Senior Editor-News
Warren R. True
Pipeline/Gas Processing
Editor
World pipeline construction planned in 1994 and beyond has fallen in the past year, reflecting uncertainties in energy markets.
Still, significant expansions are under way or planned for Latin America, Asia and the Pacific regions, and Europe.
Latest Oil & Gas journal data, derived from its survey of world pipeline operators, industry sources, and published information, show more than 55,000 miles of crude oil, product, and natural gas pipeline planned for 1994 and beyond.
The data include projections for pipeline construction in Russia and former republics of the Soviet Union. Western Russia and all countries west of the Ural Mountains are included under totals for Europe, eastern Russia and countries east of the Urals under totals for the Asia-Pacific region.
In 1994, companies expect to spend nearly $14 billion to lay more than 16,000 miles of line. For projects completed after 1994, companies will spend another $32.7 billion to lay 38,700 miles of line.
Total 1994 projections are lower than those reported a year ago for 1993 and beyond. Companies then expected to lay more than 17,500 miles in 1993 at a cost exceeding $15 billion and more than 42,700 miles beyond 1993 at a cost of another $36 billion (OGJ, Feb. 8, 1993, p. 25).
Projections for 1994 mileage include only projects expected to be completed by yearend. Those figures include construction in progress at the first of the year or set to begin during 1994.
Projections for mileage in 1994 and beyond reflect construction that may begin this year but will be completed in 1995 or later. Some projects will not break ground until 1995 or after.
Cost estimates are based on U.S. average cost per mile for onshore and offshore construction as determined by OGJ's most recent annual pipeline economics report (OGJ, Nov. 22, 1993, p. 43).
The cost projections assume 90% of all construction will be onshore and 10% offshore. Pipelines of 32 in. diameter or larger are assumed to be onshore projects.
Here is a breakout of costs by line diameter:
- Total onshore construction for 1994 will cost $13 billion - $4.1 billion for 4-10 in. pipelines, $5.1 billion for 12-20 in., $1.3 billion for 22-30 in., and $2.5 billion for 32 in. and larger.
- Total offshore construction for 1994 will cost $749 million - $291 million for 4-10 in. pipelines, $364 million for 12-20 in., and $95 million for 22-30 in.
- Total onshore construction for 1994 and beyond will cost $31.3 billion - $2.9 billion for 4-10 in. pipelines, $8.3 billion for 12-20 in., $7.8 billion for 22-30 in., and $12.3 billion for 32 in. and larger.
- Total offshore construction for 1994 and beyond will cost $1.4 billion - $208 million for 4-10 in. pipelines, $591 million for 12-20 in., and $555 million for 22-30 in.
Here is a rundown on construction plans by region or project:
EUROPEAN GAS LINES
Much pipeline construction in Europe revolves around plans to serve growing gas demand in the western part of the region, where gas consumption could increase to 420-480 billion cu m (bcm)/year from about 315 bcm/year at present.
Wingas, a joint venture of Germany's Wintershall AG and Russia's Gazprom, last October 1993 finished integrating the 320 km Stegal pipeline in eastern Germany and the 640 km Midal pipeline in the western part of the country. Total cost of the 3 year construction project is $2.64 billion. Wintershall owns a 6% interest in the distribution grid and Gazprom 35%.
Russian and Polish officials in July 1993 agreed to lay a $10 billion pipeline to transport gas from the Yamal Peninsula by way of Poland to western Europe. Gazprom is to fund $6.8 billion of the cost and Poland the balance. The Polish government reportedly is to fund 15% of the Polish share of costs. Work on the 4,000 km system could last a decade into the 21st century. Construction of the 670 km Polish segment of the pipeline from Kondratki on Poland's eastern border to Odra on the western border is to start this year.
Russia wants to export as much as 67 bcm/year of gas beginning early in the next decade. Poland would have rights to buy as much as 14 bcm/year of the supply. Poland's Polskie Gornictwo Naftowe I Gazownictwo and Gazprom each are to own 50% interest in the Polish segment of the line.
NORTH SEA PROJECTS
Crews next month are to begin excavating a 2.6 km tunnel beneath protected wetlands in a German coastal national park near Dornumersiel, Germany, through which the 620 km, 40 in. Europipe is to pass en route to Emden.
Norway's Den norske stats oljeselskap expects to begin shipping about 12 bcm/year of gas from the North Sea through Europipe to markets in Germany by October 1995. Statoil is to build the Europipe tunnel with a combination pipe jack-telescoping method in which pairs of casing tubes are assembled on land - with the tunneling machine mounted on the lead tube - then driven into the tunnel with jacks.
