MARKET ACTIVITY/TRADING NOTES FOR DAY ENDING MONDAY, FEBRUARY 23, 1998 (4)
INTERNATIONAL
Companies
The U.S. State Department has notified a Canadian and two British oil companies that they could be sanctioned under the Helms-Burton Act for doing business in Cuba with properties confiscated from Americans, a U.S. official said on Monday.
"Phone calls were made to the companies as part of a routine inquiry," the official said.
The Canadian company is Genoil Inc(GNOL/CDN) of Calgary, Alberta, and the two British firms are Premier Oil Plc and British Borneo Petroleum Syndicate Plc.
The Helms-Burton law passed in 1996 tightened an economic embargo that the United States has enforced for 35 years against Fidel Castro's communist government in Cuba.
The law provides for penalties against foreign companies that do business in Cuba with properties confiscated by the Castro government. Under Title IV of the law, top executives and major shareholders of these firms can be barred from entering the United States.
The United States has so far punished three companies for doing business in Cuba: the Canadian mining company Sherritt International Corp., the Mexican telecommunications company Grupo Domos and the Israeli-owned citrus firm B.M. Group.
A fourth company, Italian telecommunications firm Stet SpA, escaped penalty last year after striking a compensation deal with the original U.S. owners of the property involved, ITT Corp.
The controversial law, which has annoyed the United States' trading partners, is named after its sponsors, Republican Sen. Jesse Helms of North Carolina and Republican Rep. Dan Burton of Indiana.
Genoil Inc, an oil and gas exploration company, announced last week the Ontario Securities Commission had placed a cease trading order on it because the company was delinquent in filing end of the year and first quarter 1998 financial statements. It also had been embroiled in controversy over loans made to parent firm St. Genevieve Resources Ltd last year.
Genoil said it planned to submit the financial statements as soon as it completed negotiations regarding its Cuban assets with two third party oil and gas companies.
CityView Energy Corp updates Drilling. MMC Exploration & Production (Philippines) Pte Ltd has been advised by the operator ARCO Philippines Inc, that Hippo Well No. 1- at 0600 hours 23 February 1998 was at 940 metres (3082 feet) depth and running 20 inch casing.
MMC Exploration & Production (Philippines) Pte Ltd is owned 51% by MMC Exploration and Production BV and 49% by CityView Energy Corporation Limited's wholly owned subsidiary Western Resources N.L.
Doreal Energy Corporation (DOY/ASE - DEGCF/OTCBB) announced that the operator of the Alijubarrota no. 1 exploration well has set casing to total depth of 2,686 meters (8,864 feet). Testing is in progress. There is no further material information that can be reported at this time.
Doreal has a 10 percent working interest in the exploration well and will earn a 9.35 percent revenue interest in the project.
Countries / Regions
Persian Gulf
An updated Fact Sheet on Persian Gulf Oil Exports is now available.To access the Persian Gulf Fact Oil Exports report, the World Wide Web address is: eia.doe.gov
The report provides data on Persian Gulf oil exports from 1983 right up through the first 9 months of 1997. Also included is a table for the United States, Western Europe, and Japan showing the percentage of demand that comes from imported Persian Gulf oil.
SERVICE SECTOR
Syner-Seis Technologies Inc. (SYN/ASE), has completed an agreement between its wholly owned subsidiary, Exploration Innovations Inc., and Paradigm Geophysical that allows for the signing of a revenue sharing arrangement between the two companies.
The agreement was originally signed between Exploration Innovations Inc. and CogniSeis Development Corp. With the sale of CogniSeis Development Corp., (the world leader in the sale of specialized seismic processing software to the independent seismic processing industry) to Paradigm Geophysical, the agreement now binds Paradigm. The agreement stipulates a revenue split of 75 percent to Exploration Innovations Inc. and 25 percent to Paradigm Geophysical, with all administration being the responsibility of EI.
The agreement allows Exploration Innovations Inc. to provide customer access to Paradigm proprietary software through its existing workstation rental service. EI will add VOXEL GEO, Geo-Sec 2D and Geo-Sec 3D to the specialized seismic processing software packages it makes available to its clients.
VOXEL GEO is a 3D-visualization and seismic interpretation software package that assists the geophysicist in understanding and interpreting complex faulted reservoirs that have been surveyed using 3D seismic collection methods. The user-friendly program provides the fastest, most efficient and most accurate results currently available in today's marketplace.
