Puts

Last year clearly didn’t turn out like most industry officialsexpected, according to a new survey by the Washington InternationalEnergy Group, a Washington, D.C.-based energy consulting firm. Thefirm’s 1999 Energy Industry Outlook notes the retail marketrevolution “wimped out,” mergers were quite a bit larger thanexpected, the oil price glut was more serious than many thought andpower generation became much more important than most initiallybelieved.

Well depletion rates in the Gulf of Mexico have reached astartling 38% this year and within the next three years could reach49%, according to a report by Houston-based Simmons & Co.International.

California’s Gov. Pete Wilson has signed into law a measurethat for the first time, allows full judicial review of CaliforniaPublic Utilities Commission decisions. This could mean more courtchallenges to future energy decisions when the law goes into effectJan. 1, 1999.

Nova Corp. announced yesterday it is selling its 26% interest(38.8 million shares) in Dynegy Corp. (formerly NGC Corp.) andplans to redeploy the potential $460 million in proceeds in itscommodity chemicals business. Nova CEO Jeffery Lipton said themarket is “currently assessing little or no value to ourinvestment” in the Houston-based marketing and processing company.

The depressed crude oil market continued to fuel an acquisitionfrenzy north of the border yesterday with Canadian producerRenaissance Energy mounting a friendly takeover of fellow CanadianPinnacle Resources Ltd. Renaissance CEO Clayton Woitas said theC$1.06 billion deal is designed to improve “operatingefficiencies,” build a stronger presence at a “fair price andcreate “long-term value” for shareholders.

A big shift in strategy led Equitable Resources to put some ofits most prized Gulf Coast midstream assets on the auction blocklast week. The company announced it is selling the 1,900-mileLouisiana Interstate Gas pipeline (including a 500 MMcf/dDepartment of Energy oil line it converted to transport naturalgas), the 3.6 Bcf capacity Jefferson Island salt dome storageproject and its gas and power marketing operation. The gasmarketing operation sold 500 Bcf of gas in 1997.

“Total Energy” may be an “unforgettable” brand name in this ageof energy convergence, as the small New York energy services firmTotal Energy Corp. claims, but would someone actually buy the nameand make it their own? Total Energy’s consultant R.J. RuddenAssociates thinks so, though Richard J. Rudden, president of thefirm, admits he’s never heard of a company buying another’s brandname. “I can’t say I’ve heard of that. But I know it’s nothing fora large national energy company to spend tens of millions ofdollars on brand imaging.”