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Gold/Mining/Energy : KERM'S KORNER -- Ignore unavailable to you. Want to Upgrade?

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To: Kerm Yerman who wrote (13825) 11/26/1998 5:39:00 AM From: Kerm Yerman   Respond to of 15196   IN THE NEWS / WSC-Canadian Energy Weather 26 NOV 1998 SUMMARY- Temperatures 4-8F (2-4C) above normal. IMPACT- The next 5 to 7 days will see above normal temperatures and below normal heating demand across the region including the cities of Toronto, Montreal, and Quebec. FORECAST- 48 HOUR...Temperatures 3-6F (2-3C) above normal Friday, 6-12F (3-6C) above normal Saturday. 3 TO 5 DAY...Temperatures 10-15F (5-8C) above normal Sunday, 6-12F (3-6C) above normal Monday, 3-6F (2-3C) above normal Tuesday. 6 TO 10 DAY...Temperatures above normal for most of the period, may cool late in the period toward normal levels. Source: Weather Services Corporation

To: Kerm Yerman who wrote (13825) 11/26/1998 5:44:00 AM From: Kerm Yerman   Read Replies (6) | Respond to of 15196   IN THE NEWS / Gulf Canada Resources sells more Canadian assets Gulf Canada Resources Ltd. took another step in its asset sale plan on Wednesday, with an agreement by Equatorial Energy Inc. (OZ/VSE) to buy some western Canadian oil and natural gas properties for C$70.5 million. The properties cover 340,000 net undeveloped acres in Alberta, Saskatchewan and northeast British Columbia and include the Kaybob South Triassic Unit and the Bigoray area, according to Gulf Canada. "This sale is a significant step in the Western Canada divestiture program announced in July," said Don Hrap, Gulf's Vice President of North American Operations. Gulf officials in July said they had an asset sale target of C$1.38 billion in 1998. The company is eyeing the sales in a bid to cut debt amid a period of depressed oil prices. Gulf will get C$50 million cash and C$20.5 million in preferred stock convertible into common stock of Equatorial Energy. The preferred stock will carry a 6.5 per cent annual dividend and is redeemable by EEI at any time subject to a premium payment and accrued dividends. The companies hope to close the deal in January. Equatorial Energy President G. Marshall Abbott said the transaction "will be pivotal in providing ascending cash flow and asset value for our shareholders in 1999."

