Cuts

Rumors of a possible Securities and Exchange Commission (SEC) inquiry, credit ratings downgrades and dire analyst forecasts pummeled El Paso Corp.’s share price last week, after the Houston-based company revised its proved oil and gas reserves downward by 41%. After beginning the week at $8.81, El Paso shares were hovering just above $7 a share on Friday.

Amerada Hess’ declining production, low reserve replacement and burdensome cost structure, which is among the highest in the industry, prompted Moody’s Investors Service to downgrade the company’s debt to junk status Friday.

Denver-based Forest Oil Corp. last week slashed its estimated Alaskan oil reserves by 86% and warned that other oil and gas field estimates may be cut. In addition, the independent forecast a fourth quarter write off of some of its overseas assets.

Denver-based Forest Oil Corp. on Tuesday slashed its estimated Alaskan oil reserves by 86% and warned that other oil and gas field estimates may be cut. In addition, the independent forecast a fourth quarter write off of some of its overseas assets.

Murphy Oil Corp., which announced last month that it is pulling out of Western Canada to concentrate on more deepwater development, on Tuesday cut 15% off of this year’s capital budget compared with 2003. Nearly 77% of the $843 million budget will be allocated to the upstream.

Murphy Oil Corp., which announced it would pull out of Western Canada to concentrate on more deepwater development, on Tuesday announced its capital expenditures will be 15% less than in 2003. Nearly 77% of the $843 million budget will be allocated to the upstream.

As part of his larger 2004-05 fiscal year budget, California Gov. Arnold Schwarzenegger Friday proposed a significant downsizing of the state government bureaucracy overseeing the energy industry and further renegotiation of the state’s long-term power contracts with suppliers.

In a bold move to improve its competitive advantage, ChevronTexaco will sell some of its non-strategic U.S. assets, cut up to 200 U.S. jobs, consolidate several U.S. offices and consider whether to sell some of its producing and midstream assets in western Canada. The program, which only targets North American operations, is expected to be completed in 2004.

Consultants at Energy Security Analysis Inc. (ESAI) said they expect the U.S. gas market to become the “sink” for any unwanted or spillover global LNG supply in the future, which could mean significant downward pressure on domestic gas prices at certain locations.