Orchard Petroleum signs final two deals with Aera

The first of the two projects is Coalinga. Aera owns or leases approximately 11,000 acres in the Coalinga area. Under the project agreement, Orchard has the exploration rights to propose prospects below productive depths over Aera’s fee and leased lands. In addition, Orchard and Aera have established an area of mutual interest of approximately 125,000 acres in the Coalinga area. OP Inc.’s working interest at Coalinga will vary from 37.5% to 56.25%. OP Inc.’s technical team believes the project area has the potential for reserves in the range of 25-100 MMboe across this vast area.

The second project is Yowlumne. OP Inc. is currently funding a 3-D seismic- based evaluation of the exploration potential in this area. OP Inc.’s objective is to participate with Aera in a Yowlumne deep exploration project. Final determination of Orchard’s involvement in the project is an Aera decision yet to be determined.

These new exploration initiatives will provide additional projects for 2007 and beyond as part of OP Inc.’s existing project inventory. Funding for these future projects will come out of production revenues and financing capacity. The combined five projects with Aera cover numerous play types with different prospect sizes. Orchard believes the combined range of prospect sizes vary from 95 to 170 MMboe with Orchard having a working interest between 15% and 56.25%.

The venture with Aera will allow Orchard to continue to build on its core focus area, being onshore California. Orchard has numerous projects at various stages of exploration, appraisal, development, and production, which will be augmented by the Aera projects.

The Coalinga project involves developing prospects in a highly petroliferous area below currently producing fields. Coalinga is comprised of several large fields with a combined production of over 20,000 boe being produced each day. The Coalinga oil field complex has produced over 850 million barrels of 200 API gravity oil since 1887, mostly from the Temblor Formation. The Coalinga anticline is one of a series of echelon folds that modifies the generally homoclinal eastern flank of the Diablo range along the west side of the San Joaquin Basin. The field is part of the Kregenhagen-Temblor petroleum system that derives oil from organic-rich shales of Middle Eocene Kreyenhagen Formation. The Temblor Formation represents the inter play of shallow marine and non-marine depositional environments. Reservoir trapping is a combination of structural and stratigraphic mechanisms. Aera owns or leases approximately 11,000 acres in the Coalinga area. Current production is around 7,600 b/d.

Under the project agreement, Orchard would have the exploration rights below productive depths over Aera’s fee and leased lands. In addition, OP Inc. will be charged with gathering geologic and seismic data across the area and developing play concepts. OP Inc.’s technical team will develop and propose play concepts to Aera as part of the agreement. The Yowlumne project involves exploration of Monterey/Stevens play concepts. OP Inc. is currently funding a 3-D seismic based evaluation of the exploration potential in this area. The lay concept involves the complex relationship between submarine fan channel reservoirs and structural deformation history in the San Joaquin Basin. Precise mapping of the 3-D data, utilization of seismic attributes, and leading reservoir engineering concepts provide the platform for OP Inc.’s exploration approach to this project. The existing Yowlumne field was discovered in the mid 1970s with production coming from Etchegoin and Monterey formations of the Pliocene/Miocene age. Total production to date has been approximately 20 MMboe.

Aera is one of the largest owners of exploration acreage in California and is one of the state’s largest oil and gas producers, accounting for approximately 30% of the state’s production. Aera produces about 210,000 boe and 75 MMcf of gas each day with over 900 million barrels of oil and gas reserves. Aera’s holdings have taken many decades to acquire and represent some of the most prospective exploration acreage in California. The five project agreements will give Orchard access to some of this highly prospective acreage, which either adjoins large oil and gas fields, or lies directly below such fields.

Suncrest Energy acquires two Russian oil companies

Suncrest Energy has completed negotiations to acquire parts of two Russian oil companies. The first will give the company 75% of a Russian oil company from the former Soviet Union - DDM from Amerossi Holding Corp., located in the Permskiy region of Russia. “Having finalized the negotiations to acquire the first of what we see as potentially several natural resource companies located in Russia part of the former Soviet Union, this we add significantly to the value of Suncrest over the short term and we anticipate over the long term as well,” said David Alexander, chairman. “DDM’s management brings many years of experience to Suncrest in the operational side of oil companies and to have there expertise will certainly benefit Suncrest for many years to come.”

Suncrest Energy has also completed negotiations to acquire 100% of Alba-Oil from Amerossi Holding Corp. for common and preferred stock. Located within the limits of North Sorokinskiy license are three structures slated as potential traps for hydrocarbons: Dmitrovskaya, Krutikhinsko-Zhelninskaya, and Tikhanininskaya. According to an evaluation by A.V. Arzhilovskiy, these areas potentially hold over $15,000,000,000 worth of recoverable oil, based on conservative estimates.

