AltaGas Services acquired a 53-mile gas gathering system andrelated compression in the Kindersley area of Saskatchewan for C$3million. The acquisition of the Kindersley & Kerrobert gasgathering systems are a significant strategic addition to AltaGas’Central Border gas gathering and processing complex. With theaddition of these systems AltaGas’ contiguous presence in westcentral Saskatchewan is 56 miles east from the Alberta/Saskatchewanborder. This extensive area presence provides AltaGas withsignificant opportunity as producers are expected to substantiallyincrease gas drilling activity in this currently largelyundeveloped gas region. Since AltaGas’ first acquisition in thisarea in 1996, Central Border has increased from a 4 MMcf/dprocessing facility with 49 miles of gathering lines to an 81MMcf/d processing complex with more than 311miles of gatheringlines. With the addition of these new assets utilization of theCentral Border complex will be 78%.

Petroleum Development Corp. has acquired a 7,500-acreundeveloped lease in the Grand Valley Field of the Piceance Basinin western Colorado. The lease lies between areas which have beensuccessfully developed by Barrett Resources, Occidental Petroleum,and others. PETD owns a 100% working interest on this land. Theprimary target formation in the Piceance Basin is the Mesaverde.Well depths may range from about 6,500 feet to 10,000 feet,depending upon the surface elevation. A number of well locationsare available which are direct offsets to existing producing wells.Reserves of 1.5 Bcf or more per well are expected. The companyplans to commence drilling on its acreage during the first quarterof 2000. Initial well spacing will be 40 acres. Tests by operatorsin the region indicate that closer spacing may be possible in thefuture. If successful, production from here could add as much as 5Bcfe of new reserves in 2000.

Infinity, Inc., an independent producer in Eastern Kansas andNortheastern Oklahoma announced the start of operations on itsLabarge coalbed methane project in Sublette County, WY, part of theGreen River Basin. Infinity said yesterday that the first test wellis to be drilled to confirm estimates of reserves for the GreenRiver Basin established by the Gas Research Institute and othergas-in-place studies. With approximately 100 drillable locationsand assuming recovery of 80% of original gas in place, thesepreliminary studies suggest reserves could be over 450 Bcf,Infinity said. Assuming the tests confirm these findings, Infinityplans to drill additional wells and move into the full developmentof the acreage in the first half of the year 2000. Work will beginimmediately on the property with the drilling rig moving into placeon January 3, weather permitting.

DPL Inc. announced yesterday it has sold its financial interestin Market Hub Partners (MHP) to a subsidiary of NiSource for $29million in cash. This sale follows DPL’s recent announcement of thesale of its natural gas retail distribution business to IndianaEnergy. MHP is a natural gas storage company headquartered inHouston. DPL was required to separate its electric business unitswith the July passage of Ohio electric restructuring legislation.In so doing, the company said it was going to explore options forits gas businesses while focusing on electric generation. DPL saidit has continued to expand its natural gas-fired generationbusiness with the addition of 475 MW through two plans called”Phases One” and “Two.” Two more phases, which have yet to beannounced, will increase that capacity by 320 MW. These expansionsare occurring in both Ohio and Indiana, DPL said, and will beimmediately accretive to earnings as these units come onlinestarting in the summer of 2000.

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