To: Kerm Yerman who wrote (13825) 11/27/1998 1:22:00 AM From: Kerm Yerman   Respond to of 15196   CRUDE OIL - 1 / Market Overview Ending Wednesday Post Index 11/25 12:01 Emerging Markets - Oil prices woes cut two ways 11/25 16:09 World Oil sinks to new low on OPEC gloom and glut 11/25 16:10 NYMEX crude slumps to near 12-year lows on OPEC 11/25 17:39 U.S. Cash Prods-Shortcovering, draws, raise diffs 11/25 17:39 U.S. foreign crudes quiet as OPEC roils futures 11/25 17:41 North Sea Brent dips five cents in late U.S. trade 11/25 18:27 US West Coast diffs steady as new month looms 11/25 12:01 EMERGING MARKETS - Oil prices woes cut two ways While a fresh slump in oil prices piles the misery on major oil-exporting countries of the developing world, analysts are keen to point out more emerging markets benefit from low energy prices than lose out. This year's steep slowdown in world economic growth and the economic contraction in parts of Asia has been key to the drop in oil demand. The net effect of lower oil prices on these economies, however, is probably positive. Apart from the obvious oil-exporting losers -- such as Indonesia, Russia and Venezuela -- falling prices elsewhere adds a fillip to hopes of economic recovery. "For the majority of the emerging markets, apart from OPEC, falling oil prices are going to provide a small extra stimulus to economic recovery," said Roger Monson, head of emerging market equity strategy at Rabobank in London. "Most of the nations in Asia, apart from Indonesia and possibily Malaysia for example, are net oil importers." The dampening effect on producer prices hits inflation and allows more room for interest rate cuts in hard-pressed economies, analysts argue. Moreover, the net positive effect on the balance of payments is supportive for local currencies. This scenario should help kindle any nascent return to emerging market debt markets next year. Wednesday's winter meeting of the once-mighty OPEC oil cartel, meantime, is seen holding little chance of further production cuts. And with a gloomy outlook for the world economy, there is little hope of a serious pick-up in demand. Benchmark Brent crude oil futures fell to their lowest price since 1986 of $11.13 per barrel early on Wednesday. Looked at another way, the scale of this year's collapse in oil prices means Brent's average 1998 price of $13.66 is already the lowest since 1976. Adjusted for inflation, that is the lowest since 1973. Lack of OPEC discipline over oil cuts agreed earlier this year has meant the slump in demand has not been fully offset by supply tightening. Brimming world oil stocks, combined with pressure on exporter nations like Russia to make up for lost hard currency revenues by pumping out even more oil, has only added to the supply overhang, analysts said. Geoffrey Dennis, head of emerging market equity strategy at Deutsche Morgan Grenfell in London, said oil may be overdue a brief post-OPEC bounce but it was still on course to fall to at least $10 per barrel early next year. "The big losers in terms of the oil price are Mexico, Venezuela, Russia, Indonesia and Egypt. But for many of the rest of emerging markets it could be a net positive," said Dennis. "Latin America as a region may be worrying," he said. "But then again, Brazil is a big net importer and is the most important country to keep stable there." Moreover, traders said low oil prices will help keep interest rates low and liquidity buoyant in western economies. That should encourage greater risk appetite in emerging markets as 1999 approaches. "Asia is already feeling the effects of deflation and this is really the story the oil price is both reflecting and reinforcing," said Mitul Kotecha, emerging markets analyst at Standard Chartered Bank. "To the extent that the economic slowdown story may be close to being discounted, then the more room for interest rate cuts in the interim is a plus for the world economy." 11/25 16:09 World Oil sinks to new low on OPEC gloom and glut World oil prices crashed to new 12-year lows on Wednesday as troubled OPEC looked unable to trim extra oil from glutted markets and Iraq agreed to continue oil sales without interruption. Ministers of the troubled cartel meeting in Vienna are poised to agree an extension to existing output curbs by another six months rather than cutting deeper into supply. A draft OPEC communique being prepared on Wednesday referred to the possibilIty of extra cuts but only after ministers review output in March, a delegate said. Separately, Iraq said it accepted the fifth round of an "oil-for-food" deal with the United Nations making an extended gap in oil exports from Baghdad this winter unlikely. World benchmark Brent crude oil futures tumbled sharply on Wednesday. The contract closed at $10.90 a barrel, having earlier in the day dipped to $10.65, the lowest level for Brent crude since 1986. Oil traders said the OPEC deal, which extends existing production cuts by six months, won't do enough to rescue the oil market next year from burgeoning supply, brimming oil storage tanks and sluggish demand. Some believe the deal might even come back to haunt OPEC when seasonal demand declines next summer and storage tanks begin re-filling quickly. "The current cuts are just not taking enough oil off the market. They are going to have to deal with the same problem next year," said Glenn Murray of oil brokers Azur SA in France. A cold winter in the Western consuming nations might help boost demand and bite into stocks in the short-term but any deal will "certainly not solve the stock problem," said Nigel Saperia of Bankers Trust in London. OPEC lynchpin Saudi Arabia has insisted that members adhere to their existing pledges to cut supply before any new measures to cut output can be considered. The deal is about "Saudi Arabia laying down the law," said Saperia. OPEC agreed earlier this year to cut 2.6 million barrels per day (bpd) or some 10 percent of its total production until the middle of next year. The new agreement looks set to extend those cuts until the end of next year. OPEC's second and third biggest producers behind Saudi have been overproducing, according to independent monitors. Venezuela has admitted overproducing and there are growing concerns that Iran has wavered on its promise to trim output. Saudi officials said Riyadh could not sanction deeper cuts while fellow OPEC members pumped 600,000 bpd more than permitted. The once mighty oil producers' cartel has been stunned by the huge drop in oil prices that has driven Brent to an average of $13.66 so far this year, the lowest average since 1976. Adjusted for inflation, prices are at their lowest since 1973. A quarter of a century after the Arab oil embargo, the West's lingering nightmare that petrol pumps might again run dry has scarcely felt so remote. Meanwhile, Iraq on Wednesday agreed to a new fifth round of oil sales with the United Nations adding more downward pressure to prices. Iraq's UN Ambassador Nizar Hamdoon saw an export gap of only a "few days". Some oil traders had been expecting a gap of several weeks. 11/25 16:10 NYMEX crude slumps to near 12-year lows on OPEC Crude futures on the New York Mercantile Exchange (NYMEX) slumped to near 12-year lows Wednesday as the Organization of Petroleum Exporting Countries (OPEC) decided merely to extend current output curbs instead of cutting production deeper, traders said. Near the close, NYMEX January crude traded at $11.75, down 37 cents. It recovered slightly from $11.63, the day's low that it struck late in heavy selling after news broke of the expected OPEC move. The $11.63-low broke the $11.65 low of November 18, both near the $11.40 intra-day, 12-year low of June 15. Traders said late short covering and book squaring deals shored up the battered January crude, which went on top of the board only on Monday. After lingering near its Tuesday close of $12.12 past midday, the front month crashed below $12 on market talk that Venezuela did not agree to extension of the output cuts for six months, to the end of 1999. As a senior official of OPEC explained later on, Venezuelan President Rafael Caldera had agreed to the extension. However, Caldera had asked that the agreement on extending the cuts carry a footnote about his country's general election in 10 days' time and that Venezuela will have a new president in 11 days, the official said. December heating oil last traded at 33.00 cents a gallon, down 0.29 cent from its Tuesday settlement. December gasoline last traded at 34.90 cents, down 0.39 cent from the previous session. The front month refined products contracts will expire on Monday, Nov. 30. In another bearish development, Iraq has agreed to a fifth round of the United Nations-sponsored "oil-for-food" program, allowing it to export up to $5.256 billion of oil for the next six months. Iraq's Ambassador to the U.N., Nizar Hamdoon said Wednesday he will formally sign Iraq's acceptance of the terms of the new round at 1700 EST/2200 GMT at the U.N. Iraq's agreement to the new round means there will not be any extended gap in oil exports from Iraq. If Iraq's oil exports were disrupted for any extended amount of time, it would have been bullish for the oil markets as it would withhold Iraq's oil supply of about two million barrels per day to the market. 11/25 17:39 U.S. Cash Prods-Shortcovering, draws, raise diffs Spot U.S. oil products differentials firmed slightly on shortcovering while distillates inched higher on a large stock draw, amid across- the-board futures dips, traders said. New York Harbor low sulpher diesel also firmed on the shortage of supplies in the Philadelphia area, while jet kero was weaker on a large build in Padd 1. The crude futures market sunk to near 12-year lows as OPEC was poised to extend current output curbs instead of slashing current production quotas, at its ministerial winter meeting in Vienna Meanwhile products futures slipped. "I don't see any big reaction from the stock data...everything is overshadowed by crude and what's going on at OPEC," said one trader. On Tuesday evening, the American Petroleum Institute reported a 1.3 million barrel draw in distillates, which include heating oil and diesel, and a drop in gasoline stocks by 346,000 barrels for the week ended November 20. The U.S. Department of Energy (DOE) early Wednesday also reported draws in the products, but at a smaller 600,000 barrels each. But the stock news on crude was more bearish with the API reporting a stockbuild of 2.9 million barrels and the DOE said there was an increase of 5.1 million barrels for the same week. Refinery runs were down 2.0 to 93.2 percent of capacity or 300,000 bpd above 1997 and 250,000 bpd above 1996, the API said. On the NYMEX, December heating oil closed at 33.10 cents per gallon, down 0.19 cent while gasoline slipped 0.31 cent at 34.98 cents. NYMEX January crude closed 26 cents per barrel lower at $11.86. NEW YORK HARBOR Low sulphur diesel differentials, which firmed all week, gained another 0.50 points Wednesday in sympathy with a lack of barrels near Philadelphia, and Sunoco's raising of their distillates posted prices late last week, traders said. Low sulphur diesel firmed for Laurel pipeline purchases to a penny over the December screen, while New York differentials went up to 1.50/1.75 over the screen after Sunoco purchasing of Laurel barrels on late last week. Prompt material traded at 1.75 cents over. Heating oil was a touch stronger on the stock data at 0.50/0.30 cents under the screen. Regular gasoline differentials were steady holding a weak tone, traders said. Prompt regular unleaded M5 grade gasoline was pegged at 3.80/3.65 cents under the screen, and 3.50 cents under traded for barges, while regular RFG A5 was pegged at 1.75/1.50 under the screen. Premium conventional V5 was pegged at 2.20/1.90 cents discount and the RFG D5 pegged weaker at 0.10 cent under and over the screen. Jet fuel 54-grade was pegged at 4.75/5.00 cent over the heating oil contract on the NYMEX and traded at 4.75 cents overwhile the 55-grade was at 6.75 cents premium. GULF COAST Gasoline and distillate differentials edged up in shortcovering ahead of the Thanksgiving holiday, traders said. Regular gasoline was the bull of the shortcovering barrel with benchmark conventional M5 pegged 0.30 cent stronger at a 6.30/6.00 cents discount on the prompt front 34 December cycle. Premium V5 grade gasoline was pegged steady at 1.50/1.75 to the M grade and the prompt A regular reformulated gasoline was traded at a 3.00 cents under the screen. Prompt December front 34 cycle low sulphur diesel was pegged firmer at 2.70 to 2.50 cents under and prompt heating oil at 3.20/3.00 cents under the screen. Compared to the national distillate stocks sharp draw, the Padd 3 district showed the largest distillate inventory build with low sulphur rising 311,000 barrels and the high sulphur up 345,000 bpd. Jet fuel held its weak tone amid a puddle of product in the hub supplied by the recent Colonial Pipeline freeze. Jet 54-grade was pegged at 1.10/0.90 cent below the print and the 55-grade offered at a penny over. MIDCONTINENT Besides Group Three low sulphur diesel trade at steady values, midcontinent differentials were notionally unchanged in the quiet run up to the holidays. Group Three low sulphur diesel were pegged at -0.20/+0.10 cent to the NYMEX and regular gasoline at a 5.00/4.75 cents discount. Premium gasoline in the Group was at a 3.00 cents regrade and in Chicago at a 2.25/2.50 cents. Chicago low sulph was pegged at -0.25 to flat to the screen. Group jet fuel sat at 4.00/4.25 cents premium and Chicago at 2.50/2.75 cents. 11/25 17:39 U.S. foreign crudes quiet as OPEC roils futures The U.S. market for imported crudes was mostly quiet on Wednesday, with many traders out in anticipation of the U.S. Thanksgiving holiday. Those that remained in the market, were glued to their screens, as news from the Organization of Petroleum Exporting Countries took the limelight on Wednesday. Crude oil futures on the New York Mercantile Exchange were volatile in relatively thin trading, but reacted bearishly to the headlines, slipping to an intraday low of $11.63 a barrel. Front-month January futures settled 26 cents weaker at $11.86 a barrel on Wednesday. The NYMEX will be shut on Thursday and Friday, to commemorate the Thanksgiving holiday. Saudi Oil Minister, Ali al-Naimi said late Wednesday that the oil cartel had reached an agreement, but would announce it on Thursday. OPEC delegates said the agreement would the group's 2.6 million barrels per day cut by another six months, although the deal reportedly refers to further output reductions after a March 1999 meeting. In other news, Iraq's ambassador to the United Nations, Nizar Hamdoon, told Reuters on Wednesday that his country had agreed to the fifth-round of the oil-for-food plan, under which Iraq sells its oil to buy humanitarian good. Hamdoon expected to file the distribution plan for the U.N. program on Saturday. LATAM - CHILE, COLOMBIA, VENEZUELA, ECUADOR -- Details were not yet available on Ecopetrol's million-barrel package of Colombian light sweet Cusiana, for which the buyer can nominate a loading window in January. Traders said that a narrower trans-Atlantic arbitrage and rising prices for Dated North Sea Brent may help Cusiana prices. In the meanwhile, Cusiana remains valued at $1.65-1.55 under West Texas Intermediate, where four late December cargoes of the grade were awarded by Colombia's Ecopetrol in that range earlier this week. A December 17-18 loading cargo the grade is also on offer, traders said. -- Talk on Colombia's heavier crude, Vasconia, remained in a wide range of $2.95-2.80 under WTI, although most market talk was heard around the minus $2.95 level for cargo sold by a trader and an Ecopetrol tender heard done last week. -- Venezuela's sour crude Mesa/Furrial remained valued at about $2.80 under WTI, with some buyers as far away as minus $3.00. Mesa was last heard done at a discount of $2.73 under WTI about two weeks ago. -- Ecuador's sour crude was also weak, valued around $3.00 under WTI cif U.S. Gulf Coast, although traders said talk on the Ecuadorean crude was relatively quiet in the U.S. Gulf Coast. NORTH SEA, WEST AFRICAN -- The January trans-Atlantic arbitrage remained steady on Wednesday, settling at a relatively narrow 94 cents a barrel. Dated North Sea Brent strengthened by 15 cents, as traders said a prompt cargo of Brent traded at 50 cents under January Brent. But although both developments typically indicate less profitability in bringing over North Sea and West African grades, traders said offers of Brent and West African remained ample in the U.S. Gulf. There was talk on Wednesday that a U.S. trader was bringing over another Ultra Large Crude Carrier (ULCC) of North Sea Brent to the U.S. Early December arriving barrels of Brent were reported to be on offer at 70 cents under January West Texas Intermediate, traders said. 11/25 17:41 North Sea Brent dips five cents in late U.S. trade North Sea Brent lost five cents in a frenzy of late U.S. trading on Wednesday, dealers said. January Brent was valued at $10.87 a barrel, down slightly from its close on the International Petroleum Exchange at $10.92 a barrel. Traders said deals Wednesday were recorded in a broad range, including a full cargo of January cash Brent at $10.95 a barrel and a full cargo at $10.90 a barrel. Also, traders said 100 lots of partial January cash cargoes sold at $10.70, 200 lots sold at $10.72, 200 lots sold at $10.75, 300 lots sold at $10.90, 100 lots sold at $10.92, and 100 lots sold at $10.95 a barrel. In addition, the December-January spread changed hands at 15 cents on Wednesday. 11/25 18:27 US West Coast diffs steady as new month looms Differentials for West Coast cash crudes were steady on Wednesday as the market headed into a long holiday weekend with no new trades reported. Market participants will start discussing January business when they get back to work next week and most expect to see three to six cargoes traded by the end of the year. The last deal reported for the West Coast's staple ANS crude was done last week at a discount of $1.70 a barrel to West Texas Intermediate (WTI) crude. The notional price for a barrel of ANS for December delivery on the West Coast slipped some 60 cents to $9.03/9.28 a barrel on Wednesday, the eve of the Thanksgiving holiday. This reflected renewed weakness in global oil prices as an OPEC meeting in Vienna appeared headed for an agreement to extend existing production cuts rather than cut output further. Some players said the ANS discount to WTI could widen to $1.80 to $2.00 a barrel when the next deals are done. "There's a lot of foreign crude out there competing against ANS and producers (of ANS) really have to move it," said one. One big seller of ANS already indicated earlier this week that the discount was too great for his taste and that he would be holding out for deals at no more than $1.50 below WTI.

