Energy Deals of the Week

on November 22, 2013 at 11:00 AM

Temperatures Plunge In Moscow

Russian gas independent Novatek and Gazprom oil-producing arm Gazpromneft have agreed to a $2.94bln deal to buy Italian Eni‘s stake in SeverEnergia, which is expected to produce 36 billion cubic meters of gas and liquids by 2017, equivalent to two-thirds of Novatek’s production, according to Reuters. A joint venture of Eni and Italian Enel has a 49% stake in SeverEnergia, of which Eni controls 60%.

Investment fund Templeton Emerging Markets Group has sold its stake in RN Holding – formerly TNK-BP – to state-controlled oil giant RosneftMoscow Times coverage alludes to Rosneft mistreatment of TNK-BP’s minority shareholders.

The US Department of Energy granted the Freeport LNG project approval to export an additional 0.4 bln cubic feet per day of natural gas to countries with which the US does not have a free trade agreement, on top of 1.4 bcf/d already approved. Freeport’s chief executive said he was “disappointed” in the approval, which provides for exports of 1 bcf/d less than the company requested.

US independent Devon has agreed to pay GeoSouthern Energy $6 billion for assets in the Eagle Ford shale that currently produce 53,000 barrels per day of oil equivalent and hold recoverable resources of 400 million boe, most of that proved reserves.

The US Securities and Exchange Commission has approved Linn Energy‘s $4.9 bln acquisition of Berry Petroleum. A shareholder vote on the deal is scheduled for December 16.

TransCanada has raised the estimated cost of the Keystone XL pipeline by $100 million, to at least $5.4bln. The cost estimate will likely rise again after the company gets more information about when it will be able to proceed with construction.   

Azure Midstream Holdings has completed its purchase of 100% of TGGT Holdings from US independent Exco and the UK’s BG for $910MM.

Magellan Midstream closed a $135m deal to buy Plains All American‘s Rocky Mountain Pipeline system, which includes roughly 550 miles of product pipeline with distribution in Colorado, South Dakota and Wyoming, as well as 4 terminals with more than 1.6 million barrels of storage. [Magellan Midstream]

Oneok has announced plans to invest another $650-$780MM in midstream assets serving the Williston Basin – home to the Bakken shale – by the second quarter of 2016. Projects will include a 200MM cubic foot per day gas processing facility and a second expansion of the Bakken NGL pipeline to 160,000 barrels per day from 135,000 bbl/d. A lack of natural gas processing and transportation infrastructure in the area forces many producers to flare associated gas.

First Solar plans to invest $100 million in solar power plant development in Japan in partnership with Japanese firms. Japan is looking increasingly at alternative sources of energy, like solar, to reduce its dependence on fossil fuels and nuclear power. [Solar Novus]