Unocal Corp.’s Spirit Energy 76 unit completed the previouslyannounced trade of most of its Rocky Mountain oil and gas assets toTom Brown Inc (See Daily GPI March 11,1999). Unocal received 5.8 million shares of Tom Brown commonstock (about 16.5%) and $5 million for the properties. The deal isworth about $76 million. Subject to certain restrictions andconditions, Unocal has the option to increase its stock ownership upto 19.5% through open market purchases. The sale agreement alsoentitles Unocal to nominate one director to the Tom Brown board.

Unocal said it expects the deal to be accretive to reserves andproduction in the long-term as Tom Brown applies its aggressiveexploration and development activities to the Unocal assets. Forthe short-term, the transaction will slightly dilute Unocal’sreserves and production.

Tom Brown received most of Spirit Energy’s Rocky Mountainassets. These include about 35 net wells that recorded firstquarter 1999 net daily production of 29 MMcf of gas, 239 barrelsof oil and 29,065 gallons of gas plant liquids. In addition, TomBrown received proved reserves of 89 Bcfe of natural gas and about65,000 undeveloped acres in Colorado, Utah, Wyoming and NorthDakota.

The assets also include the Lisbon Cryogenic Processing Plant inMoab, UT, one of only seven plants in the U.S. that produce liquidhelium. The effective date of the transaction was Jan. 1.

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