Existing

The Minerals Management Service (MMS) issued a final rule Thursday amending existing regulations for natural gas valuation for royalty purposes, increasing the rate of return used in valuing non-arm’s-length transportation from 1.0 to 1.3 times the Standard and Poor’s BBB Industrial Bond rate, and clarifying other parts of the transportation deduction from the sale price of gas. The final rule substantially followed the lines of the proposed rule for collection of royalties from federal lands issued last year (see NGI, July 26, 2004).

TFS Energy, LLC, an affiliate of the international TFS Brokers, has announced the opening of a Houston office, complementing its existing energy offices in Stamford, CT, on the New York Mercantile Exchange (Nymex), and in New York, London, Frankfurt, Singapore and Sydney.

There is almost uniform agreement within the natural gas industry that the Federal Energy Regulatory Commission should continue its existing policy on selective discounting, which allows interstate gas pipelines to provide customer discounts to compete with both alternative fuel providers and other gas pipelines.

Berry Petroleum Co. will pay $110 million to purchase more than 130,000 acres of natural gas-rich properties in the Niobrara fields in northeastern Colorado from J-W Operating Co. and other undisclosed sellers. The company, as operator, will have a working interest of approximately 52%.

Berry Petroleum Co. will pay $110 million to purchase more than 130,000 acres of natural gas-rich properties in the Niobrara fields in northeastern Colorado from J-W Operating Co. and other undisclosed sellers. The company, as operator, will have a working interest of approximately 52%.

The Energy Minister of Trinidad and Tobago told Reuters that the government plans to reopen three existing contracts with Atlantic LNG, the country’s main liquefied natural gas (LNG) exporter, because it has not seen any financial gain from the diversion of several LNG cargoes to the higher priced market in the United States from markets in Spain. Energy Minister Eric Williams said the government plans to reopen but not renegotiate contracts for Trains 1, 2 and 3. Williams told Parliament on Monday that reopening the contracts would give the country an opportunity to increase its economic return from LNG. He said that although cargoes have been diverted to the more lucrative U.S. markets, the revenue that has been sent back to Trinidad is the same as if the shipments had gone to Spain. “We are about to seek to close that loophole, a substantial loophole, that is why we wish to reopen contracts,” he said, according to Reuters. The three LNG processing trains have a total capacity of nearly 10 million tonnes per year. A fourth train is under construction and set to come on line next year. It will increase the production capacity to more than 15 million tonnes a year. Atlantic LNG is owned by BP, BG Group, Repsol, Tractebel and the National Gas Co. of Trinidad and Tobago.

Pioneer Natural Resources said it has released all of its existing shallow gas leases in the Matanuska-Susitna Valley in Alaska in response to a contentious debate with residential landowners over the leases and to new legislation affecting the area. The leases were part of its merger with Evergreen Resources that closed on Tuesday. The released leases cover 235,500 acres and include farm-outs and the Mental Health Trust lease No. AK550.185 located east of the Pioneer Unit near the town of Palmer. As a part of the strategic planning and due diligence associated with the merger, Pioneer decided to relinquish the leases issued under the over-the-counter leasing program and to withdraw the exploration license applications made by Evergreen in August. “We strongly support the state’s new gas-only leasing program defined by HB531, and we encourage them to continue the best interest finding process for the Mat-Su,” said CEO Scott D. Sheffield. “We support the efforts of the Mat-Su Borough Assembly to develop a regulatory program that recognizes the state’s primacy while at the same time representing the borough’s interests.” The leases being released were on residential land. Pioneer also holds nearly one million gross acres on the North Slope and has working partnerships with ConocoPhillips, Anadarko and others.

The Department of Transportation (DOT) on Monday published a final rule requiring new onshore natural gas transmission lines and replacements of existing pipe or components to be designed and constructed to accommodate the passage of instrumented internal devices, better known as “smart pigs.”

The Bush administration has turned a deaf ear to Sen. Jeff Bingaman’s (D-NM) recommendations on how the president can use his existing authority to cut high-flying natural gas prices and bolster supply.