PGI Acquires Asset in Tx.

- PGI Acquires Asset in Tx.

Friday, August 12, 2011
PGI Energy Inc.

PGI through its joint venture with Home Creek Energy as operator, has acquired a proven producing oil & gas asset. The field is located in Haskell County, Texas, and covers five leases with 11 production wells, 2 injection wells, pumper jacks, tanks, separators, tubing, rods and well equipment. PGI Energy owns 40% of the project which was purchased for an undisclosed amount of money. PGI will receive 40% of the Net 75% NRI from the monthly production.

"We are excited to have closed on this asset purchase and look forward to receiving revenues from this production," said Robert Gandy, Senior Underwriter for PGI Energy.

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EOG CEO: Boosts Asset Sale Target to $1.6B, from $1B

- EOG CEO: Boosts Asset Sale Target to $1.6B, from $1B

Friday, August 05, 2011
Dow Jones Newswires
HOUSTON
by Ryan Dezember

EOG Resources Chief Executive Mark Pappa said Friday the oil and gas explorer is increasing the amount of cash it hopes to raise by selling assets this year in order to offset rising oilfield service costs.

The assets being sold "are primarily mature long-lived domestic gas properties and other acreage," Pappa told investors during a conference call to discuss EOG's second-quarter results. Those properties are scattered in east Texas, the mid-continent and in the Gulf of Mexico.

Houston-based EOG posted a profit of $295.6 million, or $1.10 a share, up from $59.9 million, or 24 cents a share, a year earlier. Excluding hedging impacts, write-downs and other impacts, per-share earnings rose to $1.11 from 18 cents.

Revenue jumped 89% to $2.57 billion on a 13% increase in output and oil prices that climbed 37%.

Analysts polled by Thomson Reuters expected a per-share profit of 79 cents and revenue of $2.01 billion. Shares rose 6.22% to $97.86 in early Friday trading.

While EOG's oil and natural-gas liquids production rose in the second-quarter, natural-gas output was about 1% lower to an average of 1,615 million cubic feet per day. EOG has stressed its shift to oil production in recent quarters due to an oversupply-induced natural-gas price slump.

"We're not interested in growing North American gas volumes at current prices unlike most other companies," Pappa said, adding that EOG will drill in natural-gas basins only where necessary to preserve leases.

By mid-year, EOG had completed $944 million worth of gas-asset sales and has another $271 million in deals pending, Pappa said. The divesture target should be reached by the end of the year.

About $400 million of the extra $600 million being raised will be spent on rising oilfield-service costs, Pappa said.

Beyond raising money to cope with oil-patch inflation, Pappa said EOG plans to open a Wisconsin sand mine in the fourth quarter, which will supply sand proppant for "most of our North American resource plays."

Proppant is a crucial component in hydraulic fracturing, a process in which water, sand and chemicals are forced deep underground to crack open energy-bearing rocks, including shales, so that oil and natural gas can seep out. The sand, or proppant, wedges into the resulting fissures to hold them open. Proppant, which comes in grades ranging from raw sand to manufactured ceramic spheres, is in tight supply worldwide.

Supplying much of its own proppant should save EOG some $400 million a year and help reduce the cost of drilling a well in its prolific Eagle Ford wells in south Texas by about $1 million, executives said.

EOG has also signed an agreement for a 70,000-barrel-a-day rail off-loading facility in St. James, La., that will allow it to transport most of its crude oil from the Eagle Ford and North Dakota's Bakken Shale around Cushing, Okla., where congestion has depressed oil prices this year, to the Gulf Coast, where crude oil fetches a premium.

The Louisiana off-loading facility should be able to start taking shipments in the first quarter of 2012 and will enable EOG to take advantage of the difference in regional oil prices, Pappa said.

Pappa, who turns 65 next month, also said Friday that he will remain as CEO for the next 18 months "and, when I do retire, my successor will be a long-tenured EOG employee."

Copyright (c) 2011 Dow Jones & Company, Inc.

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India OKs Reliance Industries' $7.2B Asset Sale to BP

- India OKs Reliance Industries' $7.2B Asset Sale to BP

Friday, July 22, 2011
Dow Jones Newswires
NEW DELHI
by Rakesh Sharma

India approved Reliance's proposed $7.2 billion asset sale to BP, paving the way for the U.K. oil giant's largest venture in the South Asian nation.