GEO SEC 2D & GEO SEC 3D are paleospastic reconstruction modelling tools that allow exploration teams the ability to unfold and reconstruct the depositional environment of highly faulted reservoirs. Specifically, these upgrades are used to bind geology with geophysics and will be of inestimable value in processing data from mountainous or rugged regions (be they land or marine).
This agreement represents the first step in achieving our goal of creating a ''Technology Boutique''. The addition of these specialty programs will enable Exploration Innovations Inc. to accept more complicated seismic data processing and interpretation projects and the resulting improvements in the company's product mix and workstation turnover times areexpected to have significant influence in the overall efficiency and profitability of the company.
Negotiations for American Eco Corp.(ECX/TSE) US$93-million takeover of Dominion Bridge Corp. were back on track yesterday, with both sides reducing their rhetoric and promising a signing "within several weeks."
In Houston, American Eco president Michael McGinnis said he will join Dominion's board and executive committee, and his company has taken up US$5 million of Dominion treasury shares, giving it an equity stake of almost 6%.
American Eco is negotiating with its lenders for a US$25-million loan to Dominion, he said. American Eco's total debt will remain less than US$100 million.
Talks will continue on a management agreement and the terms for the offer to all shareholders, he added.
"It may take several weeks to reach a definitive agreement."
Both companies, which operate in the international engineering and construction sector, said management on both sides has agreed to co-operate on common goals.
Michel Mareng‚re, Dominion's chairman and chief executive, and chief operating officer Nicolas Matossian will stay during a transition period.
"We aren't liquidators and we want to keep Dominion intact, including its Australian unit, while streamlining its operations," McGinnis said.
Dominion is headquartered in Delaware and operates from Montreal, while American Eco operates out of Houston and Toronto.
PIPELINES
TransCanada PipeLines Ltd. added a fifth Ontario property to its stockpile of gas cogeneration facilities with the purchase yesterday of an electricity plant in the province's northwest.
The Calgary company, through its income fund TransCanada Power L.P., bought the 42.6-megawatt power plant for $119 million.
The plant, located about 25 km northwest of Iroquois Falls, uses natural gas to create electricity to be sold to Ontario Hydro under long-term sales contracts.
The move is the latest in a string designed to boost the company's presence in Ontario as the province moves toward deregulation.
The restructuring of Ontario's troubled nuclear power sector has opened a space for gas producers to claim a larger share of the electricity market.
Also see earnings Reports
ENERGY TRUSTS
Enerplus Resources Fund ERF.G/TSE&MSE) is pleased to announce that it has closed the last of a series of fourth quarter 1997 acquisitions for a total consideration of $21.2 million.
During 1997, Enerplus focused its acquisition and development activities on natural gas properties adding 24.8 billion cubic feet (''bcf'') of proven and 4.2 bcf of probable net natural gas reserves during the year, representing 77% of net 1997 reserves additions. Enerplus replaced 157% of its 1997 production at an average cost of $4.67 per barrel of oil equivalent net of property dispositions. The Fund has consistently fully replaced its production in each of thelast 5 years and has done so at replacement costs below $5.00 per barrel of oil equivalent (''BOE'') each year.
The Fund's largest 1997 acquisition, which closed on February 17, 1998, consisted of various working interests and royalty interests in the Medicine Hat area of Alberta. The property currently produces 3.9 million cubic feet of natural gas per day net to Enerplus and has added 1.17 million BOE of proven and 0.39 million BOE of probable reserves to the Fund. The total consideration paid in this transaction was $8.13 million, or $5.22 per BOE, and the remaining economic reserve life of the property is over 28 years.
Other acquisitions completed by the Fund in the fourth quarter included natural gas producing properties in the Harmattan Elkton Unit, Wembley, Hotchkiss, Fox Valley, Bantry and Buck Lake areas, as well as oil producing properties in Luseland, Hayter and Medicine River. During the first nine months of 1997, the Fund had been a net seller of assets as over $13 million in non-core properties were disposed of at favorable prices.
As a result of 1997 acquisition and development activities, Enerplus Resources Fund has increased its year end total proven and probable reserves base by 4.5% over 1996 levels and has increased its year end Reserve Life Index from 12.5 years in 1996 to 13.0 years in 1997.
