• Privately held Petrohawk Energy LLC, Houston, and Beta Oil & Gas Inc., Tulsa, Okla., (Nasdaq: BETA) have agreed to Petrohawk's purchase of $60 million of Beta common stock, warrants and a convertible note. Petrohawk will pay $25 million for 15.15 million Beta shares and five-year warrants to purchase up to 10 million additional common shares at $1.65 each. The note is unsecured and five-year for $35 million and convertible after two years into common stock at $2 per share. Until maturity, only quarterly 8% per year of interest is payable under the note. Upon closing, Petrohawk, which has EnCap Investments LP private-equity backing, will own approximately 55% of Beta common. If exercising warrants and converting the note, Petrohawk will own approximately 73%. Beta's new board will consist of six Petrohawk designees and one Beta designee. Floyd C. Wilson, Petrohawk president and chief executive, will become chairman, president and CEO of Beta. Wilson was a founder of 3Tec Energy Corp., which was sold this summer to Plains E&P. Petrohawk owners include Wilson, affiliates of EnCap Investments LP and an affiliate of Liberty Energy Holdings LLC. Petro Capital Advisors LLC was financial advisor to Beta. Mitchell Energy Advisors LLC was advisor to Petrohawk. "While it is difficult for us to hand off the project we have become so dedicated to, we are confident that this transaction will expose the company to both financial resources and operational opportunities on a more accelerated track than we could have expected otherwise," says David Wilkins, Beta president and CEO. Beta had first-nine-month 2003 production of 93,500 bbl. of oil and 1.362 million cu. ft. of gas. Most of its assets are located in the Midcontinent, Texas, Louisiana, Kansas, offshore and in Australia. Year-end 2002 proved reserves were 14.7 billion cu. ft. of gas and 608,000 bbl. of oil, or 18.3 billion cu. ft. of gas equivalent. Approximately 97% of its gas reserves and 99% of its oil reserves were proven developed. • Plains Resources Inc., Houston, (NYSE: PLX) has retained Petrie Parkman & Co. as its financial advisor in response to a takeover bid by Vulcan Capital, James Flores, Plains chairman, and John Raymond, Plains chief financial officer and president. Plains reported third-quarter 2003 production of 2,141 bbl. per day, compared with 2,511 per day in the 2002 third quarter. Vulcan Capital is an investment arm of Seattle-based Paul G. Allen, a founder of Microsoft Corp. This deal would take the firm private. • Edge Petroleum Corp., Houston, (Nasdaq: EPEX) has acquired Miller Exploration Co., Traverse City, Mich., (Nasdaq: MEXP) in a stock swap valued at more than $12.7 million, boosting its proved reserves and production by about 10%. The companies have complementary producing assets in the Gulf Coast region and undeveloped assets in the northern Rockies. Miller's net proved reserves at year-end 2002 were 6.8 billion cu. ft.; production was 6.7 million cu. ft. a day. It had 103,000 undeveloped acres, including a large undeveloped tract in northern Montana. Miller sold its Alabama properties to an unrelated private party prior to closing, leaving it with proved reserves of about 4.6 billion cu. ft., no debt and working capital of more than $3 million. • Privately held Medicine Bow Energy Corp., Denver, has merged with Ensign Oil & Gas Inc. in a deal that began in June 2003 when Medicine Bow acquired all of the outstanding common shares of Ensign. Medicine Bow is the surviving company. The closing was in conjunction with Medicine Bow stock purchases of up to $120 million by EnCap Investments LP, CSFB Private Equity Inc., Kayne Anderson and Liberty Energy Holdings et al. Rivington Capital Advisors LLC was financial advisor to Medicine Bow. • Quest Resource Corp., Oklahoma City, (OTC BB: QRCP) has purchased Devon Energy Corp.'s (Amex: DVN) leases, pipelines and related assets in the Cherokee Basin of southeast Kansas and northeast Oklahoma for $126 million in cash, becoming the largest operator in the basin. Quest gains proved reserves of 95.9 billion cu. ft. equivalent for a purchase price of $0.89 per thousand equivalent after allocating $40.7 million to net undeveloped acreage and pipeline assets, it