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

To: Kerm Yerman who wrote (14106)	12/8/1998 7:26:00 AM
From: Kerm Yerman	Respond to of 15196

IN THE NEWS / Solv-Ex Shareholders Back Company With Cash Sandra Rubin Financial Post Shareholders of Solv-Ex Corp., which says it has a cheaper way to extract oil from the Alberta tar sands, are backing the company with cash to support its legal battles with short-sellers, bankers and U.S. securities regulators. The added investment is a clear sign there are people who feel the embattled Albuquerque, N.M., firm has an future - despite its well-publicized troubles in the last few years. "Even though we've got all this litigation turmoil floating around, the focus of this company is to commercialize the technology," Herbert Campbell, Solv-Ex's senior vice-president, said yesterday. "Without that, we do all this for nothing." Ast first reported in the National Post, Solv-Ex, which has been rocked by wild swings in its share price and questions about its technology, struck back Friday with a "massive" lawsuit against seven U.S. short sellers, Deutsche Bank and the bank's cross-dressing British fund manager who secretly invested millions in the firm. Solv-Ex alleges in its lawsuit filed in Albuquerque that short sellers tried to drive the share price down for profit at the same time Peter Young, a "superstar" fund manager for Deutsche Bank in London, was trying to corner the market and drive the price up. The company alleges it was "whipsawed" by the ensuing price swings, and shareholders, bankers, and regulators became suspicious Solv-Ex was involved in stock manipulation. The firm says it was unable to raise the money to complete an extraction plant at Fort McMurray, Alta., as a direct result, and deprived of the chance to prove its technology works. Deutsche Bank and Mr. Young couldn't be reached for comment. The firm is also defending itself against an suit filed in July by the Securities ands Exchange Commission. Solv-Ex said yesterday 21 non-management investors have bought an $807,000 (all figures in U.S. dollars) private placement of restricted shares to help fund the two lawsuits. Separately, investors holding $2.36-million in convertible debentures have agreed to extend the maturity date to June 30 from Dec. 31. Solv-Ex shares, which once traded on Nasdaq at $36.79 , lost 50¢ yesterday to close at 50¢ on the over-the-counter "pink sheets."

To: Kerm Yerman who wrote (14106)	12/8/1998 7:48:00 AM
From: Kerm Yerman	Read Replies (2) \| Respond to of 15196

IN THE NEWS / Juniors Surge As Well Burns Brightly Kookaburra Soars 460% Garry Marr Financial Post Shares of Kookaburra Resources Ltd. soared again yesterday as news of a natural gas blowout in a jointly held well in Bakersfield, Calif., continued to have the biggest effect on the property's smallest stakeholders. Since initial reports of the blowout surfaced, Kookaburra stock (KOB/TSE) has declined in just one of the past 10 sessions. It jumped 39¢ to close at $2.32 yesterday and has now risen more than 460% since closing at 41¢ on Nov. 23. Kookaburra has at 5.2% after-payout interest in the well, which represents the majority of the company's potentials revenue. "This could be a home run but I understand it is largely the only thing they have going for them," said Peter Linder, an analyst at CIBC Wood Gundy Securities Inc. Yesterday, the partners in the Bellevue number one well said they had decided to drill a relief well, which is expected to spud on Saturday. Samples taken Sunday from the hydrocarbon stream indicate the presence of light oil, condensate, natural gas and water. "It's a huge blowout," said Mr. Linder. "It's not like it was three days and fizzled. The pressure is as strong ask ever." "You wouldn't be drilling a relief well if you didn't think it was a major discovery. Otherwise you would put the fire out and move on," he said. Mr. Linder does not believe figures will be available for some months but says he is "95% sure" it is a major gas discovery, possibly as much as three trillion cubic feet. He said there are many partners in the well, including Berkley Petroleum Corp. and Westminster Resources Ltd., and their stakes are relatively small. "But if Berkley's interest after payout is 15% of three trillion cubic feet, and Westminster's is 7.5%, that's 450 billion cubic feet and 225 billion cubic feet, [respectively]. That would double Westminster's reserves," he said. Westminster shares (WML/TSE) rose as high as $8.90 yesterday before closing up 15¢ at $7.60. They have gained 52% since closing at $5 on Nov. 23. Berkley stock (BKP/TSE) jumped $1 to $11.75, up from $11.25 on Nov. 23. "The impact on smaller companies is much larger than on Berkley," said Mr. Linder. Other companies involved in the project include: Richland Petroleum Corp. (RLP/TSE), up 10¢ to $3.30. With a 3.75% after-payout interest in the well, Richland stock has climbed 83%s since closing at $1.80 Nov. 23. Elkn Point Resources Ltd. (ELK/TSE), which is operating the well, climbed 50¢ to $5.85 and has risen 129% since closing at $2.55 on Nov. 23. "There are a lot of questions as to the size of the reservoir that won't be answered until there is a controlled well," said Paul Beique, an analyst at Dundees Securities Corp. However, he said predictions of 45 days to drill a relief well and use it as replacement wells might be optimistic.