EARNINGS REPORTS
Ramarro Resources Inc. (RMA/ASE) announces its 1998 first quarter results for the period ended December 31, 1997. Revenue totaled $795,050 compared to $654,058 in 1996. Earnings amounted to $128,213 ($0.008/share) compared to $111,511 ($0.010/share) last year. Cash flow was $343,058 ($0.021/share) vs $269,237 ($0.024/share) in 1996. Natural gas production averaged 2.69 mmcf/d compared to 2.15 mmcf/d for the same period in the prior year.
Increased natural gas volumes and better prices produced enhanced financial results for the first quarter of the 1998 fiscal year. The
number of common shares now outstanding is significantly higher due to the shares issued for the acquisition of Ripple Resources and for the conversion of preferred shares and debentures.
Subsequent to the end of the quarter a second well was drilled at Orion in NE British Columbia and is presently being tested. This well completed the terms of earning under a farmout agreement.
For complete report with table data, see Message 3510635
Rider Resources Inc. (RRI.A/TSE) reported 1997 results Net income increased to $1,224,000 ($0.45 per share) compared to $427,000 ($0.18 per share) in 1996. Revenues for 1997 totalled $4,472,000, an increase of 78% over 1996 revenues of $2,511,000. Cash flow for the year increased to $2,682,000 ($0.98 per share) from $1,267,000 ($0.55 per share) in 1996.
Rider's proven reserves, as of January 1, 1998 increased to 2,640 MBOE from 1,507 MBOE at the end of 1996. Total proven plus probable reserves increased to 3,785 MBOE from 2,495 MBOE at December 31, 1996. The company has replaced its 1997 production by 8 times on the basis of proven reserves only. Finding and development costs for 1997 were $3.67 per BOE for proven reserves and $3.27 per BOE for proven plus probable reserves. 1997 production of oil and gas averaged 454 barrels of oil equivalent per day (1996 - 280 BOED).
For complete report with table data, see Message 3509996
Computalog Ltd. (CGH/TSE - CLTDF/NASDAQ) See Kerms Watchlist of Companies In The News
Niko Resources Ltd. (ASE/NKO) announced its financial results for the three and nine months ended December 31, 1997.
During the three months ended December 31, 1997 operating revenue increased to $971,000 compared to $447,000 in 1996. Cash flow from operations rose to $510,000 or $0.025 per share compared to $292,000 or $ 0.015 per share in 1996. The Company earned $234,000 or $0.011 per share compared to $260,000 or $0.013 per share in 1996.
For the nine months ended December 31, 1997 revenue was $2,097,000 compared to $892,000 in 1996. Cash flow from operations was $1,106,000 or $0.054 per share compared to $353,000 or $ 0.022 per share in 1996. Net income was $497,000 or $0.024 per share compared to net income of $270,000 or $0.010 per share in 1996.
ATCO Ltd. (ACO.X/TSE) reported 1997 Results. The ATCO Group reported earnings attributable to Class I and Class II shares for the year ended December 31, 1997 of $81.2 million ($2.68 per share) on revenues of $2,045.1 million. Comparative figures for 1996 were earnings of $80.1 million ($2.63 per share) on revenues of $1,934.1 million. 1996 earnings included a gain of $6.8 million ($0.22 per share) from the sale of ATCOR.
Cash flow from operations for the year ended December 31, 1997 was $410.6 million compared to $383.3 million in 1996.
The 1997 earnings reflect strong performance by all of the Corporation's units and were achieved despite temperatures that were 18.7% warmer than 1996 in the main service areas of the Corporation's natural gas utility operations. Other significant factors impacting 1997 results were lower financing costs and increased sales in the Corporation's electric power operations.
Earnings attributable to Class I and Class II Shares for the three months ended December 31, 1997 were $20.7 million ($0.69 per share) on revenues of $544.6 million compared with $18.5 million ($0.61 per share) on revenues of $546.6 million in the previous year.
Cash flow from operations for the three months ended December 31, 1997 was $112.0 million compared to $101.0 million in 1996.
The ATCO Group of Companies is engaged in electric power generation, transmission and distribution; natural gas gathering, processing, transmission, storage and distribution; workforce housing and technical facilities management.
