Industry Briefs
Anadarko to divest two midstream assets for $1.85 billion
Anadarko Petroleum Corp. has reached an agreement with Atlas Pipeline Partners LP. Anadarko will receive $1.85 billion and Atlas will acquire control of Anadarko’s interests in the Chaney Dell and Midkiff/Benedum natural gas gathering systems and associated processing plants. The Chaney Dell system is located in central Oklahoma and southern Kansas. It consists of nearly 3,500 miles of gathering lines and processing plants with a combined processing capacity of about 230 MMcf/d. The Midkiff/Benedum gathering systems and processing plants are located in the Spraberry Trend of the Permian basin near Midland, Tex. This system includes nearly 2,500 miles of gathering lines and processing plants with a combined capacity of roughly 170 MMcf/d. Anadarko has no equity gas production in either of these systems. The parties are forming two separate joint ventures to effect the transactions, which are expected to close in the third quarter of 2007. UBS Investment Bank and Citi acted as financial advisors to Anadarko in the transaction.
IHS acquires Geological Consulting Services
IHS Inc., a global provider of technical information, decision-support tools, and related services, has acquired the inventory and assets of Geological Consulting Services-Houston Inc. GCS has developed a database containing information on more than 120,000 oil and gas wells, with each well offering an average of 20 correlated tops. Using those correlations, GCS has created hand-contoured structure maps. The Energy segment of IHS provides integrated exploration and production information, software, consulting services and industry insight to oil and gas companies worldwide.
Keppel secures $534M in rig contracts
Keppel FELS has secured two rig contracts for $534 million. The contracts are for the construction of a drilling and production jackup rig and a deepwater drilling tender rig. Both rigs will be built to Keppel’s proprietary design. The first contract, worth $400 million, is for the third KFELS N Class jackup rig for Skeie Drilling and Production. The new rig is expected to be delivered in the fourth quarter of 2010. The second contract is from Seadrill Asia Ltd. for a semisubmersible drilling tender at $134 million. It is scheduled for delivery by the end of 2009.
EPL to divest onshore south Louisiana assets
Energy Partners Ltd. has agreed to sell substantially all of its onshore South Louisiana assets to a privately-held onshore operator for $71.7 million in cash. The sale represents approximately one-third of the reserves contained within the divesture package EPL has been marketing recently, which included both onshore south Louisiana and Gulf of Mexico shelf properties. Merrill Lynch Petrie Divesture Advisors served as the exclusive advisor on this transaction. EPL is an independent oil and natural gas exploration and production company based in New Orleans.
Far East Energy receives favorable independent report
Netherland, Sewell & Associates Inc. (NSAI) recently completed a review of Far East Energy Corp.’s coalbed methane properties in the Shouyang block in Shanxi Province, China. NSAI concluded that the No. 15 coal seam contains high permeability of 100 millidarcies, the gas content of the Shouyang Block is on the high end of CBM fields, and that potential gas rates of 1 million to 2 MMcf/d are possible in future horizontal wells. The NSAI report also states in part that, “Due to the limited amount of production data currently available, the aforementioned production and reservoir characteristics, and the range of performances of other CBM basins, there is a wide range of potential individual well recoveries from Coal Seam 15 in the Shouyang Block. Our preliminary estimates of the range of gas recovery is 0.3 to 4.1 bcd per well with a most likely and mean recovery estimate of 1.1 BCF and 1.8 BCF, respectively.” Based in Houston, Far East Energy is focused on CBM exploration and development in China through its agreements with ConocoPhillips and China United Coalbed Methane Co. Ltd. Netherland, Sewell & Associates Inc. provides integrated consulting services encompassing geophysics, geology, petrophysics, engineering, reservoir modeling and economics.
Noble Energy makes deepwater Gulf of Mexico discovery
Noble Energy Inc. has made a discovery on Mississippi Canyon Block 562 (Isabela prospect) in the Gulf of Mexico, located nearly 150 miles southeast of New Orleans in 6,500 feet of water. The Isabela well was spud on February 28, 2007, and drilled to a total depth of about 19,100 feet. The well encountered hydrocarbons in two high quality reservoirs. Noble Energy has a 33.33% working interest in the discovery. BP is the operator and holds 66.67%. The discovery well has been temporarily suspended pending development operations. The most likely development concept for the project is a subsea tieback to BP’s existing Na Kika production facility located nearby. Noble Energy has also acquired an interest in adjacent acreage with additional exploration potential. Noble Energy is an independent energy company and operates throughout major basins in the US including Colorado’s Wattenberg Field, the Mid-continent region of western Oklahoma and the Texas Panhandle, the San Juan Basin in New Mexico, the Gulf Coast and the deepwater Gulf of Mexico.