Because of concern about crew safety, German authorities required the tunnel to be bored remotely from land. Work will have to stop periodically while workers enter the tunnel to change dull drillbits or make repairs.
In addition, Statoil and German officials are talking about the possibility of laying two more parallel gas lines across Europipe's 18 km route through the German wetlands. Environmental disruption caused by the extra pipelines would be small because it would be relatively simple to widen Europipe's trench and tunnel through the ecologically sensitive area. Preinstalling the wetlands passage would allow a trunkline to be tied in quickly and easily, when the need arises for another Norwegian gas line from the North Sea.
A decision must be made soon because pipelaying must begin in April if Norwegian producers are to begin selling gas to customers in Europe by October 1995, as planned.
Meantime, Norwegian officials late last year approved Statoil's new plan to move West Troll field oil by pipeline to the Mongstad, Norway, terminal (OGJ, Dec. 20, 1993, p. 33). The 85 km, 16 in. Troll pipeline is to be laid in 1995, with first oil to flow from West Troll Jan. 1, 1996. The Troll line capacity is to be 157,000 b/d.
GULF OF THAILAND
Gulf of Thailand gas production at the end of last month was to begin ramping up as gas to fuel an Electricity Generating Authority of Thailand (EGAT) power project near Khanom, in peninsular southern Thailand, began flowing through a recently completed Petroleum Authority of Thailand (PTT) pipeline from Unocal Thailand Ltd.'s offshore Erawan field processing center.
The flow of gas from the gulf to markets in eastern Thailand could double in early 1996 when a second large diameter subsea gas line is to be ready to start moving gas from Erawan northward to Rayong, Thailand.
Unocal is to produce some of the gas bound for Khanom through the 161 km, 24 in. line from Erawan, with the balance coming from Total Exploration & Production Thailand's Bongkot field, also in the gulf. Bongkot gas is flowing through a 172 km, 32 in. pipeline that began transporting gas to Erawan last October (OGJ, Jan. 24, p. 12).
A group led by Bechtel International Inc, provided engineering, project services, and construction supervision on the Bongkot and Khanom pipeline projects. Combined cost of the two lines was about $200 million.
Combined with Thailand's existing 433 km, 34 in. subsea trunkline from Erawan to Rayong in eastern Thailand, the new Bongkot to Erawan to Khanom system increases gas pipeline capacity out of the gulf to more than 1.1 bcfd.
That capacity is to nearly double by March 1996, when PTT completes a 425 km, 36 in. gas pipeline paralleling the existing Erawan to Rayong line. The $700 million project is to include an onshore gas receiving terminal, 110 km of 28 in. onshore pipeline from Rayong to Bang Pakong near Bangkok, and onshore and offshore compression.
PTT named Bechtel International prime contractor on the project.
YACHENG SUBSEA PIPELINE
Pipelaying began early last December on a subsea gas trunkline to link ARCO China's $1.2 billion Yacheng 13-1 field development in the South China Sea to markets in Hong Kong.
Pipelay contractor SEJV, a joint venture of Saipem and European Marine Contractors (EMC), expects to complete the 440 mile, 30 in. line in June. Yacheng 13-1 pipeline will be the longest subsea line built in a single lay season and second to Zeepipe in the North Sea as the world's longest offshore transmission line.
SEJV began laying pipe near the northern end of the subsea route, about 30 km south of Macau. The line is to traverse water as deep as 150 m before terminating near Hainan Island. Major Yacheng 13-1 pipelines include a 60 mile, 16 in. pipeline from the Yacheng 13-1 production installation to Hainan.
Yacheng 13-1 field production is to begin in January 1996. Deliveries to Hong Kong could peak at more than 330 MMcfd of gas and to Hainan at as much as 60 MMcfd of gas and gas liquids.
EMC's 1 Semac semisubmersible pipelay barge is installing the 440 mile Yacheng line with the help of two anchor handling tugs, four pipehaul vessels, and a dedicated route survey vessel.
SEJV set up support bases in China at Shekou and Zhanjiang.
Pipelay and support vessels arrived in the South China Sea early last November, following mobilization from the North Sea.
EMC is owned equally by Saipem, an operating unit of ENI Corp.; and Brown & Root Energy Services, a unit of Halliburton Co.'s Brown & Root Inc.
