Southern Energy to Manage CanWest Gas' Business

CanWest Gas Supply Inc., an old-line natural gas aggregator in British Columbia --- and also the largest --- has agreed to allow Atlanta's Southern Company Energy Marketing to manage its business.

Under the agreement, Southern will market the aggregator's operations, which are owned by 38 Western Canada natural gas producers. CanWest was buying about 430 MMcf/d of natural gas from 100 natural gas producers. The CanWest agreement will add about 500 MMcf/d of natural gas to Southern's marketing operations, which had totaled 8.2 Bcf/d before the announcement yesterday.

The agreement doesn't just strengthen Southern's natural gas marketing base; it also strengthens its grip in Canada. Earlier this year, the company set up a similar agreement with Pan-Alberta Gas Ltd., the second-largest Canadian gas exporter (see NGI, Jan. 31). As part of the deal, Southern assumed Pan-Alberta's office in Calgary and integrated its businesses with trading and marketing operations. The Calgary office is now staffed with former Pan-Alberta employees.

"This agreement is similar to the arrangement we made with Pan-Alberta," said Southern spokesman James Peters. "It is structured the same, and had few changes." Peters said that about eight of 30 CanWest employees will remain with the company, and will work in the Calgary office.

Southern Company Energy Marketing is owned jointly by Southern Energy Inc. and Vastar Resources Inc., and the subsidiary provides energy marketing, risk management and financial services and other energy-related commodities, products and services to North American customers.

Carolyn Davis, Houston

©Copyright 2000 Intelligence Press, Inc. All rights reserved. The preceding news report may not be republished or redistributed in whole or in part without prior written consent of Intelligence Press, Inc.