To: Kerm Yerman who wrote (14106)	12/8/1998 8:11:00 AM
From: Kerm Yerman	Respond to of 15196

IN THE NEWS / Warm Season Hurts Natural Gas Prices Down 50% In A Month: Bulging Storage Levels Weigh Heavily On Market Ian McKinnon Financial Post Warm weather and bulging storage levels have kicked the prop out from under the price of natural gas, with Canadian prices plunging as much as 50% in the past month. But the forward contract market indicates the bulls are still on the loose because longer-term fundamentals remain positive. The dichotomy is helping create sharp price changes, something not likely to disappear soon. "Volatility is here to stay, there's no doubt about it," said Jim Oosterbaan, vice-president of gas services for Ziff Energy, a Calgary based consulting firm. While winter does not officially begin until Dec. 21, it begins on Nov. 1 in the gas business and runs until March 31. The amount of gas withdrawn from underground storage tanks in Canada and the U.S. in these months is crucial to price dynamics. Marketers generally want to sell their stored gas by the end of March and then rebuild supplies in the rest of the year. Temperatures of up to 10C above normal across most of North America have resulted in storage volumes, which were at near record levels in November, dragging down prices. That has been evident at Alberta Energy Co.'s AECO C-hub in southern Alberta -- a major pricing point for Canadian gas. Prices fell in 50¢-chunks late last week before staging a rebound yesterday to about $2.20 a gigajoule. David Wilson, vice-president of structured product at TransCanada Energy Ltd., said prices fell harder in Canada than on the New York Mercantile Exchange because expectations were higher and have not retreated as quickly as in the U.S. He said the slide means the January-March strip fetches $2.45 a gigajoule, down from its high near $3. Long-term fundamentals of increasing demand and pipeline access to U.S. markets are still bullish for the industry and are reflected in the price for the next gas marketing year, now hovering at $2.50 a gigajoule, down from $2.60. The volatility of the past few days shows the industry has not fully matured, said Mike Broadfoot, senior Canadian vice-president for Engage Energy. It is putting pressure on producers to manage their risk on price fluctuations. "Managing the commodity is becoming more important. My belief is the volatility of prices in the next three or four years will outstrip other things producers work hard to control," he said. When the continental gas market is fully mature, the price difference between North American supply basins and the benchmark Nymex futures contract will be based on the cost of transportation, Mr. Broadfootn said. The difference between Alberta gas and the Nymex will fall below the transportation costs, said Mr. Oosterbaan. Producers constrained by low oil prices will be unable to meet all commitments, leaving excess pipeline capacity that will create transportation rate discounts and shrink the "basis differential." Gas prices in the late summer and falls swung out of balance with basic fundamentals, said Mr. Oosterbaan. Despite low oil prices and a resurgence in nuclear plants slowing the growth of the gas-fired power market, he said Ziff is still optimistic about the future off gas.

To: Kerm Yerman who wrote (14106)	12/8/1998 8:45:00 AM
From: Kerm Yerman	Respond to of 15196

IN THE NEWS / Remington Energy Dips --- Puts Record Straight Garry Marr Financial Post Remingtonn Energy Ltd. (REL/TSE), down 40¢ to $4.80, on volume of 479,655 shares. The company issued a release yesterday about "misstatements disseminated by an investment dealer" in the past week. The stock was as high as $7.25 on Monday, Dec. 1, but had fallen to $4.50 by Wednesday, something Remington officials blamed on the statement that $75-millionn of credit had been called by company's bankers. "There is no foundation for the statement that any part of our banking facility has been called or is due at this time. The investment dealer has published a statement acknowledging that its information was incorrect," said Paul Baay, president of Remington. The company's releases did little to spur the stock, which fell 7.7%.

