Kerr-McGee Corp.'s chemicals unit, New-Co Chemical Inc., has filed an initial public offering (IPO) for up to $300 million in Class A common stock. However, Kerr-McGee still holds an option to sell New-Co if the opportunity arises. The IPO or sale of the chemicals unit was announced earlier this year so the company could refocus its attention on oil and gas exploration and production (see NGI, May 16). About 90% of the chemicals sold by the unit last year were titanium dioxide, according to the company. In the Securities and Exchange Commission filing on the IPO, the Oklahoma City-based producer did not specify how many shares would be offered or the price of the shares. That information is expected to be disclosed in a later filing. The underwriters are Lehman Brothers and JP Morgan. Kerr-McGee said it wants the chemicals unit sold or spun off from the company by the end of the year.
Energen Corp. has hedged an additional 5 Bcf of its 2006 natural gas production at $7.50/Mcf and 360,000 bbl of its sour oil output at $55.21/bbl, and with the additional uncertainty of price volatility removed, raised its 2006 earnings guidance to a range of $2.55-2.75/diluted share The company's previous guidance for 2006, adjusted for a 2-for-1 stock split on June 1, was $2.50-2.60/share. The Birmingham, AL-based company's oil and gas acquisition and development subsidiary, Energen Resources Corp., uses derivative hedge instruments to mitigate the impact of volatile commodity prices. Energen Resources' total natural gas hedge position for 2006 now stands at approximately 22.7 Bcf at an average New York Mercantile Exchange-equivalent price of $6.99/Mcf; the company's total oil hedge position is now approximately 1.8 million bbl at $47.85/bbl. Embedded in Energen's 2006 earnings guidance is the assumption that prices applicable to its unhedged natural gas and oil production will average $6.15/Mcf and $35/bbl, respectively. The assumed average price for unhedged natural gas liquids (NGL) production in 2006 is 58 cents/gallon.
Rising global interest in the crude oil, gasoline and natural gas markets, has driven the price of a New York Mercantile Exchange (Nymex) Nymex Division seat to a new record of $2.49 million, topping a $2 million sale on Oct. 12, 2004, Nymex reported on Wednesday. The exchange has a finite number of seats (816), and a seat can only be purchased if a member puts one up for sale. The latest seller and buyer were not disclosed. Ownership of a seat on the Nymex Division also represents a share of common stock in Nymex Holdings Inc. "In a year when the exchange has experienced unprecedented volume levels and is in the midst of global expansion, we are gratified by the strength of our seat values," said Exchange President James E. Newsome. "The record serves as an indication of the market's confidence in our continued growth."
Equitable Gas Co. said it will install 260,000 electronic meter reading devices in its southwestern Pennsylvania utility service territory to gain efficiencies and cut long-term service costs. The implementation and installation process will begin later this month and will be completed by September 2006. The Mobile Automated Meter Reading (AMR) technology will enable Equitable to virtually eliminate estimated bills, dramatically reduce the number of times a service representative may ever need to enter the customer's home, improve billing accuracy and enable the company to focus resources on providing safe and reliable service. Customers will receive a post card notification two weeks prior to the installation, which will not require disruption of service. "We're deploying this AMR technology as part of our ongoing efforts to improve customer service and reduce our costs," said Equitable Gas President Randall Crawford. "The use of this technology will also improve our relationship with more than 60,000 customers that currently have indoor meter sets, as the AMR technology virtually eliminates the need to disrupt our customers' daily schedules to read their meters." Tru Check Meter Services, a contractor for Equitable Gas, will be completing the installations, which take less than a half hour. If the meter is outside the home or business, no internal access is required.
The Canadian Environmental Assessment Agency said it has made available C$40,000 in funding to assist groups and individuals who would like to take part in the federal environmental assessment of the proposed C$4 billion Keltic Liquefied Natural Gas (LNG) Terminal and Marginal Wharf in Goldboro, NS. Keltic Petrochemicals is planning a multifaceted project in Goldboro that will include a petrochemical complex, a cogeneration power plant, a marginal wharf as well as an LNG import, storage and vaporization terminal and associated infrastructure including a new highway. Applicants for special funding must participate in the comprehensive study process and in the review of the comprehensive study report. They also must sign a contribution agreement with the agency. Information on the participant funding program, including the Participant Funding Program Guide, the application form and the contribution agreement can be found on the agency's website at www.ceaa-acee.gc.ca. Funding applications received by July 5 will be considered. For additional information on the funding program, contact Peter Bedrossian at (613) 957-0254 or firstname.lastname@example.org.
Updating its current exploration and production program, Pioneer Natural Resources Co. said Wednesday that it has initiated production from a new natural gas well at its Raptor field in the Falcon Corridor, which is in the East Breaks area in the deepwater Gulf of Mexico. The Dallas-based company holds a 100% working interest and operates the three fields that are tied into the Falcon facilities. The new Raptor well was tested at 30 MMcf/d. Pioneer noted that while the system pressure will limit the incremental production impact, the new Raptor well is expected to extend the productive life of the Falcon Corridor system and generate a return on investment in excess of 100%. Over the remainder of the year, Pioneer said it plans to drill and operate two additional wells in the deepwater Gulf. The Clipper prospect, an amplitude play located in the Green Canyon area in which Pioneer has a 55% interest, is currently drilling. The Paladin prospect, a subsalt well located in the Garden Banks area in which Pioneer expects to own approximately 40% interest, is expected to spud during the third quarter. The company said it also plans to drill three to four wells on the Gulf of Mexico shelf before year end. "Pioneer has enjoyed significant exploration success in the Gulf of Mexico which has resulted in several large scale development projects including Canyon Express, Devils Tower and the Falcon Corridor," said CEO Scott D. Sheffield. "The Gulf of Mexico, where we have a number of attractive deepwater opportunities, will continue to be one of our key exploration focus areas."
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