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

To: Kerm Yerman who wrote (13977)	12/3/1998 5:31:00 AM
From: Kerm Yerman	Respond to of 15196

FINANCING / Rally Energy Corp. Private Placement RALLY ENERGY CORP., ANNOUNCES COMPLETION OF PRIVATE PLACEMENT Date: 12/2/98 10:05:21 AM Dateline: TORONTO, ONTARIO Stock Symbol: RALY Rally Energy Corp., ("Rally"), (CDN: RALY) announces completion of a private placement with arm's length third parties, for proceeds of $1,107,000. Under the terms of the private placement, Rally issued 885,600 units, each unit comprised of one common share and one common share purchase warrant exercisable at the price of $1.50 until November 25, 2000. The proceeds from the private placement have been applied to working capital, and to finance Rally's oil and gas exploration program in joint venture agreement with Glacier Ridge Resources Ltd., ("Glacier") of Calgary, Alberta. Rally has the right to participate up to a 37.5% working interest in all current and future oil and gas prospects generated by Glacier. Number of issued shares: 12,944,240

To: Kerm Yerman who wrote (13977)	12/3/1998 5:46:00 AM
From: Kerm Yerman	Read Replies (15) \| Respond to of 15196

IN THE NEWS / More Mergers Ahead For U.S. Oil Industry LOS ANGELES (Reuters) - Bigger may be better, but even really big is no longer good enough in the oil industry. After Exxon Corp. and Mobil Corp. agreed Tuesday to form the world's largest corporation, more companies could be forced to make combinations big enough to match the financial muscle and savings of the new oil giant, experts said Wednesday. The $77 billion deal follows British Petroleum Co. Plc's purchase of Amoco Corp. earlier this year, and creates yet another mega-company likely to pressure rivals into following suit as oil prices hit rock bottom. "This is a trend that's going to continue for a number of years," said Cyrus Tahmassebi, an oil economist and president of Energy Trends Inc. in Bethesda, Md. With the Exxon-Mobil deal official, California's two biggest oil companies, Chevron Corp. and Atlantic Richfield Co (Arco), as well as White Plains, N.Y.-based Texaco Inc. remain as merger targets, experts said. Los Angeles-based Arco, a top gasoline retailer in California, has been a rumored acquisition target for months, although the company has pledged to remain independent, cutting staff and removing some top managers. Arco's strong presence on the West Coast could make it valuable as a refinery division of another company, and its growing overseas portfolio could be split off in an upstream deal, experts said. Some experts said California rival Chevron could make a play for Arco now that speculation of a Chevron-Mobil merger was dead. "Chevron and Arco would be great," said Jennifer Gordon, oil analyst with BT Alex.Brown Inc. "But they'd have to divest in California," where the two operate refineries and jockey for the market share. Chevron earlier this year formed a mergers-and-acquisition unit but has declined to comment on recent merger rumors. Arco also declined to comment. "(The unit's) looking at ways to position us for growth or cost cutting," said Chevron spokeswoman Dawn Soper. "We just don't comment on specifics," she said. Texaco, the nation's No. 4 oil firm, also is ripe for a deal, analysts said. The company on Wednesday announced a package of cost cuts for next year, including layoffs of 2,000 employees. "That might lead you to believe Texaco is one of the (merger) candidates," Gordon said. Texaco already has formed refining and marketing alliances with in the United States with Shell Oil Co. and Saudi Aramco. Texaco also declined to comment. While its plans to link up with Shell in the European refining business have collapsed, speculation lingers that the two firms could merge fully. While U.S. oil firms have declined to comment on specific plans, experts said 12-year lows in the price of oil -- the lifeblood of earnings -- have forced companies to look at mergers to cut costs. Related companies, such as oil service firms Halliburton Co. and Schlumberger Ltd. also could combine in response to fewer equipment requests from big oil producers, experts said. "The environment for consolidation will continue to exist with $11 a barrel oil," Gordon said. Occidental Petroleum Corp., and Unocal Corp. also have been the object of takeover speculation, but experts say Los Angeles based Occidental was too highly invested in chemicals and Unocal too involved in the unstable Asian markets to earn serious interest. Conoco, also a top 10 oil firm, was sought by Mobil but is solidly independent after a successful spin-off from DuPont Co. last month. Despite the rash of mergers, the specter of a new Standard Oil Trust -- John D. Rockefeller's oil monopoly that was dissolved in 1911 -- is remote, experts said. With oil prices low and more independent companies than earlier this century, many deals are likely to win approval. "Both in here and in Europe, mergers are looked at with much less suspicion than they used to," Tahmassebi said.