AUSTRALIAN GAS LINES
Australia's gas industry during 1993 continued increasing its share of domestic energy markets.
While export of liquefied natural gas offers Australian gas producers the greatest potential for profit, new pipelines are delivering more gas into domestic interstate and intrastate markets.
Earlier this year, the $150 million (Australian) Southwest Queensland pipeline was to transport the first shipment of Queensland gas to markets in South Australia (OGJ, Jan. 17, p. 30). The 190 km line traverses the Cooper Creek floodplain en route to gas treatment and distribution facilities at Moomba, in the northeast corner of South Australia.
South Australia is to receive 28.5 bcf/year of Queensland gas under a 10 year contract plus as much as 114 bcf in later years under another agreement. In addition, negotiations are under way for a third multiyear sale of 123.5 bcf of gas.
By the end of third quarter 1994, Northwest Shelf gas project partners are to begin transporting gas and gas liquids from Goodwyn A and North Rankin A offshore fields through a two phase, 97 mile pipeline system to a processing and LNG plant at Dampier on the northwest coast of Western Australia (OGJ, Jan. 3, p. 42).
Gas processed at Dampier is to move through a proposed $400 million (Australian), 95 MMcfd pipeline to gold and nickel mining operations near Kalgoorlie and Kambalda in south-central Western Australia (OGJ, July 15, 1993, p. 14). Total length of the pipeline system is estimated at 850 miles.
Construction of the Dampier-Kalgoorlie pipeline could begin in 1995, pending completion of studies by a joint venture formed late in 1993 by companies expected to take as much as 90% of initial deliveries. The system's mainline would have a diameter of 16 in. as far as Newman on the eastern slope of the Hammerly Range mountains and 14 in. on to Kalgoorlie.
OTHER ASIAN LINES
In other Asia-Pacific pipeline activity, South Korea's Hyundai Heavy Industries Co. Ltd. by mid-September expects to complete a 123 km offshore-onshore oil pipeline from Viet Nam's White Tiger field in the Con Sun basin of the South China Sea to Ba Ria, southeast of Ho Chi Minh City. Hyundai is to lay the line under a $150 million contract from Viet Nam's National Oil Equipment & Technology Export-Import Corp. (OGJ, Jan. 17, p. 29).
Design capacity of the White Tiger-Ba Rai line reportedly is larger than White Tiger's oil flow, fueling speculation that other discoveries in the area could be tied in to the system. Hyundai's contract includes 107 km offshore and 16 km onshore segments.
Meanwhile, a group of construction companies near yearend 1993 confirmed the feasibility of laying a $4.5-5 billion subsea line to transport gas from Oman to India beginning later this decade.
Based on a study disclosed in March 1993, companies studying the project recommended laying two parallel 24 in. lines, each about 1,000 km long, across the Arabian Sea to landfall in India's Gujarat state along a route traversing water more than 10,000 ft deep. An alternative shallow water route involves laying a 1,450 km, 36 in. or 42 in. pipeline across the mouth of the Gulf of Oman and along the continental shelf of Iran and Pakistan.
According to preliminary plans, the first of the twin 24 in. lines could begin service after 1997. The second line would be laid after completion of the first, boosting combined capacity in operation by 2000 to about 2.12 bcfd.
RUSSIAN ACTIVITY
Members of the Caspian Pipeline Consortium (CPC) are yet to set a starting date for construction of a proposed oil pipeline system from Kazakhstan's Tengiz field to the Russian seaport Novorossysk on the Black Sea.
After lengthy study of eight alternative routes, CPC last October settled on a 1,300 mile route around the northern shore of the Caspian Sea and picked a lump sum bid by Overseas Bechtel Inc. (OBI) for engineering, procurement, financing, and construction services on the project. The route was chosen mainly because it was the most politically and economically attractive of proposed alternatives.
Current plans call for a 500 mile, 42 in. pipeline to be laid from Novorossysk to the Russian city of Komsomolsk on the Caspian Sea. From Komsomolsk, an existing 40 in. pipeline would be upgraded to traverse the last 800 miles to near Tengiz. Cost of the project as it now stands is estimated at more than $850 million.
CPC members - Kazakhstan, Russia, Azerbaijan, and Oman - believe the Komsomolsk-Tengiz segment of the pipeline could begin service within 3 years of start of construction. Capacity at first would be about 300,000 b/d, expandable to 1.5 million bid in increments as needed. Eventually, Russian and Azeri crude oil also could reach world markets through the system.