To: Kerm Yerman who wrote (14106)	12/8/1998 8:56:00 AM
From: Kerm Yerman	Respond to of 15196

IN THE NEWS / Hurricane Hydrocarbons Ltd. Obtains Kazakhstan Ruling The oil exploration company said on Friday it had received a favourable ruling from Kazakhstan's anti-monopoly committee in relation to its case against the Shymkent refinery. Hurricane had complained about processing fees charged by the refinery, the mix of products it was receiving, and access to the refinery by third parties, which will allow Hurricane to sell crude directly to customers. Hurricane now has the right to refine an unlimited amount of crude and will have an "independent expert" assessing the product, the company said. It lost on the issue of processing fees but plans to appeal. Hurricane Hydrocarbons Ltd. (HHLa/TSE), closed up 22.4% or 37¢ to $2.02, on volume of 410,100 shares. Shares are climbd 34.7% since closing at $1.50 on Thursday.

To: Kerm Yerman who wrote (14106)	12/8/1998 9:02:00 AM
From: Kerm Yerman	Respond to of 15196

IN THE NEWS / It's A Superior Deal - Superior Propane Inc. Propane giant clears hurdle in bid to take over ICG By TODD NOGIER, CALGARY SUN Calgary-based Superior Propane Inc. got a vote of confidence yesterday in its plan to take over rival ICG Propane Inc. Federal competition watchdogs failed in their bid to block the $175-million merger after a two-day hearing with the Competition Tribunal, a branch of the Federal Court of Canada. Superior has now cleared a major hurdle in the deal it says is essential to compete in a market dominated by other fuels such as natural gas. "This decision just reinforces all the arguments we've made," Superior president Geoff Mackey told the Sun. The Competition Bureau is not giving up its fight to stop the merger, however. It is applying for a full hearing into the deal. The bureau says the merger would give Superior control of 73% of the national propane market, while in some parts of the country, such as the Yukon, Northwest Territories and in some farming regions, it would have a monopoly. "We have to take these concerns seriously, we have many customers who have come forward who have asked us to block this merger," Robert Lancop, assistant deputy director of competition. Mackey said 90 of the some 300,000 combined customer base of Superior and ICG complained of the takeover. "To me, that is not a very large number opposed," he said. Superior employs 1,450 while ICG employs 850.

To: Kerm Yerman who wrote (14106)	12/8/1998 9:11:00 AM
From: Kerm Yerman	Respond to of 15196

IN THE NEWS / Bryan and Noval get a divorce Tuesday, December 8, 1998 MATHEW INGRAM Calgary -- As corporate marriages go, former Gulf Canada CEO J.P. Bryan's fling with Canadian 88 Energy founder Greg Noval ranks right up there with Dennis Rodman's brief wedding to former Baywatch star Carmen Electra. Mr. Bryan's dalliance with Canadian 88 lasted a bit longer than Mr. Rodman's nine-day union, but after barely two months it is still just as over. From all reports, Mr. Rodman's joint venture with Ms. Electra fell apart amid allegations that the notorious cross-dressing NBA star was drunk when he signed the register at a chapel in Las Vegas last month. Mr. Bryan's mental state when he agreed to join Canadian 88 isn't known, but there is very little surprise in the oil patch at the brief nature of the union. Mr. Noval's announcement in September that Mr. Bryan would be joining Canadian 88 as chairman came after weeks of rumours about some kind of business combination involving the two. Despite this advance warning, however, there was still a significant amount of skepticism among industry players familiar with both men that such an arrangement would work. "I don't see how there could possibly be an office big enough to handle both of those two in the same company," one insider said when Mr. Bryan's arrival at Canadian 88 was still just a rumour. The industry source then went on to make it clear that he was referring to the fact that both executives have, um . . . a well-developed sense of their own abilities. In Gulf Canada's 1996 annual report, designed as a running gag on secret-agent caper films like James Bond and Mission Impossible, Mr. Bryan's alter ego was named James Brash -- and this is likely a description that struck home with many who had occasion to encounter the blunt-spoken Texan. An avid hunter both of local wildlife and of corporations, he stood out even in an oil patch filled with many larger-than-life characters. Almost every article about him, for example, eventually mentioned his comments about Quebec separatists and how they should go back to France. Many profiles referred to his dislike of teamwork, something he defended by saying that decisions made by committee tended to be the worst decisions ever made. Not surprisingly, perhaps, his departure came after a clash with the Gulf Canada board of directors about corporate strategy. In the end, industry watchers say the Noval-Bryan union likely suffered from an excess of leadership. "These guys are both used to driving the bus," said one insider. "I remember one CEO said [when Mr. Bryan's appointment was announced] that it would have to be an awfully big bed for those two to get into bed together." Among the other analogies making the rounds was the ever-popular "too many cooks in the kitchen." Mr. Noval, a lawyer who started his company in 1988, has gained attention in the past few years through a combination of audacious but futile takeover attempts, including a run at Morrison Petroleums last year. Industry insiders say he has a reputation for being somewhat combative, fuelled by actions such as a continuing acrimonious legal battle with former joint venture partner Newport Petroleum of Calgary. Although executive personalities have definitely been enough to sour more than one corporate merger, there is also an industry backdrop to the end of the Greg-and-J.P. show. Mr. Bryan's specialty -- as anyone who looks at Gulf's debt-heavy balance sheet knows -- is the leveraged acquisition, and that is something the market currently has very little stomach for. Canadian 88's focus is natural gas, and expectations for that commodity are certainly more bullish than for oil, but even gas boosters have been getting skittish as the weather stays warm and gas prices in North America continue to weaken. Canadian 88's balance sheet may also have led some company watchers to be leery about large, debt-financed purchases. In its most recent quarterly report, the company said its cash flow had fallen by 37 per cent in the first nine months of this year, in part because of a higher debt load (its debt has doubled since September, 1997). It also stated that "those who are expecting corporate acquisitions by Canadian 88 will be gravely disappointed," and that the company intended to grow strictly through "the drill bit," or traditional exploration. For his part, Mr. Bryan has said that his decision to leave was driven primarily by a need to get more involved with his U.S. investments -- specifically Torch Energy, the investment firm he helped found after leaving the Wall Street brokerage business, and the vehicle he originally used to invest in Gulf Canada way back in 1993. Indeed, Mr. Bryan's tenure at Canadian 88 was only slightly shorter than the reign of Torch Energy's most recent CEO, former oil analyst Arthur Smith, who left in October after less than four months because of what Torch called "disagreements over strategy." In fact, some industry sources say Mr. Bryan helped engineer Mr. Smith's departure -- an ironic touch, given Mr. Bryan's own departure from Gulf last February over "strategic differences."

