Income

Calgary-based Esprit Exploration Ltd. is one step closer to reorganizing into an income trust and an exploration and production (E&P) company, and will hold a special shareholder meeting in late September to consider the arrangement. Esprit Energy Trust would hold 90% of Esprit’s existing proved producing reserves, while ProspEx Resources Ltd. would own the balance of the assets and some of the undeveloped lands (see Daily GPI, July 23).

Western Gas Resources shares tumbled 7% Thursday to $30.35 after the company reported a 33% decline in quarterly net income to $14 million ($0.19/share) compared to $20.9 million ($0.28/share in 2Q2003) because of one-time special charges for redemption of 10% senior subordinated notes ($6.7 million) and the cost ($7 million) of settling false price reporting charges with the Commodity Futures Trading Commission.

XTO Energy Inc.’s second quarter natural gas production hit a record 803 MMcf/d, a 27% increase from 2Q2003’s 631 MMcf/d, the company reported Tuesday. The Fort Worth-based producer’s oil production was up 38%, also a record, to stand at 17,682 bbl/d, while natural gas liquids output was up 17% over a year ago to 7,463 bbl/d.

Calgary-based KeySpan Facilities Income Fund, the trust owner of KeySpan Energy Canada, announced plans Wednesday to acquire EnerPro Midstream Co. from Chevron Canada Resources for C$268.5 million. KeySpan, one of Canada’s largest natural gas midstream operators, will pick up EnerPro’s interests in its five gas processing plants and associated gathering systems located in the Western Canadian Sedimentary Basin (WCSB).

Calgary-based KeySpan Facilities Income Fund, the trust owner of KeySpan Energy Canada, announced plans Wednesday to acquire EnerPro Midstream Co. from Chevron Canada Resources for C$268.5 million. KeySpan, one of Canada’s largest natural gas midstream operators, will pick up EnerPro’s interests in its five gas processing plants and associated gathering systems located in the Western Canadian Sedimentary Basin (WCSB).

Murphy Oil Corp. announced that its first quarter net income will average 90 cents to $1.10 per share, lower than expected, but the El Dorado, AR-based producer said production in the quarter will be slightly higher, averaging 136,500 boe/d. Sales volumes for the quarter will average 136,000 boe/d, lower than expected because of lower sales volumes in Malaysia. Canadian Natural Resources Ltd. also announced it is working to acquire some of Murphy’s Canadian natural gas assets, which are estimated to be worth C$260 million ($193 million). Pengrowth Energy Trust already has agreed to buy some of Murphy’s remaining Western Canadian Sedimentary Basin assets for C$550 million. The assets include interests in the west central and Peace River Arch areas (including McLeod, Deep Basin and Peace River Arch interests); southern Alberta (including interests in Countess, Princess and Twining/Three Hills); and heavy oil interests (including properties in Lindbergh, Tangleflags and Lloydminster areas). Canadian Natural said the assets it wants to purchase produce about 40 MMcf/d. The transaction would increase its 2004 oil and gas production about 2%, according to the company. Some of the properties are subject to rights of first refusal, which means the outcome of the bid is uncertain.

Net income for 20 top independent oil and natural gas producers rose 89% in the fourth quarter of last year over the same period in 2002, and skyrocketed 397% for all of 2003 due to robust U.S. oil and gas prices, according to a report issued by the Energy Information Administration (EIA) Friday.

Following through on previously announced plans to deleverage the company’s balance sheet and focus investments in the Americas, Duke Energy said Sunday that it has agreed to sell its Asia-Pacific assets, including all of its pipeline and power generation assets in Australia and New Zealand, to Australian combination utility company Alinta Ltd. for US$1.238 billion (A$1.69 billion).

The utility is obligated under a franchise agreement to pay the city a fee based on its income from gas sales to customers. However, since deregulation those fees have fallen as large customers have migrated to alternative suppliers. The city charged that the utility purposely violated its franchise agreement by allowing large customers to buy gas from other companies (see Daily GPI, July 6, 1998).