UNION TEXAS OIL RESERVES DROPPED IN 1986
  Union Texas Petroleum said its worldwide
  proved reserves fell to 511 mln barrels of oil equivalent at
  the end of 1986 from 555 mln barrels reported in 1985.
      In its newly released annual report, Union Texas said it
  replaced about 71 pct of its production of 56 mln barrels of
  oil equivalent last year after taking into account the sale of
  27 mln barrels of U.S. reserves.
      Union Texas, the nation's largest independent oil and gas
  producer based on revenues, is a privately-held company owned
  by Kohlberg Kravis Roberts and Co and Allied-Signal Inc &lt;ALD>.
      The Houston-based company said it lost 57.5 mln dlrs on
  1.26 billion dlrs in sales last year, compared to profits of
  165 mln dlrs on 2.04 billion dlrs in sales in 1985.
      Union Texas said it received an average of 13.35 dlrs per
  barrel for its international oil production and 2.99 dlrs per
  mcf for its foreign natural gas sales. The majority of the
  company's total energy production is in the United Kingdom,
  Indonesia and Pakistan.
      In the United States, Union Texas said it completed
  evaluation work on its oil find in Alaska's Colville Delta
  area.
      "Although significant oil reserves were confirmed,
  development of this discovery will not be economical without
  substantially higher prices," the company said.
      Union Texas said it planned to spend about 42 mln dlrs over
  the next two years to develop its Eugene Island Block 371 in
  the Gulf of Mexico.
      In 1987, the company said it budgeted 178 mln dlrs for
  capital spending, less than half of the amount spent in 1985
  and down from 199 mln dlrs budgeted last year. Union Texas also
  said it would seek acquisitions of oil and gas properties as
  well as petrochemical-related businesses.
  