INTERNAL AFFAIRS
Black Sea Energy (BSX/ASE) announced an expanded management team Robert M. Friedland, Chairman, announced today that an expanded management team headed by newly-appointed President and Chief Executive Officer Barry W. Harrison has been named to direct the future of Black Sea Energy.
Mr. Friedland also announced that while he will remain as a director, he will step down as Chairman of the Board. Clint A. Hussin, former Black Sea President and CEO, will replace Mr. Friedland as chairman. All appointments are effective immediately.
''Black Sea is a maturing company'', said Mr. Friedland. ''Since going public last June, it has acquired significant new land holdings and increased daily production from the Tura Petroleum joint venture to approximately 8,850 barrels per day. The new appointments strengthen the management team and give it the expertise needed to combine operating profitability with the ability to pursue opportunities for future growth.''
An experienced oil and gas executive, Mr. Harrison has held many senior management positions in the oil and gas industry including President and CEO of Mark Resources Inc. and its predecessor Blue Sky Oil and Gas Ltd, as well as President and CEO of Quest Oil and Gas Inc. He currently serves on the board of directors of PanCanadian Petroleum Ltd. and Wawanesa Mutual Insurance Co. ''Mr. Harrison's proven leadership and his knowledge of Canadian markets will help Black Sea move forward,'' Mr. Friedland said.
Mr. Hussin's leadership in Black Sea's acquisition of three fully operational Russian projects are the foundation of the company's current success. As chairman, he will devote significantly more time to the Russian operations and explore opportunities for further expansion.
Mr. Burrows joins Black Sea after a successful career as a senior partner with Deloitte & Touche Chartered Accountants, where he has served as Managing Partner of the Calgary office and was responsible for serving many of that firm's domestic and foreign oil and gas clients.
Black Sea Energy is a Canadian company focused exclusively on the initiation, rehabilitation, exploration and development of major oil properties in Russia. With Russian partners, the company is actively involved in two exploration and development projects, Tura Petroleum and Radonezh Petroleum in Western Siberia and one production rehabilitation project. Kuban Technologies in the Krasnodar region of Southern Russia.
Sands Petroleum AB (SPB/TSE - SANPY/NASDAQ - O List/Stockholm) announced that as a result of its acquisition of 95.5 percent of the issued and outstanding shares of International Petroleum Corporation ("IPC"),Sands now holds, directly and indirectly, approximately 10.9 percent of the issued and outstanding shares of Arakis Energy Corporation ("Arakis").
Prior to Sands' takeover of IPC, Sands held 7,455,800 common shares of Arakis or approximately 8.5 percent of the issued share capital of Arakis. When combined with the 2,169,000 common shares of Arakis owned by IPC and its subsidiary, IPC Limited, Sands now holds, directly and indirectly, 9,624,000 common shares of Arakis or approximately 10.9 percent of the issued share capital of Arakis.
Sands did not act jointly or in concert with any persons and acquired the securities for investment purposes. Subject to availability, price, the general state of the capital markets and the financial condition of Arakis from time to time, Sands may purchase or dispose of common shares of Arakis.
Meridian Energy Corporation (MDG/ASE&VSE) announced that it has granted an additional 525,000 incentive options to members of its management team. The Company has granted Fred Thompson, President and Chief Executive Officer and Allen Bradley, Vice President, Exploration, an additional 200,000 options each, Norris Morgan, Secretary, an additional 100,000 options and Shannon Matthyssen, Comptroller, an additional 25,000 options all subject to the approval of The Alberta Stock Exchange and The Vancouver Stock Exchange. Each option will entitle the officer to acquire one (1) Class A Common Share in the capital of the Company at an exercise price of $0.50 per Class A Common Share. The options will expire on February 10, 2003.
Owing to the policies of the Vancouver Stock Exchange the existing outstanding 290,000 incentive options in favour of the above officers have been cancelled and reissued on the same terms and conditions (including the exercise price of $0.50 per share) as the additional options granted. The weighted average exercise price of the options cancelled was less than the exercise price of the new options. When approved, all of the outstanding options in favour of the directors and management of the Company will represent approximately 9 percent of the issued and outstanding common shares after the Special warrants issued in December 1997 have been converted into common shares.
