Warburg

Private equity (PE) money is continuing to flow into prospective Lower 48 operations, with two deals announced over the past few days that together are worth more than $1 billion.

Consol Energy Inc. is searching for a new operating chief of the natural gas division after 34-year veteran and COORandy Albert announced his retirement. Albert played a key role in developing Consol’s gas business, overseeing a production increase from 7 MMcf/d in 2006 to 285 MMcf/d today, and helping the operator become one of the largest and most active explorers in the Appalachian Basin, said CEO J. Brett Harvey. Albert went to work for Consol as a mining engineer trainee in 1979 and took over the coalbed methane business in Southern Appalachian in 1985 and later the northern part of the basin. He became COO in 2010.

Five people were injured after a Marcellus Shale gas well owned by Antero Resources exploded in Doddridge County, WV, on Sunday morning.

Warburg Pincus LLC is leading a group of investors to fund up to $1.125 billion in Venari Resources LLC, a new Gulf of Mexico (GOM) deepwater explorer helmed by former Nexen Inc. executive Brian Reinsborough. The Dallas-based explorer also would be financed by Kelso & Co., The Jordan Co., and Asian investment giant Temasek Holdings. Venari, which is Latin for “hunt,” plans to target subsalt reservoirs, which are pockets of oil and natural gas that had been obscured by salt layers until advances were made in seismic imaging technology. Initial investments of 10-25% are to be made in GOM exploration blocks, with Venari providing technological expertise to majority lease owners.

UBS Warburg natural gas analyst Ronald J. Barone said he has lowered his gas price forecast for this year to $5.50/MMBtu at the Henry Hub from about $5.85, but will maintain his projections for next year and 2005 at $4.65 and $4.15, respectively, mainly because wellhead decline rates continue to accelerate while demand from the residential, commercial and power generation sectors continue to increase.

UBS Warburg analyst Ronald J. Barone on Monday raised his Henry Hub gas price forecast for the year to $5.85 from $5.15/MMBtu because of continued low storage levels, deliverability issues and expected strong demand from power generators this summer. But in a separate report analyst Stephen Smith of Stephen Smith Energy Associates said the market appears to be missing the potential for some large storage injections this summer due to demand destruction. Smith sees a need for a downward correction in prices.

UBS Warburg analyst Ronald J. Barone added 25-65 cents/MMBtu to his natural gas price projections for 2003, 2004 and 2005 on Tuesday, citing 10 bullish factors, including steep declines in wellhead deliverability, higher crude oil prices, an improving economy and expectations for normal temperatures.

UBS Warburg analyst Ronald J. Barone added 25-65 cents/MMBtu to his natural gas price projections for 2003, 2004 and 2005 on Tuesday, citing 10 bullish factors, including steep declines in wellhead deliverability, higher crude oil prices, an improving economy and expectations for normal temperatures.

Williams CEO Steve Malcolm said last week during a UBS Warburg energy conference in New York that his company plans to cut $50 million in annual expenses in an effort to strengthen its balance sheet and prepare for the possibility that it will have to assume all or a portion of the $2.2 billion in debt of its former communications subsidiary.