ALGERIA-EUROPE GAS LINES
Efforts accelerated in 1993 to expand gas pipeline capacity by yearend 1996 to deliver Algerian gas to customers in Europe.
An expansion of the trans-Mediterranean pipeline, which since 1983 has been transporting gas from Algeria across Tunisia and the Sicily Channel to Italy, is to more than double trans-Med capacity to 2.5 bcfd. Adding compression after 1995 could boost capacity to 2.9 bcfd.
Meantime, construction is to start by third quarter 1994 on the Maghreb-Europe gas pipeline system. The system is to begin moving gas by early 1996 to markets in Spain and later possibly to markets in Portugal, France, and Germany (OGJ, Jan. 17, p. 49).
The trans-Med expansion includes laying about 1,366 miles of pipeline loop, building compressor stations in Algeria and Italy, and increasing compression at stations in Tunisia, Sicily, and Italy. A total of about 1,248 miles of 48 'M. pipeline is to be installed onshore in Tunisia, Sicily, and Italy and a combined 118 miles of dual 26 in. lines on subsea crossings of the Sicily Channel and Strait of Messina.
Enough of the trans-Med expansion had been completed by yearend 1993 to allow gas throughput of 671 MMcfd.
Current plans call for the 856 mile Maghreb-Europe pipeline is to be laid in four sections: 330 miles of 48 in. line in Algeria, 335 miles of 48 in. in Morocco, 30 miles of twin 22 in. subsea lines across the Strait of Gibraltar, and 170 miles of 36 in. and 48 in. in Spain. First stage construction will create capacity of about 700 MMcfd at a cost of $1.5 billion.
More compression could expand the system's capacity to 1.8 bcfd.
SOUTHEAST U.S.
Sponsors of large interstate pipelines competing for new gas customers in the U.S. Southeast are advancing their projects. Meanwhile, Gulf of Mexico producers in 1993 began expanding offshore gas gathering systems to provide transportation for growing supplies off Louisiana, Mississippi, and Alabama.
Florida Gas Transmission Co. (FGT) is on schedule to have its Phase III expansion in service by yearend 1994. The project is to increase FGT system capacity by 530 MMcfd to 1.4 bcfd.
The company expects to begin next month building three compressor stations and increasing horsepower at eight other stations as part of its $900 million Phase III expansion. FGT in March is to begin laying 815 miles of 30 and 36 in. line in four southeast U.S. states. The Federal Energy Regulatory Commission in mid-September 1993 approved FGT's expansion plans.
Transcontinental Gas Pipe Line Corp. (TGPL) this year expects to begin work on the first of three expansions to serve markets in the Southeast (OGJ, Oct. 4, 1993, p. 40). When the expansions are complete by yearend 1996, TGPL will have laid about 25 miles of 30 in. and 42 in. pipe and added 70,000 hp of compression in Alabama, Georgia, and North Carolina.
TGPL's 1994 expansion program could begin as early as June and add about 35 MMcfd of capacity by winter 1994-95 at a cost of $28 million. The company also expects to add about 165 MMcfd of capacity with a two phase expansion in 1995-96.
Phase I of the 1995-96 expansion is to begin in May 1995 and add 115 MMcfd of capacity by winter 1995-96 at a cost of $80 million. Phase II construction is to begin in May 1996, adding 50 MMcfd of capacity by winter 1996-97 at a cost of $19 million.
Meanwhile, units of Coastal Corp. and Florida Power Corp. (FPC) are awaiting Florida's approval of the intrastate portion of the proposed SunShine pipeline, a 600 mile interstate system originating at Pascagoula, Miss. (OGJ, Mar. 15, 1993, p. 34).
Late last month, SunShine partners were awaiting completion of a review by the Florida Department of Environmental Protection (FDEP) of the proposed line. FDEP is expected to rule on SunShine's application by mid-February, however, review by all state regulatory agencies is expected to take most of 1994.
SunShine's intrastate segment would extend east and south from Okaloosa County in the Florida Panhandle before terminating in Polk County in the central part of the state. Construction of the line could begin early in 1995, with completion expected by yearend.
Utilities and local distribution companies so far have agreed to take 196.7 MMcfd of gas in 1995, growing to 311.7 MMcfd by the end of 1999. Negotiations are under way for additional transportation volumes.
GULF GATHERING SYSTEMS
Competition in 1993 began heating up among Gulf of Mexico gathering pipelines to tie in supplies of gas to serve new markets in the U.S. Southeast.