“Now we that we have acquired the second oil company located in Russia part of the former Soviet Union, we are ready to move to our next target,” said David Alexander, chairman.

Founded in Toronto, Canada, Suncrest Energy is engaged in oil and gas exploration and drilling programs for itself and other companies.

PLS forms Capital Markets Group; appoints Patrick DaPra managing director

PLS Inc. has formed a Capital Markets Group and appointed Patrick DaPra as its managing director. Capital Markets Group is a new advisory firm initiated to serve buyers and sellers of oil and gas assets. Its experienced financial experts will work to pinpoint the best possible match between capital resources and its client’s goals for business growth, including exploration and development ventures, as well as asset purchase or divestiture. It will also assist in the negotiations to insure the best possible terms for its clients. “We are excited to be adding a Capital Markets division as a compliment to our growing range of oil and gas advisory services,” said Ronyld Wise, president and founder of PLS Inc. “Patrick DaPra has the experience to add value to oil and gas companies that are seeking capital for growth, weather through asset acquisition or the drill bit.” Patrick DaPra was formerly the president of Cambrian Capital Corp. Working with independents, he has handled transactions from $5 million to $65 million in senior secured loans and oil and gas properties. PLS provides services to energy asset buyers and sellers from project inception through to completion. It has been in business as a multiple listing service publisher since 1986, and provides advisory services, package coordination, technical support, data rooms, brochure preparation and management of sealed-bid and negotiated sales. Since 1989, the PLS marketing and advisory arm has handled over 500 projects worth $1.5 billion in the US, Canada, and overseas. PLS publishes a variety of reports on a daily, weekly, and monthly basis, keeping buyers and sellers updated on acquisition opportunities, recent transactions, and current prices.

Noble Energy and Samson Offshore enter exploration agreement

Noble Energy Inc. and Samson Offshore Co. have entered into an exploration agreement covering interests in 37 deepwater leases held by Noble Energy in the Gulf of Mexico (GoM). Under the terms of the agreement, Samson will acquire a 25% working interest net to Noble Energy’s existing working interest in the leases, a majority of which are currently 100% owned and operated by Noble Energy. In addition, Samson will participate in at least four exploratory wells through the end of 2008, the first of which is scheduled to commence later this month.

“Long-term strategic alliances, like the agreement announced today with Samson, will become a key component of our deepwater exploration program in the future,” said Dave Stover, Noble Energy’s senior vice president for North America. “This agreement guarantees that we will have a committed partner in upcoming exploration wells for several years. It will also help us leverage resources to expand our opportunity base in the deepwater. Samson is a premier E&P player active in many other domestic and international areas and will bring experienced personnel to the partnership. We are pleased they have chosen to team up with Noble in the deep water Gulf of Mexico.”

“Noble is a very successful and experienced deepwater explorer and operator,” said David Adams, Samson’s executive vice president of exploration. “They have assembled a high quality portfolio of deepwater prospects. Given Noble’s experienced and highly talented employees, we are confident this partnership will be profitable and rewarding.”

Noble Energy is an independent energy company operating throughout major basins in the US including the GoM, as well as internationally, in Argentina, China, Ecuador, Equatorial Guinea, the Mediterranean Sea, and the North Sea. Noble Energy markets natural gas and crude oil through its subsidiary, Noble Energy Marketing Inc.

Samson Offshore Co. is a wholly-owned subsidiary of Samson Investment Co. Samson Investment Co., a Tulsa company, is engaged in oil and gas exploration, acquisition, and production operations in 18 states in the US, Canada, Venezuela, and the North Sea.

Cano Petroleum closes $55 million acquisition of WO Energy

Cano Petroleum has closed the acquisition of WO Energy of Pampa, Tex. for $55,240,000. After the acquisition, and based on Cano’s year end SEC pricing of $56.54 oil and $6.80 gas, the PV10 evaluation of Cano’s proved reserves increased from $59,551,000 to $347,358,000. As a result of the acquisition, Cano’s proved reserves grew from 5,523,000 boe to 40,020,000 boe. Based on approximately 26.9 million shares outstanding, the acquisition results in a PV10 value of proved reserves (net of debt) of $11.24 per share.

The company’s daily production will increase from approximately 400 boe/d to around 1,200 boe/d. With this acquisition, Cano’s operating revenues, net of lease operating expenses, production taxes and debt service, are expected to increase to about $800,000 per month.