To: Kerm Yerman who wrote (13825) 11/27/1998 1:24:00 AM From: Kerm Yerman   Respond to of 15196   CRUDE OIL - 2 / Market Overview Ending Wednesday Post Index 11/25 18:02 Iraq signs document with U.N. allowing oil to flow 11/26 05:04 U.S. Products Outlook-Overhang dampens fire-outage 11/26 05:12 OPEC meets to seal weak compromise on oil cuts 11/25 18:02 Iraq signs document with U.N. allowing oil to flow Iraq's U.N. Ambassador Nizar Hamdoon on Wednesday signed a renewal of the "memorandum of understanding" with United Nations legal affairs chief Hans Corell, clearing the last legal obstacle before the fifth 180-day round of the "oil-for-food" program can start. But a gap of at least a few days to a week in oil exports is expected as Iraq and the U.N. negotiate final terms of a plan to distribute food, medicine and other supplies funded by proceeds of the oil-for-food sale. Iraq can legally ship oil at 0001 EST (0501 GMT) Thursday now that the renewal of the memorandum of understanding has been signed. But Hamdoon said Wednesday that Iraq is unlikely to ship any oil until U.N. Secretary-General Kofi Annan approves the distribution plan. About two-thirds of the proceeds of the oil-for-food sale go to buy food, medicine and other supplies for Iraq's people. The largest chunk of the remainder, 30 percent, repays victims of the 1991 Gulf War and its buildup, largely Kuwaitis. The memorandum of understanding was first signed in May 1996; renewals for each six-month sales phase must be signed to let the oil-for-food program continue. Although a mere technicality, Hamdoon's signing of the document shows Iraq is ready to sell oil almost immediately instead of delaying the start of the new, fifth round of oil sales at least three weeks -- as international oil traders had expected. This means that instead of almost two million barrels per day (bpd) off the world market for a month or so, oil will probably flow out of Iraq in the first week of December, said an Iraqi knowlegeable about the technical aspects of the oil-for-food sale. World oil demand is about 75 million bpd. On Tuesday, the U.N. Security Council approved extending the oil-for-food program for six months and allowing Iraq to sell up to $5.256 billion of oil in that time. But with oil prices at 12-year lows and Iraq's limited export capacity, the fifth round is not expected to greatly exceed the $3 billion in oil sold by Iraq during the fourth round, which expires at midnight Wednesday. Iraq can now sell oil as soon as its national oil company State Marketing Oil Organization (SOMO) submits contracts to the U.N.'s international oil marketing experts, the so-called overseers. By Wednesday afternoon, U.N. sources said the overseers had not received any oil-sale contracts. There is also the issue of a pricing formula for Iraqi crude shipped in December. Each month, Iraq asks the U.N. to approve prices of Iraq oil. These prices largely mirror price m 11/26 05:04 U.S. Products Outlook-Overhang dampens fire-outage News of a refinery fire on Monday failed to rally the U.S. oil products, setting the bearish tone for the week, traders said. Instead, the growing stocks on the Gulf Coast refining hub, which has caused a bottleneck on gasoline and distillate shipments to the northeast, were expected to remain the dominant factor. "I don't see a rally coming," said one Gulf Coast source. New York traders said differentials, as gasoline did on Monday,would follow the Gulf. "Gasoline is in the dumps, and all eyes are on the Gulf," said a Midwest trader who works the Harbor. But with the trading week cut short by U.S. holidays on Thursday and Friday, some traders said shortcovering may be supportive, as well as any bullish announcements from this week's OPEC meet in Vienna or any bullish news on margin-related refinery cuts. "Everybody knows about it (the fire), but numbers are all the same," said a Houston trader, adding there were enough stocks to quash any rally. Lyondell-Citgo Refining Co., a joint venture between Lyondell Petrochemical Co <LYO.N> and Citgo Petroleum Corp, which is owned by PDV America Inc, a subsidiary of state-owned Petroleos de Venezuela S.A., said a fire broke out early Monday morning fire at its 265,000 barrel per day (bpd) Houston, Texas refinery. As a result, it cut its operating rates and shut down some units, including a 92,000 bpd fluid catalytic cracker (FCC) and 95,000 bpd hydrotreater. "Prices should go lightly lower...there are plenty of barrels," a trader with a major oil company said. U.S. gasoline inventories have been rising fast in the last three weeks, and were at 21 million barrels in the latest week, up 9 million barrels from a year ago, the American Petroleum Institute (API) said for the week ending Nov. 13. Distillate stocks, include heating oil, were even more bearish, rising in November to one of the highest levels for the month for at least 11 years, one analyst said. The API said U.S. distillate stocks rose 1.2 million barrels to 14.8 million barrels, or around 13 million barrels higher than a year ago and just half a million barrels away from its 11-year record set this September. The surplus of product prompted the Colonial Pipeline last week to extend freezing shippers' nominations on the arterial 1.2 million bpd gasoline line and 888,000 bpd distillates line from mid-November to December shipments. Shippers will instead be allocated or prorationed the volume they can move up from the Gulf Coast to the northeast. The initial news of the freeze and panic selling saw Gulf Coast differentials dive to fresh lows -- to gasoline's March low of a 8.00 cent discount to the New York Mercantile basis contract, and to heating oil's January low of around a 3.75 cent discount. Although differentials have pared some of their losses as the market factored in the freeze, outright prices last week ended lower. Gasoline on both hubs lost around 2.30 cents per gallon to 31.90 cents on the Gulf, and 34.50 in New York Harbor. Gulf Coast heating oil at 31.60 cents per gallon, ended the week with bigger losses of around 3.20 cents compared to the Harbor's 2.70 cents loss. Traders said heating oil, along with diesel and jet fuel were supported by independent refiner Sunoco Inc's <SUN.N> unusual buying presence in the northeast, spurring rumors of cuts in output due to weak refining margins. Sunoco, whose bulk of its production coming from the 307,000 bpd two-refineries complex in Philadelphia and the 175,000 bpd Marcus Hook refinery, both in Pennsylvania, declined to comment on its daily operations. Traders said news of any cuts were supportive but did not expect to see a huge onslaught of cuts yet. Refinery margins saw a slight recovery with losses for processing benchmark West Texas Intermediate crude in the Gulf Coast hub, shave off six cents per barrel to 85 cents for the week with a late rally to a 53 cents loss on Friday. "People are going to be very cautious...they will only cut as a last resort," said a trader with major oil company. 11/26 05:12 OPEC meets to seal weak compromise on oil cuts OPEC oil producers on Thursday were meeting to iron out the details of an agreement to extend existing limits on their exports, disappointing some in their ranks who favoured more curbs to reverse a price crash. Delegates said ministers were expected to complete a compromise deal to prolong by six months, to the end of 1999, existing output curbs put in place last June. The decision was at hand despite heavy pressure from what ministers said was a majority in OPEC who wanted to take immediate further action to ease a towering oil stockpile and address stagnant world demand. "I don't think we will have a decision on further cuts at this meeting," said Iranian Oil Minister Bijan Zanganeh as the meeting started. "I think it is more practical at this time," to extend previously agreed cutbacks, United Arab Emirates minister Obaid bin Saif al-Nasseri said. Libya's Abdullah el-Badri said an extraordinary meeting would be called for March. Ministers were also working on a clause to their agreement referring to the possibility of further action in March. That, said delegates, should prove enough to satisfy the demands of member states that preferred immediate new cuts. "The majority are asking for cuts now," said Kuwait Oil Minister Sheikh Saud al-Sabah, a leading advocate of immediate new limits. "There are only two options...if we can put those two together fine. We are completely flexible." Kuwait's efforts have foundered on the insistence of OPEC's leading policy maker Saudi Arabia for full adherence to existing supply curbs before it would consider any new measures. Riyadh's concern is that is not be left to shoulder the burden of supply restraint leaving rivals to grab extra market share -- a situation it vowed never to repeat after the last big oil slump of 1986. After a day of talks on Wednesday, Saudi Oil Minister Ali al-Naimi said that the essentials of an agreement were firmly in place. "That's it. We have reached an agreement. We will announce it tomorrow (Thursday)," al-Naimi told Reuters. OPEC in June had pledged to remove 2.6 million barrels a day, 10 percent of its output, from the market and non-OPEC states said they would slice an additional 500,000 barrels daily. The finer details of Thursday's embryonic agreement were lost on traders who had already sold oil futures to new lows in anticipation of the deal. North Sea Brent on Thursday traded down another 15 cents to just $10.75, losing 10 percent of its value this week. Oil this year, on average at $13.66 a barrel for Brent, is priced lower than at any time since 1976. "There is going to be downward pressure on prices," said Jeremy Hudson of Salomon Smith Barney. "We may see oil flirting with $7-$8 a barrel."

