As a result of early settlement and reset arrangements for 37% of its 2009 commodity hedge volumes, XTO Energy Inc. said it has realized about $900 million of after-tax proceeds that it has used to reduce its outstanding debt. The company expects to end the first quarter with net debt of approximately $11 billion. The net effect of the early settlements is to accelerate cash receipts, while maintaining XTO’s full hedge position against further declines in oil and natural gas prices during the year. By executing the transactions, the company said it has accomplished the lion’s share of its previously announced $1.25 billion minimum debt reduction. In November XTO said it had 1,745 MMcf of gas hedged at $8.83/Mcf for 2009 and 730 MMcf of gas hedged at $8.67/Mcf for 2010 (see Daily GPI, Nov. 21, 2008). At the same time, the company’s board of directors approved a 2009 capital budget for development and exploration expenditures of $3.3 billion and an additional $500 million was budgeted for the construction of pipeline infrastructure and compression and processing facilities. Fort Worth, TX-based XTO’s properties are concentrated in Texas, New Mexico, Arkansas, Oklahoma, Kansas, Wyoming, Colorado, Alaska, Utah, Louisiana, Mississippi, Montana, North Dakota, Pennsylvania, New York, West Virginia and Kentucky.

Norex Energy said assets it is acquiring in Alberta have the potential to contain more than 8 Bcf of natural gas. Norex recently announced that it would acquire a 49% interest in a natural gas processing and compression facility, natural gas pipeline, additional infrastructure and certain lands associated with the infrastructure. The company also has the option to obtain the remaining 51% interest from the owner over a two year period. The processing facility, constructed in 2004, is capable of processing sour gas by a regenerative solution, as well as sweet gas compression, gas metering and water storage. Norex is also acquiring a network of five six-inch diameter pipelines that connect to a major trunk line operated by EnCana and that extend out toward three gas wells ready for tie-in.

©Copyright 2009Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.