The $55,240,000 paid for WO was structured as follows: $2,000,000 cash, $8,240,000 in restricted Cano shares, $30,000,000 senior debt financing, and $15,000,000 subordinated debt. The 1,791,320 restricted shares issued in the transaction were issued at market and are restricted under Rule 144 for one year, subject to additional selling conditions beyond that. The purchase price was allocated $5,240,000 to inventory and equipment, with the balance of $50,000,000 to the underlying oil and gas assets, resulting in Cano paying approximately $1.45 per proved boe - a figure that is comparable to Cano’s previous acquisitions, but is significantly lower than recently reported acquisitions in the industry.

WO’s assets are located in the Panhandle field consisting of 480 producing wells, 40 water disposal wells, and 380 idle wells on approximately 20,000 acres in Carson, Gray, and Hutchinson counties located in the Texas panhandle, approximately 45 miles north of Amarillo. The acquisition includes 10 workover rigs, company vehicles, compressors, and associated equipment. The field currently produces about 800 net boe/d to WO, comprised of 55% oil (40 gravity) and 45% gas (2,000 MMbtu) from the Brown Dolomite and Granite Wash formations at a depth of about 4,000 feet. Lease operating expenses are approximately $14 per boe.

Forrest Garb & Associates’ (Cano’s independent engineer) engineering report estimates the WO assets contain approximately 34,497,000 boe of proved reserves comprised of 5,100,000 boe of proved-producing reserves and 29,397,000 boe of proved-undeveloped reserves that can be recovered through waterflooding, given the results of four analog fields in the same formation.

Cano Petroleum Inc. is an independent Texas-based energy producer with properties in the mid-continent region of the US. Cano’s primary focus is on increasing domestic production from proven onshore fields using secondary and enhanced recovery methods.

Energen to acquire Permian Basin properties for $168 million

Energen Corp.’s oil and gas acquisition and development subsidiary, Energen Resources Corp. (ERC), has signed a purchase and sale agreement to buy Permian Basin oil properties from a private company for $168 million (subject to closing adjustments).

The properties include the North Westbrook Unit in Mitchell County, Tex., and two smaller fields nearby, and encompass approximately 15,000 gross acres. The North Westbrook Unit is contiguous to ERC’s existing waterflood operations in the Southeast Westbrook Unit. The Permian Basin in West Texas is the oldest producing oil basin in the US and ERC’s second largest area of operation.

Approximately 80% of the 21.8 MMboe proved reserves are undeveloped; in addition, ERC estimates that probable reserves total around 15 MMboe. The combination of proved undeveloped and probable reserves is expected to generate a drilling inventory for the company of about 470 wells over the next six years. More than 90% of the estimated proved and probable reserves are oil.

“This acquisition is an excellent fit for Energen Resources,” said James McManus, president and COO of Energen’s oil and gas subsidiary. “While these properties have a smaller component of proved developed reserves than our previous acquisitions, their location adjacent to our successful Southeast Westbrook Unit represents an important expansion in one of our core areas of operation and gives us an excellent opportunity to capitalize on our operating expertise there.”

ExxonMobil signs EPSA agreement for exploration in offshore Cyrenaica Basin

Exxon Mobil Corp.’s subsidiary, ExxonMobil Libya Ltd., has signed an exploration and production sharing agreement (EPSA) with Libya’s National Oil Corp. (NOC) to begin exploration activity offshore Libya.

The agreement covers the large Cyrenaica Basin Contract Area 44, which was awarded in the second round of EPSA IV licensing in October. The contract area comprises 2.5 million acres and is located offshore in water depths ranging from approximately 10 feet to more than 10,000 feet.

“We are pleased to be back in business in Libya with our success in the second licensing round,” said Phil Goss, president and general manager of ExxonMobil Libya Ltd. “In the past we worked closely with our Libyan partners to achieve many firsts in the Libyan petroleum industry, such as discovering and producing the first Libyan oil field, shipping the first oil to market, and building the Marsa El Brega facility including the LNG plant. We look forward to working with the NOC and Libyan government to achieve great successes in Libya once again.”

Onefour Energy completes $52 million financing campaign

Onefour Energy Ltd. has drawn down the first installment against a C$38,500,000 line of equity advanced by The Huff Alternative Fund LP of Morristown, NJ and COSCO Capital Management LLC through its affiliates, COSCO Investments LP and COSCAN Investments Syndicate Ltd. This line of equity is the final step in a $52 million financing campaign arranged for Onefour over the past five months by COSCO through its broker-dealer affiliate, Private Energy Securities Inc., which also included $3.5 million of senior secured convertible debentures, $4.5 million of flow-through shares, and $5.6 million of straight common equity.

