SEMCO settles pipeline dispute

PORT HURON, Mich. - SEMCO Energy Inc. will pay $5.5 million to settle a dispute over the sale of a subsidiary in Alaska, the company announced Dec. 31.

The settlement resolves a dispute that was headed to arbitration between SEMCO, headquartered in Port Huron, and Atlas Pipeline Partners L.P.

The claim had been filed by Atlas, which said SEMCO terminated an agreement to sell Atlas its Alaska Pipeline Co. subsidiary. Atlas had sought damages of more than $94 million, according to SEMCO.

The agreement calls for both companies to drop all claims related to the sale of Alaska Pipeline Co. Neither company acknowledges wrongdoing. SEMCO will continue to own and operate the company.

Alaska Pipeline transmits natural gas from Alaska's Cook Inlet region to customers of SEMCO's ENSTAR Natural Gas Co. division in Anchorage and the surrounding area.

SEMCO president George A. Schreiber Jr. said the agreement allows the company to begin 2005 without uncertainty over the Alaska pipeline situation affecting its plans.

SEMCO, distributes natural gas to more than 392,000 customers combined in Michigan and Alaska.

- The Associated Press

Gazprom, ConocoPhillips sign agreement on Barents Sea field

MOSCOW - Gazprom and U.S. energy company ConocoPhillips Co. have signed a memorandum of understanding on the development of a large Barents Sea natural gas field, the Russian state-run gas giant said in late December.

The United States and other Atlantic countries would be export targets for the gas from the giant Stockman field, estimated to hold 3.2 trillion cubic meters of gas, Gazprom said in a press release.

According to the agreement, the two companies will engage in preliminary appraisals of the project for producing and transporting liquefied natural gas.

Gazprom has signed such agreements with numerous companies already including Norweigan energy companies, Norsk Hydro and Statoil ASA.

- The Associated Press

Venezuela considers using pipeline across Panama

CARACAS, Venezuela - Venezuela has planned talks with Panama on the possibility of pumping oil from the Caribbean to the Pacific through an existing pipeline, Foreign Minister Ali Rodriguez said Dec. 29.

Rodriguez denied that new agreements signed earlier in December to sell Venezuelan oil to China are part of any strategy to decrease oil exports to the United States, the No. 1 buyer of Venezuelan crude.

In the next five years, the Venezuelan oil company plans to increase production to 5 million barrels of crude a day, he said. Venezuela now says it produces 3.1 million barrels a day, while industry analysts say the true figure is less.

To reduce transport costs to the Pacific, Venezuela is considering the possibility of using the pipeline across Panama, Rodriguez said. It was built years ago to carry up to 800,000 barrels of oil a day from the Pacific to the Caribbean, but is now carrying a relatively small quantity, he said.

Some businesses and Panamanian officials have suggested that pumps could be built to reverse the flow and send crude from the Caribbean to the Pacific.

At the same time, he said, a smaller pipeline could be built to accommodate the small flow currently coming from the Pacific to the Caribbean.

- The Associated Press