During spring 1993, Dauphin Island Gathering Partners, a 50-50 venture of Offshore Energy Development Corp., The Woodlands, Tex., and the Enron Gas Gathering Inc. unit of Enron Gas Services, Houston, completed construction of a 20 in., 12 mile extension of Dauphin Island Gathering System (DIGS) from north of Dauphin Island to shore. The project created a 70 mile, 400 MMcfd pipeline corridor from Mobile Block 821, in federal water off Alabama (OGJ, Jan. 10, p. 21).
DIGS partners last month began laving a 40 mile, 20 in. extension of the gas gathering system across federal water south of Mobile Bay. That span in third quarter 1994 is to begin gathering low sulfur gas from wells in the Mobile federal planning area and in the northern tier of Viosca Knoll area tracts. The size of the line will allow for capacity expansions as the need for gas transportation in the area grows.
DIGS at yearend 1993 was shipping 70-80 MMcfd of gas from Miocene wells just outside Mobile Bay. DIGS transportation volumes by spring could exceed 100 MMcfd and by fall could reach 150-200 MMcfd.
TENNECO GATHERING SYSTEMS
Rising gas production in and around Mobile Bay prompted Tenneco Gas Gathering Co. in October 1993 to announce plans to lay a 200 MMcfd gathering pipeline in the area.
The company in 1993 applied to the Army Corps of Engineers for permits to lay the pipeline and early last month was preparing to order pipe for the project. The 20 in., 30 mile line at first will connect Mobile Block 916 field wells to the interstate gas pipeline systems of Koch Gateway and Transcontinental Gas Pipe Line Corp. in Southwest Alabama.
Tenneco expects to call for construction bids in February and start construction as early as April or May. The line could be in service by October or November.
Meantime, Tenneco and Leviathan Gas Pipeline Partners LP, Houston, late last month agreed to lay 95 miles of 20 in. gas pipeline off Louisiana from a Shell Offshore Inc. platform on Main Pass Block 252 to an interconnect with a Tennessee Gas Pipeline Co. transmission line on South Pass Block 55. Plans include laying a 6 mile, 16 in. lateral from Viosca Knoll Block 817 to an interconnect with a Southern Natural Gas Co. line on Main Pass Block 289.
Leviathan and Tenneco each are to own a 30% interest in the 400 MMcfd Viosca Knoll Gathering System (VKGS). Leviathan is to install the platform on Viosca Knoll 817, ownership of which eventually could be split equally between Leviathan and Tenneco.
VKGS partners at the end of January were negotiating transportation agreements with Shell and other gas producers in the area and conducting preliminary surveys and materials procurement. Pipeline installation is to start during summer 1994, with gathering to begin by fourth quarter.
WESTERN U.S.
Efforts to further integrate the large North American gas transmission system slowed somewhat last year, but a handful of big projects went on line.
Northwest Pipeline Corp., Salt Lake City, in second quarter 1993 officially began flowing gas through its $432 million, 443 MMcfd expansion (OGJ, Nov. 15, 1993, p. 49). The project included laving 362 miles of loop, adding 113,572 hp of compression, and requalifying 89 miles of existing pipeline at a higher pressure.
Northwest's system stretches from the U.S.-Canadian border near Sumas, Wash., to the Blanco hub in Northwest New Mexico. The expansion increased system capacity to 2.4 bcfd.
Northwest plans to expand capacity again by fourth quarter 1995 by adding gas turbine compressor stations at Sumas and Tumwater, Wash., and Lava Hot Springs and Owyhee, Ida. The company in October 1993 let a $2 million engineering design contract to John Brown, Tulsa. Detailed design and engineering are to be complete in August, and construction is to begin in the fourth quarter.
Pacific Gas Transmission Co. (PGT), San Francisco, last Nov. 1 began flowing gas through facilities included in a $1.6 billion, 900 MMcfd expansion of its Alberta-California system. About 800 miles of mainline was included in the project.
PGT by yearend 1995 expects to add another 300 MMcfd of capacity to its system. Included in the $200 million expansion are two 12 in. laterals, a 75 mile, 40 MMcfd line to Boardman, Ore., and an 18 mile, 30 MMcfd line to Medford, Ore.
