The share price of Burlington gained 7 per cent yesterday on reports in the US that ConocoPhillips would secure agreement this week for a takeover of the company.

Burlington stock has doubled in value over the past year, boosted by an extraordinary surge in the price of gas. After yesterday’s stock price gain to $81.70 a share, the gas and oil explorer was valued at $30.8 billion (£17.4 billion), compared with $84billion for ConocoPhillips Meanwhile, shares in ConocoPhillips fell 3 per cent yesterday as the market assessed the impact of a deal that would create the largest US natural gas producer.

Gas is an increasingly popular fuel in the US, but traditional onshore supplies are dwindling and the country has failed to invest in the pipeline and liquefied gas infrastructure needed to import more of the fuel.

The combination of rising demand and flat domestic gas production has pushed up the price on the NYMEX futures exchange in New York, where the Henry Hub gas futures contract has risen from $7 to $15 per million British thermal units.

A takeover of Burlington would transform ConocoPhillips into the leading US gas company, producing more than 3.3 million cubic feet per day and racing past BP, which currently claims leadership with output of 2.75 million cubic feet per day.

Burlington boasts an extensive portfolio of exploration acreage in America’s Rocky Mountains and in western Canada, where energy companies are finding important new reserves of gas in geological formations that were previously inaccessible.

America’s hunger for gas prompted BP to announce a 15-year investment programme in its Wamsutter gasfield in Wyoming, where the UK oil giant will drill some 2,000 wells to boost output at a cost of $2.2 billion.

The exceptional US gas price has even affected the UK this winter, drawing cargoes of liquefied natural gas away from Britain’s new LNG terminal. The new terminal has remained almost unused despite strong demand for gas and a soaring UK price.

Opec quota steady

Opec ministers meeting in Kuwait scrapped an emergency plan for additional oil supplies as they kept their daily output target near a 25-year high. The leaders agreed to keep the production quota at 28 million barrels a day, a decision that the oil cartel said would “be adequate, if fully observed, to balance the market for the first quarter of the year”.

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