Amend

Alaska Republican Sen. Frank Murkowski vowed to amend the Senate energy bill before the end of winter to better ensure that his fellow Alaskans get a fair shake in any gas pipeline deal that comes out of the legislation. Murkowski said he wanted to include a ban to prevent producers from pursuing an “over-the-top” pipeline route, which would bypass most of the state by crossing the Beaufort Sea and then heading down the Mackenzie River in the Northwest Territories to connect with the pipeline grid in Alberta.

Alaska Republican Sen. Frank Murkowski vowed to amend the Senate energy bill before the end of winter to better ensure that his fellow Alaskans get a fair shake in any gas pipeline deal that comes out of the legislation. Murkowski said he wanted to include a ban to prevent producers from pursuing an “over-the-top” pipeline route, which would bypass most of the state by crossing the Beaufort Sea and then heading down the Mackenzie River in the Northwest Territories to connect with the pipeline grid in Alberta.

Due to spiraling commodity prices, which have led to a drop in Devon Energy Corp.’s stock price, Devon and Mitchell Energy & Development Corp. said Friday that the board of directors of each company has amended their merger agreement to address certain risks posed by Devon’s falling stock price. The amendment would provide for an alternate structure to mitigate the risks in the event the stock price would prevent the issuance of certain tax opinions, which are a condition to the merger transaction.

If Devon Energy Corp. and Mitchell Energy & Development Corp. have to amend their merger agreement, they may create a new holding company to ensure that the transaction remains tax-free for Mitchell shareholders. The proposed change to the merger agreement was announced Wednesday (see Daily GPI, Sept. 27). Under the existing agreement, Mitchell would merge with a subsidiary of Devon in a tax-free transaction to the extent that Mitchell’s shareholders would receive cash. Because of the decline in Devon’s stock price in recent weeks, the original agreement created doubt as to whether those opinions could be obtained at closing. An amended agreement would require both parties to complete the transaction as structured if the tax opinions are available, but in the event that the opinions are not available, the parties would create a new holding company with Devon and Mitchell the subsidiaries. By doing this, Devon’s shareholders would exchange each of their Devon shares for one share of the new holding company and Mitchell shareholders would exchange their shares for .585 shares of the new company and $31 in cash. The new holding company, which would keep the transaction tax-free except for the cash paid to Mitchell shareholders, would include Devon’s current board of directors along with Todd Mitchell, the son of Mitchell CEO George Mitchell.