Poor

If oil and gas prices remain strong, Standard & Poor’s Ratings Services (S&P) expects domestic producers’ capital budgets to “gently” rise this year, which will lead to modest increases in aggregate production. As the year progresses, S&P also expects merger and acquisition activity to increase, with companies able to use their strong cash flows and “largely undrawn bank facilities” to fund acquisitions.

Standard & Poor’s Ratings Services said the ratings and outlook on Union Gas (BBB/Stable) remain unchanged despite the adverse affects of a 2004 rate cut Thursday by the Ontario Energy Board (OEB).

Despite continuing $5-plus gas prices, Lehman Brothers is forecasting another year of poor domestic gas production results in 2004 after an estimated 3% drop in 2003. The Lehman Brothers production estimates, however, have a track record of showing an entirely different picture from the one laid out over the last six years by the federal government.

Reacting to the stinging criticism of El Paso Corp.’s continued poor performance within its exploration and production (E&P) unit, the company announced late Friday that Rodney D. Erskine, president of El Paso Production Co., had resigned.

Off the beaten path of western energy and commerce superhighways, Elko, NV, is being left in the dust by natural gas pipeline and power plant developers since the wholesale market and many of its major practitioners suffered the retrenchment of the past 18 months.

Saying it boosts liquidity, Standard & Poor’s Ratings Services gave a thumbs up to San Jose, CA-based Calpine Corp.’s decision last Thursday to create another Canadian natural gas trust surrounding a chunk of its oil/natural gas holdings in Western Canada. S&P said that Calpine expected to receive about $125 million in net proceeds from selling units in the trust, for which it will retain 25% ownership and a right to buy all of the gas at market prices.

Standard & Poor’s Ratings Services (S&P) said Friday that it has affirmed its ‘A’ corporate credit rating on AGL Resources Inc. and its subsidiaries based on the organization’s solid operating performance, continued conservative financial management and maintenance of its current level of business risk.

Although it acknowledged political and regulatory factors that continue to be uncertain, Standard and Poor’s Ratings Services reported last Thursday sighting “signs of life” in California’s private-sector utilities. The uncertainties that still cloud the state’s energy picture go well beyond the outcome of the proposed new settlement plan for bankruptcy-bound Pacific Gas and Electric Co., according to S&P brief analysis, “California’s Utilities: Another Step Forward?”

Standard & Poor’s Ratings Services (S&P) said Tuesday that it affirmed its ‘BBB’ corporate credit ratings on holding company NiSource Inc. and its subsidiaries and upgraded its outlook from ‘Negative’ to ‘Stable.’