Del Roca Energy Inc. (DER/ASE) announced that a notice to make a Normal Course Issuer Bid has been accepted by The Alberta Stock Exchange. Pursuant to the Bid, Del Roca may purchase, from time to time as it considers advisable, up to 1,200,000 of the issued and outstanding common shares of Del Roca through the facilities of The Alberta Stock Exchange. The price which Del Roca will pay for any shares purchased by it will be the prevailing market price of such shares on The Alberta Stock Exchange, at the time of the purchase.
In the view of the board of directors of the Corporation, the common shares of the Corporation are undervalued on the market and purchases of the Corporation's common shares at the current market price would be advantageous to shareholders of the Corporation.
An independent engineering firm has valued the Corporation's oil and gas reserves at $6.39 million, effective January 1, 1998 and has assigned proved and 50 percent probable reserves of 550,000 BOEs. Based on its reserve valuation and cash on hand of $1.2 million, Del Roca's net asset value is estimated at $0.32 per share. Del Roca currently has no debt, an unused line of credit and is actively seeking additional high quality acquisitions.
Tracer Petroleum Corporation (TCP/VSE - OTC BB:TCXUF - TCXXF/NASDAQ) announced the resignation of Mr. Hal Kettleson, P. Eng. from the Board with immediate effect. Mr. Kettleson's counsel will be missed and on behalf of the Board, the company wishes him well in the future and expresses the company's appreciation for his efforts over the last year.
DIVIDEND NOTICES
The Board of Directors of ATCO Ltd. (ACO.X/TSE) declared a first quarter dividend of 17.0 cents per Class I and Class II shares, up from 14.0 cents in each of the previous four quarters. The dividend is payable March 31, 1998 to shareholders of record on March 16, 1998.
MISC.
The National Energy Board (''NEB'') on Friday, 20 February submitted to the federal Minister of Environment and to the Canadian Environmental Assessment Agency (the ''Agency'') a copy of its Comprehensive Study Report (''CSR''), which was prepared in accordance with the Canadian Environmental Assessment Act, with respect to Trans Qu‚bec & Maritimes Pipeline Inc.'s (''TQM'') application to construct a natural gas pipeline from Lachenaie, Quebec to East Hereford, Quebec near the New Hampshire border, where the proposed pipeline would connect with the Portland Natural Gas Transmission System (''PNGTS''). The project is known as the ''PNGTS Extension''. The report was submitted on behalf of the NEB and the Canadian Coast Guard, Fisheries and Ocean Canada.
The NEB concluded that the PNGTS Extension project is not likely to cause significant adverse environmental effects, provided that the mitigative measures identified during the public hearing are implemented and enforced. The Board indicated that, should it find that the PNGTS Extension is required by public convenience and necessity, a series of environmental conditions would be included in the certificate.
The CSR results from a public hearing that the NEB held from 17 November to 17 December 1997 in Montreal and Magog, Quebec to consider the PNGTS Extension. The hearing was also used as a forum for public participation in the comprehensive study of the project.
The following steps will occur prior to the NEB making a decision on the PNGTS Extension project:
- the Agency will issue the CSR for public review and comment; and
- the Minister of Environment will take a course of action after taking into consideration the CSR and any comments filed.
TQM applied for approval to construct a 213.2-kilometre (132.2-mile pipeline from Lachenaie to the Canada/U.S. border near East Hereford. TQM also requested approval to install, for the first year of operation, a 7.0 megawatt electric motor driven compressor unit at Lachenaie and two meter stations, one at Waterloo and one at East Hereford. In the second year of operation, TQM proposes to install an additional 3.2 megawatt electric motor driven compressor unit at East Hereford and one gas aftercooler unit at Lachenaie. The estimated cost of the project is $270 million with a planned in-service date of 1 November 1998.
Beginning 1 November 1998, 4.3 million cubic metres (152.2 million cubic feet) per day of natural gas would be delivered at East Hereford to supply markets in the U.S. Northeast and 1.0 million cubic metres (33.7 million cubic feet) per day would be delivered at Waterloo to supply markets in the Eastern Townships of Quebec. In the second year of operation the deliveries would increase to 5.9 million cubic metres (210.0 million cubic feet) per day for East Hereford and to 1.4 million cubic metres (48.7 million cubic feet) per day for Waterloo.
END - END
|
