Despite a stinging second quarter net income loss of $17.3million, or $0.07 per share, compared to last year’s second quarternet income of $74 million, or $0.30 per share, Union PacificResources noted the addition of Norcen Energy assets helped pushdiscretionary cash flow up 20% ($56 million) to $332 million ($1.34per share). Producing property volumes increased to nearly 2.8Bcf/d, a 72% increase over the same period last year. The drop innet income was a result of lower commodity prices, higherexploration expenses and interest expense from the Norcenacquisition, UPR said. Included in the company’s second quarterresults were a pre-tax gain of $26 million on the sale of DJ Basinproperties, a settlement of gas supply agreements which addedpre-tax income of $30 million and an $11 million pre- tax gain on aforeign currency exchange.
Pacific
Articles from Pacific
CPUC, PG&E Protest El Paso Agreement
California regulators and Pacific Gas and Electric (PG&E)earlier this week protested a letter agreement between El PasoNatural Gas and Dynegy Marketing and Trading, that they claim wouldgive the latter the “unilateral right” to keep a large portion ofthe Block II capacity on El Paso off the California market withoutbeing subject to recall rights.
UPR Touts Land Grant Success
Union Pacific Resources Group announced details of itsparticipation in four successful wells recently completed on itsLand Grant acreage. UPR’s net production from the wells is about 28MMcf/d of gas and 500 barrels of oil/d. The most prolific well, theChamplin 457 A No. 5, is located in the Whitney Canyon field inUinta County, WY. The company owns a 33% net revenue interest inthe well which began producing at an initial rate of 60 MMcf/d.
CPUC Allows PG&E Plant Sale to Proceed
Pacific Gas and Electric Co. is moving ahead with the sale offive additional power plants, following the California PublicUtilities Commission’s decision this week to lift a temporary haltto the plant auction in response to an appeal by local governmentofficials and a citizens’ action group in San Francisco where twoof the plants are located. PG&E is now authorized to reviewpreliminary bids (“nonbinding expressions of interest”) frompotential buyers.
Transportattion Notes
Pacific Gas & Electric extended a Stage 1 Operational FlowOrder that began Thursday (see Daily GPI, June 11) through today.
De-Leveraging UPR Sells Colorado Properties
Union Pacific Resources Group sold its interests in theWattenberg area of Colorado’s Denver-Julesberg Basin toDenver-based United States Exploration Inc. for $41 million. Theproperties, which are in Adams, Arapahoe, Elbert and Weld counties,consist of 336 producing wells, which produced about 5.5 MMcf/d ofgas and 640 barrels of liquids/d in 1997. UPR retained its royaltyinterest in the properties. The transaction closed May 15 and waseffective Jan.1.
Enova, PE Merger Receives Final FERC Approval
After meeting significant conditions to mitigate market power,Enova Corp. and Pacific Enterprises, holding companies of San DiegoGas & Electric and Southern California Gas, respectively,received final FERC approval yesterday of their $6.6 billionmerger. FERC approved the merger application with only minorcode-of-conduct modifications.
UPR Details Property Divestiture Plans
Union Pacific Resources Group announced additional details ofproducing properties it will sell to raise at least $600 million byyear-end. US and international properties make up nine bid packagesand will be made available in two phases. The first phase willinclude properties in the Gulf of Mexico, South Louisiana, SouthTexas and East Texas. Executive summaries for these packages willbe available by June 1 with closings anticipated by Oct. 1. Thesecond phase of the program will include properties in the RockyMountains, Argentina, Egypt and Australia. Executive summaries willbe available July 1 with closings anticipated by Oct. 30.
Transportation Note
Pacific Gas & Electric said less than 1,000 of the more than60,000 customers who lost natural gas service last week in SantaCruz County, CA, were still without service Monday. A massivelandslide Wednesday had ruptured two main transmission pipelinesserving the county, which is southwest of San Jose. More than 600PG&E workers and another 190 from Southern California Gasworked thoughout the weekend to restore service. Facilities withhot showers were set up in two towns for those without gas to heatwater. It was PG&E’s largest gas restoration project since the1989 Loma Prieta earthquake caused severe damage to thedistribution system throughout Northern and Central California, thecompany said.
UPR Acquiring Occidental Properties
Union Pacific Resources Group agreed to pay about $59 millionfor Occidental Petroleum’s interests in four oil and gas fields insouthwest Wyoming, 23 producing wells in Louisiana, increasedownership in the Masters Creek Gas Plant and nearly 127,000 netacres in the Louisiana extension of the Austin Chalk trend.