US energy firms in $21bn merger
This was the headline Friday in the BBC on line news service. It was pushed off the front page of their website later in the day with stories about the "bombing" plans of the 7 "homegrown terrorists" that were arrested in Florida.
Follow me below the fold for the rest of the article.
http://news.bbc.co.uk/...
Three of the largest US oil and gas exploration firms are merging in deals worth a combined $21bn (£11.6bn).
Anadarko Petroleum Corporation is to buy Oklahoma-based Kerr-McGee for $16.4bn, while separately acquiring Western Gas Resources for $4.7bn.
Kerr-McGee holds extensive oil and gas deposits in Colorado, Utah and offshore in the Gulf of Mexico while Western Gas Resources owns gas fields in Wyoming.
Energy firms are merging to absorb the huge costs of research and exploration.
The two deals - which must be approved by each firm's shareholders - should be completed by the autumn.
Anadarko said the deal would create a market leader in exploration in the deepwater Gulf of Mexico and the Rockies, two of the US fastest-growing oil and gas production regions.
"Kerr-McGee's outstanding deepwater holdings and skill sets will elevate Anadarko into the top echelon of deepwater operators," said Anadarko's chief executive Jim Hackett.
Note the location of the holdings and then remember that there are low or non-existent taxes on profits or profit sharing on the platform production in the Gulf. Hmm - do you think that this will be a good deal for the shareholders?? I think I'll see about buying some stock. If they use the same Exxon tactics, there's gonna be lots of money available and lobbyists flinging it at "our" elected officials to keep the leases free or low cost for the "poor" oil and gas companies. Everyone knows that there's no money in the business, just expensive research and exploration. Like it says in the article, this merger is just to economize on research and exploration costs... and if they don't have to compete against each other, then there's more opportunity to profit because there won't be anyone else the size that they are so they can kill off their competitors easily. And that means that you will just get a super great deal on the gas that they will suck out of the Gulf, the Colorado Rockies and other locations while the taxpayer foots the bill -again.
This isn't worth a mention in the US Press and it is only on the BBC front page for a few hours. Well I guess that a 21 BILLION dollar merger is not very interesting here in the States. There must be news about the latest American Idol winner's car advert, or maybe something about the new Superman movie. You know, something REALLY important.
I forsee a new wave of profiteering in the near future. Home heating and other natural gas users will be relieved to find out that the holy "market forces of competition" have disappeared and the solution will cost them more money for the same product. What a GREAT system - for those who own the system that is!