reports. All of Quest's Cherokee Basin assets are now part of subsidiary Quest Cherokee LLC. Cherokee Energy Partners LLC, an affiliate of ArcLight Capital Partners LLC, provided $51 million of financing to Quest Cherokee. Banc One Capital Markets Inc. provided $105 million of senior bank debt and mezzanine debt financing to fund the purchase and as a credit facility. Energy Capital Solutions LLC was financial advisor to Quest and arranged the financing. Quest receives approximately 330 wells producing approximately 20 million cu. ft. per day, some 200 miles of gathering pipelines and interests in approximately 375,000 leasehold acres. Devon's working interest in the properties was 100%. Quest's net daily production from the Devon and existing assets will be approximately 25 million cu. ft. per day, it will own more than 800 miles of pipeline infrastructure and it will control approximately 500,000 net acres. Devon says $126 million is approximately its net investment in the coalbed-methane assets, and that the proved reserves at year-end 2002 were approximately 109 billion cu. ft. of gas, 58% proved producing. Devon will continue to own and operate 41,000 acres in the Arkoma Basin in central Oklahoma, which produce from a conventional formation and hold potential for coalbed-methane production. Standard & Poor's Ratings Services says the sale is beneficial to Devon's credit profile because Cherokee drilling results and production have historically lagged the company's initial projections. • Range Resources Corp., Fort Worth, Texas, (NYSE: RRC) has purchased properties complementing its Conger Field assets in Sterling County in West Texas for approximately $85 million from an undisclosed seller, making it the largest operator in Conger Field. Proved reserves are approximately 80 billion cu. ft. equivalent, 88% gas and gas liquids and 80% proved developed. Net production is more than 14 million cu. ft. equivalent per day. Range will operate more than 95% of the production. The properties have an R/P of more than 15 years and include more than 500 wells producing primarily from the Cisco and Canyon formations at an average depth of 7,500 feet. A 400-mile gathering system is associated with the production being acquired. The purchase includes all deep drilling rights on 38,000 gross (32,000 net) acres of leases. Range reports an allocation of the purchase price to the gathering system, resulting in the proved reserves being acquired for approximately $1 per thousand cu. ft. equivalent. Financing was with bank debt. Pro forma, Range's debt-to-capitalization ratio will be approximately 54% at year-end, which Range expects to reduce to 50% during 2004. Range now has more than 800 wells in the Conger Field area. • Westport Resources Corp., Denver, (NYSE: WRC) has purchased South Texas assets from privately held United Resources for $350 million, increasing its total proved reserves by approximately 211 billion cu. ft. equivalent, 97% gas. Of the added proved reserves, 60% are proved developed. The company has also identified more than 100 billion cu. ft. equivalent of probable and possible potential and gained an exploratory prospect inventory comprised of 48,000 gross (25,000 net) undeveloped acres. Targets are the Wilcox, Lobo and Vicksburg trends. Production was approximately 27 billion cu. ft. equivalent in 2003. The properties have an average lease operating cost of approximately $0.50 per thousand cu. ft. equivalent and a reserve-to-production ratio of approximately eight years. Westport will allocate approximately $38 million of the price to unproved properties, undeveloped acreage, seismic data, exploration projects and other assets. The deal was funded with cash and bank debt. • Oneok Energy Resources Co., a subsidiary of Oneok Inc., Tulsa, Okla., (NYSE: OKE) has acquired approximately $240 million of East Texas properties and related gathering systems from Wagner & Brown Ltd., Midland, Texas. The properties will be owned and operated by Oneok Texas Energy Resources LP, a subsidiary of Oneok Energy Resources. They include approximately 177.2 billion cu. ft. of gas equivalent of proved gas reserves with a reserves-to-production index of 12.4 years and are 91% gas. Financing