Producer

Duke Energy Field Services became the top NGL producer in thecountry and the second largest gas marketer with completion of itspurchase of UPFuels, and Union Pacific Resources’ marketingoperations for $1.35 billion.

Duke Energy Field Services becomes the top NGL producer in thecountry and the second largest gas marketer with completion of itspurchase of UPFuels, and Union Pacific Resources’ marketingoperations for $1.35 billion.

Richmond, VA-based Dominion Energy Inc. is completing its purchaseof gas producer Remington Energy Ltd., of Calgary, AB in a deal valuedat nearly US$300 million that will give Dominion a stake in AlliancePipeline. Still to be completed is its $6.3 billion deal to buyConsolidated Natural Gas (CNG) which was originally announced inFebruary just days before the Remington buyout was revealed (See Daily GPI, Feb. 25, 1999).

The Senate unanimously passed two economic relief measures forindependent oil and gas producers last week. The bad news, however,is that the initiatives are part of a supplemental spending billthat President Clinton has threatened to veto because theexpenditures – mostly for foreign aid efforts – would cut intospending for domestic programs that he supports.

The Senate unanimously passed two economic relief measures forindependent oil and gas producers on Tuesday. The bad news,however, is that the initiatives are part of a supplementalspending bill that President Clinton has threatened to veto becausethe expenditures – mostly for foreign aid efforts – would cut intospending for domestic programs that he supports.

Companion bills have been introduced in the Texas legislature togive small producers a break on gas and oil severance taxes inlight of foundering commodity prices. If enacted, legislation wouldtrigger a temporary suspension of severance taxes on productionfrom certain wells.

Companion bills have been introduced in the Texas legislature togive small producers a break on gas and oil severance taxes inlight of foundering commodity prices. If enacted, legislation wouldtrigger a temporary suspension of severance taxes on productionfrom certain wells. Relief would be triggered if the three-monthaverage price for gas hits $1.89/Mcf (NYMEX) or $15/barrel (NYMEX)for oil.. When the price trigger is reached, the severance taxwould be suspended until the three-month average rises above thetrigger price. Severance tax relief would apply to oil productionfrom leases with wells averaging 15 barrels/d or less and to gasproduction from leases with wells averaging 90 Mcf/d or less. Ifpassed by the legislature, the measure would take effectimmediately and last until Aug. 31 or until $45 million in taxrelief has been granted, whichever comes first.

Last year was one of misery for most energy companies,particularly producers. It was so bad that one industry analyst iscalling for sweeping change in how producers do business.

Seeking emergency relief for Texas oil and gas producerssuffering from low commodity prices, the three-member TexasRailroad Commission (TRC) last week voted to propose statelegislation to suspend severance tax payments when the price foroil and gas drops below $15/barrel of oil or $1.50/Mcf of naturalgas as determined by the Comptroller of Public Accounts