Intent

The Australian-owned oil and gas company, Chancellor Group, saysit has signed a letter of intent to acquire from Union PacificResources a half-interest in the Deadwood Field in East Texas for$35 million. The announcement comes on the heels of one made lastFriday by UPR that it had agreed to sell its interests in certainSouth Texas oil and gas properties to Collins & Ware Inc. for$148 million.

The Australian-owned oil and gas company, Chancellor Group, saysit has signed a letter of intent to acquire from Union PacificResources a half-interest in the Deadwood Field in East Texas for$35 million. The announcement comes on the heels of one made lastFriday by UPR that it had agreed to sell its interests in certainSouth Texas oil and gas properties to Collins & Ware Inc. for$148 million.

KN Energy and Devon Energy signed a letter of intent to formThunder Creek Gas Services and build a new $110 million, 126-milegas gathering system and associated facilities in the Powder RiverBasin of northeast Wyoming. The 24-inch diameter gathering systemwould extend between Gillette and Glenrock, WY, bringing up to 450MMcf/d of new production to connections with multiple downstreampipelines during the first half of 1999.

Koch Midstream Gathering and Processing and Duke Energy FieldServices signed a letter of intent to exchange gas gathering andprocessing systems in Texas, Mississippi, New Mexico, Alabama andOklahoma.

Duke Energy Transport and Trading signed a letter of intent tobuy some of Dynegy’s U.S. crude oil transportation and marketingoperations for $50 to $55 million pre-tax subject to terms of theagreement. The sale is expected to close by the end of the thirdquarter.

Connecticut Energy Corp. said subsidiary CNE Energy ServicesGroup signed a letter of intent with Conectiv to join a liquefiednatural gas (LNG) storage joint venture. This new business, to benamed Total Peaking Services (TPS), will use an existing 1.2 BcfLNG storage facility in Milford, CT. The venture has received FERCauthorization to provide open access storage; but is awaitingtariff approval, expected later this spring.

PG&E Corp. and Ultramar Diamond Shamrock Corp. (UDS)announced yesterday they had signed a letter of intent to enterinto what is probably the largest energy purchase alliance to datein the industry, representing about $2 billion in electricity,natural gas and steam purchases over a seven-year period. UDS isone of the largest independent refiners in the U.S., with sevenrefineries in the U.S. and Canada processing 650,000 barrels perday, 6,400 branded retail gasoline/convenience stores, and a largehome heating oil business in the Northeast.