NEWS BULLETIN

September 04, 2001 --- Vol. 7, No. 109September 2001

Amec says it is one of front-runners for Alaska Highway gasline engineering

British contractor Amec believes it is one of the front-runners to secure the major engineering and design work contracts for the Alaska Highway gas pipeline, according to a report in London-based Energy Day.

The newspaper, in a Sept. 3 report, quoted Amec chief executive officer Peter Mason as saying his company has "been involved in many Arctic pipeline contracts and will be a leading bidder" for the job to deliver North Slope gas to the Lower 48.

He said a feasibility study Amec is currently working on will serve as a springboard for more engineering work on a project he estimated carries a price tag of $20 billion.

Mason said Amec is completing an environmental and social impact study for Canadian regulatory agencies along with a C$75 million study by Mackenzie Delta gas owners Imperial Oil, ExxonMobil Canada, Shell Canada and Conoco Canada to develop Arctic gas.

He said the studies cover conceptual design, project costing, commercial structures and project viability.

Mason did not indicate which basin, the North Slope or Mackenzie Delta, he expects to be developed first.

Devon bids for Anderson Exploration and a dominant Arctic position

Devon Energy has launched a $4.6 billion bid to acquire Calgary-based Anderson Exploration, seizing control of the largest landholding in Canada's Arctic.

The offer, which would turn Oklahoma-based Devon into North America's largest independent oil and gas producer, has the unanimous backing of both boards of directors and is expected to close in the fourth quarter.

Anderson's assets feature reserves of 532 million barrels of oil equivalent, including 2.5 trillion cubic feet of gas, and 8 million net undeveloped acres.

Under the leadership of founder and chairman J.C. Anderson a Nebraska native who emigrated to Canada in 1968, made a 1.4 trillion cubic foot discovery in Alberta and built one of the few remaining senior independent producers in Canada Anderson Exploration has embarked on an aggressive expansion into the Arctic over the last year.

As well as being the dominant landholder in the Mackenzie Delta-Beaufort Sea and the Yukon, Anderson made a C$962 million purchase earlier this year of Calgary-based Numac Energy and was viewed by analysts as having enough shareholder support to make a hostile takeover all but impossible.

Devon chairman and chief executive officer Larry Nichols said expanding its Canadian foothold, gained through subsidiary Northstar Energy, "has been an important objective.

"Anderson has built an exceptional, gas-weighted production platform with powerful exploration potential," he said.

Devon is also in the midst of a $3.1 billion purchase of Mitchell Energy. It estimates the Anderson transaction will increase its proved reserves by 35 percent to about 2 billion barrels of oil equivalent, with North American reserves amounting to 87 percent of its worldwide holdings. North American gas production would grow to 2.2 billion cubic feet per day.

The Anderson deal continues this year's rapid change in the line-up of northern players in Canada, with Conoco completing its acquisition of Gulf Canada Resources and Anadarko Petroleum buying Berkley Petroleum.

Devon has a minority working interest in Phillips Alaska Inc.'s proposed Cosmopolitan unit in lower Cook Inlet.


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