ExxonMobil Corp. and Qatar Petroleum said Wednesday they lined up $7.5 billion in financing for their giant Qatargas II project, which will export liquefied natural gas (LNG) to Great Britain. The companies said they tapped 57 financial institutions to fund the project, which carries an overall price tag of $12 billion. About $6.5 billion of the $7.5 billion raised to date is in the form of debt. Qatar Petroleum holds a 70% stake in the project, while ExxonMobil owns the remaining 30%. The two companies also said they had awarded $4.5 billion in engineering and construction contracts linked to the project, under which LNG shipments would commence during the winter of 2007-08 using eight tankers engaged on 25-year charters. The Qatargas II project will ship up to 7.8 million tons per year of LNG from a liquefaction plant at Qatar’s Ras Laffan Industrial City to a regasification terminal at Milford Haven in Wales. The initial $700 million construction phase of the Wales project was awarded last month to Texas-based Chicago Bridge & Iron Co.
Vintage Petroleum closed an acquisition of producing properties in Escambia County, AL, from ExxonMobil Corp. for $76.4 million cash. Vintage acquired 100% of ExxonMobil’s interest in the Big Escambia Creek field and gas processing facility. The field produces condensate, gas and liquids from the Smackover formation and current net sales are 1,920 boe/d. The field is adjacent to the existing Vintage-operated Flomaton and Fanny Church fields and plant. Vintage believes it will be able to increase production and profitability through a series of planned facility modifications, drilling and increased operational efficiencies.
Texas Eastern Transmission LP, a subsidiary of Duke Energy, filed a Form 15 with the Securities and Exchange Commission Wednesday to suspend its reporting obligations under the Securities Exchange Act of 1934. The company is eligible to suspend its reporting obligation pursuant to the act because it has fewer than 300 holders of record of any class of its securities, the company said. Duke Energy said it determined that keeping Texas Eastern Transmission LP a registered issuer was not cost- effective. Texas Eastern will continue to provide investors with quarterly financial statements and annual audited financial statements.
Lexington, KY-based NGAS Resources Inc. said its Daugherty Petroleum Inc. subsidiary has entered into an agreement with Duke Energy Gas Services to operate and maintain the Stone Mountain natural gas gathering system owned by Duke Energy. The system runs through southeastern Kentucky, western Virginia, and northeastern Tennessee and interconnects with Duke Energy’s East Tennessee Natural Gas pipeline at Rogersville, TN. It consists of 50 miles of natural gas production lines, 100 miles of natural gas gathering lines, five delivery measuring and regulation stations, four compression stations, and a liquids extraction plant. “Our operation of the Stone Mountain natural gas gathering system for Duke Energy will enhance our operating and production position in our core area while also adding to our ongoing profitability,” said William S. Daugherty, CEO of NGAS. NGAS controls 250,000 acres in the Appalachian Basin where it owns 154 miles of gas gathering lines and interest in over 575 wells.
Aspen Exploration Corp. announced Wednesday that it has begun gas sales from another well in the Sacramento Valley gas province of northern California. The Verona No. 1, located in the Verona Gas Field, Sutter County, CA, was drilled by another operator 21 years ago to a depth of 3,800 feet and encountered 30 feet of gas pay in the Mokelumne Sand at a depth of 2,150 feet. Aspen said the upper portion of this zone was perforated and tested at a rate of 3 MMcf/d. However for various reasons, the prior operators of the Verona No. 1 were never able to connect the well to a gas pipeline. Aspen and partners acquired this well in March 2003 and have been pursuing the issuance of permits with numerous governmental agencies to effectuate the pipeline route construction including a major river bore. After the permits were obtained and the pipeline was constructed, gas sales commenced on Dec. 1 at a rate of 500 Mcf/d with no pressure drawdown.
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