Onefour is a private, Calgary-based exploration and production company incorporated in January 2004 under the laws of Alberta. Onefour holds working interests and operated in the Senex area of northern Alberta and the Sweetgrass Arch area in southern Alberta. Onefour is managed by Lou Sanche, its founder, president, and CEO; Brent Cooper, VP exploration and land; and Brian Johnston, executive VP engineering and financial.

Huff is an affiliate of W.R. Huff Asset Management, which invests over US$10 billion across many industries on behalf of pension funds and other institutions primarily in the US.

Petrie Parkman to market assets for Chief Oil & Gas

Chief Oil & Gas LLC has retained Petrie Parkman & Co. to advise the company in the sale of its assets. Lonnie T. Samford, vice president and CFO said, “In considering our transaction alternatives, we are please to have Petrie Parkman assisting in this important initiative.”

Chief Oil & Gas is a Dallas-based, privately held, independent oil and gas company engaged in the exploration, development, production, gathering, and processing of natural gas from the Barnett Shale in North Texas.

Petrie Parkman & Co. is an investment banking firm specializing in energy-related transactions. The firm was founded in 1989 and maintains offices in Houston, Denver, and London.

Neumin Production acquires stake in Barnett Shale

Neumin Production Co., a Gulf Coast oil and gas producer and wholly-owned subsidiary of Formosa Plastics Corp., has acquired a 25% stake in 8 wells and 6,200 undeveloped acres in the Barnett Shale. The properties were held and operated by Reichmann Petroleum. Neumin joins working interest partners Wynn-Crosby and Kerogen Resources in the development project, and expects to participate in more than 20 wells in the Barnett Shale in 2006.

Neumin has historically focused its exploration efforts primarily along the Texas and Louisiana Gulf Coast, but has recently closed on a joint venture program with Navidad Resources in Tyler, Tex. and plans to expand its exploration efforts into the East Texas Basin.

Neumin is kicking off operated drilling programs in both Texas and Louisiana that were derived from proprietary 3-D seismic data shot for Neumin in 2004. The company joined the Access Exploration Corp. prospect evaluation program which reviews third party prospects all along the Texas and Louisiana Gulf Coast as well as internationally.

As part of its overall corporate initiatives, the company has opened a Houston office and has retained PLS Inc. for buy-side services including sourcing new opportunities and introductions. PLS assisted Neumin in the Reichmann acquisition.

Cooper Cameron Corp. acquires Dresser Flow Control businesses

Cooper Cameron Corp. has closed on most of the businesses being acquired from the Flow Control segment of Dresser Inc. for about $224 million in cash. The closing of the Brazilian portion is awaiting Brazilian regulatory confirmation of transfer of operating permits and tax documentation and is expected to be completed in early 2006.

The businesses being acquired will be combined with Cooper Cameron Valves operations.

Cooper Cameron chairman, president, and CEO Sheldon R. Erikson said, “As previously noted, we expect this acquisition to favorably impact our profitability in 2006, after adjusting for one-time integration costs.” He said that the integration process will be ongoing throughout 2006 and into early 2007.

Cooper Cameron is an international manufacturer of oil and gas pressure control equipment and provides oil and gas separation, metering, and flow measurement equipment.

Syntroleum acquires interest in oil discovery off Nigeria

Syntroleum Corp. has signed a Heads of Agreement (HOA) with an indigenous oil and gas company, Britania-U Nigeria Ltd., to acquire a 40% participating interest in an oil discovery in Oil Mining Lease OML 90 offshore Nigeria in the Ajapa field. The field, discovered in 1987 by Chevron Corp. 234 km south of Lagos, has been partically delineated. The Ajapa #1 well was drilled in approximately 30 feet of water and it flowed at stabilized rates of 4,210 bo/d from about 100 feet of net pay. The tested crude oil was high quality 40 API gravity.

Syntroleum estimates the Ajapa Field could contain from 15 million to more than 70 million barrels of gross oil. Syntroleum will undertake an appraisal drilling program to confirm the reserve and production potential of the Ajapa field.

“Due to the shallow water depth of Ajapa and the presence of existing infrastructure in the area, this project provides the potential for near term cash flow for Syntroleum. It is consistent with our objective of working to develop more near term cash flow while we pursue our broader objective of developing our first GTL plant,” said Jack Holmes, president and CEO of Syntroleum. “The Ajapa Field is one of several discovered, partially delineated oil and gas fields in West Africa that we are pursuing. While there is additional appraisal work to be done to confirm commerciality, we look forward to implementing successful oil development of this field.”

The first appraisal well is expected to be drilled in 2006, subject to government approval and rig availability.

