82 ROVs from Subsea 7 for $108 million. Subject to a satisfactory due diligence review, the transaction is expected to close in early 2004.
Subsea 7 was formed in 2002 as a result as a joint venture combining Halliburton subsea activities and DSND Subsea ASA business.
In another deal, Oceaneering agreed to buy an ROV fleet, along with related contracts, from Stolt Offshore for $50 million. The transaction remains subject to a due diligence review.
Stolt Offshore CEO Tom Ehret said, "This sale is part of our program of disposals of noncore assets and businesses. It includes drill support ROVs and contracts in place in the North Sea, the Americas, and West Africa."
Unit
Unit's purchase of Serdrilco included an earn-out provision allowing the sellers to obtain 50% of the cash flow in excess of $10 million for each of the next 3 years.
Serdrilco had 12 rigs, a 12-truck moving fleet, inventory, and other equipment. The transaction closed in early December. Serdrilco operated in the Texas Panhandle for more than 50 years. All 12 rigs were under contract at the time the deal was announced.
