Finance/Companies news briefs, Dec. 5

Grant Prideco � Weatherford International � WTG Gas Processing � Texaco Exploration & Production � Torch Energy Marketing � Energy Search � Southern Producer Services � Cross Timbers Oil � McMoRan Exploration � Shell Offshore � Plains Resources � Panaco � GulfWest Oil � Alberta Energy Co. � RBC Dominion Securities � Merrill Lynch Canada � Lukoil � and more


Grant Prideco Inc. said has made a private placement of $200 million in senior unsecured notes. The notes have a coupon rate of 9 5/8%, priced to yield 9 3/4%. The company will use the proceeds to repay a $100 million note to Weatherford International Inc., its former parent, and for other debt.

WTG Gas Processing LP has acquired Texaco Exploration & Production Inc.'s stakes in three West Texas gas processing plants. WTG acquired a 90.56% interest in the East Vealmoor gas plant in northeast Howard County, a 97.81% interest in the Fuller gas plant in Scurry County, and a 15.89% interest in the Torch Energy Marketing Inc.-operated Snyder gas plant west of Snyder. The plants have associated low-pressure gas gathering systems. East Vealmoor and Fuller gather 24 MMcfd of gas combined, and the Snyder plant handles 14 MMcfd.

Energy Search Inc. plans to spend $11.5 million participating in 75 wells in 2001. Southern Producer Services LP, a subsidiary of Southern Energy Inc., Atlanta, Ga., has preapproved the funding for 60 wells Energy Search plans to drill.

Cross Timbers Oil Co., Fort Worth, Tex., has completed a 6.6 million common share offering through Lehman Bros. Inc. It will use the $126,225,000 it raised to reduce debt.

McMoRan Exploration Co. expects to receive its $23.3 million share of the insurance settlement for the loss of the Brazos block A-19 JC No. 1 well within a few weeks, bringing its total proceeds from the loss to $90 million. McMoRan's Brazos A-19 JC No. 1 well was damaged during the early production phase in November 1999 after producing 84 MMcfd of gas for 1 month. Attempts to repair the well were unsuccessful, and the well was abandoned. Shell Offshore Inc. bought McMoRan's 35% interest in the well for $66.5 million earlier this year (OGJ Online, July 19, 2000).

Plains Resources Inc. has set a $120 million capital budget for 2001, up 50% from 2000's expenditures. Of the budget, 85% is earmarked for development projects in California, including a gas processing plant and the drilling and completion of 217 wells.

Panaco Inc., Houston, has set a $37.1 million capital budget for fiscal year 2001. The budget includes continuing Panaco's exploration program and the East Breaks 109 & 110 field. More than $2 million is earmarked for workovers, equipment modifications, and repairs.

GulfWest Oil Co., Houston, plans to begin a workover and drilling program on its newly acquired oil and gas properties in Texas, Oklahoma, and Mississippi. GulfWest has paid $2.9 million to an unnamed seller, of which $800,000 in cash. The price is $3.75/boe, said the company. The acquisition was effective Oct. 1. The properties are producing 300 Mcf/d of gas and 250 b/d of oil.

Alberta Energy Co. Ltd. said it has entered a "bought deal" arrangement with a group of underwriters led by RBC Dominion Securities Inc. and Merrill Lynch Canada Inc. for the sale of $200 million worth of securities. In a bought deal, investment dealers buy the issue and sell it to their clients. AEC has also granted the underwriters an option to purchase up to $50 million more of the securities. The unsecured subordinated debentures pay 8.5%/year. They will have a 40-year term.

Russian company Lukoil and Chevron Oronite Co. LLC are considering forming a joint venture to make lubricating oil additives at Lukoil's Volgograd refinery. The venture would include marketing Chevron Oronite additives in Russia and other adjoining countries. Lukoil said a feasibility study earlier this year was positive. It supplies more than 40% of the Russian lubricant market.

J.M. Huber Corp., Edison, NJ, has acquired Chevron Corp.'s interest in South Timbalier blocks 21, 22, 27, and 28. Huber will operate the blocks with interests ranging from 50% to 72.9%. The South Timbalier 21 field, discovered in 1957, is in 40 ft of water 3 miles from shore. It is producing 2,300 b/d of oil and 4.4 MMcfd of gas. Huber assumed operations Nov. 1.

Trinidad Drilling Ltd., Calgary, has agreed in principle to acquire the business and associated assets of Progressive Well Servicing Ltd. for $3.9 million in cash. Progressive owns and operates eight service rigs in Saskatchewan and Alberta. Trinidad expects to close the acquisition Dec. 15.

Omax Resources Ltd. has privately placed 3 million units, raising $450,000 (Can.). Azara SA now holds 12.2% of the company but said it does not plan to increase its holding.

Promax Energy Inc. has completed a private placement of 4,365,271 flow-through common shares for proceeds of $5,020,062. It has raised $10.6 million through private placements this year. The proceeds will be used to drill 47 more wells by the end of the year and drill up to 75 more wells in 2001. Promax operates in the Cessford area of southeastern Alberta.

Michael Petroleum Corp., Houston, will acquire interests in 72 producing wells and 22,500 acres in the Lobo Wilcox Trend in Webb County, Tex., from Enogex Inc. subsidiary Enogex Exploration for $7.5 million. Michael Petroleum operates 61 of the 72 wells. Total proved reserves are estimated at 16.6 bcfe, of which 36% are proved developed reserves. Enogex Inc. is a subsidiary of OGE Energy Corp., of Oklahoma City.

Schlumberger Ltd. and Baker Hughes Inc. closed a deal to create joint venture seismic company WesternGeco Nov. 30. Schlumberger paid $500 million in cash to Baker Hughes. WesternGeco is owned 70% by Schlumberger and 30% by Baker Hughes.

Noveder Inc., Montreal, Que., has settled a dispute with the Canada Custom and Revenue agency regarding exploration expenses for 1993-1995. Noveder agreed to pay $158,698 although it admitted no wrongdoing.

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