Interests

Despite the volatility the natural gas market has experienced over the last few weeks, Anadarko CEO Robert J. Allison, Jr. assured attendees at the tenth annual Herold Pacesetters Energy Conference in Greenwich, CT that his company has not made any major changes in its business plan. He added that just like they always do, “Gas markets will self-correct.”

In a part of California known for big oil and big agricultural interests, and the big bucks that go along with both, deep drilling is getting a huge boost in the southwestern parts of oil/gas-rich San Joaquin Valley west and northwest of Bakersfield with the announcement that a consortium of major E&P talent became the third group to begin a deep drilling project in the area.

KeySpan Energy Canada last week acquired all of Westcoast Capital Corp.’s interests in the Wilson Creek Express Pipeline and the Crystal Pipeline, which KeySpan said will complement its existing natural gas gathering and processing infrastructure. The pipelines gather sour gas from areas to the west and north of the KeySpan-operated Rimbey Gas Plant in Alberta.

Facing the prospect of Davis administration regulators sacking electric retail competition, an alliance of large and small interests Tuesday urged California officials to consider alternatives that do not require shutting down the last vestiges of its 1996 restructuring law permitting direct access contracts.

Denver-based MarkWest Hydrocarbon Inc. announced preliminary results for three new gas wells in which it holds interests. In eastern Michigan, the Sims 2-7 well was successfully recompleted, testing at 4.4 MMcf/d of sour gas and 400 bbl/d of condensate and natural gas liquids. The well is the second to be connected to the Au Gres gas plant, modified by MarkWest and its partners in 2000. The well is scheduled to be on production by mid-July. In western Michigan, MarkWest and its partners have made two gas discoveries. The previously drilled Victory 32, in which MarkWest owns 8.5%, successfully tested before being shut in for pipeline connection. The reef play is only a few miles from the company’s sour gas pipeline. The third well, the Victory 21, in which MarkWest holds a 14.6% interest, found a reef and is shut in awaiting equipment to complete and test the well.

Houston-based Nuevo Energy Co. has accepted the resignation of Doug Foshee as chairman, president and CEO. Foshee intends to pursue other interests. With Foshee’s resignation, the board of directors appointed Isaac Arnold, an outside Nuevo director since 1990, as chairman. The board also announced that Phillip Gobe, currently Nuevo’s COO, has been appointed interim president and CEO. Nuevo has initiated a search for a new president and CEO, and Gobe will be considered as part of the search. “Phillip Gobe and the rest of Nuevo’s senior management team have the full support of our board of directors,” said Arnold.

Denbury Resources Inc. has picked up almost all of the working interests in the West Mallalieu and Olive Fields located in southwestern Mississippi and another 14,000 acres in the Barnett Shale gas play in Texas, acquisitions expected to bring the Dallas-based company opportunities for oil and natural gas reserves and production growth.

Detroit-based MCN Energy Group Inc. has completed selling its 95% interest in four coal fines plants for $100 million and its interests in two other plants for $32 million to a unit of DTE Energy Co. The transaction was independent of MCN’s pending merger with DTE (see Daily GPI, April 2). MCN built the plants to process fine particles of coal into briquettes for traditional coal markets. Concerns about the plants’ qualification for synthetic fuel tax credits led MCN in 1998 to record a $133.8 million pre-tax write-off of the coal fines project. Because of its completed sale to DTE Energy Services, MCN will record a pre-tax first quarter gain of approximately $125 million.

Enterprise Products Partners L.P. reported Monday that itsoperating subsidiary has acquired ownership interests in five naturalgas pipeline systems and related assets in the central Gulf of Mexicofrom El Paso Energy Partners, L.P. for $112 million in cash. The ElPaso unit was forced to sell the assets as part of the Federal TradeCommission’s approval of the El Paso Energy/Coastal Corp. merger,which was completed Monday as well (see Daily GPI, Jan. 30).