To: Kerm Yerman who wrote (13825) 11/27/1998 1:35:00 AM From: Kerm Yerman   Respond to of 15196   NATURAL GAS - 2 / Market Overview Ending Wednesday 11/25 14:01 U.S. Dec/Nov spot natural gas prices - November 25 DEC/NOV ($/mmBtu) DEC-11/25 NOV-11/25 U.S. GULF OFFSHORE 2.00/2.05 1.68/1.73 TEXAS COAST 2.01/2.06 1.70/1.75 WESTERN TEXAS 1.98/2.03 1.65/1.70 LOUISIANA COAST 2.07/2.12 1.76/1.81 NORTHERN LOUISIANA 2.09/2.14 1.78/1.83 OKLAHOMA 2.03/2.09 1.68/1.73 APPALACHIA 2.31/2.36 2.16/2.21 SO. CALIFORNIA BORDER 2.26/2.31 2.17/2.22 HENRY HUB 2.11/2.15 1.80/1.85 WAHA HUB 1.98/2.03 1.68/1.73 11/25 12:47 Canadian spot natural gas domestic prices - November 25th DOMESTIC (NOV SWING) $CDN/GJ $US/MMBTU ALBERTA PLANT-GATE 2.34/2.39 1.63/1.66 ALBERTA BORDER - EMPRESS 2.57/2.62 1.79/1.82 STATION 2, B.C. 2.48/2.53 1.73/1.76 SASK. PLANT-GATE 2.34/2.39 1.63/1.66 TORONTO CITY-GATE 2.79/2.86 1.94/1.99 1-YR PCKGS - EMPRESS 2.69/2.74 1.87/1.91 AECO 2.46/2.51 1.71/1.75 N=notional. One yr package beginning Nov. 1, 1999. Canada/U.S. dollar conversion based on Bank of Canada noon rate. One year packages converted to U.S. dollars at a 12-month forward rate 11/25 12:47 Canadian spot natural gas export prices - November 25th EXPORT (NOV SWING) $CDN/GJ $US/MMBTU HUNTINGDON B.C. 2.60/2.68 1.81/1.86 KINGSGATE B.C. (TO PNW) 2.63/2.70 N 1.83/1.88 N MONCHY SASK 1.90/1.97 N 1.32/1.37 N EMERSON MAN 2.63/2.70 1.83/1.88 NIAGARA ONT 2.82/2.89 1.96/2.01 Canada/U.S. dollar conversion based on Bank of Canada rate. 11/25 15:25 Weekly Canadian spot LPG prices - Nov 25th FOB US CTS/GALLON SARNIA EDMONTON PROPANE (spot) 23.75/24.25 15.75/16.25 BUTANE 24.00/24.50 N ISOBUTANE 24.50/25.00 21.75/22.25 FIELD BUTANE 17.75/18.25

To: Kerm Yerman who wrote (13825) 11/27/1998 1:42:00 AM From: Kerm Yerman   Respond to of 15196   EARNINGS / Oilexco Incorporated Third Quarter Report OILEXCO INCORPORATION - THIRD QUARTER INTERIM REPORT CALGARY, ALBERTA-- Oilexco Incorporated announces its first shipment of Iraqi crude oil under the United Nations Oil for Food Program is enroute, sale of undeveloped lands in north central Alberta, updates its current activities and reports its interim financial and operating results for the third quarter and nine months ended September 30, 1998. Quarterly Review and Update Oilexco Incorporated is pleased to announce that on November 3, 1998 its first cargo of oil from the Republic of Iraq under the Oil for food Program - UN Resolution 1152 (98) of approximately 1.9 million barrels of Kirkuk Light at Ceyhan Turkey set sail and is destined for North America. Net proceeds from the settlement of this transaction will be utilized to augment the Company's working capital position. The Crude Oil Purchase Contract from the State Oil Marketing Organization (SOMO) of Iraq is the first awarded to a Canadian oil and gas company relating to the Iraqi oil industry. Oilexco continues to pursue additional crude oil purchase contracts for the next phase of the Oil for Food Program and development and exploration projects in Iraq which will directly benefit the Iraqi people by augmenting humanitarian aid efforts. Arthur Millholland, President of Oilexco indicated that these discussions have reached their final stages and hopes that when Oilexco is granted UN approval to commence or sanctions are lifted, that the benefits of the projects will enure to the Iraqi people and to the shareholders of Oilexco. On November 13, 1998, Oilexco sold 2,704 net acres of raw undeveloped land in north central Alberta to a major oil and gas company for net proceeds of $400,000. Proceeds from this sale will be utilized to pay off the outstanding line of credit and solidify the working capital position of the Company. The Company's #1 Blackshire 32-10 well in Monroe County, Alabama has been producing at test allowables from late July to mid October at average daily volumes of 605 barrels of oil and 390 mcf of flared gas per day. In an effort to conserve and market the associated gas, production has been cut back to 285 barrels of oil and 170 mcf of flared gas per day, until pipeline facilities are completed. It is expected that production rates will return to a minimum of the test production rates of July - October, if not greater. Oilexco holds a 12.5% working interest in prospect area and has to date drilled two successful Jurassic Smackover wells for a 100% success rate. Several offset locations to these wells have been identified based on the interpretation of 30 square miles of proprietary 3D seismic data. A third well may be drilled in 1999 to further delineate this significant oil discovery. The option granted to a junior Canadian oil and gas company to acquire an additional 12.5% working interest in Oilexco's Castleberry, Alabama prospect expired unexercised on September 15, 1998. On July 13, 1998 reentry operations on the South Lakeside #1 well at Cameron Parish, Louisiana were abandoned after reaching a depth of 17,562 feet. The drilling costs of the well were under budget by approximately $125,000 US net to Oilexco's interests. A write down of approximately Canadian $1.9 million was taken in the third quarter of 1998, relating to drilling costs incurred on the Louisiana prospect. Financial Highlights During the third quarter of 1998, Oilexco Incorporated had a loss of $2,062,924 on revenues of $188,162 as compared to a loss of $64,828 on revenues of $237,427 for the comparable period of 1997. The loss realized in the quarter was mainly due to the $1,900,000 write down associated with drilling costs incurred at Cameron Parish Louisiana and increased operating costs of $124,768 relating to new production and rework of existing wells. Cash deficit for the third quarter totaled $187,456 as compared to a deficit of $58,139 for the same period in 1997. Three Months ended Nine Months ended September 30 September 30 1998 1997 1998 1997 Oil and gas revenue 178,427 152,680 459,690 357,481 Other revenue 9,735 84,747 31,972 173,443 Loss (2,062,924) (64,828) (2,928,851) (1,194,556) Loss per share (0.12) nil (0.17) (0.07) Cash flow (deficit) (187,456) (58,139) (475,875) (304,407) Cash flow (deficit) per share (0.01) nil (0.03) (0.02) Production (boe per day) 107 67 86 51 Average price ($ per boe) 18.45 24.60 19.49 26.27 The production increase realized in the third quarter of 1998 was primarily due to production realized from the Blackshire well in Alabama. Lower commodity prices offset the financial impact of the increase in production volumes on production revenues realized. Outlook Proceeds from the settlement, in early December, of the Iraqi crude oil sale and sale of undeveloped land in north central Alberta, will enable Oilexco to extinguish its outstanding line of credit and solidify its working capital position. The Company will continue to focus its activities on its: US Gulf Coast projects in Alabama, western Canadian prospect areas in Alberta and Saskatchewan, and on its international opportunities in the Republic of Iraq. Oilexco is endeavoring to report improved financial results and cash flows in successive quarters.