The companies have been waiting for approval from the federal government since February when Reliance, controlled by billionaire Mukesh Ambani, agreed to sell a 30% stake to BP in 23 oil and gas blocks for $7.2 billion plus another $1.8 billion linked to exploration success. The deal includes the D6 block in the Krishna-Godavari basin, India's richest gas find so far, and Reliance has already received $2 billion from BP.

Oil Minister Jaipal Reddy said his ministry recommended the Cabinet Committee on Economic Affairs to approve the deal for 21 blocks as there were some technical issues over two non-producing blocks. The ministry may in future grant or refuse consent on the two blocks, he added.

"This is one of the major foreign investments in the history of India," Reddy said. "This transaction will not only mean investment of $7.2 billion by a foreign company in India, it will also mean induction of vast technical expertise to India's hydrocarbon sector."

Under the February agreement, BP and Reliance will also establish an equally owned joint venture for the sourcing and marketing of natural gas in India. That venture doesn't require government approval.

BP's chief executive, Robert Dudley, said the energy giant hopes to complete the deal in a matter of weeks.

Reliance didn't immediately comment on the announcement.

Future investments to develop Indian assets could bring its total payments to $20 billion, BP had said previously.

The deal gives BP access to new hydrocarbon resources and markets, in line with its strategy of continuing to increase exploration and access new exploration acreage, especially as it is yet to resume drilling operations in the Gulf of Mexico following last year's oil spill there.

Reliance is expected to gain from BP's deepwater drilling expertise to increase gas production. The company's D6 block is expected to boost India's gas supply, but several technical and geological issues have resulted in output from the field off the eastern coast falling below 50 million metric standard cubic meter per day from 60 MMSCMD last year.

Reliance's market valuation has taken a hit due to issued including the decline in gas production. Its shares closed 1.5% up at INR873.60 ahead of the announcement on the Bombay Stock Exchange, where the benchmark index closed up 1.6%.

Copyright (c) 2011 Dow Jones & Company, Inc.

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Faroe Notes Progress on Petoro Asset Swap

- Faroe Notes Progress on Petoro Asset Swap

Tuesday, July 12, 2011
Faroe Petroleum plc

Faroe provided an update on the Petoro asset swap deal as follows:

Highlights

• The transaction was passed by the Norwegian Parliament on June 17, 2011 and completion is expected in the Autumn
• Average net production from the Petoro Assets in the six month period January 1 to June 30, 2011 was approximately 8,400 boed
• 3.2 million boe of additional reserves net to Faroe's acquired interest in Njord since signing the Petoro Asset swap, expected to result from sanctioning of two new projects

On April 11, 2011, Faroe announced that it had signed an agreement with Petoro AS to swap its 30% interest in the significant Maria oil discovery for non‐operated interests in a number of good quality oil and gas production assets in Norway, namely in Brage, Njord, Ringhorne East and Jotun (the Petoro Assets).

Average net production from the Petoro Assets in the six month period January 1 to June 30, 2011 was approximately 8,400 boed. This high level of production has been achieved despite a technical problem with the riser system in Njord, which caused several production wells to be shut in for a period. Following the completed repairs, Njord is expected to be back on full production in 3Q 2011.

On May 12, 2011, a Field Development Plan (FDP) was submitted for the Hyme oil field, and this has already been approved by the Norwegian Ministry of Petroleum and Energy. Faroe will have a 7.5% net interest in the Hyme development (previously named Gygrid), located to the east of Njord. First oil from Hyme is expected in early 2013. The field will be developed with one dual‐lateral producer and a water injector sub‐sea tied back to the Njord field. In addition, the Njord partnership has sanctioned a project to allow continued production at lower pressure and extended field life. These two projects will add 3.2 million boe of 2P reserves and come as an addition to the 14 million boe of 2P reserves reported by the Company on April 11. Net Faroe capital expenditure on these projects is expected to be approximately £42 million, to be funded principally through a combination of cash flow from the Petoro Assets and bank debt.

The transaction was an asset for asset swap with no cash consideration from either party, and an effective date of January 1, 2011. Through this transaction, Faroe avoids the net capital investment of approximately £250 million required to appraise and develop Maria. Petoro retains the majority of decommissioning and abandonment liabilities in the Petoro Assets and have transferred a tax balance of NOK 400 million (approximately £46 million). The deal is conditional upon approval by the Norwegian authorities; the transaction was passed by the Norwegian Parliament on 17th June 2011 and completion is expected in the Autumn.

Graham Stewart, Chief Executive of Faroe Petroleum, commented, "We are very pleased with progress of the Petoro transaction. We are also encouraged by the higher than expected production rates of the fields we are acquiring during the first half of the year.

