KeySpan Energy affiliate Houston Exploration said it purchased 42 Bcfe of proved reserves in South Texas from subsidiaries of Burlington Resources for $48.1 million in cash. The producing and undeveloped properties total 24,800 gross acres in four fields in Webb, Jim Hogg, Wharton and Calhoun counties. The properties currently are producing 16 MMcfe/d. “Our expansion in South Texas is a direct result of our historical operating performance and the investment in 3-D technology that continues to improve drilling and development results,” said CEO William G. Hargett. “These new properties will continue providing operating efficiencies to our South Texas operations as they are adjacent to existing operations in the Charco Field.” The acquisition will increase Houston Exploration’s South Texas production by 15% to an average of 123 MMcfe/d and grow its total reserves by 10%. The 146 wells in the acquisition are located in the following fields: Northeast Thompsonville, South Laredo, McFarlan and Maude Traylor. The acquisition will be financed through cash flow from the company’s previously announced $250 million capital budget.

ChevronTexaco has signed an agreement to sell its 12.5% ownership interest in Texaco Exploration and Production Inc., a natural gas liquid fractionator, to Enterprise Products Partners LP for an undisclosed amount. The transaction, expected to close in the second quarter, was part of a divestiture mandated by the Federal Trade Commission (FTC) as a condition of the merger between Chevron and Texaco last year. FTC still must approve the sale. The fractionator is located in Enterprise’s complex in Mont Belvieu, TX with the capacity to split 210,000 bbl/d of mixed natural gas liquids into ethane, propane, normal butane, isobutane and natural gasoline. Enterprise already owned 62.5% interest in the facility and serves as the operator.

A standard contract for both long- and short-term natural gas purchases and sales has been ratified by members of the wholesale gas quadrant of the North American Energy Standards Board (NAESB). A Canadian addendum enables companies that conduct business on both sides of the border to use the new contract, which is a revision and expansion of a standard contract approved by NAESB’s predecessor, the Gas Industry Standards Board, in 1996. “This contract is an answer to the gas industry’s call for a contract that can be used for a wide variety of transactions, both long- and short-term,” The new contract and the Canadian addendum may be downloaded by NAESB members at www.naesb.org. NAESB was formed in December 2001 as GISB’s successor to serve as an independent and voluntary North American organization to develop and promote the use of business practice and electronic communications standards.

A Long Island Power Authority (LIPA) study shows that up to 5,200 MW could be produced for Long Island by ocean-located wind generators placed offshore. A 314 square-mile band of generators placed up to six miles off the south shore and east of Montauk Point could produce the most power, but even restricting the placement of wind turbines to a smaller 135 square-mile area with water depths of 50 feet or less would produce 2,250 MW. Among other things, the study found that a 100 MW offshore project would cost about $150-$180 million, with interconnections costing between $40-$70 million. The permitting process, because of multiple oversight entities, would take a minimum of three years. Additional work also would determine potential environmental impacts on water foul, migratory birds and marine life, and the costs associated with building and connecting the wind generators to LIPA’s on-island electric grid. Since offshore wind development is new to the United States and has only taken place in northern Europe, the study focuses on broad issues relating to the state-of-the art technology and its applicability to the Long Island environment. Most offshore wind generation developed in Europe has been done in water 50 feet or less in depth. The main objective was to identify offshore areas that appear to have the best potential for wind energy development, and to also examine the implications of delivering offshore-generated electricity into LIPA’s on-island transmission system. The study, Long Island’s Offshore Wind Energy Development Potential: A Preliminary Assessment, was co-funded by LIPA and NYSERDA. The study can be downloaded from LIPA’s web site.

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