To: Kerm Yerman who wrote (13825) 11/27/1998 1:44:00 AM From: Kerm Yerman   Respond to of 15196   EARNINGS / Golden Trend Petroleum Ltd. Third Quarter Report GOLDEN TREND'S CASH FLOW EXCEEDS $1 MILLION - NATURAL GAS REPRESENTS 83% OF TOTAL PRODUCTION CALGARY, ALBERTA-- Golden Trend Petroleum Ltd. presents its interim report for the nine months ended September 30, 1998. During the first nine months of 1998, Golden Trend's net production averaged 4.73 mmcf/d of natural gas and 96 bbl/d of light oil. The combined total of 569 boe/d was 5% higher than the 1997 nine-month total of 543 boe/d. The product mix for this period was 83% natural gas and 17% light oil. Natural gas production increased by 30% over the 1997 nine-month average of 3.65 mmcf/d, highlighted by production from the Marten Hills and Redwater core areas. Light oil production decreased by 46%, compared to the 178 bbl/d average in the same period in 1997, mainly due to expected declines in the Company's Coutts wells. Total revenue was $2,517,689, a 5% reduction from the 1997 nine-month total of $2,654,099. Cash flow from operations was $1,005,520, down 23% from $1,309,956 in the first nine months of 1997. Cash flow per Class A share was $0.14, compared to $0.30 in 1997. Golden Trend forecasts it will generate cash flow of $1,400,000 in 1998, which would translate to cash flow per Class A share of $0.19 for the year. The Company's net income for the period was a loss of $555,977 versus income of $1,752 in 1997. The loss was primarily due to a higher depletion and depreciation calculation. Long term debt was $4,266,965, a 3% reduction from $4,412,868 as of September 30, 1997. Total debt (long term debt plus working capital deficiency) was $4,838,491, down 22% from $6,170,843 as of September 30, 1997. Golden Trend received $1.73/mcf as an average natural gas price for the first nine months, compared to $1.61/mcf in the same period in 1997. The Company's light oil price averaged $18.99/bbl, versus $25.70/bbl in 1997. Operating costs were $4.77/boe, a 15% reduction when compared to $5.63/boe in 1997. In the first nine months of 1998, Golden Trend focused most of its capital expenditures on acquiring land on shallow, low-risk natural gas prospects, primarily in east-central Alberta. The Company now has sufficient land on its new prospects to drill over 20 wells. Activity on six of the new prospects, before the end of 1998, will include two wells and four seismic programs, with more drilling planned for early 1999. At its existing core production areas, Golden Trend plans to drill three development wells before the end of 1998. At Black Spruce, a development well will be drilled in late November. At Redwater, Golden Trend plans to drill two development wells, fracture stimulate two potential Viking gas wells, and complete two shut-in Ostracod wells. With over 28 sections of land to exploit and two underutilized compressor stations, the Company expects Redwater will be our largest production area by the end of 1999.

To: Kerm Yerman who wrote (13825) 11/27/1998 1:47:00 AM From: Kerm Yerman   Respond to of 15196   EARNINGS / Black Sea Energy Announces Nine Months' Results CALGARY, Nov. 26 /CNW/ - Black Sea Energy Ltd. (BSX on the TSE) today reported results for the nine months ended September 30, 1998 (all amounts are expressed in U.S. dollars, with volume amounts being net to Black Sea). Petroleum revenues from Tura, Black Sea's only producing project, were $9,494,000 for the first nine months of 1998, compared to $8,409,000 for the same period in 1997. The average sales price per barrel of $9.10 for 1998 is 22% lower than the $11.60 per barrel realized during the same period in 1997, attributable to continuing depressed world oil prices and also the resulting impact on Russian domestic market prices. Oil production for the first nine months of 1998 was 1,335,452 barrels (4,892 barrels per day), representing an 84% increase from the 725,700 barrels (2,658 barrels per day) produced during the same period in 1997. At September 30, 1998, Black Sea's share of oil production from the Tura project was 5,400 barrels per day and it currently continues at that rate. Sales during the first nine months of 1998 amounted to 1,043,133 barrels, representing 78% of Black Sea's share of production, with the balance being added to inventory. Sales during 1998 have been equally divided between export and domestic markets. At September 30, 1998, Black Sea's share of oil inventory was 413,948 barrels. Cash flow from operations during 1998 amounted to $1,990,000 ($0.02 per share), compared to $1,080,000 ($0.02 per share) cash flow provided from operations for the same period in 1997. The net loss for the nine months of 1998 was $3,337,000 ($0.04 per share), compared to a net income of $532,000 ($0.01 per share) for the first nine months of 1997. The majority of the 1998 loss is attributed to a charge of $3,496,000, representing a revaluation to estimated net realizable value of equipment held for resale. This charge to income was partially offset in the period by a foreign exchange gain of $1,904,000, represented by the impact of the rapid devaluation of the Russian rouble during the third quarter. Operating costs of $4,142,000, or $3.97 per barrel, for the period were down 16% from the $4.70 per barrel cost during the first nine months of 1997. This decline reflects cost reduction measures implemented during 1998 and reductions due to the devaluation of the rouble, as most of the operating costs are settled in local currency. Transportation costs, incurred on export sales only, amounted to $1,330,000 for 1998, a cost of $2.56 per barrel exported. Production and capital taxes averaged $2.55 per barrel compared to $1.95 per barrel in 1997. General and administrative costs have been reduced by 32% from 1997 to 1998, with further savings expected to the end of the year. For the first nine months, interest of $1,450,000 was earned on the Company's cash deposits. Depletion and depreciation costs provided during 1998 amounted to $2.30 per barrel, compared to $0.76 for the same period in 1997. As previously reported, the validity of the transfer of the Kalchinskoye fields' licenses held by Tura, has been challenged by our partner, even given the fact that by agreement, our partner undertook to validly transfer these licenses. Discussions with our partner are continuing, but progress is slow. The Company is vigorously defending its position, and has commenced the process towards international arbitration in Stockholm. The next Russian court hearing into the validity of the transfer of the Kalchinskoye licenses is scheduled for December 28th. If uncertainty over the Tura venture continues, it may be necessary to review and adjust the carrying value of the Russian assets at year-end. Highlights Nine Months Ended Nine Months Ended September 30, 1998 September 30, 1997 (as restated) ------------------------------------------------------------------------- Financial Petroleum revenue $ 9,494,000 $ 8,409,000 Cash flow from operations 1,990,000 1,080,000 Per share .02 .02 Net income(loss) (3,337,000) 532,000 Per share (.04) .01 Capital expenditures 25,175,000 53,382,000 Oil Production Total barrels 1,335,452 725,700 Average per day 4,892 2,658 Exit rate (barrels per day) 5,400 3,650 Netback Per Barrel Sales price $ 9.10 $ 11.60 Operating costs 3.97 4.70 Transportation costs 1.27 .73 Production and capital taxes 2.55 1.95 -------------------------------- Netback before Russian income taxes 1.31 4.22 Russian current income taxes .01 0.00 -------------------------------- Cash Flow Netback Per Barrel $ 1.30 $ 4.22

To: Kerm Yerman who wrote (13825) 11/27/1998 1:50:00 AM From: Kerm Yerman   Respond to of 15196   MERGERS - ACQUISITIONS / New Cache Petroleums Ltd. and Canadian Abraxas Petroleum Ltd CALGARY, Nov. 26 /CNW/ - Canadian Abraxas Petroleum Limited (''Canaxas'') and New Cache Petroleums Ltd. (''New Cache'') announce today that Canaxas has mailed an Offer (the ''Canaxas Offer'') dated November 24, 1998, to purchase all of the issued and outstanding common shares and associated rights (together the ''New Cache Securities'') in the capital of New Cache at a price of $6.50 per New Cache Security. The expiry date of the Offer is December 22, 1998 unless withdrawn or extended. A Directors' Circular dated November 24, 1998 indicating that the directors of New Cache have unanimously recommended acceptance, of the Canaxas Offer which was mailed out to Shareholders of New Cache with the Canaxas Offer. The Offer is conditional on a minimum 66 2/3% of the fully diluted shares of New Cache being tendered by the expiry date of the Offer. Directors and Officers of New Cache representing approximately 20% of the shareholders have tendered their shares to this offer. The soliciting dealers for Canaxas are Griffiths McBurney & Partners and Jennings Capital Inc. (The Toronto Stock Exchange has neither approved nor disapproved the information contained herein).

