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Gold/Mining/Energy : Oil & Gas Exploration & Production Co.'s -- Ignore unavailable to you. Want to Upgrade?

To: Ed Ajootian who wrote (75)7/1/2003 10:35:51 AM
From: DELT1970  Read Replies (1) | Respond to of 112
Unit Corp is paying a 34% premium for PetroCorp, its Tulsa neighbor. Unit drills for clients (#5 land based driller in the US) and its own portfolio. Petro had already hi-graded its portfolio by selling Alabama and Canadian assets.

Unit Corp. (NYSE:UNT - News) , in a move to boost its presence in the oil and gas exploration sector, Tuesday said it agreed to acquire rival energy concern PetroCorp Inc. (AMEX:PEX - News) for $190 million in cash and stock.

PetroCorp, based in Tulsa, Okla., explores and develops oil and natural gas properties primarily in Texas and Oklahoma. Unit Corp., which is also based in Tulsa, is involved in oil and gas exploration, production and contract drilling.

The proposed deal consists of two million shares of Unit Corp., with the remainder in cash. Unit Corp. expects the deal to immediately add to earnings and cash flow per share.

The acquisition is subject to conditions, including approval of PetroCorp shareholders.

Monday, shares of PetroCorp closed at $11.15 on the American Stock Exchange, and Unit Corp.'s shares closed at $20.91 on the New York Stock Exchange (News - Websites).

Unit Corp. said about $101 million of the purchase price will be allocated for working capital, $78 million to proved reserves and the remaining $11 million to undeveloped leasehold and partnership interest.

To: Ed Ajootian who wrote (75)7/8/2003 11:12:06 PM
From: Ed Ajootian  Read Replies (1) | Respond to of 112
HORIZON: Early Leaders Emerge In Race To Build New US LNG Ports
(Copyright © 2003 Energy Intelligence Group, Inc.)
World Gas Intelligence Wednesday, July 2, 2003

The question these days seems to be not whether the US is a viable market for LNG but rather when, how, and from where more LNG can be delivered. Currently, around 20 proposals to enhance LNG receiving capacity through onshore, offshore, or Mexico-based terminals are in one stage or another of commercial or regulatory approval.

The US currently has about 1.8 billion cubic feet per day of receiving capacity, including a recent expansion of the Everett, Massachusetts, terminal. Upon the slated reopening of the Cove Point, Maryland, facility later this month, that should leap to 2.8 Bcf/d (WGI Jun.18,p1). Approved expansions of Lake Charles and Elba Island should bring the total for existing terminals up to a combined 4 Bcf/d. Since forecasts suggest that the US could be using 9 Bcf/d -- or nearly 70 million tons per year of LNG -- by 2010, a number of new facilities will likely be needed (WGI Oct.23,p5). But that number isn't as large as 20. Those that look to be good contenders to make the cut are mainly clustered along the Gulf Coast.

ChevronTexaco's Port Pelican application has been making its way through the US Coast Guard permitting process since late last year, with a decision expected by end-2003. Located offshore Louisiana about 50 miles south of Lake Charles, Port Pelican could start up as early as 2006, a point when new Atlantic Basin liquefaction facilities should be completed (WGI Apr.9,p4).

The Freeport LNG project on Quintana Island, southwest of Freeport, Texas, also looks promising for several reasons, starting with a blue-chip customer and a location in a heavily industrial and economically depressed area where any job-creating venture is likely to get solid local backing. Freeport shouldn't face regulatory impediments at the state level, and Federal Energy Regulatory Commission (FERC) approval is pending. Completion is set for 2007. Dow Chemical has provisionally agreed to bring 3.6 million tons/yr of LNG, or 500 million cubic feet per day of gas, into the facility from an unspecified source. Cheniere Energy came up with the Freeport project but has since sold a majority to small, privately held investment groups.

Cheniere has targeted two other sites: Sabine Pass, Louisiana, and Corpus Christi, Texas, each projected to have 2 Bcf/d of capacity, with completion targeted for 2007-08. At both sites, Cheniere has awarded a front-end engineering and design contract to Black and Veatch in anticipation of filing an application with the FERC in early 2004.

Exxon Mobil is looking at Sabine Pass, too, but on the Texas side of the border, about 80 miles east of Houston, for a possible 1 Bcf/d (7.7 million ton/yr) terminal (WGI Jun.25,p1). Exxon, which currently has no firm US import capacity, is evaluating other Gulf Coast locations, as well, including one in Louisiana. One reason for Exxon's relatively late indication of interest in US LNG was the regulatory environment. FERC's Hackberry decision changed that (WGI Jan.22,p1). Now Exxon can build its own terminal and not have to share it or worry about regulated tariffs if it does sell access to others.

Sempra's Cameron LNG project -- initiated by Dynegy -- to convert an unused LPG terminal at Hackberry, Louisiana, has preliminary FERC approval, and an environmental impact study is underway. A 2007 completion date is targeted. The company hasn't said whether the facility will be open-access. The location on Calcasieu Lake has a major drawback: potential shipping bottlenecks in the Lake Charles Channel. The existing Lake Charles terminal is further upstream.

Of three proposed LNG receiving terminals in the Bahamas, only two are active. The largest and apparently most promising is Tractebel's Calypso venture near Freeport, acquired from Enron last year. Output from the 830 MMcf/d complex would be shipped through a 96 mile pipeline to Florida. The other is AES' scheme to build a 550 MMcf/d facility on Ocean Cay that would be connected by a 65 mile pipeline to Florida. AES also would build a power plant in the Bahamas. Both have applications into the Bahamian government and into FERC for the pipeline access, and both are scheduling a 2006-07 startup (WGI Jun.4,p3). Given that a supply contract with end-user Florida Power & Light is a near necessity, both are unlikely to go through.

El Paso's Energy Bridge project may be up for sale, but its application is still wending its way through the US Coast Guard permitting process, giving it potential value to another company. Special tankers would have regasification equipment on board, eliminating the need for a conventional receiving terminal. Regasified LNG would be unloaded directly into a pipeline through a submerged docking buoy.

Another technological innovation would be use of salt caverns for storage. The US Energy Department recently endorsed a process developed by Houston-based Conversion Gas Imports that involves an innovative heat exchanger to allow direct injection of pressurized LNG or dense-phase vapor into salt caverns or pipelines. At a fraction of the cost, that would eliminate the need for both storage tanks and conventional regasification facilities (WGI May7,p8). Conversion Gas itself is participating in two projects, and its technology could be used in a third sponsored by Freeport McMoRan (Natural Gas Week Jun.23,p6).

Also enticing is Canadian refiner Irving Oil's recently resurrected plan for an LNG regasification in New Brunswick, Canada, to target New England through an expansion of the existing Maritimes and Northeast Pipeline.

By Barbara Shook in Houston and Madeline Jowdy in New York