Oklahoma

Newfield Exploration Co.’s Midcontinent operations, which cut across a swath of the Woodford Shale from Oklahoma into the Texas Panhandle, reached “new highs” in 3Q2009, with production jumping almost a third from a year ago, the Houston-based independent said late Wednesday.

With people in Canada and the northern half of the U.S. waking up Tuesday morning to temperatures in the vicinity of freezing or lower, and such conditions expected to continue through Wednesday for the most part, it was hardly surprising to see prices rising again Tuesday at a large majority of locations. However, a significant decline by November futures appears likely to nip this week’s cash rally in the bud.

CIG canceled a force majeure Thursday at its Mocane Field Compressor Station in Oklahoma and said it was restoring capacity there from 28 MMcf/d to 43 MMcf/d. The force majeure was declared Feb. 20 when a broken compressor pedestal and foundation issues caused severe vibrations in a compressor unit, the pipeline said.

Penn Virginia Resource Partners LP (PVR) said late Monday it would be able to increase its natural gas processing capabilities in western Oklahoma after acquiring processing and residue pipeline facilities from Atlas Pipeline Partners LP (APL) for $22.6 million in cash.

Oklahoma City-based Quest Resource Corp. (QRCP) and its related partnerships plan to merge and form a publicly traded corporation focused on unconventional resource development in the Marcellus Shale and the Cherokee Basin.

House lawmakers in Oklahoma Tuesday passed legislation that would extend for five years an existing tax credit for clean vehicle purchases to buyers of vehicles powered by compressed natural gas (CNG), liquefied natural gas (LNG) or electricity. The vote was 90-4. The bill will be sent to the Senate for final consideration. The credit is equal to 50% of the cost of conversion of a vehicle to operate on a qualified fuel, as well as those originally equipped to do so. The bill would also add hydrogen and hydraulic hybrid vehicles to the state’s list of qualified fuels. Oklahomans installing home-fueling stations for the vehicles would be eligible for $2,500 tax credits. An earlier House vote on HB 1949 was 94-4 in favor (see Daily GPI, March 24).

CIG said various operating conditions related to gas loading factors in its Segment 118, located in the Oklahoma Panhandle, have caused variations in pressure that affect the pressure needed to deliver gas to the east end delivery points of Segment 118. “To assist in controlling these varying pressure levels, CIG will establish a new constraint point: Beaver East (BEC) between Beaver…and Floris (FRS),” the pipeline said. The operationally available capacity at this point will be 210 MMcf/d beginning Thursday. The new BEC constraint point will limit deliveries to FRS, Forgan, Mocane and Mid-America, CIG said, but it will not affect firm primary nominations.

Less than a year after its launch as a publicly traded independent, Oklahoma City-based Crusader Energy Group Inc. has filed for voluntary bankruptcy protection. Crusader primarily develops unconventional resource plays. Most of its production has focused on the Anadarko Basin, the Barnett Shale, Delaware Basin, Val Verde Basin and the Bakken Shale. Crusader until early 2008 was privately held, but last June it completed a merger with Dallas-based Westside Energy Corp. and began operating as a public company (see Daily GPI, June 30, 2008). At the end of 2007 the combined companies had a net proved reserve base of more than 150 Bcfe, 80% weighted to natural gas, with an estimated reserve life of 15.8 years. Combined production at year-end 2007 was more than 26,000 Mcfe/d, 75% gas. The total leasehold at the end of 2007 was more than 765,000 acres (316,000 net), with 92% undeveloped. The Chapter 11 filing was made in U.S. Bankruptcy Court for the Northern District of Texas. Crusader is “continuing its discussions with various parties regarding strategic alternatives, which may include a potential sale of all or substantially all of its assets, a sale of the company or reorganizing the company and its existing capital structure…” Based on its current financial condition, management determined that “it was in the best interest of the company and all of its stakeholders” to seek bankruptcy protection.

Chesapeake Energy Corp. CEO Aubrey McClendon agreed to helm the Oklahoma City-based natural gas producer for another five years under a new employment contract that awarded him a one-time $75 million bonus for the leadership role he played in negotiating four joint ventures in the Haynesville, Woodford, Fayetteville and Marcellus shales.