To: Kerm Yerman who wrote (13825) 11/27/1998 1:53:00 AM From: Kerm Yerman   Respond to of 15196   EARNINGS / Cavell Energy Corporation announces nine month results ended September 30, 1998 CALGARY, Nov. 26 /CNW/ - Cavell Energy Corporation ( KVL:TSE ) states that primarily as a result of low oil prices revenue net of royalties fell 58% to $5.6 million compared to $13.9 million one year ago. The company realized an average price of $17.06 per barrel as compared to $24.83 per barrel received in 1997. As a result of current low oil prices, Cavell took a write down of $19.8 million. This resulted in a reduction of property, plant and equipment and there was a charge to earnings of $19.8 million. Cavell's depletion rate for the fourth quarter will be $4.92 per barrel of oil equivalent. Cash flow for the nine months was $1.6 million ($0.06/share fully diluted) as compared to $9.1 million ($0.33/share fully diluted) one year earlier. Long term debt net of working capital at September 30, 1998 was $12 million. At September 30, 1998 there were 25,616,122 shares outstanding as compared to 25,521,122 at September 30, 1997. Operations and Strategic Direction Low oil prices have had a significant impact on the Company and as a result Cavell has continued to refine the business plan which was articulated in the 1997 Annual Report and subsequent quarterly statements. As planned Cavell has continued to make opportunistic acquisitions and evaluate other SE Saskatchewan opportunities arising from the low commodity price. Further we have taken some definitive steps towards establishing the new Alberta core area and the development of a significant gas position in 1999. Current oil prices continue to validate this strategy as Cavell continues to be faced with oil prices that do not show signs of strengthening. It is our opinion that West Texas Intermediate will, over the next 12 months continue to trade in a $13.00/bbl-$16.00/bbl (U.S.) range. This outlook has reinforced the already identified need to take steps to change the direction of the Company. Cavell's strategic plan underwent further development and has set some longer term goals. Within 5 years we plan to be producing a minimum of 10,000 boe/d with a 60/40 oil/gas mix. We have weighted it more heavily towards the oil side, as we believe that there is significant commodity price upside to be achieved over the next 24 - 36 months as compared to gas. Another goal is to introduce new opportunities that have the potential to significantly impact the company i.e. large reserve additions and drilling opportunities. In 5 years we expect to have 3 - 4 well developed core areas of operation. Our first step was to reduce our cost of doing business, we have cut administrative costs by 30%. Next the management team identified a new core area and has developed a business plan to exploit this area. Our plan will allow Cavell to continue to grow in SE Saskatchewan, but also, and more importantly develop our new core gas area. The attraction of gas is obvious, it is currently trading at an effective $/boe rate of $23-$27/bbl (Can.) this is in contrast to a current WTI oil price which is below $13.00 (U.S.). The areas in which we have selected to develop a gas position are the east central area of Alberta and the western portion of Saskatchewan east of Lloydminister. Our strategic planning process has resulted in the following action plan. In SE Saskatchewan we plan to continue to opportunistically acquire assets. Our strategy is, while oil prices and netbacks remain low, to focus on acquisitions rather than drilling. We would attempt to acquire oil assets at a cost that fully acknowledges the current low prices. We plan to limit our Saskatchewan oil drilling activity to those wells, which are necessary to maintain our production levels and a borrowing base and are aggressively pursuing operating cost reductions. When higher prices return, we will increase our oil production by exploiting the extensive inventory of prospects that have been developed and acquired over the last 24 months. Cavell is taking steps to sell its U.S. properties. These properties no longer fit the strategic direction of the Company and we hope to conclude a sale early in 1999. In the East Central Alberta/Western Saskatchewan new core area we plan to commence a gas development strategy to develop low risk projects with high cash netbacks, high recycle ratios and low finding and development costs. In 1999 we expect to drill between 10 and 20 wells targeted for gas in this area. The Company has also targeted a second multi zone prolific oil and gas bearing area in Central Alberta. This area is one that can be developed from our SE Saskatchewan strengths. The company is currently acquiring land over a number of identified prospects. We expect that this area will supply the additional oil production needed to meet our goals and objectives. The area also possesses significant opportunities for high rate gas wells, many have produced over 10 bcf each. Reserves Cavell commissioned an independent third quarter Reserve Report from our external reserve auditors. The Company was concerned that the trading prices of its shares were not indicative of Cavell's underlying reserve value or its net asset value. As of October 1, 1998 and after giving effect to the write down, Cavell's proved plus risked probable reserves stood at 6,173,000 boe. (probable reserves have been risked 50%). Cavell over the past 24 months has developed an extensive inventory of development locations, which we will bring on stream when oil prices improve. We also see reserve and production additions arising from acquisitions currently underway. Q3 1998 Highlights For the periods ended September 30, (unaudited) Three Months Nine Months 1998 1997 1998 1997 ------------------------------------------------------------------------- Volume (boe/d) 1,369 2,495 1,497 2,737 Volume (boe) 125,989 229,525 408,804 747,105 Average selling price ($/boe) 16.80 23.20 17.06 24.83 Field netback ($/boe) 8.14 10.78 8.62 14.63 Revenue ($000's) 2,117 5,324 6,975 18,550 Cash Flow ($000's) 367 1,861 1,621 9,135 Net (loss) ($000's) (20,416) (8,357) (20,704) (5,540) Average Shares 25,616,122 25,521,122 25,616,122 25,521,122 Cash flow/share (basic) $ 0.01 $ 0.07 $ 0.06 $ 0.36 Net (loss) share (basic) $(0.80) $(0.33) $(0.81) $(0.22) CAVELL ENERGY CORPORATION Consolidated Balance Sheets (thousands of Canadian dollars) ------------------------------------------------------------------------- September 30, December 31, 1998 1997 ------------------------------------------------------------------------- Assets (unaudited) (audited) Current Assets Cash and short term investments $ 310 $ 1,237 Accounts receivable 1,812 3,591 Prepaid expenses 153 740 ------------------------------------------------------------------------- 2,275 5,568 ------------------------------------------------------------------------- Property, plant and equipment 25,355 41,154 ------------------------------------------------------------------------- 27,630 46,722 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Liabilities and Shareholders' Equity Current liabilities Accounts payable and accrued liabilities $ 1,483 $ 4,636 Future site restoration provision 1,022 885 Long-term debt 12,800 7,800 Deferred income taxes - 372 Shareholders' equity Share capital 31,620 31,620 Retained earnings (deficit) (19,295) 1,409 ------------------------------------------------------------------------- 12,325 33,029 ------------------------------------------------------------------------- $27,630 $46,722 ------------------------------------------------------------------------- ------------------------------------------------------------------------- CAVELL ENERGY CORPORATION Consolidated Statements of Loss and Retained Earnings (Deficit) For the periods ended September 30, (thousands of Canadian dollars, except per share data) (unaudited) Three Months Nine Months 1998 1997 1998 1997 ------------------------------------------------------------------------- Revenue Oil and gas sales $ 2,117 $ 5,324 $ 6,975 $ 18,550 Less royalties 436 1,779 1,327 4,647 ------------------------------------------------------------------------- 1,681 3,545 5,648 13,903 Interest 1 1 9 53 ------------------------------------------------------------------------- 1,682 3,546 5,657 13,956 ------------------------------------------------------------------------- Expenses Production 655 1,072 2,120 2,977 General and administrative 457 338 1,225 1,047 Interest 176 60 429 92 Depletion and amortization 20,797 14,629 22,710 17,656 ------------------------------------------------------------------------- 22,085 16,099 26,484 21,772 ------------------------------------------------------------------------- Loss before taxes (20,403) (12,553) (20,827) (7,816) Income and other taxes Capital 26 215 249 705 Deferred (recovery) (13) (4,411) (372) (2,981) ------------------------------------------------------------------------- 13 (4,196) (123) (2,276) ------------------------------------------------------------------------- Net loss for the period (20,416) (8,357) (20,704) (5,540) ------------------------------------------------------------------------- Retained earnings, beginning of period 1,121 10,341 1,409 7,524 ------------------------------------------------------------------------- Retained earnings (deficit), end of period $ (19,295) $ 1,984 $ (19,295) $ 1,984 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Loss per common share Basic $(0.80) $ (0.33) $(0.81) $ (0.22) -------------------------------------------- -------------------------------------------- Fully diluted $(0.80) $ (0.33) $(0.81) $ (0.22) -------------------------------------------- -------------------------------------------- Weighted average number of common shares outstanding during the year 25,616,122 25,521,122 25,616,122 25,521,122 -------------------------------------------- -------------------------------------------- CAVELL ENERGY CORPORATION Consolidated Statements of Changes in Financial Position For the periods ended September 30, (thousands of Canadian dollars, except per share data) (unaudited) Three Months Nine Months 1998 1997 1998 1997 ------------------------------------------------------------------------- Operating activities Loss $ (20,416) $ (8,357) $ (20,704) $ (5,540) Add non-cash items Depletion and amortization 20,796 14,629 22,697 17,656 Deferred income taxes (recovery) (13) (4,411) (372) (2,981) ------------------------------------------------------------------------- Funds from operations 367 1,861 1,621 9,135 Changes in non-cash working capital (214) (1,292) (393) (832) ------------------------------------------------------------------------- 153 569 1,228 8,303 ------------------------------------------------------------------------- Financing activities Issue of long-term debt 4,300 5,300 5,000 7,800 Investing activities Property and equipment (2,884) (7,588) (6,366) (27,169) Proceeds on sale of property and equipment - - 700 - Changes in non-cash working capital (1,266) 1,111 (1,489) 1,152 ------------------------------------------------------------------------- (4,150) (6,477) (7,155) (26,017) ------------------------------------------------------------------------- Increase (decrease) in cash for the period 303 (608) (927) (9,914) Cash position at beginning of period 7 608 1,237 9,914 ------------------------------------------------------------------------- Cash position at end of period $ 310 $ 0 $ 310 $ 0 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Cash is defined as cash and short-term investments Funds from operations per common share Basic $ 0.01 $ 0.07 $ 0.06 $ 0.36 -------------------------------------------- -------------------------------------------- Fully diluted $ 0.01 $ 0.07 $ 0.06 $ 0.33 -------------------------------------------- --------------------------------------------

To: Kerm Yerman who wrote (13825) 11/27/1998 1:55:00 AM From: Kerm Yerman   Respond to of 15196   PIPELINES / Alliance Pipeline Receives NEB Reasons for Decision CALGARY, Nov. 26 /CNW/ - Alliance Pipeline today announces that it has received the ''Reasons for Decision'' released by the National Energy Board (NEB) with respect to the GH-3-97 Alliance Pipeline proceeding which recommends approval. ''Today is another key milestone for Alliance'', says Dennis Cornelson, Alliance President and Chief Executive Officer. ''We are very pleased that the Board has released this document which brings us closer to our goal.'' Cornelson continues, ''This is a very important next-to-last step in the issuance of our Certificate of Public Convenience and Necessity (CPCN) enabling us to construct and operate the Alliance Pipeline system. The final step will be for the federal cabinet to issue an Order in Council (OIC) authorizing the NEB to grant us the CPCN.'' Cornelson concludes, ''We plan to review the Decision thoroughly so that we will be in a position to provide public comment after the cabinet's decision.'' The Alliance Pipeline system is designed to carry natural gas from western Canada to the Chicago-area market center for distribution throughout North America. Investors in the Alliance Pipeline Limited Partnerships currently include affiliates of: - Coastal Corporation (NYSE:CGP) - 14.4% - Duke Energy Corporation (NYSE:DUK) - 9.8% - Enbridge Inc. (TSE:ENB) - 21.4% - Fort Chicago Energy Partners LP (TSE:FCE.UN) - 26.0% - The Williams Companies, Inc. (NYSE:WMB) - 4.8% - Unocal Corporation (NYSE:UCL) - 9.1 %