was with short-term debt. Oneok expects to later pay the debt with cash on hand and/or by selling equity. • Forest Oil Corp., Denver, (NYSE: FST) has closed its purchase of Permian and South Texas assets from Maynard Oil Co. for $103 million, gaining 102 billion cu. ft. equivalent of reserves producing approximately 25 million cu. ft. equivalent per day. During the year, Forest intends to sell 5% to 10% of the assets deemed marginal. The purchase was funded with bank debt. • Vintage Petroleum Inc., Tulsa, Okla., (NYSE: VPI) has canceled plans to buy producing properties in the Uinta Basin of Utah from El Paso Corp. for $52.5 million. The assets include 80% operated working interest primarily in Duchesne and Uintah counties, covering more than 200,000 net acres. Current net production is 2,000 bbl. of oil and gas liquids and 920,000 cu. ft. of gas per day from the Green River and Wasatch formations. • Black Stone Acquisition Partners I LP, Houston, has acquired all the U.S. producing and nonproducing mineral and royalty assets of Toreador Resources Corp. (Nasdaq: TRGL) and Tormin Inc. for approximately $45 million. Toreador's domestic mineral and royalty portfolio comprises approximately 2.6 million gross acres, or 1.4 million net acres, in eight states: Alabama, Arkansas, California, Kansas, Louisiana, Michigan, Mississippi and Texas. The royalty and overriding royalty interests are in approximately 4,000 wells with net daily production of approximately 675 BOE. The assets represent 14% of Toreador's proved reserves. Toreador, which also operates in France, Romania, Turkey and Trinidad, is building its international E&P business. Proceeds will be used to retire two senior credit facilities, reducing debt by approximately $30 million. Stockholders' equity will grow by approximately $20 million. Toreador will retain its U.S. working-interest ownership portfolio, which accounted for about 10% of its proved reserves at year-end 2002. • Novus Petroleum Ltd., Sydney, (Australia: NVS) has acquired 100% working interest in East Cameron tracts 317 and 318, and 79% working interest in Main Pass tracts 64 and 65, in federal waters offshore Louisiana for approximately US$25 million. The purchase price is 70 cents per thousand cu. ft. equivalent of proven reserves compared with recent transactions of more than $1.20 per million Btu. Gross production is approximately 10 million cu. ft. of gas and 600 bbl. of oil per day. Proved reserves are approximately 33.4 billion cu. ft. equivalent, 88% gas. Darcy Energy, the parent of Darcy Exploration, which Novus acquired in 2002, retains the right to purchase up to 25% of Novus' working interest in the properties within 12 months. • PetroQuest Energy Inc., Lafayette, La., (Nasdaq: PQUE) has acquired an interest in the Southeast Carthage Field in East Texas for approximately $23 million from a private company, gaining 29 billion cu. ft. equivalent of proved reserves (57% proved developed, 69% gas). Production is 5.5 million cu. ft. equivalent per day. The deal includes 13,500 net developed acres and 8,500 net undeveloped acres. The purchase was funded with bank debt. About $1 million of the purchase price will be allocated to unevaluated acreage. PetroQuest hopes the purchase will strengthens its asset base by adding reserves that have a longer life than its Gulf Coast portfolio. The East Texas assets' reserve-to-production ratio is 14.5 years. • St. Mary Land & Exploration Co., Denver, (NYSE: SM ) has sold its 100% interest in the Fort Chadbourne Field in Coke and Runnels counties, Texas, to an undisclosed party for $17 million in cash. Also, St. Mary plans to sell its properties in the Scott, Well Draw and Sage Spring Creek fields in the Powder River Basin, Wyo., for $5.3 million to an undisclosed party. • Five States Energy Co. LLC, Dallas, has acquired producing royalty interests in New Mexico's San Juan Basin for more than $6.8 million from Pulte Homes. Wells Fargo Energy Advisors represented Pulte, which purchased the royalty interests in 1995 from the state of New Mexico to take advantage of coalbed-methane tax credits. The assets are in San Juan and Rio Arriba counties and production is from the Fruitland Coal. Five States receives 