Improved

Higher commodity prices may have improved the net profit for producers, but as prices have risen, related service costs have escalated “tremendously,” forcing the exploration and production (E&P) sector to focus on appraisal and development projects rather than new long-lead-time exploration, according to a report issued Tuesday by Cambridge Energy Research Associates (CERA). The latest IHS-CERA Capex Index for generic global projects found costs have risen 68% since 2000 and 18% in just the last six months.

Dallas-based Energy Transfer Partners LP said improved operating results from its core natural gas pipeline assets in Texas will lead to higher-than-expected earnings in fiscal 2006. The partnership on Monday upped its expectations for the year to $730 million from $710 million.

Despite improved fourth-quarter earnings results reported earlier in the week, Rapid City, SD-based Black Hills Corp. was placed on “CreditWatch with Negative implications” by Standard & Poor’s Ratings Services, noting the company’s signing of a confidentiality agreement with NorthWestern Corp. as the trigger. Black Hills’ credit rating remains the same (BBB-).

Saying operating conditions on its South Mainline had improved, El Paso lifted Thursday afternoon the Strained Operating Condition (SOC) that it had implemented Tuesday (see Daily GPI, Aug. 24). “Actions by shippers to balance their supply and demand, along with maximal withdrawal volumes from Washington Ranch Storage Facility, have restored south system linepack to a level at which system integrity is not currently threatened,” El Paso said.

ConocoPhillips’ natural gas marketing management team could probably write a new-and-improved version of how to succeed in the energy merchant business. In the past three years, the integrated producer has steadily grown from regional marketer to North American powerhouse, and now the company is positioning itself to become a major player in liquefied natural gas (LNG), a new market that likely will impact energy trading, a company executive said Wednesday.

Improved geological understanding and technology have generated an increase of 30% in official estimates of supplies awaiting development in the chief Canadian natural gas producing province of Alberta.

Improved geological understanding and technology have generated an increase of 30% in official estimates of supplies awaiting development in the chief Canadian natural gas producing province of Alberta.

Citing “greatly improved” permit processing by the U.S. Bureau of Land Management, Western Gas Resources expects to grow its unconventional gas production by between 10-15% this year and 15-20% in 2006, company officials said in an earnings conference call last Thursday. While production, mainly from the Rockies area, was only up 5% in 2004 over 2003, net income increased 42% to a record $119.2 million.

Citing “greatly improved” permit processing by the U.S. Bureau of Land Management, Western Gas Resources expects to grow its unconventional gas production by between 10-15% this year and 15-20% in 2006, company officials said in an earnings conference call Thursday. While production, mainly from the Rockies area, was only up 5% in 2004 over 2003, net income increased 42% to a record $119.2 million.