To: Kerm Yerman who wrote (13825) 11/27/1998 1:57:00 AM From: Kerm Yerman   Respond to of 15196   PIPELINES / Fort Chicago Announces Alliance Pipeline's Receipt of NEB Reasons for Decision CALGARY, Nov. 26 /CNW/ - Fort Chicago Energy Partners L.P. announces that Alliance Pipeline issued a Press Release earlier today which reports that it has received the Reasons for Decision released by the National Energy Board (NEB). Since the Reasons for Decision recommends approval, Alliance Pipeline has also reported that the next step in the approval process will be the issuance by the Federal cabinet of an Order in Council authorizing the NEB to issue a Certificate of Public Convenience and Necessity (CPCN). The CPCN will enable Alliance Pipeline to construct and operate the Alliance Pipeline system in Canada. Alliance Pipeline will make a further public announcement regarding its comments on the NEB Reasons for Decision after the cabinet's decision. ''This is another important milestone in the approval process for this significant North American pipeline project,'' says Guy J. Turcotte, Chairman and Chief Executive Officer of Fort Chicago. Mr. Turcotte added that, ''We remain optimistic that the balance of the Canadian authorizations will be available in the near future.'' The Alliance Pipeline system includes a 3,000 kilometre mainline natural gas pipeline designed to carry natural gas from Northeastern British Columbia to the Chicago-area market centre for distribution throughout North America. Fort Chicago and its affiliates own a 26% interest in the Alliance Pipeline limited partnerships and related entities.

To: Kerm Yerman who wrote (13825) 11/27/1998 2:00:00 AM From: Kerm Yerman   Respond to of 15196   EARNINGS / Benson Petroleum Ltd. Reports Operating and Financial Results for the First Nine Months of 1998 CALGARY, Nov. 26 /CNW/ - FINANCIAL AND PRODUCTION SUMMARY For the Nine Months Ended September 30 ($000's except per share) 1998 1997 Change ---- ---- ------ Total revenue 9,319 11,742 (21%) Cash flow 3,030 5,350 (43%) Cash flow per share 0.17 0.31 (45%) Net earnings (524) 811 (165%) Net earnings per share (0.03) 0.05 (160%) Crude oil & NGL production (bbls/day) 1,414 1,347 5% Natural gas production (mmcf/day) 5.79 4.95 17% BOEPD production 1,993 1,842 8% Benson experienced a 17% increase in natural gas production to an average of 5.79 mmcf/d through the first nine months of 1998. Crude oil and liquids production increased 5% to an average of 1,414 resulting in an overall increase of 8% in production on a BOE basis to 1993 BOE/d. Despite higher production levels, the continuing low crude oil prices, coupled with the Company's 71% weighting to crude oil production resulted in a 21% decrease in gross revenues to $9.3 million. Cash flow was $3.0 million in the first nine months of 1998 compared to $5.4 million in 1997. Benson received an average price of $14.07 per bbl for crude oil and liquids, down 39% from the average of $23.12 per bbl received in the first nine months of 1997. Substantially lower crude oil and liquids prices, higher G&A costs and increased interest expenses were the primary reasons for the Company incurring a loss of $0.5 million through the third quarter of 1998 compared to a profit of $0.8 million for the same period in 1997. As a result of the significant decline in the Company's cash flow in 1998, drilling activity has been curtailed since early second quarter. During the first nine months of 1998, Benson participated in the drilling of 14 wells (10.1 net) resulting in nine oil wells (7.4 net), two gas wells (1.2 net) and three dry holes (1.5 net). An additional two wells were farmed out and were plugged and abandoned. At Hinton/Obed, two wells on the Apetowun prospect were re-entered and recompleted during the third quarter. One well tested light oil and flowed 70 bbls/d of oil with a 70% water cut, however, the well has been shut in pending further testing. The second well flowed natural gas at 1.1 mmcf/d with 30 bbls/mmcf of condensate. The Company is encouraged with these test results and additional seismic has been acquired and new seismic will be shot in the fourth quarter to identify and high grade stepout locations for drilling in the new year. Benson has extensive land holdings offsetting these two wells. In addition, the Company continues to acquire additional seismic to evaluate a number of other prospects at Hinton/Obed and has initiated a marketing program to generate farmout activity. During the third quarter, Benson acquired additional exploration acreage at Hinton/Obed with a total of 10,880 net undeveloped acres being purchased. The Company has shifted its efforts toward natural gas prospects as evidenced by the greater increases in gas production volumes through the third quarter. It is expected that additional gains will be made through the end of the year with new tie-ins in East Central Alberta and Cherhill. A number of multi-zone oil and gas prospects have been reviewed in East Central Alberta and drilling activity could recommence in this area by the end of fourth quarter. At Cherhill, gas recompletion opportunities are being pursued as a result of successes during the past year. With Benson's good inventory of prospects, and with the bullish outlook for natural gas prices, the primary focus of the Company's exploration and development efforts in 1999 will be on natural gas. Benson Petroleum Ltd. is a Calgary based exploration, development and production company listed on the Toronto Stock Exchange (Symbol: BEN). The Toronto Stock Exchange has neither approved nor disapproved the information contained in this press release.

To: Kerm Yerman who wrote (13825) 11/27/1998 2:03:00 AM From: Kerm Yerman   Respond to of 15196   ASE BULLETIN / Cirque Energy Corp. Delisting CALGARY, Nov. 26 /CNW/ - BULLETIN NO.: 9811 - 704 DELISTING CIRQUE ENERGY CORP. (CQU) The common shares of Cirque Energy Corp. will be delisted at the close of business on MONDAY, NOVEMBER 30, 1998 at the request of the Company. The common shares will continue to trade on the Toronto Stock Exchange.

To: Kerm Yerman who wrote (13825) 11/27/1998 2:05:00 AM From: Kerm Yerman   Respond to of 15196   IPO / Caravan Oil & Gas Ltd. Announces Completion of Initial Public Offering CALGARY, Nov. 26 /CNW/ - Caravan Oil & Gas Ltd. announced today that it has successfully completed its initial public offering (''IPO''), selling 1.3 million shares at $0.75 per share for gross proceeds of $1 million. Jennings Capital Inc. acted as agent for the IPO. The Company has received conditional listing approval from the Alberta Stock Exchange and will now proceed to seek formal listing approval. After completion of the IPO, Caravan has 12.9 million basic common shares outstanding, 15.6 million on a fully diluted basis after considering stock options and 1.8 million Share Purchase Warrants which are outstanding to July, 1999 at an exercise price of $0.90. Of the outstanding shares, management and directors of the Company own approximately 46% on a fully diluted basis. Senior management of Caravan includes Curtis Hicks, Chief Executive Officer, and Bruce Francis, President and Chief Operating Officer. In addition to Mr. Hicks and Mr. Francis, the Company's directors are Betsy Cotton, a Senior Vice President of Stratum Group LP of New York, N.Y., Dennis Flanagan, an oil and gas executive who was previously Executive Chairman of ELAN Energy Inc., Karim Manji, a Vice President of a private oil and gas marketing and production company, Cam McVeigh, President of Camcor Capital Inc., Asheet Ruparell, Chairman of Caravan and an independent businessman, and Phil Toews, a Vice President of a private oil and gas marketing and production company. Caravan currently has an asset base that consists of approximately 500 BOE per day of production and 2 million barrels of oil equivalent reserves. Over the balance of 1998, the Company plans to participate in the drilling of up to six wells that, if completed, will bring its well count for the year up to 18. Proceeds from the IPO will ultimately be used to fund Caravan's exploration and development activities, however they will initially be applied to reduce bank indebtedness. Upon receipt of the formal listing approval, Caravan will trade on the Alberta Stock Exchange under the trading symbol ''CVO''. The Alberta Stock Exchange has neither approved nor disapproved the information contained herein.

