El Paso Corp. said subsidiary El Paso Oil & Gas Canada Acquisition Inc. earlier this month received an advance ruling from the Canadian Competition Bureau regarding its proposal to acquire all the shares of Velvet Exploration Ltd. The Commissioner of Competition indicated El Paso would not be subjected to the regulatory process dealing with matters of competition, which keeps El Paso on track to complete the deal in the third quarter. The next step is to obtain approval under the Investment Canada Act, which requires review of significant non-Canadian investments in Canada. Under the terms of El Paso’s offer, which was announced on June 14, Velvet shareholders would receive C$8.15 in cash for each Velvet common share, or a total of about US$280 million, including the assumption of US$52 million.
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Industry Briefs
Duke Energy has entered into an agreement to acquire a 400 MW merchant generation facility from Enron North America. Acquisition of the Union County, MS, gas-fired facility expands Duke Energy’s Southeast generation portfolio. It also provides additional trading and structured origination opportunities throughout the eastern interconnect. Terms of the transaction were not disclosed. Closing is anticipated to take place in early October. The North American Electric Reliability Council estimates the Southeastern Electric Reliability Council needs an additional 40,000 MW of generation capacity over the next decade to meet peaking demand. Given access to major transmission lines, the Duke Energy facility will be able to serve demand throughout the southeastern and midwestern United States.
Ocean Energy Reels in Another, Acquires Ensight
Houston-based Ocean Energy Inc. continued on its acquisition trail last Monday, reporting it has entered into a definitive purchase and sale agreement with EnSight Resources L.L.C. to acquire all of EnSight’s oil and gas assets, located primarily in East Texas and North Louisiana. The companies said they expect the approximate $121 million transaction to close on or before April 20 with an effective date of Jan.1, 2001.
Industry Briefs
Westcoast Energy Inc. finalized on Wednesday its previouslyannounced acquisition of the remaining 50% of the Empire StatePipeline for approximately $75 million, increasing its stake in thenatural gas line to 100%. The company first announced it wasacquiring the remaining 50% interest from Coastal Corp. in Novemberof 2000 (see Daily GPI, Nov. 10, 2000). The 156-mile pipeline runsfrom the Canada/United States border near Niagara, through New YorkState to an interconnect near Syracuse, NY. The pipeline has arated capacity of 525 MMcf/d. “We are pleased to now have fullownership of this valuable link to our Union Gas system, our Dawnhub and markets in Upper New York State and the northeast U.S.,”said Michael Phelps, CEO of Westcoast.
Ocean Energy Reels in Another, Acquires Ensight
Houston-based Ocean Energy Inc. continued on its acquisitiontrail Monday, reporting it has entered into a definitive purchaseand sale agreement with EnSight Resources L.L.C. to acquire all ofEnSight’s oil and gas assets, located primarily in East Texas andNorth Louisiana.
Industry Briefs
FERC last week gave the green light to AES Corporation’sacquisition of IPALCO Enterprises, which owns Indianapolis Power& Light Co. The stock-for-stock transaction, which wasannounced last July, now only needs the approval of the Securitiesand Exchange Commission to be completed. AES is a global powercompany involved in generation, distribution and retail supplybusinesses. It sells electricity to more than 19 million end-usecustomers each year. Indianapolois, IN-based IPALCO Enterprises’sregulated subsidiary, Indianapolis Power & Light, serves about430,000 residential, commercial and industrial customers in centralIndiana.
Apache Remains Confident of Fletcher Acquisition
Apache Corp.’s definitive agreement to purchase FletcherChallenge Energy’s Canadian and Argentina assets has been in placesince last October, and a company spokesman said yesterday it wasstill a “done deal,” despite an announcement that a consortium madeup of Fletcher investors has made a counter offer to purchase theNew Zealand-based company.
El Paso, Coastal Complete Merger After FTC OK
El Paso Energy Corp. completed its $24 billion acquisition of The Coastal Corp. last Monday within hours of the Federal Trade Commission (FTC) giving its blessing to the mega-deal, creating the fourth largest energy company in the United States after ExxonMobil, a combined Texaco-Chevron and Enron Corp.
El Paso Buys Lines; Coastal Merger Closer
El Paso Energy Corp. last week completed its acquisition of some PG&E GT transmission lines following approval of a consent agreement by the Federal Trade Commission (FTC) and the Texas Attorney General. El Paso Field Services will pick up 8,500 miles of natural gas transmission pipelines that transport 2.8 Bcf/d, nine natural gas processing plants that now process 1.5 Bcf/d and a 7.2 Bcf natural gas storage field.
Williams to Handle Production Capacity from Deep-Water Giant
Williams was selected last week by a consortium of deep-waterGulf of Mexico producers to handle about 500 MMcf/d of gasproduction that is scheduled to come on stream in mid-2002. Toaccommodate the projected volumes, Williams will build, operate andown the Canyon Station, a production handling platform in the EastMain Pass area south of Mobile Bay.
