Finance/Companies news briefs, June 23

Ivanhoe Energy � Discovery Operating � Pangea Petroleum � Mass Energy � Taiwan�s Ministry of Economic Affairs � TrueNorth Energy � Koch Industries Inc. ... UTS Energy � Gulf Canada Resources � Petrovera Resources � MOL


Ivanhoe Energy Inc., Calgary, said it acquired rights to participate in the development of a 7,300-acre oil and gas project in the Spraberry trend of the West Texas Permian basin. Drilling of the first well commenced on June 13. The development plan provides for the use of two rigs to drill as many as 15 wells on the Spraberry project this year. Ivanhoe has obtained a working interest of 62.5% in the project through an agreement with operator Discovery Operating Inc., a Texas-based independent oil and gas company. Ivanhoe's interest will revert to 50% after payback of development costs.

Pangea Petroleum Corp., Houston, has begun preliminary negotiations to acquire a privately held Texas-based exploration and production company, Mass Energy. Mass has extensive mineral leases in East Texas and other valuable assets. If the acquisition is consummated, Pangea plans to develop a significant natural gas project in South Texas. The acquisition is expected to close in 6 weeks.

Taiwan�s Ministry of Economic Affairs is working on a draft amendment that is expected to relax restrictions on investment in mainland China by the island�s manufacturers of basic petrochemicals. A ministry official speaking on condition of anonymity said the new amendment, which requires approval by the ministry�s Investment Commission, could remove the blanket ban on investments by several key industries, including petrochemicals, petrochemical raw materials, semiconductors, and notebook computers. Investments would, however, require approval on a case-by-case basis. Under terms of the proposed amendment, small and medium-size companies would be allowed to invest a maximum of $2 million, while the amount publicly owned companies can invest will be determined by the amount of their paid-in capital and will range from 20% to 40% of total paid-in capital.

TrueNorth Energy LP, the Canadian unit of Koch Industries Inc., is looking for an equity interest partner in a planned $1 billion (Can.) Alberta oilsands project. The company is preparing regulatory applications for the Fort Hills project near Fort McMurray in northeast Alberta. TrueNorth Pres. David Park said the company is looking for a partner with oilsands mining experience to take an interest of about 25%. He said the Koch unit has held discussions with five mining companies. Park said he hopes to sign a deal with a partner in 6-9 months. The project, scheduled for completion in 2005, would produce 90,000 b/d of bitumen from estimated reserves of 2 billion bbl. The project does not include an upgrader. Bitumen would be blended with condensate and piped to the Koch Pine Bend refinery near St. Paul, Minn. TrueNorth has a 78% interest in the project, and UTS Energy Corp. holds the remainder.

Gulf Canada Resources Ltd., Calgary, says three US groups are interested in the company�s 47% share of heavy oil producer Petrovera Resources. Gulf has been selling noncore assets to reduce debt. Gulf CEO Dick Auchinleck said the sale process is going slower than expected but he hopes to have a good offer by the end of June. PanCanadian Petroleum Ltd., Calgary, holds the remaining interest. The Gulf interest in Petrovera, which has extensive heavy oil holdings in Alberta, is valued at $250-275 million (Can.). Gulf�s share of production is about 16,000 b/d from production of 30,000-32,000 b/d. Auchinleck said three unnamed companies with heavy oil interests are looking at Petrovera.

MOL Rt. Chairman Janos Csak resigned yesterday in protest over a Hungarian government decision involving natural gas prices. Csak sees the decision as implementing insufficient market liberalization.

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