Company News: Range Resources' reserves swell with drilling, acquisitions

April 4, 2005
Range Resources Corp., Fort Worth, reported replacing more than 8 times its 2004 production last year, including replenishing more than double its production through drilling alone.

Range Resources Corp., Fort Worth, reported replacing more than 8 times its 2004 production last year, including replenishing more than double its production through drilling alone.

In other recent company news:

  • BP PLC is forming Innovene, a wholly owned olefins and derivatives subsidiary.
  • BP Trinidad & Tobago LLC (BPTT) will offer for sale, through a competitive bid round, its operating interests in Teak, Samaan, and Poui oil fields off eastern Trinidad and Tobago.
  • El Paso Corp., Houston, said an indirect subsidiary has sold its 51% interest in Coastal Petrochemical LP, and associated working capital, to Petro-Canada for $74 million.
  • El Paso Corp also has acquired the interest held by a unit of Lehman Bros. in a joint drilling venture that the companies, along with Nabors Industries Ltd., formed in October 2003. El Paso paid Lehman $62.5 million.
  • Total SA said Chinese authorities approved its formation of a retail-fuel joint venture with China National Chemical Import & Export Co. (Sino- chem) called Total Sinochem Fuels Co.

Range reserves

Range's yearend reserves were 946 bcf of gas and 38 million bbl of oil and liquids, up 72% on the year.

The company set a $254 million capital budget excluding acquisitions for 2005, up 44% on the year, to drill or participate in 787 wells and 75 recompletions. It was running 13 rigs as of late February.

Among its 2005 exploration plans are the drilling of 5 wells to test the deeper part of the Trenton-Black River play in the Appalachian basin, the first of which is to spud in July.

The independent produced a record 50.7 bcf of gas and 3.5 million bbl of oil and liquids in 2004, and production rose in each quarter of the year, averaging 196 MMcfed.

Production climbed to 225 MMcfed in December with closing of the $219 million acquisition of private Pine Mountain Oil & Gas Inc., Abingdon, Va., gas and oil unit of Pittston Coal Co., which produces mainly coalbed methane in Virginia (OGJ Online, Dec. 2, 2004).

Proved reserves are assigned to 30% of Pine Mountain's 417,000 acres of properties. The lands, which have wide enhancement potential, brought Range's drilling inventory to nearly 5,300 projects.

BP forms Innovene

BP expects to sell the olefins and derivatives subsidiary, possibly through an initial public offering, later this year.

Innovene will be based in Chicago and will have manufacturing sites in Asia, Europe, and the US.

The company is expected to produce more than 15 million tonnes/year of petrochemicals worldwide.

BPTT to sell oil fields

BPTT said it considered the Trinidad and Tobago fields' combined 21,000 b/d of oil production insufficient, and selling them would allow it to concentrate on its gas business. The fields represent 4% of BPTT's production off Trinidad and Tobago.

The fields have combined reserves of 40 million bbl. Chairman and CEO Robert Riley said BPTT would retain rights to deep exploration in the fields. The Trinidad and Tobago government retains the right to review potential investors.

Petro-Canada buys Montreal plant

El Paso Corp. said Coastal Petrochemical LP operates the Montreal paraxylene plant.

El Paso obtained the interest as part of its $24 billion merger with Coastal Corp. in 2001 (OGJ Online, Jan. 29, 2001).

El Paso-Lehman Bros.

El Paso Corp.'s acquisition involves various oil and natural gas properties in the Gulf of Mexico, South Texas, and the Ark-La-Tex regions. El Paso Production Co. already operates all 86 wells involved in the acquisition.

The Nabors interest in the venture was unaffected. El Paso estimates proved reserves associated with the acquired properties to be 14.6 bcfe, 73% of it gas.

Total Sinochem

Total said it will own 49% of the venture, and Sinochem will own 51%.

The first in a planned network of 200 service stations is expected to open in Beijing in the fall.