Marathon Group, a unit of USX Corp., said the strategicre-organization of its upstream business is largely complete but anadditional 250 positions likely will be eliminated, leaving theupstream business with 24% fewer employees than in 1999. “We haveplans in place for dramatic change and improvement and I believethat the organization is both ready for change and able to deliveron our commitments,” said Company President Clarence Cazalot.Cazalot introduced a new senior leadership team in September afterannouncing the restructuring plan in October. Commenting on thecompany’s target of implementing $150 million of annual repeatableefficiencies by the end of 2001, Cazalot said, “We are on track todeliver a $75 million reduction in above-the-field costs and wehave made substantial progress towards cutting exploration expensesby $50 million. As we also realize annual savings of $25 millionthrough global procurement, we are well on our way to meet ourambitious overall target.”

Maritimes & Northeast Pipeline completed construction andcommissioning of the 63 mile Saint John Lateral last week and begandelivering 164,000 MMBtu/d of gas from a point near Kedron Lake todelivery points in the Saint John and Lake Utopia areas in NewBrunswick.

Kinder Morgan Energy Partners LP yesterday announced plans tobuy GATX Corp.’s U.S. petroleum pipeline and terminal businessesfor $1.15 billion in cash and assumed debt. Primary assets includedin the transaction are the CALNEV Pipe Line Co. and the CentralFlorida Pipeline Co., which transport petroleum products tohigh-growth markets in Nevada and Florida, along with 12 terminalsthat store petroleum products and chemicals. Upon closing thistransaction, KMP will become the second largest independentpetroleum storage operator in the U.S. and the second largestindependent chemical terminal operator in the U.S., based oncapacity. GATX’s international operations and its 50% ownership inthe GPS trading arm, which are also being marketed, are not beingsold to KMP. “The transaction is expected to be immediatelyaccretive to cash available for distribution to KMP unitholders bybetween 10 to 15 cents annually,” said Richard D. Kinder, CEO ofKMP. “Additionally, it is expected to be substantially accretive toKinder Morgan, Inc. shareholders by 15 to 20 cents per shareannually.” KMI, through its general partner interest, operates KMPand shares in the cash distributions generated by KMP.

Vintage Petroleum is buying all of the common stock of CometraEnergy (Canada) Ltd. for $46.3 million in cash (C$71 million) fromElectrafina, which is part of Groupe Brussels Lambert SA. Thetransaction is scheduled to close on Dec. 8 with an effective dateof Sept. 1. “The acquisition of Cometra marks our initial entryinto Canada and Trinidad. It also establishes Western Canada as anew core area for Vintage, complementing our existing coreoperating areas in the U.S., Argentina, Bolivia and Ecuador,” saidS. Craig George, CEO. The Cometra properties consist of 13producing fields in Alberta and British Columbia with additionalfields in Saskatchewan, certain processing and pipeline facilitiesand 146 thousand net undeveloped acres. Vintage will operate 50% ofthe wells, which have a total current net daily productionaveraging 12 MMcf and 635 barrels of light crude.

The Oil & Gas Asset Clearinghouse sold more than $18.1million of properties as of its Oct. 25th Hybrid auction, whichfeatured simultaneous floor and Internet bidding in Midland, TX.Based in Houston, the company is a wholly owned subsidiary ofPetroleum Place, an Internet portal and marketplace serving theupstream energy industry. The Clearinghouse said it offered 128lots, consisting of more than 800 wells, including 46 higher valuedproperties. Year-to-date, Internet bidders have purchased more than$25 million properties through Selective Offerings, andparticipation on the Internet also is increasing, said the company.

AltaGas Services Inc., based in Calgary, has filed a Notice ofIntention with the Toronto Stock Exchange to make a Normal CourseIssuer bid. Subject to regulatory approval, the independentmidstream natural gas company may purchase up to 1.46 millionshares, which represents approximately 5% of the 29 million sharesoutstanding. AltaGas said it was putting the bid in place because,in the view of management, recent trading prices for the shareswere not reflecting the company’s value. Assets include natural gasgathering and processing facilities in Alberta and Saskatchewan,interests in two Alberta ethane and natural gas liquids extractionplants, and ownership of AltaGas Utilities Inc., which serves morethan 90 Alberta communities. It also holds a 33% interest in theIkhil Gas Project, the first Canadian commercial natural gasdevelopment project north of the Arctic Circle.

MidAmerican Energy Co. has become the first to be registered asa Certified Retail Electric Supplier in the Cincinnati Gas &Electric Co. territory, enabling the Cincinnati-based company tocompete for electric sales throughout southwest Ohio. Under Ohiolaw, consumers and businesses will be able to choose amongelectricity suppliers beginning Jan. 1, 2001. MidAmerican hasopened an office in Beachwood, OH, and is currently contactingcustomers throughout the state. Ohio is the company’s second entryinto the deregulated U.S. market. It also is operating in Illinoisand has sold more than 1 billion KWh there, along with more than 10Bcf of natural gas.

Consolidated Edison Inc. said it would not make a final decisionon whether to proceed with its acquisition of Northeast Utilitiesuntil it has completely reviewed the stringent conditions set forthby the Connecticut Department of Public Utility Control. Con Edsaid it also would await regulatory decisions in New Hampshire andNew York before deciding whether to proceed. Last week, Con Edissued a statement that said, “We are continuing to analyze theimplications of the Connecticut DPUC’s decision relating to ourPetition for Reconsideration. The department did clarify somefeatures of the merger order in line with our request, but did notchange its earlier conclusions on important financial issues.” ConEd first announced the $7.5 billion purchase of NU in October 1999,which would create the largest gas and electric utility in thenation with more than five million electric and 1.4 million gascustomers in New York and New England. However, the DPUC imposedstrict guidelines imposing rate reductions and employment rulesamong other things.

Houston-based Michael Petroleum has purchased Enogex Explorationfor $7.5 million, picking up interests in 72 producing wells and22,500 acres in the Lobo Wilcox Trend in Webb County, TX. MPCalready operates 61 of the 72 wells purchased. Total provedreserves are estimated to be 16.6 Bcfe, of which 36% are proveddeveloped reserves. Enogex Exploration is a subsidiary of EnogexInc., which is a subsidiary of Oklahoma City-based OGE Energy Corp.

Intercontinental Exchange (ICE), the hard-charging new entry inthe electronic energy trading business says its cash markets innatural gas are averaging between one and two Bcf/d – just onemonth after going live. Since Oct. 19 over 60 Bcf ofphysically-delivered gas has been traded over ICE, whilefinancially-settled gas volumes have reached almost 900 Bcf.

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