Finance/Cos. news briefs, Sept. 12
Chesapeake Energy � Gothic Energy ... Parker Drilling � Sunoco � Abraxas Petroleum � Hadrian Energy � Southern Energy ... Vastar Resources ... Patterson Energy ... Vista Midstream Solutions ... TransCanada PipeLines ... Oiltec Resources ... Talisman Energy
Chesapeake Energy Corp., Oklahoma City, said Monday it has entered into its previously announced agreement to acquire Tulsa-based Gothic Energy Corp for $345 million. The deal was first announced in June (OGJ Online, June 30, 2000). Chesapeake expects to complete the deal by Jan. 15, 2001. Both companies' boards have unanimously approved the transaction. Gothic plans to hold a special shareholders meeting after Chesapeake files an S-4 registration statement form.
Parker Drilling Co., Tulsa, plans to sell about 12 million shares of common stock. The net proceeds from the underwritten offering will be used to acquire, upgrade, and refurbish certain offshore and land drilling rigs and for general corporate purposes, including the repayment of debt.
Sunoco Inc., Philadelphia, completed its current $150 million share repurchase program in August and has received board authorization to repurchase an additional $200 million of Sunoco shares. With the completion of the $150 million program, which was authorized in December 1998, Sunoco has now repurchased over 23 million of its shares and has spent more than $700 million for repurchases over the last 5 years.
Abraxas Petroleum Corp., San Antonio, Tex., announced a significant reduction in the potential future dilution of its common stock associated with its Contingent Value Rights. Based on recent trading price levels of Abraxas stock, the potential number of issueable new shares under the CVRs has been permanently reduced to 16.7 million shares from 26.4 million on the last valuation in May of this year. Since yearend, potential dilution has been reduced 79%. If a valuation equal to last Friday's closing price of $3.38 were utilized, the potential dilution would be reduced by a further 5.7 million shares, says Abraxas.
Hadrian Energy Corp., Calgary, has raised $3.7 million (Can.), net of commission, through the issuance of Class A common shares on a private placement basis on Sept. 1, 2000. Peters & Co. Ltd. acted as agent for this offering. A total of 3,387,000 Class A common shares were issued at $1 (Can.) each and 429,600 flow-through shares were issued to directors and management at $1.05 (Can.)/share. Hadrian Energy now has 15,792,047 Class A common shares outstanding.
Southern Energy Inc., Atlanta, has completed the $250 million purchase of Vastar Resources Inc.'s 40% interest in Southern Co. Energy Marketing, making the company wholly owned by Southern Energy. Southern Energy and Vastar will continue with a 10-year natural gas purchase and sale agreement established when the two formed Southern Co. Energy Marketing in August 1997.
Patterson Energy Inc., Snyder, Tex., announced the commencement of an underwritten public offering of 3 million shares of its common stock. All of the shares are being sold by the company. The firm expects to close the offering Sept. 15. The offering was underwritten through a group led by CIBC World Markets. Patterson expects to use the net proceeds to reduce debt under its existing credit facility, to refurbish recently acquired rigs, and for other general corporate purposes, including possible future rig and other acquisitions and related refurbishment expenditures.
Vista Midstream Solutions Ltd., Calgary, has acquired natural gas gathering and processing assets in Saskatchewan from wholly owned subsidiaries of TransCanada PipeLines Ltd. The assets include a 100% working interest in the Freefight and Crane Lake gas plants and varying working interests in over 500 km of associated gas gathering systems. The gas plants have raw, sweet processing capacity of about 27 MMcfd and are about 80 km west of Swift Current, Sask. The assets are contract-operated on behalf of Vista by Burlington Resources Canada Energy Ltd.
Oiltec Resources Ltd., Calgary, has signed a new seismic option agreement with Talisman Energy Inc. covering a number of townships in southeastern Saskatchewan. Under the terms of the agreement, Oiltec has access to Talisman's comprehensive 2D seismic database over the lands and an exclusive right to exploit any seismic anomalies that may be present on Talisman's leased or owned mineral rights. Oiltec earns several sections of mineral rights with each successive exploratory well at what it calls "attractive earning terms." An area of mutual interest covering the lands is in effect, said Oiltec. The agreement area is contiguous with a previous 16-township option area and on trend with two discoveries made by Oiltec this year. Ten of the 16 townships defined in the original agreement have reverted back to Talisman. The remaining six include deep seismic anomalies that Oiltec continues to evaluate.