Magnum Hunter Resources said it has participated in three new field discoveries in the Gulf of Mexico that the company estimates will add 36 MMcf/d of gas production (12 MMcf/d net to Magnum Hunter) later this year. “Our company’s daily oil and gas production from the Gulf of Mexico continues to increase each quarter with production now averaging 55 MMcfe/d,” said Charles R. (Chuck) Erwin, senior vice president of exploration. “Our ability to ‘fast track’ some of our 2003 discoveries in order that we can benefit immediately from current high commodity prices, should bode well for our second half 2003 income estimates. With drilling rig and service costs remaining at unusually low levels in relation to current commodity prices, the Gulf of Mexico will capture a minimum of $60 million or 60% of our company’s 2003 capital budget,” he said. “Magnum Hunter will be participating in an additional seven wells in the Gulf of Mexico prior to year-end.”

An administrative law judge (ALJ) has recommended that the Arizona Corporation Commission (ACC) approve Tucson-based UniSource Energy Corp.’s proposed $230 million acquisition of gas and electric system assets from Citizens Communications Inc. Judge Dwight D. Nodes endorsed the proposed purchase as well as the increase in gas and electric rates agreed upon in an earlier settlement between ACC staff, UniSource Energy and Citizens. The ALJ’s recommendation will be forwarded to the ACC, which is scheduled to consider the sale on July 1. “We’re looking forward to finalizing this sale so that we can begin providing safe, reliable energy to our new customers in Arizona,” said James S. Pignatelli, CEO of UniSource Energy. Under terms endorsed by the judge, a new UniSource Energy subsidiary would operate Citizens’ gas systems in Santa Cruz, Coconino, Navajo, Yavapai and Mohave counties, as well as electric systems in Santa Cruz and Mohave counties. According to UniSource, the judge endorsed a proposed electric rate increase of 22%, less than half the 45% increase that Citizens originally requested. The judge also supported a 20.9% increase in gas rates, a significant reduction from the 29% increase originally requested by Citizens. UniSource Energy has agreed to forgo $135 million in compensation for increased energy costs not passed along to Citizens customers.

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