The Florida Association of Convention and Visitors Bureaus, which has long opposed offshore drilling, conditionally endorsed federal and state policies allowing the production of oil and natural gas from existing leases within the Gulf of Mexico at least 30 miles from the Florida coastline. The conditions include: Florida offshore drilling must be a component of a comprehensive energy policy; production facilities must incorporate the most advanced zero-discharge systems; Congress must allow for sharing of royalties between states and the federal government; a five-year moratorium on new leases in the eastern Gulf must be established so state officials can evaluate production safety and evaluate any impact on Florida’s natural resources; and the military mission of the Defense Department shall have the first priority in the Gulf offshore.
Denver-based Forest Oil Corp. has completed the previously announced sale to undisclosed buyers for some of its Rocky Mountain assets, which include acreage in the Niobrara and San Juan basins and various properties in Wyoming and Utah. Forest received cash proceeds of $200 million. Following the sale, the producer’s bank syndicate reaffirmed the borrowing base available under the credit facility at $1.8 billion. Forest estimates 4Q2008 production will average 568-583 MMcfe/d, reflecting the loss of one month of output from the assets that were sold.
Northwest Natural Gas Co. (NW Natural) said it has filed a stipulated agreement with the Oregon Public Utility Commission (OPUC) to create a consolidated natural gas pipeline system integrity program (SIP). The SIP would integrate older programs into a single program and provide customers with enhanced safety and system reliability. It is subject to approval by the OPUC. Parties to the stipulation are NW Natural, OPUC staff, the Citizens’ Utility Board of Oregon, and the Northwest Industrial Gas Users. Previously implemented separately, NW Natural’s bare steel and transmission integrity programs are requested to be approved as a single program by the OPUC. The SIP also includes a component for a distribution integrity management program, which would be implemented following issuance of new federal regulations. NW Natural said costs would be tracked annually, with recovery to be sought after the first $3.25 million of capital costs incurred. An annual cap for expenditures would be approximately $12 million, with any extraordinary costs above the cap to be approved by all parties. If approved, the settlement will apply to costs incurred during the period from Sept. 30, 2008 to Oct. 31, 2011, or until the effective date of new rates adopted in the company’s next general rate case.
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