Oklahoma City-based Crusader Energy Group Inc. has begun operating as a publicly held independent following completion of its merger with Dallas-based Westside Energy Corp. No financial details were issued, but the transaction is valued at about $956 million in stock. Westside, which had been publicly traded, and Crusader, which had been private, announced their merger in January (see NGI, Jan. 7). The merger brought together assets that at the end of 2007 had a net proved reserve base of more than 150 Bcfe, 80% weighted to natural gas, with an estimated reserve life of 15.8 years. Combined production at year-end 2007 was more than 26,000 Mcfe/d, 75% natural gas. Its leasehold is more than 765,000 gross acres (316,000 net), with 92% undeveloped. At the end of March, Westside said it owned 81,431 gross (66,435 net) acres in the Barnett Shale, with 77,161 gross (65,208 net) undeveloped. Net production was estimated at 5.23 MMcfe/d. Westside also had working interests in 75 gross (20.6 net) producing wells with operations in Montague, Johnson and Hill counties, TX. Crusader has operated primarily in several U.S. basins, including the Anadarko, Delaware and Val Verde, with most of its operations in the Barnett Shale in the Fort Worth Basin. It also has operations in the Bakken Shale in the Williston Basin. Crusader was to have a total of 198.1 million shares outstanding at close. None of the shares issued were registered or may be sold or transferred until the six-month anniversary of the business combination's completion.
U.S. mayors took a stand against global warming-causing pollution at a conference in Miami, noting that fuels derived from tar sands, liquid coal and oil shale emit "even greater amounts of global warming pollution than conventional petroleum sources." The U.S. Conference of Mayors adopted a policy resolution calling for cities, communities and the federal government to "take actions to reduce global warming pollution." The resolution takes particular aim at Canadian tar sands oil production. "[T]he production of tar sands oil from Canada emits approximately three times the carbon dioxide pollution per barrel as does conventional oil production and significantly damages Canada's boreal forest ecosystem -- the world's largest carbon storehouse...[T]he continued production and purchase of these higher-carbon unconventional or synthetic fuels slows the United States' transition to clean, renewable energy sources." The resolution calls for life cycle analyses to evaluate greenhouse gas emissions from the use of fuels, including unconventional and synthetic fuels, and supports the creation of federal and state guidelines for tracking the origin of various types of fuel in order to enable the analysis.
Pepco Energy Services has been awarded a two-year contract to supply natural gas to various Department of Defense (DoD) facilities and federal civilian agencies in the Northeast and across the central part of the United States. The $92.5 million contract to supply 4.2 million Dth would begin Oct. 1 and would run through Sept. 30, 2010. The contract, secured by the Defense Energy Support Center in Fort Belvoir, VA, is fixed with an "economic price adjustment," the DoD stated. The original proposal was web-solicited with 37 responses, according to DoD. Pepco Energy Services, a subsidiary of Pepco Holdings Inc., estimated that it has saved federal agencies nearly $46 million in electricity costs in the Washington, DC, area over the last 18 months under a U.S. General Services Administration (GSA) contract. Between December 2006 and May, the GSA-DC portfolio used 2.5 billion kWh, Pepco said. During that time, it said the GSA portfolio saved $45.75 million versus the applicable standard offer service rates.
A proposal to drill for natural gas on Colorado's Mount Herman in the Pike National Forest has been delayed until spring 2009, the U.S. Forest Service said. The proposal has been on the table since 2002. The Forest Service has been working on an environmental assessment, which would include a recommendation on whether to approve or deny a request from Dyad Petroleum Co. of Midland, TX. Dyad owns the mineral rights to around 21,000 acres in the national forest and it has requested permission to drill two exploratory wells. The delay is required, said the Forest Service, because more information is needed from Dyad on how drilling equipment would impact air quality, how the company plans to monitor groundwater, and what improvements it would make to the roads systems to accommodate traffic for the drilling site. Dyad also has to provide details on the drill pads that would be constructed. No drilling has been conducted in the national forest since the 1950s, and area stakeholders don't want drilling to begin again. The Front Range Environmental Resource Coalition (FRERC), formed by area residents, opposes the drilling because of quality of life and environmental issues. The national forest also is a popular destination for wildlife enthusiasts.
OG&E has proposed to the Oklahoma Corporation Commission (OCC) that it recover only 50% of its higher natural gas costs this summer -- deferring the allowed recovery until later this year -- to give customers a break on their bills. Oklahoma City-based OG&E, a subsidiary of OGE Energy Corp., uses natural gas along with other fuels to generate electricity, and by law, the utility recovers only the actual cost of the fuels it uses. Those costs are then passed directly to customers based on how much electricity each customer consumes. OG&E serves more than 765,000 customers in a service territory spanning 30,000 square miles in Oklahoma and western Arkansas. In its fuel adjustment filing to the OCC, OG&E proposed that it recover only 50% of its fuel costs during the summer months. The deferral also would include $60 million in higher fuel costs that the company has not yet recovered from customers. The company's proposal, which is scheduled to take effect July 1, would reduce the near-term impact on its customers of higher fuel prices, it said. The average summer bill, which is based on usage of about 1,500 kWh/month from July through September, would increase by about $15. Without the proposed deferral plan, bills would increase by $30 or more, OGE said. Bills received in the months of October through December, when average usage is about 950 kWh/month, would be higher to recover deferred fuel costs. In addition, OG&E wants to increase the frequency of fuel forecast reviews with the OCC, which it said would help to avoid dramatic increases or decreases in customer bills.
Intelligence Press Inc. All rights reserved. The preceding news report
may not be republished or redistributed, in whole or in part, in any
form, without prior written consent of Intelligence Press, Inc.