Continental Energy Corp. forms new ventures exploration company

Continental Energy Corp. and its partner GeoPetro Resources Co. have formed CG Xploration Inc. to pursue new venture oil and gas exploration and production projects and obtain new exploration concessions in Indonesia. CG Xploration Inc. is incorporated in Delaware and is owned 50/50 by Continental and GeoPetro. Continental’s president, Richard L. McAdoo, has been named “president & CXO” of CG Xploration Inc. and will lead the new company’s exploration and new ventures development activities.

McAdoo, said of the new company, “The recent sale of our Yapen Block provides Continental and GeoPetro with sufficient funds to take advantage of several promising new venture opportunities in Indonesia during 2006. CG Xploration Inc. will actively pursue, develop, and acquire new venture opportunities on behalf of Continental and GeoPetro.”

James D. Eger, Continental’s CFO said, “The new and improved financial and fiscal production sharing terms and incentives available to oil and gas exploration companies in Indonesia continue to make Indonesia a very attractive place to explore for and produce hydrocarbons. Our long experience in Indonesia puts us in a very favorable position to strike the best deals possible on new concessions.”

Continental Energy Corp. is a small oil and gas exploration company, focused entirely on making a major oil or gas discovery in Indonesia.

Baker Hughes acquires UK’s Zertech and Canada’s Baseline Technologies

Houston-based Baker Hughes Inc. has been in an acquisitive mode recently. In December, the company announced two acquisitions - Zeroth Technology Limited (Zertech) and Baseline Technologies Inc. The purchase price was not immediately disclosed.

Zertech, a privately owned company based in Aberdeen, Scotland, has developed and patented a non-elastomer, expandable metal sealing element that is currently marketed in well intervention applications. Zertech’s customers include major oil and gas E&P companies in the United Kingdom, Norway, and the Middle East. Baker Hughes plans to market the sealing technology in other producing areas of the world as well.

Baseline Technologies of Calgary, Alberta, Canada, is expected to operate as part of the Baker Hughes Pipeline Management Group, a unit of its Baker Petrolite division. Baseline provides a comprehensive suit of data management products and services to help pipeline operators comply with complex operational and regulatory requirements. The company’s product line includes the Pipeline Information Control System (PICS), which provides essential integration and analysis capabilities needed for the effective implementation of pipeline integrity management programs.

Baker Hughes PMG offers a range of products and services intended to help pipeline operators increase delivery, assure system integrity, and improve reliability of upstream, transmission, and distribution lines. Baker Petrolite is the specialty chemicals division of Baker Hughes Inc., a major provider of drilling, formation evaluation, completion, and production products and services to the global oil and gas industry.

Swift Energy implements holding company structure

Houston-based Swift Energy Co. plans to implement a holding company structure pursuant to Texas law in a manner that does not require action by Swift Energy shareholders and is a non-taxable transaction. No exchange of Swift Energy stock certificates will take place.

The new parent holding company will assume the Swift Energy Co. name and continue to be traded on the New York Stock Exchange under the same ticker symbol (“SFY”) and its CUSIP number will remain the same.

The purposes of the new holding company structure are to separate Swift Energy’s domestic and international operations to better reflect management practices, to improve its economics, and to provide greater administrative and organizational flexibility, according to a company spokesman.

Under the new operational structure, four new subsidiaries will be formed with the Texas parent holding company owning three Delaware subsidiaries, which in turn will own Swift Energy’s domestic properties. Swift Energy’s name, charter, bylaws, officers, board of directors, authorized shares, and shares outstanding will remain substantially identical, according to the company.

The company’s international operations will continue to be conducted through Swift Energy International Inc. Swift Energy will be making amendments to its bank credit agreement, debt indentures, and various other plans and documents to accommodate the internal reorganization, but the company says that day-to-day business will not be impacted.

Swift Energy was founded in 1979.

NGAS Resources acquires CBM assets in Arkoma basin

Lexington, Ky.-based NGAS Resources has acquired the coalbed methane (CBM) assets of Dart Energy Corp., located in the Arkoma basin in Leflore County, Okla., and Sebastian County, Ark. In the transaction, NGAS acquired an estimated 7.0 bcf of natural gas reserves, comprised of 4.3 bcf of proved developed producing, and 2.7 bcf of proved undeveloped (PUD) reserves.

Of the acquired properties, NGAS has a 25% non-operating interest in 48 gross producing wells, 19 PUD locations, and 13 probable locations. In addition, as part of the transaction, NGAS also acquired a 25% interest in the gathering system servicing the project area.

Total purchase price of the assets was $11.4 million. NGAS funded the purchase with a portion of the proceeds from its recent convertible note financing.