Amerada Hess Corp. reported it has acquired EEX Corp.’s 27.5% interest in the Llano Field located on Garden Banks Blocks 385 and 386 in the Gulf of Mexico for $50 million plus an overriding royalty interest of 1/2 of 1% for the first 100 million boe total production from the Llano Field and 1% on all production thereafter. Amerada Hess estimates that the Llano Field contains gross proved and probable reserves of 125 million boe. Amerada Hess currently operates production of over 130,000 boe/d from four fields in the Garden Banks area. The Llano Field is located 20 miles southwest of the Amerada Hess operated Baldpate compliant tower production facility. Amerada Hess said first production from Llano is expected to occur approximately 18 months after project sanction, which is expected to come in 2002.
Blocks
Articles from Blocks
House GOP Blocks Western Price Cap Initiative
The House Appropriations Committee, in a vote that split closely along party lines, last week rejected an amendment forwarded by Rep. Nancy Pelosi (D-CA) that would have instituted cost-of-service rates for electricity sold at wholesale in the western region.
Alaska Senate Bill Blocks Pipe from North Slope to Mackenzie
The Alaska senate is trying to force North Slope gas producers to build a pipeline through the state and down the Alaska highway rather than across the Beaufort Sea and down the Mackenzie River to Alberta. The Mackenzie River route would be about 400 miles shorter and possibly much cheaper. Producers worry the measure could significantly change the economics of gas development there.
CPUC Blocks Utility Work Force Cuts
On a strictly partisan 3-2 vote, California regulators Thursdayblocked attempts by the state’s two near-bankrupt investor-ownedutilities to cut their work forces and services in order toconserve cash while awaiting a settlement with the state on theirfuture financial viability. Responding to an emergency request froma coalition of utility workers’ unions, the California PublicUtilities Commission’s (CPUC) action means proposed staffinglayoffs of several thousand regular and contract workers, totalinghundreds of millions of dollars in operating costs, will nothappen.
Cisco Blocks New Silicon Valley Power Plant
In what is a harbinger for other electricity-intensive high-techcorridors that have sprung up in various regions of the U. S., alocal zoning decision in the midst of California’s Silicon Valleycould decide the fate of a new generating plant that everyoneagrees is badly needed to serve the rapidly growing powerrequirements of the Internet-connected, new economy businesses.
Deepwater Pipe Brings in the Gas
Deep-water natural gas from ExxonMobil’s Hoover Diana discoveryin East Breaks Blocks 945 and 989 has begun flowing through thenewly constructed East Breaks Gathering System, an 85-mile, 20-inchdiameter pipeline running from water depths of 440 feet to 4,700feet in the Gulf of Mexico.
Transportation Notes
NGPL discovered a leak Monday on its HI [High Island] Block 71Lateral offshore southeastern Texas. Three platforms (High IslandBlocks 71, 139 and 116) with scheduled nominations through thelateral were shut on Tuesday until further notice. Shippers will benotified via NGPL’s bulletin board when nominations may be resumed.
Gas Natural Charges Mexican Panel Blocks Bid
Despite the fact that it has been awarded similar contracts, GasNatural Mexico charged last week that Mexico’s anti-trustcommission will not allow it to participate in an auction for amulti-million dollar natural gas distribution contract. Thecontract, scheduled to be awarded on June 21 by the ComisionReguladora de Energia (CRE), calls for a $100 million investment inthe heavily populated Guadalajara metropolitan area. Nearly 4million live there, and the Guadalajara contract will be one of thelargest issued by the government for natural gas distribution.
Industry Briefs:
Coastal Oil and Gas has announced it is selling its interests in36 offshore oil and gas holdings. The offshore leases are locatedin the Gulf of Mexico, in blocks ranging from offshore of Alabamato south of Texas. When asked about the reasons for selling theseleases, spokesperson Dorothy Beeler said it was just “ongoingportfolio asset management,” and that it had nothing to do withCoastal’s planned merger with El Paso Energy.