AMEX lists new Ameristock ETFs
The American Stock Exchange and Ameristock Corp. recently launched trading in 5 new US Treasury exchange traded funds (ETFs). These 5 new fixed income funds represent Ameristock’s first foray into the ETF product category. Each Ameristock/Ryan ETF seeks to track a particular US Treasury securities index owned and compiled by Ryan Holdings LLC and Ryan ALM Inc. The new ETFs are: Ameristock/Ryan 1 Year US Treasury ETF, Ameristock/Ryan 2 Year US Treasury ETF, Ameristock/Ryan 5 Year US Treasury ETF, Ameristock/Ryan 10 Year US Treasury ETF, and Ameristock/Ryan 20 Year US Treasury ETF. Kellogg Capital Group LLC is the specialist for the ETFs.
Falcon’s MoBay storage hub gets final permit from US Army Corps of Engineers
Falcon Gas Storage Co., Inc. has been issued a final permit by the US Army Corps of Engineers for MoBay Storage Hub LLC, authorizing construction of its 50 bcf MoBay gas storage facility under Section 404 of the Clean Water Act and Section 10 of the Rivers and Harbors Act. Located in Mobile County, Ala., MoBay will provide natural gas storage and hub services to local and interstate gas customers, including natural gas utilities, electric generators, and industrial end users. The MoBay hub expects to complete construction and start service by October 2008. Through its wholly-owned subsidiaries and affiliated companies, Houston-based Falcon Gas Storage Co. is a large, independently owned developer and operator of high-deliverability, multi-cycle (HDMC) natural gas storage capacity in the US.
Stallion acquires two oilfield service providers
Stallion Oilfield Services Ltd. has completed the acquisitions of Shores Energy Services and The Waterline Co. Shores has facilities in Ratliff City and Elk City, Okla. and specializes in oilfield logistics. The Waterline Co., located in Cleburne, Tex., provides waterline supply services. Shores specializes in rig relocation and heavy equipment hauling and marks Stallion’s entry into the Oklahoma and the Texas Panhandle market for its Heavy Haulers division. Stallion provides wellsite support services and construction and logistic services to the oilfield.
Serica taps Tristone Capital as joint broker
Serica Energy plc has appointed Tristone Capital Ltd. as joint broker in addition to JPMorgan Cazenove, the company’s current broker and NOMAD. Tristone is an energy advisory firm providing investment banking, acquisitions and divestiture and equity capital markets services with particular focus in the UK and Canada.
Atlas Copco Drilling Solutions wins top environmental honor
At the 2007 Texas Environmental Excellence Awards banquet in Austin on May 2, Atlas Copco Drilling Solutions LLC received the Texas Environmental Excellence Award. During 2006, Atlas Copco demonstrated its commitment to the environment by investing in both technology and resources. The drilling equipment manufacturer spent nearly $1 million upgrading lighting and air-conditioning systems for its Garland facility. This investment, along with other procedural changes, reduced electrical use by 25% for the year. Annual solid waste disposal dropped by 65% with it be recycled or redirected, and annual water usage was cut by 18%.
Allegiance Capital opens new Vancouver office
Dallas-based Allegiance Capital Corp. has opened a new office in Vancouver, British Columbia. Allegiance Capital is a full-service investment banking firm specializing in the middle market (companies with revenue from $10 million to $500 million). Allegiance Capital assists companies in every aspect of selling and financing a business, including debt restructuring, mezzanine financing, buy out management, strategic partnering, consulting, and other related services
Cubic to join SMH capital program
Cubic Energy Inc., an oil and gas exploration company, has entered into a formal agreement with SMH Capital Inc., the broker-dealer subsidiary of Sanders Morris Harris Group, to participate in the SMH Capital Market Services. The Market Services Group works with each client and its investor-relations firm to facilitate and communicate information to the investor community, and disseminate relevant information through the SMH institutional and retail sales forces as well as its retail affiliate network. SMH Capital (SMH) also arranges non-deal road shows to communicate each client’s story.
