After six months of investigating a possible sale, Mitchell Energy & Development Corp. scratched the idea and decided to remain an independent producer. But some Wall Street oil analysts suggested that the Houston-area company could, and perhaps should, make another attempt at finding a suitable merger partner. The announcement came one day after company officials released a fiscal 2001 budget of $221.5 million, 50% higher than last year. Of that, $183.1 million is allocated to exploration and production, $36.2 million to gas services and the remainder to corporate projects. Some have doubts that Mitchell Energy can continue to go it alone. "Although [staying independent] is good in the near term, it's really not the long-term solution," said Fadel Gheit of Fahnestock & Co. in New York. "They have to grow the company by merging with another company." Mitchell also announced that it will combine its Class A and Class B shares into a single voting class. Currently, only the Class A stock is a voting class. Chairman George Mitchell owns about 60% of the stock; only about 14% of the shares float on the open market. "The company has to be much more proactive and really address the main issue which is the huge ownership of George Mitchell," Gheit said. "At the end of the day, my objective [would be] to have George Mitchell's interest in the company less than 15%, which means the company has to grow in size four-fold to achieve that." -Jodi Wetuski