TransCanada Corp., Calgary, plans to buy Gas Transmission Northwest Corp. (GTN) for $1.2 billion, plus $500 million of assumed debt, subject to approval from the US Bankruptcy Court for the District of Maryland.
GTN is a subsidiary of National Energy & Gas Transmission Inc. (NEGT), Bethesda, Md., which filed for Chapter 11 bankruptcy in July 2003. Upon its emergence from bankruptcy, NEGT will separate from its parent, Pacific Gas & Electric Co., San Francisco.
In other midstream news:
- Australian natural gas company Alinta Ltd. agreed to buy natural gas pipelines and gas-fired power plants in Australia and New Zealand from Duke Energy Corp., Charlotte, NC, for $1.24 billion.
In upstream news:
- XTO Energy Inc., Fort Worth, plans to acquire producing properties located primarily in the Barnett shale of North Texas and in the Arkoma basin for $200 million.
- Unocal Corp.'s subsidiary, Pure Resources Inc. of Midland, Tex., agreed to sell certain fee minerals interests it holds in several states to Black Stone Minerals Co. LP, Houston, for $190 million.
- Encore Acquisition Co., Fort Worth, plans to purchase private Cortez Oil & Gas Inc., Plano, Tex., for $123 million.
- Private equity company Vulcan Capital is in the process of acquiring Plains Resources Inc., Houston. Vulcan Capital is controlled by Microsoft Corp. cofounder Paul G. Allen's Vulcan Inc., Seattle. Upon closing, Plains Resources will become a private company.
In drilling contractor news:
- Grey Wolf Inc., Houston, agreed to buy privately held New Patriot Drilling Corp., Casper, Wyo., in a cash and stock deal worth about $37 million, plus the assumption of $13.7 million in debt.
TransCanada-GTN
GTN is a natural gas pipeline company that owns and operates the Gas Transmission Northwest pipeline system, formerly known as Pacific Gas Transmission, and the North Baja pipeline system.
The Gas Transmission Northwest pipeline system includes more than 1,350 miles of pipeline extending from near Kingsgate, BC, to near Malin, Ore.
The North Baja pipeline is an 80-mile system extending from near Ehrenberg, Ariz., to Ogilby, Calif. The North Baja pipeline sale is subject to a right of first refusal.
Alinta-Duke Energy
Duke Energy's sale of power plants and pipelines to Alinta is anticipated to close in the second quarter. Perth-based Alinta distributes gas across Western Australia.
Duke Energy's divestiture includes a total of 485 Mw of generating capacity divided between three plants in Australia and one in New Zealand. The transaction also includes 1,350 miles of pipeline in Australia.
The three pipelines involved are the Tasmanian Gas Pipeline, the Eastern Gas Pipeline, and the Queensland Gas Pipeline, Duke Energy spokesman Peter Sheffield said.
Duke Energy Chairman and CEO Paul Anderson announced in January that the company would exit the Asia-Pacific region in efforts to sell about $1.5 billion in assets this year.
XTO-Barnett shale, Arkoma basin
The properties are being purchased from multiple parties, and most of the acquisitions are expected to close by Apr. 15.
XTO plans to allocate $20 million in additional development funds to the new properties, bringing XTO's 2004 development expenditures to $520 million. The company will operate more than 88% of these producing properties.
In the Barnett shale, XTO is acquiring 97.6 bcfe of proved reserves, of which 42% is developed, for $120 million. Currently production totals 15 MMcfed. XTO said it expects substantial upside potential in the 11,000-acre position.
In addition, XTO is expanding its presence in the Arkoma basin with the purchase of 56.3 bcfe of reserves, 70% developed, for $80 million. The properties produce about 10 MMcfed.
Pure Resources-Black Stone
The purchase price of Pure Resources' fee minerals interests will be retroactive to Oct. 1, 2003. The sale is expected to close by the end of the second quarter.
The transaction involves Pure Resources' royalty interests, overriding royalty interests, minor working interests, and subsurface mineral rights on 3.3 million net acres, primarily in Texas, Louisiana, Mississippi, Arkansas, and Alabama.
The assets produce 2,250 boed.
Encore-Cortez
Cortez has an estimated 15 million boe of reserves, 60% of which are proved developed producing. The properties are in the Cedar Creek anticline of Montana and the Permian, Arkoma, Anadarko, and Fort Worth basins.
The properties have a further 7.8 million boe of identified drilling and waterflood opportunities, Encore said. Total proved reserves are 55% natural gas.
The properties are 80% operated and produce 8.4 MMcfd of gas and 1,550 b/d of oil. Cortez owns more than 25,000 net developed acres and more than 48,000 net undeveloped acres, of which 21,000 are mineral fee.
Vulcan Capital-Plains Resources
Vulcan Capital agreed to buy Plains Resources for $16.75/share. This revised offer came after Plains Resources rejected Vulcan's initial buyout offer of $14.25/share last year.
Plains Resources Chairman James C. Flores and John T. Raymond, CEO and president, are partners with Vulcan Capital in the transaction. Vulcan Capital, Flores, and Raymond form the Vulcan Group. Plains Resources' board has approved the latest offer and recommended that shareholders approve it.
Subject to customary closing conditions, closing is expected in the second quarter, at which time Plains Resources will become a privately held company. Plains Exploration & Production Co. was spun off from Plains Resources last week (OGJ Online, June 4, 2003).
Grey Wolf-New Patriot
Grey Wolf agreed to pay $16.3 million in cash and to issue 4.6 million shares of its common stock for New Patriot. The deal's stock portion is worth about $21 million based upon Grey Wolf's closing price of $4.52/ share on Mar. 5. Closing is expected in April.
Patriot owns 10 drilling rigs. Three of the rigs are working in Wyoming, and two are under contract and expected to begin work there within 2 months. The remaining five rigs are working in Colorado.