"We now look forward to a very exciting period of drilling ahead with four wells in the second half alone, starting with Fulla results, due in August 2011."

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Circle Star Acquires Tx. Assets

- Circle Star Acquires Tx. Asset

Wednesday, July 06, 2011
Circle Star Energy Corp.

Circle Star has acquired interests in certain oil and gas producing assets in Texas.

The Company has acquired mineral interests, overriding royalty interests and non-operated working interests in a set of producing and non-producing oil and gas assets throughout Texas comprised of over 30,000 gross acres. The acquisition includes production from the Eagle Ford Shale, Austin Chalk, Wolfcamp, Woodbine and Deep Bossier formations. EnCana Oil & Gas (USA), Inc., Chesapeake Energy, Newfield Exploration Company, CML Exploration, LLC and Petromax Operating are operators of the respective assets. Revenue from the properties averaged more than $125,000 per month from January to May 2011.

In related news, the Company welcomes Mr. S. Jeffrey Johnson to the board of directors where he will assume the role of Non-Executive Chairman. Mr. Johnson has over 22 years of experience in the oil & gas business. Most recently, Mr. Johnson served as the Chairman of the Board and Chief Executive Officer of Cano Petroleum, positions he held from June 2004 to February 2011 and May 2004 to February 20011, respectively. Prior to Cano, Mr. Johnson owned and operated 2 private oil companies from 1993-2003 and was a Vice President of Touchstone Capital from 1990-1993.

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Investors Wait For Next Asset To Drop In Conoco's Sales Plan

- Investors Wait For Next Asset To Drop In Conoco's Sales Plan

Thursday, June 30, 2011
Dow Jones Newswires
HOUSTON
by Isabel Ordonez & Ben Lefebvre

ConocoPhillips (COP) investors are hoping for the company to quickly unveil the next step of its plan to sell up to $17 billion in noncore assets by the end of 2012 and reinvest a bulk of the proceedings in share buybacks.

Conoco's stock outperformed rivals Exxon Mobil Corp. (XOM) and Chevron Corp. (CVX) last year after investors embraced a large-scale, two-year restructuring plan presented in late 2009 that included a $10-billion asset sale and was aimed at shoring up its finances. Conoco's shares surged more than 30% in 2010, helped by evidence that the plan was going full steam ahead. By the end of last year, the sale plan seemed to be moving along. Conoco had sold $7 billion in assets, including its stake in oil sands oil producer Syncrude Canada Ltd. and the majority of its 20% stake in Russia's oil giant Lukoil OAO for $5.82 billion. Conoco said the Lukoil proceedings were excluded from the original $10-billion asset-sale plan and that money would be used to buy back the company's own shares. Those sales went so well that the Houston-based company announced in March it will expand its planned program through 2012 by selling an additional $10 billion of older, higher-cost assets.

But after a strong start, the company has this year given few signs that the asset sale is on schedule, says Fadel Gheit, an analyst at Oppenheimer & Co. "The company is keenly aware that the market is looking for news on the progress they are making in their asset sale," he said.

Conoco still has another year to complete the plan, but uncertainty about the pace of the second phase of the asset sales is starting to take a toll on its stock. Year to date, Conoco's shares are up 9.7%, underperforming the stock of Exxon and Chevron, which are up 10.6% and 12.1%, respectively.

Some analysts believe ConocoPhillips would have to make a significant announcement by the end of July, when it will report second-quarter earnings, if it wants to maintain momentum with investors; worries will only increase the longer no announcement is made. "If they don't announce something in the third quarter, the concern could rise," says Allen Good, an analyst at Morningstar.

Others believe that it's good for shareholders that the company is taking its time to make concrete sales plans. "With asset sales, it is rarely a good idea to rush the process," says Pavel Molchanov, an analyst at Raymond James. "A lower, more deliberate process can allow the seller to maximize value for the asset."

Conoco spokesman John Roper said the company doesn't "discuss potential acquisitions and dispositions prior to their closings. While we expect additional announcements this year, we have none to discuss at present."

Conoco has made a few medium-sized deals this year, including an April sale of a 15% stake in the planned Australia Pacific LNG Project in Queensland for $1.5 billion and the sales of its Seaway Products Pipeline in South Texas for an undisclosded price. But the company needs to make a couple of large-scale assets sale announcements to let the market know that it isn't behind schedule, Gheit said.