To: Kerm Yerman who wrote (13825) 11/27/1998 2:09:00 AM From: Kerm Yerman   Respond to of 15196   EARNINGS / Vermilion Continues to Show Profits and Production Growth in the Third Quarter CALGARY, Nov. 26 /CNW/ - Vermilion Resources Ltd. ''Vermilion'' announces its third quarter financial results and operational activities. Third quarter cash flow of $5.5 million and earnings of $1.3 million were up 23% and 22%, respectively, over second quarter results and the Company continued to produce a strong earnings to cash flow ratio of 27% for the year to date. Vermilion continued to provide strong production growth as third quarter rates averaged 10,058 Boe/d, a 17% increase over the second quarter production level. For the nine-month period, the Company's average production of 9,014 Boe/d represented a 43% increase over the same period in 1997. At Mothes, Vermilion has drilled a 100% vertical discovery well that is currently flowing at a restricted production rate of 600 Bopd of clean light oil and is capable of flowing at a significantly higher rate. The recently announced acquisition of a northern Alberta operated light crude oil property is further evidence of the Company's disciplined approach to its value-added growth strategy. This acquisition of 1,800 Boe/d of light crude oil will close on December 1, 1998 and will provide the Company with a new core project area with significant development and exploration upside. Upon closing this acquisition and completing its 1998 capital program the Company anticipates ending the year with a production rate in excess of 13,000 Boe/d that is now roughly balanced between France and Canada. By year-end, Vermilion anticipates having 1998 reserve additions of approximately 29 million Boe at an estimated average cost under $5.25 per Boe. Highlights ($000's except per share amount) (Unaudited) Three months ended Nine months ended Sept. 30 Sept. 30 1998 1997 1998 1997 ----------------------------------------- Financial Petroleum & Natural Gas Revenues $ 14,792 $ 13,109 $ 39,942 $ 40,665 Cash Flow from Operations 5,541 6,888 15,856 21,063 Per Share 0.11 0.16 0.34 0.58 Net Earnings 1,315 2,402 4,255 9,051 Per Share 0.03 0.05 0.09 0.25 Capital Expenditures 42,182 13,150 100,927 57,475 Total Assets 222,094 114,376 Working Capital (Deficit) (24,430) 6,739 Long-Term Debt 42,779 12,290 Shareholders' Equity $121,918 $ 75,102 Common Shares Outstanding End of Period 47,888,879 42,065,184 Weighted Average 46,257,625 36,352,540 Fully Diluted, End of Period 52,085,522 45,140,577 Share Trading High $ 9.25 $ 9.00 Low 3.00 3.85 Close $ 3.66 $ 9.00 Average Selling Price Crude Oil (per Bbl) $ 14.70 $ 20.52 $ 14.96 $ 23.84 Natural Gas Liquids (per Bbl) 11.69 23.01 13.64 21.30 Natural Gas (per Mcf) 2.31 2.51 2.22 2.41 Operations Netback (per Boe) 7.94 12.92 7.98 14.13 Cash Flow Netback (per Boe) $ 5.99 $ 11.34 $ 6.44 $ 12.24 Operations ---------- Domestic production for the third quarter of 1998 was 3,465 Boe/d and for the nine months ended September 30, 1998 averaged 2,928 Boe/d. The average production for the nine months in 1998 represents a 78% increase over 1997 first three-quarters production of 1,647 Boe/d. In France, the Company produced 6,593 Boe/d for the third quarter of 1998 and 6,086 Boe/d for the nine months in 1998 reflecting a 31% increase over the 4,655 Boe/d produced for the nine months in 1997. Production from the Aquitaine Basin was up 25% while Paris Basin production rose by 97% for the nine month period in 1998. Production Summary as at September 30 Third Quarter 1998 1998 YTD 1997 YTD Oil & NGLs Gas Total Total Total Bbls/d Mmcf/d Boe/d Boe/d Boe/d ------------------------------------------------- Canada Chip Lake 1,636 16.01 3,237 2,708 1,288 Other 103 1.25 228 220 359 ------------------------------------------------- Total Canada 1,739 17.26 3,465 2,928 1,647 ------------------------------------------------- France Aquitaine Basin 4,141 4,141 3,839 3,065 Paris Basin 1,991 1,991 1,745 884 South Aquitaine 301 1.60 461 502 706 ------------------------------------------------- Total France 6,433 1.60 6,593 6,086 4,655 ------------------------------------------------- Combined Total 8,172 18.86 10,058 9,014 6,302 ------------------------------------------------- During the third quarter of 1998, Vermilion drilled ten wells at Chip Lake bringing the total number of wells drilled to date in Canada to twenty. Incremental production volumes of 1,281 Boe/d came from five natural gas wells and four oil wells brought on stream in the quarter. Production activity was supplemented by an additional acquisition of 450 Boe/d of crude oil production at the end of the quarter. This minor acquisition was strategic in the further consolidation of 112 gross sections of land at Chip Lake and the addition of an oil battery and associated flow lines. Drilling Activity Three months ended September 30, 1998 ------------------------------------- Canada France Total Y-T-D ----------- ----------- ----------- ------------ Gross Net Gross Net Gross Net Gross Net ----- --- ----- --- ----- --- ----- --- Oil - - 3 3.0 3 3.0 12 12.0 Gas 9 6.4 - - 9 6.4 14 10.9 D&A 2 1.2 - - 2 1.2 3 2.2 --- --- --- --- --- --- --- ---- 11 7.6 3 3.0 14 10.6 29 25.1 --- --- --- --- --- --- --- ---- >> In France, two horizontal oil wells and one vertical oil well were drilled during the third quarter. The third well drilled in 1998 at Parentis, Parentis 5GH, which encountered 340 metres of pay in the horizontal section, is under review for remedial stimulation to improve inflow. The well appears to have superior potential to the successful Parentis 4GH (Ps-304) currently producing 230 Bbls/d. Two wells were drilled at Mothes, Mothes 4GH and Mothes 9. Mothes 4GH is under further tests to prove up remaining flank oil while Mothes 9, a vertical step out well, is currently flowing at a restricted rate of 600 Bopd of clean light oil. The Vexin exploration well drilled in the fourth quarter was unsuccessful as the zone was wet and it is likely that the seal in the trap was ineffective. Capital Expenditures ($000's) Nine months ended September 30 1998 1997 ---- ---- Land and Seismic $ 2,427 $ 1,836 Drilling & Workovers 44,475 14,558 Facilities 17,445 3,740 Acquisitions 35,120 37,055 Other 1,460 286 -------- -------- $100,927 $ 57,475 -------- -------- Funding of Capital Program ($000's) 1998 1997 ---- ---- Cash Flow $ 15,856 $ 21,063 Debt and Working Capital 46,099 (7,465) Equity 38,972 43,877 -------- -------- $100,927 $ 57,475 -------- -------- Financial --------- Crude oil prices weakened again in the third quarter by over US $0.50/bbl to average US $14.15/Bbl for WTI and US $12.49/Bbl for Brent. Vermilion's cash flow netback was $5.99/Bbl for the third quarter and $6.44 per barrel for the nine-month period. The Company has implemented further operating cost efficiencies and, with continued productivity improvements, anticipates reducing lifting costs below $5.00 per Boe. For the first nine months of 1998, lifting costs exceeded this benchmark primarily due to pump repairs and minor workovers in France as well as compressor repairs and gas plant downtime in Canada. Netback Analysis ------------------------------------ Nine months ended Sept. 30 1998 1997 ------------------------- ------ Oil & NGLs Gas Total Total $/Bbls $/Mcf $/Boe $/Boed ------------------------- ------ Price $14.83 $2.22 $16.23 $23.63 Royalties (net) (2.87) (0.31) (2.91) (3.66) Lifting Costs (5.17) (0.60) (5.34) (5.84) ------------------------- ------ Operating Netback $ 6.79 $1.31 $ 7.98 $14.13 ------------------------- ------ Other Income 0.42 - Marketing Loss - (0.22) General & Administrative (1.22) (1.24) Interest (0.53) (0.28) Foreign Exchange (0.16) (0.08) Current Taxes (0.05) (0.07) ------ ------ Cash Flow Netback $ 6.44 $12.24 ------ ------ Outlook ------- The market place for oil acquisitions both in Western Canada and Europe is becoming very attractive as valuations decline and the quality of the assets improves. This is evidenced by our recent purchase of light oil assets in northern Alberta. In the current commodity price environment, natural gas acquisitions continue to carry excessive premiums and at this time, are not compatible with Vermilion's value-driven strategy. However, the Company continues to aggressively develop its natural gas assets. Vermilion has used its under-leveraged financial position in 1998 to acquire quality assets throughout the year. Upon completion of a capital program estimated to be over of $140 million, the Company will have exit production levels in excess of 13,000 Boe/d from four major project areas with facilities control and a significant undeveloped land position. Assuming a continued depressed oil price environment, cash flow for 1999 will still be more than double that reported for 1998. With increased debt levels entering 1999, management is comfortable that the asset quality and growth potential will provide a foundation for the Company's future profitability.

To: Kerm Yerman who wrote (13825) 11/27/1998 5:39:00 AM From: Kerm Yerman   Respond to of 15196   IN THE NEWS / Energy board likely to approve Alliance pipeline The Financial Post The final regulatory hurdle for the $4-billion Alliance natural gas pipeline will be cleared today when the National Energy Board releases its long-awaited decision on the project. The NEB is expected to approve the high-pressure pipeline that will begin shipping 1.3 billion cubic feet a day of natural gas and natural gas liquids from northeastern British Columbia to Chicago beginning in late 2000. The 3,000-kilometre pipeline became the longest, most controversial hearing before the board, lasting 77 days. Construction of the U.S. portion has already received the green light from U.S. federal regulators. The NEB also issued preliminary approval for the project earlier this fall. Construction may begin as early as January, but official ground-breaking won't occur until the spring. The decision comes at a time when worry is growing among some industry observers that drilling can't keep pace with all the pipeline expansion in Alberta as producers slash capital spending. But the project is supported by long-term commitments from suppliers for 98% of the pipeline's capacity.

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