Complement

Calgary-based unconventional gas player Mahalo Energy Ltd. says its pending acquisition of Peregrine Energy Ltd., also of Calgary, will complement its existing low-risk U.S. and Canadian coalbed methane and shale portfolio with high-risk, high-reward prospects in Northeast British Columbia and west-central Alberta.

For the first time this year, California had a full complement of governor-appointed energy regulators last week, and they didn’t delay getting on the job, following the May 2 announcement from California Gov. Arnold Schwarzenegger, selecting his chief energy adviser as the new chairman of the California Energy Commission (CEC) and a former Reagan administration treasury official and international banker as the fifth member of the California Public Utilities Commission (CPUC).

On track to build a global natural gas business to complement its oil operations, ChevronTexaco Corp.’s executive team on Wednesday laid out an ambitious plan to grow its natural gas business by mid-decade with more core exploration and more development of its substantial reserves that will include, among other things, liquefied natural gas (LNG) regasification terminals along the West Coast and East Coast, as well as expanded exploration and production in shelf and deepwater Gulf of Mexico prospects.

Houston’s Manta Ray Offshore Gathering Co. LLC has begunconstructing a major extension to its existing offshore gatheringsystem to complement the Hickory prospect in the Gulf Coastoffshore in Grand Isle Blocks 110, 111 and 116, which is expectedto begin production later this year. The 22.25 mile, 20-inchdiameter pipeline extension will tie into an existing gatheringsystem at South Timbalier Block 292 and extend to the Grand IsleBlock 116 platform. According to Manta Ray, the “strategicposition” will help the company compete for transportation of moregas volumes in the “prolific” area. The extension is sized tohandle the total Hickory volumes as well as the surrounding area’sproduction. Anadarko first announced the Hickory discovery inOctober 1998, and now is drilling additional development wells. Aproduction platform is planned to be moved on location at Block 116later this summer with facilities capable of handling 300 MMcf/d ofnatural gas. Shell Gas Transmission owns 50% of Manta Ray while ElPaso Energy Partners LP owns 25.67% and Marathon Gas TransmissionInc. owns 24.33%.

To complement Southern Energy’s new power generation plantscheduled for construction in Zeeland, MI, Semco Energy Inc.announced plans yesterday to build a natural gas line to serve thefacility. Southern Energy plans to build a 830-MW plant to supplythe growing demand for electricity in the upper Midwest (see NGIMay 12). Semco’s gas line will connect the plant with ANRPipeline’s interstate mainline system.

The 2000 cash market was sluggish and weak Tuesday as a fullcomplement of traders finally returned to their offices followingthe New Year’s holiday break. A sharp futures decline coupled withonly moderately cold weather in most regions depressed most pointsby about a dime or more below the levels at which they rang out theold year Thursday.

Coral Energy expanded its gas and power marketing enterprisewith two West Coast acquisitions, which complement its Canadian gassupply position.

Crystal Oil Co. of Shreveport, LA, last week closed on itspreviously announced acquisition of Petal Gas Storage Co. Theacquisition of Petal will complement and provide synergies with thesalt dome storage facility already owned by Hattiesburg Gas StorageCo., a subsidiary of Crystal, and which is located less than onemile from the Petal facility. With the acquisition of Petal,Crystal’s subsidiaries will have more than 6.7 Bcf of gas storageworking capacity with the ability to deliver in excess of 670MMcf/d in this major corridor to the northeastern gas markets. JoeAverett, Crystal president, said the acquisition makes Crystal thelargest independent provider of salt cavern gas storage in the U.S.