MARKET ACTIVITY/TRADING NOTES FOR DAY ENDING TUES., JANUARY 13, 1998 (5)
KERM'S TOP 21 - SPEC 15 - SERV 9 COMPANIES IN THE NEWS
TALISMAN ENERGY, through its wholly-owned subsidiaries Talisman North Sea Limited and Transworld Petroleum (U.K.) Limited, announced a hydrocarbon discovery on the recently acquired 14/26a property. The 14/26-a-6 well tested at over 40 mmcf/d at a flowing tubing head pressure of approximately 1,800 psi. Flow rates were limited by surface facilities. The operator plans to suspend the well in preparation for field appraisal and development activity, an appraisal well will be drilled as soon as practical in 1998.
''Further work is required to quantify this find, but the well is expected to be a significant addition to a number of discoveries in the area,'' said Dr. J. W. Buckee, President and Chief Executive Officer. ''It also provides encouragement for our upcoming well on the adjacent block, which is on trend with both this discovery and our existing Cromarty discovery.''
On December 2, 1997, Talisman announced that it had acquired a 25% interest in the partial block in an asset exchange with ARCO British Limited. ARCO hold the remaining 75% interest and operate the 14/26a licence. The 14/26a licence is adjacent to Talisman's 13/30a block (Talisman 55% and operator) which contains the Cromarty gas discovery acquired with the Ross field in 1996. Talisman plans to drill a well on Block 13/30 during 1998 to assess the upside exploration potential.
GULFSTREAM RESOURCES CANADDA LTD. announced that it has secured a Cdn. $73 million (U.S. $51 million) corporate credit facility with a consortium of international banks. The recently executed Credit Agreement is for a three year revolving term.
''This new facility combined with approximately Cdn. $35 million cash in the bank at December 31, 1997 leaves Gulfstream in a very strong position to further the development of our asset base through 1998 and beyond,'' stated Angus McKee, Chairman of Gulfstream. Completion of the financing facility enhances the corporation's ability to aggressively pursue 1998 development plans for both oil and gas projects within Qatar, to further expand cash flow during the year, and to support activities in Oman and Madagascar.
This credit facility is a significant component in Gulfstream's ongoing financing initiatives which also included a Cdn. $45 million equity placement during the 1997 fiscal year.
Gulfstream is a diversified international oil and gas company with interests in the Middle East, Far East and Africa. The company currently has no long-term debt.
PAN EAST PETROLEUM CORP. announced the appointment of Mr. Robert A. Maitland, C.A. as Vice President, Finance effective immediately. Mr. Maitland is a member of the Canadian and Alberta Institute of Chartered Accountants, a member and past director of the Canadian Petroleum Tax Society and a member of the Financial Executives Institute. Mr. Maitland has held positions in both public practice and in the independent sector of the oil and gas industry, and brings 22 years of senior experience in business and finance as he joins the management team of Pan East Petroleum Corp.
KERM'S WATCHLIST COMPANIES IN THE NEWS
STARTECH ENERGY (SEH: TSE) announced that, pursuant to its offer to acquire all of the issued and outstanding Common Shares of Laurasia Resources Limited (''Laurasia'') for $0.24 (Canadian) and 0.0362 of a common share of Startech for each Laurasia Common Share, approximately 43.5 million Common Shares, representing approximately 87.7% of the issued and outstanding Common Shares, have been deposited.
As a result, Startech has taken-up and paid for all of the Common Shares deposited to the offer and extended the period during which Common Shares may be deposited until 6:00 p.m. (Calgary time) on January 26, 1998. Nesbitt Burns Inc., in Canada, and Nesbitt Burns Securities Inc., in the United States, are acting as dealer managers in respect of the offer.
SUMMIT RESOURCES LTD. announced an update on its 1997 fourth quarter activities. As part of the Company's 1997 asset rationalization program, non-core asset dispositions comprising 1,000 BOE's of production were concluded during the fourth quarter of 1997, fetching the Company $38 million in sales proceeds. These funds were applied against Summit's long-term debt.
