ConocoPhillips last week won an auction with a bid of nearly $2 billion for the Russian government’s 7.6% stake in Russia’s Lukoil — the world’s No. 2 oil company by reserves. ConocoPhillips offered $1.988 billion, only slightly above the $1.928 billion starting price. Immediately following its winning bid, the company announced that it planned to increase its stake in Lukoil to 20%. It also announced that it had offered to buy a 17.5% stake in a production sharing agreement allowing Lukoil to develop Iraq’s, four billion barrel West Qurna field, and would pay another $374 million to secure a 30% stake in a new joint venture to tap into rich Siberian oil reserves in the Timan Pechora region. The price tag of the Lukoil bid made it the single largest cash deal in the history of Russian privatization.

Pioneer Natural Resources said it has released all of its existing shallow gas leases in the Matanuska-Susitna Valley in Alaska in response to a contentious debate with residential landowners over the leases and to new legislation affecting the area. The leases were part of its merger with Evergreen Resources that closed on Tuesday. The released leases cover 235,500 acres and include farm-outs and the Mental Health Trust lease No. AK550.185 located east of the Pioneer Unit near the town of Palmer. As a part of the strategic planning and due diligence associated with the merger, Pioneer decided to relinquish the leases issued under the over-the-counter leasing program and to withdraw the exploration license applications made by Evergreen in August. “We strongly support the state’s new gas-only leasing program defined by HB531, and we encourage them to continue the best interest finding process for the Mat-Su,” said CEO Scott D. Sheffield. “We support the efforts of the Mat-Su Borough Assembly to develop a regulatory program that recognizes the state’s primacy while at the same time representing the borough’s interests.” The leases being released were on residential land. Pioneer also holds nearly one million gross acres on the North Slope and has working partnerships with ConocoPhillips, Anadarko and others.

CenterPoint Energy Minnegasco said it will begin an interim rate increase of 1.42% for its customers, adding about $1 a month to the average residential customer bill and increasing annual company revenues by $16.87 million. The company filed a rate request in July with Minnesota Public Utilities Commission (MPUC) for new rates for gas service based on the need to recover increased costs of providing utility distribution service and to improve the seasonal stability of customer bills. If approved by the MPUC, the proposed new rates, which probably won’t be formally set until next summer, will add about $3.17 a month to the average residential customer bill and increase annual company revenues by $21.77 million or 1.8%. The proposed rate changes are the company’s first since 1995. Under state law, Minnegasco is allowed to charge interim rates while the MPUC considers the company’s rate change request. In August, the MPUC approved the interim rate increase. This temporary increase is effective Oct. 1.

NUI Corp. obtained credit facilities aggregating $95 million. The facilities will be used to meet NUI Utilities’ gas purchase prepayment requirements, provide additional liquidity for working capital and for general corporate purposes to facilitate a smooth closing of the merger with AGL Resources Inc. The new credit facilities include a $75 million senior secured credit facility to be made available to NUI Utilities and secured by NUI Utilities’ receivables and related proceeds, and a $20 million senior unsecured credit facility to be made available to NUI by means of an amendment to NUI’s existing $255 million senior unsecured credit facility. The NUI Utilities facility matures on May 15, 2005, and the NUI facility matures on Nov. 21, 2005. As of September 29, 2004, both facilities are fully drawn.

Urging retail customers to seek bill payment plans this winter, the Oregon Public Utilities Commission (PUC) last week approved rate hikes for the state’s three principal natural gas distribution utilities, effective Friday (Oct. 1). Increases will range from 7.9% to 20.6%, attributable to the record high prices in the wholesale gas markets, the PUC said. The rate increases came as a result of annual purchased gas adjustment (PGA) procedures for Northwest Natural Gas Co., Avista Utilities and Cascade Natural Gas, reflecting wholesale prices that are 25% higher than a year ago, the Oregon regulators said. The increases among the three utilities break down as follows: Northwest Natural residential customers get an average hike of $10.40/month, or 18%, and its industrial customers get an increase up to 20.6%; Avista residential customers get an average monthly hike of $7.11, or 12.3% and commercial and industrial customers get an increase of 14.8-15.8%; Cascade residential customers will see an average monthly increase of $4.60, or 7.9%, which commercial and industrial customers will see hikes in the 9.2-9.7% range.

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