Canada's oil and gas companies continue to reel from the industry downturn.
Encor could be in breach of loan covenants by midyear and is in the midst of debt restructuring plans with lenders.
It has hired an investment banker to seek a merger or a takeover offer. Encor reported a loss of $89.7 million (Canadian) for 1991.
Western Geophysical. Calgary, a unit of Western Atlas, Houston, is being closed down by its parent because of depressed activity levels.
Western Atlas said the closure will involve field crews and a Calgary data processing center with 90 fulltime jobs and about 150 seasonal positions affected. The closure will be effective at the end of the winter drilling season.
A joint venture of Total and Tractabel wants to buy a 50% interest in Montreal gas utility Gaz Metropolitain from Quebec's government.
The utility has revenues of $1 billion/year. Power Financial Corp., headed by Canadian financier Paul Desmarais, is part owner of Tractabel.
The Canadian government plans to sell its interest in Co-Enerco Resources Ltd., Calgary.
Ottawa announced the sale in a federal budget and said there is no longer a reason for continued government ownership in Co-Enerco, a medium sized E&P company that produces 7,400 b/d of oil and 44 MMcfd of natural gas. The government will sell its 50% stake in Cooperative Energy Corp., a holding company whose sole asset is a 65% share of Co-Enerco.
And Canada's Petroleum Monitoring Agency will be abolished. PMA's statistics gathering and financial analysis functions will be taken over by the energy department.
Canada's upstream woes can't he helped by its squabble with California regulators over gas export prices and contract terms (see story, p. 39).
New Alberta regulations took effect Mar. 1 to limit new spot sales to the California market. The rules limit interruptible volumes destined for California in the Alberta pipeline system. Some spot market gas can be shipped in November-February. Ottawa also has adopted interim rules limiting spot sales to California.
And Alberta Energy Resources Conservation Board has announced it will hold hearings before completing a call for information on competing plans to build new pipeline capacity from the province to California.
Pacific Gas Transmission Co. and the Altamont group have competing proposals. ERCB will take statements from each later this month.
Tough times continue in the U.S. as well. The Baker Hughes active rig count in February fell to its lowest monthly average, 669, since Hughes Tool rig count recordkeeping began in 1942. That's down 41 units from January's level and 17 less than the previous recorded low in July 1986.
Mesa and Natural Gas Vehicle Coalition Chairman T. Boone Pickens has offered Phoenix financing conversions of metropolitan area fleets to CNG and installing CNG refueling facilities. Funding will come from Mesa Environmental.
Pickens says no up front fees or out of pocket expenses will be asked and fleet operators can repay Mesa with savings from operating CNG vehicles. According to the Maricopa County, Ariz., association of governments, the Valley of the Sun area around Phoenix has failed since 1967 to meet federal air quality standards for CO2, ozone, and particulates.
Participants in last month's meeting of officials from energy producing and consuming nations deem the effort a success. IEA Executive Director Helga Steeg calls the meeting a "a confidence building exercise" that produced a "very free and frank exchange of views." Involved in workshops on energy information exchange, industrial cooperation, energy efficiency and the environment, and market mechanisms were delegates from IEA, European Community, OPEC, and eastern European nations. It was a follow-up to the first such producer/consumer meeting at the political level in Par is last year. Bilateral talks are under way for a meeting of energy and foreign ministers of 20 nations July 2-3 at Solstrand near Bergen, Norway.
Norsk Hydro has placed its Dutch E&P unit on the market as part of its strategy of concentrating international activities in higher potential frontier areas. It earlier sold its U.K. North Sea assets.
Iran plans to boost oil production capacity to 4 million b/d within a year, Islamic Republic News Agency reports. To meet that goal Iran plans to work about 45 drilling rigs, 12 leased from an unnamed Canadian firm.
Iran pegs current capacity at 3.6 million b/d vs. its OPEC quota of 3.184 million b/d.
France won't defy U.N. resolutions despite invitations from Iraq to Elf and Total to develop oil and gas on two of its southern islands (see story, p. 28). The companies confirmed they have been discussing possible production sharing agreements with Iraq covering Najnun and Nahr Umar islands, and, according to Xinhua News Agency, Iraq asked France to make efforts to partly lift the embargo in return.
Elf and Total insist there is no question of signing anything before the embargo is lifted but said they are preparing for the postembargo period.
Middle East News Network reports Lebanon has invited oil companies to apply for offshore and onshore oil and gas concessions.
Deadline is July 1.
Sudan has announced plans to develop the disputed Halaib border area with Egypt just 2 weeks after Egypt said it plans to settle 4,000 people in the area. The dispute began last month when International Petroleum Corp. signed an agreement with the Sudanese government (OGJ, Feb. 17, p. 31). A meeting in Cairo last month was unable to resolve the dispute.
Pilipinas Shell plans to expand its Tabangao refinery at Batangas, Philippines. Fluor Daniel will provide project management, detailed design, engineering, procurement, and construction management services for work valued at about $400 million. Construction is to be complete by mid-1994.
Colombia's government estimates industry will spend almost $2 billion on Colombian E&D the next 5 years, including $800 million for foreign engineering and materials. Part of the investment will go towards Cusiana oil field development, government officials say (OGJ, Mar. 2, p. 20).
Havana wants to buy oil from Iran and seeks Iranian help in developing Cuba's refining industry, Reuters quoted Cuba's State Committee for Economic Collaboration Chairman Ernesto Melendez Bachs as saying in Tehran last month. He also expressed interest in Iran participating in Cuba exploration. Bachs met with Iranian Oil Minister Gholamreza Aqazedeh, who said a final decision will follow completion of needed studies.
Chase Manhattan Bank has extended a $100 million revolving short term loan to Pemex, the first loan by a foreign bank to Mexico since the Third World debt crisis in the early 1980s.
Pemex plans to use the funds to import oil and gas equipment (OGJ, Feb. 3, p. 19). Chase led a 13 bank syndicate in the deal.
An advisor to Pdvsa has recommended Mexico, Canada, Russia, and Venezuela form a cartel of heavy crude producers to protect markets for their products and counter the coal lobby in world trade. Leonardo Montiel says while Venezuela's proven heavy crude reserves guarantee supplies for 500 years at the present rate of development, light crude reserves guarantee supply for only 4 years at the present rate. He said if Venezuela doesn't change production patterns to include heavy crude, Pdvsa could lose its export capacity while trying to satisfy domestic demand.
Lagoven reports seven combines offering bids for operating contracts on two of its four areas in Venezuela's marginal field reactivation program (OGJ, Feb. 24, p. 43).
BP and Royal Dutch/Shell offered bids on Unit 4 and combines led by Saskatchewan Oil & Gas, Wineca, Feteven-Perez Compact, Benton Oil & Gas/Vinccler CA, and Armstrong Petroleum Corp. offered bids on Unit 3. Both feature heavy crude reserves (see map, OGJ, Aug. 19, 1991, p. 15). Because of the Carnaval weekend, reports weren't available from Corpoven and Maraven on tenders for the five other areas under their purview.
And Pdvsa/OPEC veteran Alirio Parra is Venezuela's new minister of energy and mines, replacing Celestino Armas in a cabinet shuffle (OGJ, Mar. 2, Newsletter).
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