GENERAL INTEREST — Quick Takes
Feds delay Ohio forest lease sale to study fracing
The US Department of Agriculture Forest Service has postponed a sale of mineral leases scheduled for the sprawling Wayne National Forest in eastern Ohio for at least 6 months to study surface affects related to hydraulic fracturing.
The sale, formerly set for Dec. 7 at the Bureau of Land Management office in Springfield, Va., was to have made available for bids 3,300 acres on five parcels in Athens, Gallia, and Perry counties, southeastern Ohio.
Studies have indicated that the emerging unconventional Utica shale play could generate as many as 200,000 jobs within 3 years compared with the 13,000 existing jobs that the petroleum industry supports in Ohio, the Ohio Oil & Gas Association has reported.
Wayne National Forest covers 241,000 acres in three large elements, one near Nelsonville and two along the Ohio River in southern and eastern Ohio. Nearly 1,300 oil and gas wells are in operation on forest land, mostly in Washington and Monroe counties in the eastern unit.
Stone Energy to buy stake in gulf assets from BP
Stone Energy Corp., Lafayette, La., agreed to acquire BP PLC's 75% operated working interest in the deepwater Pompano field and other assets for a total of $204 million. In addition, Stone plans to acquire a 51% operated working interest in the adjacent Mississippi Canyon Block 29, a 50% nonoperated working interest in Mica field that ties back to the Pompano platform, and interests in deepwater exploration leases near Pompano field.
Pompano platform is a four-leg, 12-pile fixed structure in 1,300 ft of water with 23 producing wells and production capacity of 60,000 b/d of oil and 135 MMcfd of gas.
The acquisition is subject to preferential rights, due diligence and other customary closing conditions, and is expected to close by early 2012.
Kinder Morgan to buy CO2-helium assets
A unit of Kinder Morgan Energy Partners LP (KMEP) will buy carbon dioxide and helium holdings on the St. Johns dome in Arizona and New Mexico from Enhanced Oil Resources Inc. (EROI), Houston, for $30 million.
The purchase includes all of EORI's rights, title, and interest in the St. Johns dome and certain related assets in Apache County, Ariz., and Catron County, NM.
On closing, targeted for Dec. 1, KMEP agreed to amend the CO2 gas sale and purchase agreement with EORI, originally announced Apr. 20, 2010, modifying the dates of pipeline connection and the date of first deliveries and eliminating the termination fee. The companies anticipated a pipeline link to Permian basin oil fields.
EORI said St. Johns "offered tremendous long-term potential for the right company, (but) the capital financing risks including our cost of capital and continuing associated carrying costs were considered to be too onerous on a company of our size."
Proceeds from the sale will accelerate EORI's infill oil development on 27,000 acres in New Mexico and help finance its planned San Andres CO2 flood at 5,000-acre Milnesand field and potentially at the adjacent 20,000-acre Chaveroo field.
EORI and predecessor Ridgeway Arizona Oil Corp. had been appraising the St. Johns CO2-helium producing properties since the early 1990s (OGJ, May 28, 2007, p. 41).
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