Brief

With gas and electric utility stocks continuing to probe thedepths after a brief spike in a January fuel-cell frenzy, someobservers and executives are keeping their eyes peeled for the nextseries of corporate takeovers in the industry.

With gas and electric utility stocks continuing to probe thedepths after a brief spike in a January fuel-cell frenzy, someobservers and executives are keeping their eyes peeled for the nextseries of corporate takeovers in the industry.

Apache Corp. announced a Canadian gas discovery that tested at31 MMcf/d British Columbia on acreage acquired from Shell Canadalate last year. “Proved reserves acquired in the Shell Canadatransaction were mainly oil, but the major upside lies in gasexploration on nearly 300,000 net acres and in the staff of highlymotivated technical people who joined Apache,” said ApachePresident G. Steven Farris. Apache holds a 37% working interest inthe Ladyfern area producer. Murphy Oil, the operator, holds 33% andBeau Canada Exploration has the remaining 30% working interest.”Pressure build-up tests are under way to help in determining theapproximate size of this discovery, but it’s safe to say it has thepotential to be a very large gas field,” Farris said. Apache andits partners have under lease more than 25,000 acres in theLadyfern area and are presently drilling two additional wildcatwells on separate structures. Apache and partners will build aneight-inch-diameter pipeline 15 miles to the Beau Canada pipelineto take Ladyfern gas to Apache’s Hamburg gas plant.

Equitable Resources completed the previously announcedacquisition of the Appalachian production assets of Statoil Energyfor $630 million. The deal makes Equitable by far the largestproducer in the Appalachian basin with 2.2 Tcf of proven reservesand 12,600 gas and oil wells. Equitable said the acquisition wouldbe immediately accretive to earnings. “The addition of these assetsand resources to Equitable’s Appalachian business represent ahigh-value, low-risk opportunity for improving the overall qualityand efficiency of our production assets,” said Murry S. Gerber,Equitable’s president and CEO. “The benefits of this acquisition gobeyond making Equitable the leading gas supplier in the Appalachianbasin. We now have a dual platform for growth and increasedprofitability by ‘high-grading’ our total Appalachian portfolio.”Statoil’s production assets are contiguous to Equitable’sAppalachian properties and consist of 1.2 Tcf of proven gasreserves and 6,500 natural gas wells in West Virginia, Kentucky,Virginia, Pennsylvania and Ohio.

Courage Energy Inc., an oil and natural gas company withoperations in western Canada, announced yesterday a purchase of aninterest in producing wells and facilities in the Peace River Archarea of northern Alberta for $13.5 million. The seller wasundisclosed and Courage will now operate the property with 55%ownership. The acquisition will immediately add over 3 MMcf/d tothe company’s production. There are additional wells awaitingcompletion, and pipeline tie-in, which will add to these productionvolumes, Courage said. The purchase includes 28,000 acres (16,000acres net) of land and a comprehensive seismic database. Anindependent engineering report, prepared for the Vendor, hasassigned 14.1 Bcf of proved reserves and an additional 6.428 Bcf ofrisked probable reserves for a total 20.5 Bcf of establishedreserves. The scheduled date to close the acquisition is Feb. 28,with an effective date of Dec. 31.

Pittsburgh-based OnlineChoice announced yesterday that it haslaunched www.GasChoice.com, a free website that allows consumersnationwide to join no-obligation natural gas buying pools.GasChoice.com is forming buying pools right now in every state sothat once deregulation hits that locale, the pools of residentialand commercial consumers with group buying power are ready to bidand ready to save, the company said. In addition, the company isaggressively developing buying pool websites for telephone service,Internet access, and home security systems, all of which arefollowing closely on the heels of GasChoice.

“Owners of small businesses, intent on reducing their operatingcosts, are receptive to the idea of buying their energy supplies atreduced group rates through local or regional businessassociations,” according to a new study by RKS Research andConsulting. The North Salem, NY firm said a small businesssub-group, home-based businesses, would consider discountwarehouses and membership clubs for low-priced electricity offers.RKS also found a market emerging around the idea of bundledservices, including energy, local and long distance telephoneservice and Internet access all on one bill. While the small usersare interested in cutting costs, they can’t do without service.”Across the board, business owners say they seek long-termrelationships with suppliers who stress simplicity and ease ofuse…..They are willing to trade off price for service, qualitybrand name and convenience.”

Kinder Morgan and KN Energy announced the completion of theirmerger. The company has been renamed Kinder Morgan, Inc. and willtrade under the New York Stock Exchange symbol “KMI.” The $900million merger was announced last July.

Rio Bravo Energy, a joint venture between Tidelands Oil &Gas Corp., a Texas-based producer and Hudson SVD, a natural gasgathering and marketing company, announced the formation of SonoraPipeline yesterday. Sonora will own and operate a 53-mile gatheringsystem located in Dimmit and Zavala counties, TX. This line will beinterconnected with Rio Bravo’s Pena Creek Gathering System, whichservices the Chittim Gas Processing Plant recently acquired by RioBravo from Conoco. The plant is a propane refrigeration plant witha nominal capacity of 5 MMcf/d and a liquid fractionation train.The Pena Creek Gathering System which serves the Plant consists of15 miles of gathering and compression facilities.