Pyramid Petroleum, Capco Energy plan business combination
Pyramid Petroleum Inc. and Capco Energy Inc. have approved the execution of a Letter of Intent whereby Pyramid would acquire all of the outstanding common shares of Capco in exchange for common shares of Pyramid, as a result of which Capco will be a wholly-owned subsidiary of Pyramid. An independent committee will select an independent third party appraiser to provide a fairness opinion on the transaction. Ilyas Chaudhary, the majority shareholder in both companies, as well as being the CEO of both companies, will not participate in the selection of the third party appraiser for the transaction, nor will he vote on any issue concerning this transaction. Following the acquisition, Pyramid expects to raise funds to expand the oil and gas production of the combined company, mainly in the Gulf of Mexico, focusing on low risk producing opportunities.
Ridgeway makes name change
Ridgeway Petroleum Corp. has changed its name to “Enhanced Oil Resources Inc.” The company’s trading symbol will be “EOR.” The company board felt that the time was right for a name that reflected the company’s strategic focus of carbon dioxide delivery and enhanced oil recovery production in the Permian basin.
Aker Kvaerner acquires Phoenix Polymers
Aker Kvaerner has acquired 50% of Phoenix Polymers International Ltd. Phoenix develops and manufactures buoyancy and polyurethane products for the worldwide oil and gas sector and is a supplier of floatation elements to Aker Kvaerner’s deepwater marine drilling riser projects. Phoenix was established in 2003 and has its offices and manufacturing facilities in Aberdeen. The company will continue to trade under the Phoenix name.
Murphy acquires Canadian properties
Murphy Oil Corp.’s wholly-owned subsidiary, Murphy Oil Co. Ltd., has acquired the interests of Bear Ridge Resources Ltd. in the Tupper area, an undeveloped Montney natural gas play in British Columbia, for consideration of C$155 million. According to Claiborne P. Deming, Murphy’s president and CEO, Murphy will operate the property with a 97% working interest.
Cano Petroleum sells Rich Valley asset
Cano Petroleum has sold its Rich Valley, Okla., asset to a private company for $7 million, subject to customary closing conditions and purchase price adjustments. The Rich Valley asset is producing about 120 boe/d net and as of July 2006 there were nearly 600,000 boe reserves, all proved. Randall and Dewey Inc. marketed the asset. Cano plans to use the proceeds to pay down debt on its senior credit facility. Cano Petroleum Inc. is an independent Texas-based energy producer with properties in the mid-continent region of the US.
SAAG Drilling wins contract extension from ExxonMobil
SAAG Drilling and Well Services has been awarded a contract extension for the Telaga Usaha from ExxonMobil Exploration and Production Malaysia Inc. The contract has been extended for another year effective June 14, 2007. The contract value for the extended term based on a full year operation will be nearly RM33million.
US Steel completes $2.1 billion purchase of Lone Star Technologies
US Steel Corp. has completed its $2.1 billion acquisition of Lone Star Technologies Inc. US Steel chairman and CEO John P. Surma said, “This acquisition significantly expands our tubular product offerings, our production capacity and our geographic footprint.” US Steel plans to combine the operations of Lone Star with US Steel’s Tubular Division under the leadership of Joseph Alvarado, who served as president and COO of Lone Star. Alvarado has been named vice president-tubular operations of US Steel. US Steel financed the purchase through a combination of cash on hand and financing under its existing receivables program, new bank facilities, and a portion of the proceeds of its recent offering of $1.1 billion in senior unsecured notes.
Fairfield in negotiation to acquire Shell and Esso interests in North Sea
Fairfield Energy has entered into exclusive negotiations with Shell UK and Esso Exploration and Production UK to acquire their combined 56.8% interest in the Dunlin and Dunlin Southwest fields, 97.6% interest in the Merlin field, and 100% interest in the Osprey field in the Northern North Sea. The transaction is conditional on agreement of the final terms of the acquisition and will be subject to co-venturer and UK government approvals. The parties have not disclosed a purchase price. Fairfield is expected to assume operatorship later this year.
TrueStar nixes plans for Williston basin, Argentina
The board of TureStar Petroleum Corp. will not proceed with its proposed acquisition of the Williston Basin oil and gas leases located in the southwestern portion of the Williston basin in northwestern South Dakota. The company concluded the acreage block did not conform to the current objectives and development of the company, and did not represent the best use of the company’s resources. The Company will focus on negotiating on specific acreage in the Williston basin that is of direct interest to the company. The 22 million shares issued as the deposit for the acquisition will be returned to the treasury of the company. TrueStar is also discontinuing an earlier objective of pursuing opportunities in Argentina. TrueStar Petroleum is an oil and gas exploration, development, and production company.