100% of the royalty payment until spring 2005 when it will retain 25% of the royalty and 75% will revert to the state of New Mexico for the life of the properties. Through early December, Five States reports it had purchased more than $25 million in oil and gas assets in 2003. • Contango Oil & Gas Co., Houston, (Amex: MCF) and 33.3%-owned subsidiary Republic Exploration LLC plan to sell all of their currently producing Gulf of Mexico leases to private interests for approximately $12 million. Contango will receive approximately $4.7 million in cash, representing $3.7 million from the sale of its direct interests in the properties, plus an additional $1 million distribution from the subsidiary. Republic Exploration will receive approximately $8.3 million in cash and then pay $1 million to each of its three equity owners. Contango will reduce its bank debt to about $10 million, compared with $22.4 million on June 30. • Harken Energy Corp., Houston, (Amex: HEC) has sold the majority of its oil and gas properties in the Texas Panhandle for approximately $7 million in cash. The assets are noncore. Most of Harken's U.S. reserves are on the Gulf Coast in Texas and Louisiana. Proceeds will be used to pay all outstanding bank debt, totaling approximately $4 million. Petrie Parkman & Co. advised Harken. • Petroleum Development Corp., Bridgeport, W.Va., (Nasdaq: PETD) has acquired interests in properties in the Denver-Julesburg Basin in Weld County, Colo., from one of its joint-venture partners for $5.2 million. The properties include approximately 3.1 billion cu. ft. equivalent of proved developed producing reserves from interests in 20.6 net wells (230 gross) and 1.8 billion cu. ft. equivalent of proved developed nonproducing reserves from interests in 17 net wells (183 gross). Current daily production is approximately 1.6 million cu. ft. • Aspen Exploration Corp., Bakersfield, Calif., and Denver, (OTC BB: ASPN) has acquired working interests in four operated gas wells and one nonoperated gas well in the Sacramento Valley, northern California, where it currently has operations. Net working interests acquired in the operated wells range from 38% to 90%. Daily production will grow approximately 12%. Aspen now operates 37 gas wells and has nonoperated interests in 16 additional wells in the Sacramento Valley. The seller and financial terms were not disclosed. • American Energy Production Inc., Mineral Wells, Texas, (OTC BB: AMEP) has acquired Production Resources Inc. for $400,000 of stock and a $400,000 two-year 5% term note, gaining more than 1,500 producing acres and 193 wells capable of producing oil in Medina County, Texas. A few of the wells are producing. PRI is now a subsidiary of American Energy. • Capco Energy Inc., Orange, Calif., (OTC BB: CPEG) has acquired interests in the Brazos Field, offshore Matagorda County, Texas, from Dominion and other unidentified sellers. Current production is 2 million cu. ft. per day from two wells. After selling minor interests, Capco will have a 65% working interest and be the operator of the field. • Galaxy Energy Corp., Denver, (OTC BB: GAXI) has acquired all of the coalbed-methane interests of Pioneer Oil LLC, Sheridan, Wyo., for $1 million in cash and two million shares of Galaxy. Galaxy gains 100% working interest in five gas wells, which are presently dewatering and may begin producing by second-quarter 2004. • Geostar Corp., Mount Pleasant, Mich., the controlling shareholder of Gastar Exploration Ltd. (Toronto: YGA), has acquired 10.2 million more shares of Gastar, and now holds 30.22%. • Natural Resource Partners LP, Houston, (NYSE: NRP) has purchased mineral interests in Kentucky, Tennessee, West Virginia, Virginia and Alabama from BLC Properties LLC for $73 million. Included are coal, oil and gas and other mineral rights on approximately 240,000 acres that contain approximately 180 million tons of coal reserves. The deal also includes oil and gas and other mineral rights on approximately 200,000 additional acres, bringing the total acreage to approximately 440,000 acres. BLC will retain a 35% nonparticipating royalty interest in the oil and gas and other mineral rights. BLC purchased the properties from JM Huber Corp. in 2001.