Spirit Energy 76, Unocal Corp.’s Lower 48 exploration andproduction unit reached a definitive agreement to sellsubstantially all of its oil and gas assets in Michigan to NewstarEnergy USA Inc. and Omimex Energy Inc. for about $37.25 million incash and 670,000 shares of stock in Newstar Resources, the parentcompany of Newstar Energy.

About 20,000 net leasehold acres producing about 2,200 barrelsof oil equivalent (BOE) per day are included in the sale. Estimatedreserves were not disclosed. The effective date of the sale will beJuly 1, 1998, and the transaction is expected to close on or aboutDec. 1. Unocal expects to record an after-tax gain of about $10million on the sale in the fourth quarter.

Newstar and Omimex will share in the acquisition on a 50-50basis, with the extent of Newstar’s participation contingent uponcompletion of financing, the terms of which are being negotiated.The transaction is also subject to certain regulatory approvals.

Spirit Energy said that the sale is consistent with its recentefforts to focus more of its primary exploration and productionactivities onshore in Texas and the Gulf Coast region and offshorein the Gulf of Mexico. Spirit Energy 76 has net production of about180,000 BOE/d and operates 330 offshore platforms with 2,700 activewells in 355 fields in the Gulf of Mexico region.

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