Montana Power Co. is no longer in the oil and gas business,after closing the sale of some of its energy assets to PanCanadianPetroleum Ltd. for $475 million in a combination of cash andcredit. The assets include oil, natural gas and gas liquidsexploration, production and marketing companies in the UnitedStates and Canada.

In March, Butte-based Montana Power announced it would sell all ofits energy assets (see Daily GPI, March30). Along with the oil and gas assets, it plans to sell itsindependent power production businesses and electric and natural gasutility. It now plans to zero in on fiber-optic and wireless voice,data and video transport under its Touch American subsidiary.

Current daily production on the properties is 94 MMcf of gas and3,800 bbl of oil and gas liquids, which will increase PanCanadian’sdaily gas production to more than 1 Bcf.

“The Montana Power oil and gas assets and staff have beensmoothly and quickly incorporated into PanCanadian,” said COO DaveBoone. “We have confirmed attractive investment opportunities onthese properties, which complement our strong Canadian base. Thismarks the beginning of a major opportunity to apply our expertiseto the exploration and development of new core properties on NorthAmerica’s Great Plains.”

For the rest of the year, PanCanadian plans to completefieldwork, including connecting more than 40 gas wells. It alsowants to evaluate additional exploration and developmentopportunities. The Calgary company will incorporate most of theacquired properties into a new business unit, which will containthe properties and production in southern Alberta and Saskatchewan,northern Montana, Colorado, Wyoming and Oklahoma. The unit willmaintain regional offices in Butte and Denver.

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