To: Kerm Yerman who wrote (13977)	12/3/1998 5:56:00 AM
From: Kerm Yerman	Respond to of 15196

IN THE NEWS / Petro-Canada CEO Sees Other Buyers For ICG Petro-Canada Chief Executive Jim Stanford, just dealt another blow from Canada's competition watchdog, said other buyers for the company's propane subsidiary could emerge if the current embattled deal falls through amid regulatory opposition. "I believe there are people out there who find that asset an interesting asset," Stanford told reporters after a speech to an oil industry audience on Wednesday. Canada's Competition Bureau served notice on Tuesday it would fight Superior Propane Inc.'s proposal to buy Petro-Canada's ICG Propane Inc. unit because it believed the deal would give Superior a monopoly or near-monopoly in many regions. Calgary-based Superior is Canada's biggest propane distributor and a planned C$175-million purchase of No. 2 player ICG would give it a nationwide market share of about 70 percent. It was the second time this year the regulator has voiced strong concerns over Petro-Canada's plans. In June, the company scuttled its proposed gasoline refining and marketing venture with U.S. based Ultramar Diamond Shamrock Corp. , after Competition Bureau concerns over market share proved too expensive to assuage. Stanford said he bore no grudge against the bureau, despite Petro-Canada's setbacks at its hands. "I would like the world to unfold the way I would like it to unfold, but reality says it won't do that," he said. "We have our job to do in terms of trying to create shareholder value, and they have their job to do in terms of how they perceive they're protecting the Canadian consumer." Stanford said the company's funding commitments to big projects, such as the Terra Nova oil development off Canada's east coast, were not dependent on the sale of assets like ICG. "We have been very clear in articulating the financial discipline that we will operate the company under, and that is that we will not do anything that we can manage within our ability to cash flow," he said. "We always have a churn in terms of our assets -- we're always looking at disposition and acquisition of assets, and we continue to do that." Meanwhile, Stanford declined to comment on how the merger of Exxon Corp. and Mobil Corp. would affect Petro-Canada, which is a major player with Mobil in numerous Canadian east coast offshore plays. "Clearly the Exxon-Mobil merger is a direction that the industry is going worldwide, as we've seen with BP and Amoco. I think the industry is going through some significant changes and this is part of it," said Stanford, himself a one-time Mobil executive. He said he would not speculate on whether Petro-Canada would be a part of an oil business megamerger. Petro-Canada shares were off C$0.05 to C$17.55 in Toronto on Wednesday.

To: Kerm Yerman who wrote (13977)	12/3/1998 6:01:00 AM
From: Kerm Yerman	Respond to of 15196

IN THE NEWS / Big Oil's Cost-Cutting Ax To Hit White-Collar Jobs The endless quest to cut costs that is driving a wave of mega-mergers in the oil industry will cause plenty of collateral damage among white collar workers, industry experts say. The $77 billion merger of Exxon Corp. and Mobil Corp. announced on Tuesday would unite the two largest U.S. oil companies, but at the cost of 9,000 jobs, or about 7 percent of the joint total of 122,700. With oil prices near 25-year lows when adjusted for inflation, such job cuts are becoming common. On Wednesday, Texaco Inc. Chairman Peter Bijur told analysts the company has set about 2,000 job cuts worldwide as part of an effort to reduce costs by $400 million in 1999. The nation's No. 4 oil company, based in White Plains, N.Y., has about 19,000 employees worldwide. Last month, Royal Dutch/Shell Group said it would cut 3,000 jobs, or 20 percent of its European refining and marketing work force. British Petroleum and Amoco Corp. said they would cut 6,000 jobs out of a combined work force of 100,000 when they agreed to merge in August in a $48 billion deal. Exxon and Mobil did not spell out where the ax would fall, but analysts said it was most likely to be used to prune middle management, administrative and support functions. "Middle management will be (affected) ... but I would say the big place that you will see cuts will be in the support area," said Allen Mesch, director of the Maguire Oil and Gas Institute at Southern Methodist University in Dallas. Jobs most at risk are those in areas such as accounting and information technology, he said, adding that geologists, petroleum engineers and other specialists would remain highly prized. The industry is likely to contract out more jobs to further cut costs, said Amy Jaffe, an energy analyst with the Baker Institute at Houston's Rice University. But Jaffe was critical of companies that laid off workers only to rehire them later through pacts with independent contractors. "The industry needs to restructure its basic goals, its basic strategies and not use employees as the yo-yo for how they're going to be profitable," she said. Exxon and Mobil unveiled their merger when inflation-adjusted oil prices are at their lowest level in a quarter of a century. Crude oil for January delivery rose 11 cents to $11.24 a barrel in New York Wednesday. While employment in the U.S. oil industry rose between 1996 and 1997, the latest price drop raises fears that oil workers could face another round of cuts like those that followed the oil slump in the mid-1980s. Total employment in the U.S. petroleum industry rose 0.5 percent to 1.44 million in 1997 from the prior year, but was still 17.2 percent off the 1983 figure of 1.74 million, according to the American Petroleum Institute. The wave of mergers underlined the fact that oil and natural gas are commodity products, Maguire's Mesch said, and that companies, powerless to differentiate their products, have to compete on costs. "How are you going to make money in this business," he said. "You're not going to make it by adding new gee-whiz features to your product. You're going to make money by reducing your costs." Jaffe said it was wrong to take a pessimistic view of the oil and gas business as a zero-sum game in which the players were locked in a perpetual battle to undercut each other's costs. She noted that deepwater offshore oil and gas production and the recovery of oil and gas previously hidden beneath layers of salt were examples of important recent technological breakthroughs that could help the industry. "I think there's a lot the industry can do, focusing on new technologies and emerging technologies to improve their profitability and the cost at which they can do business," she said.