During the fourth quarter Summit sold its interest in the Alliance pipeline projects to Fort Chicago Energy Partners L.P. (Fort Chicago) and acquired 3,040,000 units ($17.6 million) in Fort Chicago which are listed for trading on Canadian stock exchanges. Summit also provided its shareholders an opportunity to invest in Fort Chicago along with Summit, which resulted in a $50 million investment through private placements and a successful rights offering.
Drilling Operations
An active fourth quarter drilling program saw 22 wells being drilled, resulting in 14 oil wells and 4 gas wells for an 82 per cent success rate. In addition to successful oil development drilling at Parkman, Ingoldsby, Hartaven and Hayter, Summit drilled three successful wells, two of which were new field discoveries in the U.S. portion of the Williston Basin.
In North Dakota, Summit drilled an 11,200 foot discovery on its Bob Creek prospect which encountered 42 degree API oil in the Duperow formation. The well has been placed on production as a flowing oil well with an initial production rate of 300 barrels of oil per day. A solution gas sales line is currently being constructed which will enable the Company to conserve natural gas and associated liquids. Summit holds a 100 per cent working interest in the discovery well and controls 2,240 acres on the prospect located in McKenzie and Dunn Counties.
A second oil discovery was made on Summit's Parrott prospect located in Sheridan County, Montana where an 11,100 foot test wellhas been completed in the Red River formation. The discovery well was placed on production at an initial rate of 175 barrels of oil per day. Summit holds a 50 per cent working interest in this 40 degree API discovery.
A further Red River exploration test is being drilled on the Nielsen prospect located seven miles southeast of the Parrott discovery. Results on this 11,200 test are expected late in January 1998. Summit has a 41 per cent working interest in this prospect. Both the Parrott and Nielsen prospects are part of the Summit's Big Sky project area where the Company holds 75,000 gross acres (50,000 net) in northeast Montana.
Summit also successfully extended the Knutson field in North Dakota with a 100 per cent working interest stepout well drilled to the Mission Canyon formation at 9,000 feet. This well was placed on production at a rate of 100 barrels of oil per day. Additional development is planned on this 36 degree API project during the summer of 1998.
Natural gas drilling during the fourth quarter 1997 resulted in a third successful Jean Marie horizontal well at Gunnel, British Columbia, where Summit holds a 75 per cent working interest; and a100 per cent working interest well at Clarke Lake in the Slave Point formation. Tie-in of these wells and facility expansions atGunnel and Mirage are expected to add 6 to 7 MMcf/d to Summit's natural gas production in February 1998.
BLACK SEA ENERGY announced that the company's Tura joint venture in Russia achieved a year-end oil production exit rate of 8,850 barrels per day (Black Sea's share is 50%, or 4,425 barrels per day). Of Tura's total fourth quarter production of approximately 706,000 barrels (7,700 barrels per day), 73% was sold into export markets with the balance held for delivery in 1998.
The production milestone exceeded Black Sea's year end target rate of 8,800 barrels per day and was reached despite record cold temperatures experienced in Russia throughout November and December. ''We are extremely pleased with the team effort displayed by our joint venture which allowed us to exceed our target. We expect these efforts will contribute to planned production increases during 1998'', said Mr. Hussin.
Post year-end production temporarily dropped back to approximately 8,000 barrels per day as Tura took advantage of warmer temperatures to catch-up on scheduled well maintenance and pump replacement.
Black Sea Energy completed a successful exploration program in 1997 and is currently evaluating the program's impact on the company's reserve base. It is expected that the results of the evaluation will be released at the end of January, 1998.
Black Sea Energy is a Canadian company focused exclusively on the initiation, rehabilitation, exploration and development of major oil properties in Russia, where the company's objective is to become one of the most significant foreign oil producers. Black Sea Energy's common shares trade on the Toronto Stock Exchange under the symbol BSX.
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