To: Kerm Yerman who wrote (14106)	12/8/1998 11:10:00 AM
From: Kerm Yerman	Read Replies (1) \| Respond to of 15196

IN THE NEWS / Steam Now Spewing From Well In Lost Hills Play Filed: December 7, 1998 By BOB CHRISTIE Californian staff writer e-mail: bchristie@bakersfield.com LOST HILLS — The blazing gas well near this western Kern County crossroads hamlet has started spewing a new substance — steam. The well, which blew out two weeks ago, has gone from a smoky fireball to a clear gas flame and now to an orange torch. The changes have come about as crews with Boots & Coots International Well Control hauled the remnants of a destroyed well drilling rig from the flames and sliced off the mangled end of the well's casing. Late Friday, the smooth, now-smokeless flame began sending off a geyser of steam. That change was caused by water from deep underground joining the stream of natural gas as it shot from the earth. It isn't known if the water is being produced from the same depth as the natural gas and oil, or if it is coming from a cracked casing above that level. All the while, the Boots & Coots crew has been battling to get close to the well so they can cap it, if possible. A new drilling rig is being erected about 1,500 feet from the burning well to drill a relief well. The new well is expected to be started Saturday. The crew will drill to a planned depth of 12,500 feet, cement a well casing, then slant drill to intercept the burning well at 13,500 to 14,000 feet. That job is expected to take at least 45 days. The dawn to dusk work on the flaming well progressed through the weekend. On Monday, the crew used a cannon that shot water at 10,000 pounds per square inch to slice off the well casing so they will have a clean pipe on which to attach a new blow-out preventer valve, according to Boots & Coots engineering vice president Larry Flak. Over the next few days, the Houston-based oil well firefighters will hook up an elaborate system of diverter pipes designed to funnel the burning gas and liquid away from the mouth of the well into two burn pits. That system must be completely ready before the crew actually moves in the new valve, Flak said. Positioning the new valve over the flaming well, they'll lower it into place, secure it, then hook up the diverter system. The crew will attempt to slowly close the valve and force the flow to move into the piping, where it will be burned off in the two pits. "So, we never shut the fire off, really," Flak explained. "This is the safest way to handle the well so you don't have that reignition risk." After the flow is diverted, the crew will be able to send tools down the blowout preventer to remove drilling pipe and tools and test the well bore. It isn't known if the casing is damaged deep underground, but that is not an uncommon occurrence. If the crew can't control the flow of gas and oil from the surface, the well could be shut off by pumping cement down the relief well. The Lost Hills well was being drilled by Canadian oil company Bellevue Resources Inc., a subsidiary of Calgary-based Elk Point Resources Inc., when it caught fire. The contracted drilling rig, from Nabors Drilling USA, had been on the site since March and had gone to a depth of 17,640 feet. Highly pressurized natural gas apparently forced its way into the well bore, and the crew could not stop the gas from forcing its way to the surface.