The Crosstex Energy companies, Crosstex Energy LP and Crosstex Energy Inc. announced July 27 plans to expand its natural gas gathering system in the Barnett Shale play in North Texas by constructing a $25 million 15-mile pipeline project. The project, which is supported by volumetric commitments, includes a seven-mile, low-pressure pipeline, an eight-mile, high-pressure pipeline and a compressor station in southwest Tarrant County that will provide customers with additional takeaway capacity.
The project should be complete by the first quarter of 2011, according to Dallas-based Crosstex.
“We are capitalizing on our great asset position in the heart of the Barnett Shale where we see many opportunities for incremental growth. We will continue to identify and invest in low-cost, high-return projects in North Texas,” said Barry E. Davis, Crosstex president and CEO, in a press release. “We also are focusing on the optimization of our core positions in the Haynesville Shale and throughout Louisiana, as well as in the Barnett Shale, and providing top-quality, cost-effective services for all our customers.”
Key Energy buys service company
Key Energy Services Inc. of Houston announced July 26 it will purchase certain subsidiaries, together with associated assets, owned by OFS Energy Services LLC, a privately-held oilfield services company of
ArcLight Capital Partners LLC for $75.6 million in cash and about 15.8 million shares of Key common stock.
The OFS subsidiaries being acquired employ about 880 workers and operate in the Haynesville Shale, Barnett Shale, Woodford Shale and Permian Basin markets under the Davis, Swan and Quail brands. The acquisition includes eight coiled tubing units (with two additional units set for delivery this year), 34 workover rigs, 123 vacuum trucks, 10 salt water disposal wells, three drilling rigs and a well-site construction business.
Through the first six months of 2010, the OFS businesses to be acquired generated about $81 million revenue and $17 million in earnings before interest, taxes, depreciation, and amortization (EBITDA).
“In addition to complementing our existing rig and fluids management businesses, closing this transaction will result in Key having a total of 41 coiled tubing units, two-thirds of which are large diameter units,” said Dick Alario, chairman, president and CEO of Key. “This will represent a total fleet increase of 78 percent since the beginning of 2010, allowing us to effectively double our presence in the major shale markets.”
Cano hires advisers
Cano Petroleum Inc. announced July 26 its board of directors has retained Canaccord Genuity Inc. and Global Hunter Securities LLC as financial advisers to assist in its review of strategic alternatives with a view to enhancing shareholder value.
Strategic alternatives may include, but are not limited to, a sale of the corporation, a merger or other business combination, a sale of a material portion of Cano’s assets, among other alternatives.
Cano had announced plans to merge with Houston-based Resaca Exploitation Inc. earlier this year, but after that deal fell through, Fort Worth-based Cano said it plans to look at alternatives.
Texas Tech, NIRE study wind energy issues
Texas Tech University and the National Institute for Renewable Energy (NIRE) will receive $8.4 million from the Texas Emerging Technology Fund (TETF) allowing them to help resolve key scientific and technology issues facing the wind power industry.
NIRE, which was formed in 2009 with organizational support from Innovate Texas Foundation and in conjunction with Texas Tech University, focuses on advancing technology in the wind industry and addressing the future energy needs of the United States through specialized renewable energy research initiatives and distributed wind energy production farms.
Texas Tech University will use the state funds to facilitate technology development, further decrease the cost of wind energy and other renewable energy sources, and optimize energy storage technologies. Funding provided to NIRE will be used to design, construct and operate research wind farms, and sell the power generated in the commercial marketplace to fund a non-profit research center. NIRE also will provide services to industry partners and offer an industry consortium, which will be managed by The Wind Alliance. Texas Tech and its wind research organizations will receive $6.4 million of the award, while NIRE will receive $2 million.
“Innovate Texas Foundation is pleased to have played a fundamental role in developing the NIRE public/private partnership structure,” said David Nance, chairman of Innovate Texas Foundation and NIRE board member. “The NIRE initiative connects government, academic and industrial assets to create a dynamic, sustainable ecosystem of innovation for renewable energy technologies and tools. Privately funded distributed wind energy production facilities will harness revenues, train renewable energy professionals and provide research installations to extend Texas’ leadership as the top wind energy producer in the U.S.”
The Fort Worth League of Neighborhoods Gas Drilling Committee will hold a discussion on natural gas drilling at 6:30 p.m. Aug. 5 at Fort Worth Firefighter’s Hall at 3855 Tulsa Way.
Speakers include Dr. Theo Colborn, an environmental health analyst, and Wilma Subra, an environmental scientist and chemist.
For information: www.fwlna.org.