Conoco could shed assets in Australia and Kazakhstan, say UBS analysts who in June met with ConocoPhillips Chief Financial Officer Jeff Sheets. Those could include new stakes in Conoco's Australian liquefied natural gas venture with Origin Energy Ltd. (ORG.AU), and its 8.4% interest in the Kashagan oilfield in Kazakhstan, UBS said. Conoco's partner in the field, Exxon Mobil, received a $5 billion bid for its identical stake in Kashagan, according to the Wall Street Journal.

Alan Hirshberg, Conoco's Senior Vice President of Planning and Strategy, said in a presentation at a May energy conference that the company is also looking at leaving countries where it has a small presence, and selling some marginal refining assets like the Wilhelmshaven refinery in Germany. Hirshberg said Conoco is also considering turning refineries into product terminals and striking joint venture agreements, exchanging refining capacity for oil and gas assets.

Conoco would most likely want to pull out of the East Coast market, where fuel imports into New York Harbor make price competition extremely difficult, UBS said. The company has two major refineries in the area, the 238,000 barrel-a-day Bayway refinery in Linden, New Jersey; and the 185,000 barrel-a-day refinery in Trainer, Penn. Valero Energy Corp. (VLO) sold two of its refineries in that region in 2010 to private equity firm PBF Energy. PBF declined to say whether it was interested in the Conoco refineries in the area.


Copyright (c) 2011 Dow Jones & Company, Inc.

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Riverdale O&G Boosts Asset, Revenue Base

- Riverdale O&G Boosts Asset, Revenue Base

Friday, May 20, 2011
Riverdale O&G Corp.

Riverdale O&G is steadily increasing its assets and revenues through acquisition of oil and gas interests that are non-operating and without the costs for drilling and completion. The latest acquisition is a 160 acre, 2.5% carried working interest (CWI) on 3 new producing wells and 1 well scheduled for drilling to 5,500', in the next few weeks, situated in Frio Co., Texas.

Recently, RVDO acquired a 1.667% CWI in 60 acres in Lavaca Co., Texas, which is scheduled to be drilled to 6,000', within a month and has an estimated reserve of two billion cubic feet (2 BCF) of gas and 12,000 barrels of condensate.

RVDO is currently in the process of commencing a 3D seismic acquisition over its 631.82 acre Foster Lease, located in Jim Wells Co., Texas. Funding is being completed and a 8,500' well is estimated to be drilled during the 4th quarter, 2011, that could penetrate 16 potential oil and gas reservoirs, that have been identified from the offset producing wells. There are an additional 8 to 10 development wells that could be drilled on the Lease. RVDO will retain a 6.25% CWI.

Each project mentioned above, has or will have the utilization of 3D seismic, and the application of a proprietary Neural Network interpretation process. The Neural Network has demonstrated the ability to define oil and gas accumulations, with much greater accuracy, than the use of 3D seismic alone.

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Husky's 1QHercules Offshore, Seahawk Drilling Finalize Asset Sale

Hercules Offshore, Seahawk Drilling Finalize Asset Sale

Wednesday, April 27, 2011

Hercules Offshore Inc.

Hercules Offshore and Seahawk Drilling announced the completion of the asset purchase and sale previously disclosed on February 11, 2011. In accordance with the terms of the Asset Purchase Agreement, Hercules Offshore will acquire 20 jackup rigs located in the U.S. Gulf of Mexico and related assets, accounts receivable, cash, accounts payables, and certain contractual rights from Seahawk Drilling. The total consideration paid to Seahawk Drilling consists of approximately 22.3 million shares of Hercules Offshore common stock and $25.0 million in cash. Following this transaction, there will be a total of approximately 137.2 million outstanding shares of Hercules Offshore, Inc.

Samson O&G Closes Asset Sale, Sets Frac Date for Earl Well

Samson O&G Closes Asset Sale, Sets Frac Date for Earl Well

Thursday, March 31, 2011
Samson O&G Ltd.

Samson O&G has closed its previously announced sale of gas assets in the Jonah and Lookout Wash Fields in Green River Basin, Wyoming for $6.3 million to a group of private buyers, with an effective date of January 1, 2011. Samson's cash balance following this transaction stands at US $73.3 million.

Samson has also been advised that a frac date has been set for the Earl #1-13H well and it is expected that frac operations will commence Monday April 4th. Earl #1-13H was previously drilled to a measured total depth of 17,342 feet, and a 5,700 foot liner set in the horizontal section. This horizontal section will be fracced with 20 stages and the treatment is expected to place 2.3 million pounds of proppant. This operation will take approximately five days.