Part of PGT's new capacity in 1995 is to transport gas for customers in northeast California, northern Nevada, and Reno served by Tuscarora Gas Transmission Co., a unit of Sierra Pacific Resources Co., Reno. The gas is to flow through a 200 mile, 120 MMcfd pipeline that Tuscarora and TransCanada PipeLines Ltd., Calgary, plan to lay between Reno and PGT (OGJ, Mar. 15, 1993, p. 32). The $130 million Tuscarora-TransCanada line also is to be completed in 1995.
In the U.S. Northeast, Empire State Pipeline last November began shipping gas from the U.S.-Canadian border near Niagara Falls to Rochester, N.Y. (OGJ, Nov. 15, 1993, p. 31). Deliveries began from Rochester to Syracuse, N.Y., in mid-November. Construction of the 24 in., 155 mile line began in June 1993, after 5 years of planning and regulatory reviews.
Empire State throughput at start-up amounted to 200 MMcfd of gas for utilities and power generators in western and central New York. Throughput by 1995 is to increase to more than 400 MMcfd.
SOUTH AMERICA
Pipeline construction plans figure heavily in proposals to expand oil and gas export capacity in South America.
Construction plans include large diameter crude oil pipelines in Colombia and Ecuador and gas transportation pipelines in Bolivia, Brazil, and Chile.
About mid-1993, BP Exploration Co. (Colombia) Ltd. revealed plans to expand oil pipelines in Colombia to handle increased production from its Cusiana and Cupiagua fields (OGJ, May p. 10, 1993, p. 30).
Through mid-1994, about 10,000 b/d of Cusiana oil is to move through a 12 in. Empresa Colombiana de Petroleos (Ecopetrol) pipeline from Araguanay to the Caribbean coastal oil terminal at Covenas.
By 1995, BP intends to lay a 20 in. oil pipeline from Cusiana field to the 75,000 b/d Central Llanos pipeline at El Porvenir and a 30 in. loop to upgrade the Central Llanos section of the 150,000 b/d Oleoducto de Colombia pipeline carrying oil to Covenas. With a combined cost of $300 million, the two projects will allow BP and partners to step up Cusiana production to 1,50,000 b/d by yearend 1995.
BP's pipeline options in Colombia after 1995 include the possibility of a new oil line, a further upgrade of the Araguanay-El Porvenir-Covenas line, or tying into Occidental Petroleum Corp.'s Limon-Covenas pipeline that passes north of Cusiana.
TRANS-ECUADORIAN EXPANSION
Ecuador earlier this year announced plans to begin expanding capacity of the 503 km trans-Ecuadorian pipeline system (SOTE).
State owned Petroleos del Ecuador (Petroecuador) next month is to call for construction bids by private companies. Winner of Petroecuador's pipeline construction bidding round will operate the entire trans-Ecuadorian system after the expansion, and all transporters will pay a tariff to use the expanded system.
Petroecuador is developing an engineering plan that would expand the export pipeline's capacity to 450,000 b/d. Current SOTE throughput averages about 325,000 b/d.
The state plan under development is to be a vehicle with which to compare bids by competing companies, but alternative expansion plans will be considered before a winner is named.
Ecuador's plans include construction of a 171 km, 18 in. crude oil line from ARCO's Villano field to an interconnect with SOTE at Baeza. About 80,000 b/d of the 120,000 b/d Villano-Baeza pipeline capacity will be needed for heavy Villano oil and the balance for new fields expected to be developed as a result of Ecuador's seventh bidding round.
Petroecuador estimates the expansion will have to be completed within 24 months after the award is announced to handle the country's expected export volumes in 1996.
Despite Ecuador's proposed pipeline construction, a World Bank study concluded SOTE's capacity could be expanded enough to handle expected production by adding 10 pump stations. Construction of a loop is not required.
CHILEAN GAS NETWORK
Feasibility studies are to be complete by yearend for a proposed expansion of gas transportation and distribution pipelines in Chile. The proposal includes linking gas supplies in Argentina's Neuquen basin to an expanded Chilean gas pipeline system.
Plans call for project construction to get under way in 1995. Parts of the expanded gas pipeline system could begin transporting gas early in 1997. Work on the network's transmission lines would be completed first, while construction of the distribution lines could span 10-15 years.
Billed as the largest pipeline project in Chile's history, preliminary plans include 750 miles of 24-28 in. mainline and laterals in Chile and about 3,000 miles of distribution lines as large as 28 in. to Santiago and other cities.
Estimated costs include $600 million for the transmission portion of the system and as much as $1.5 billion for the entire network.
Chile in October 1993 named Tenneco Gas operator of the 500 MMcfd transmission portion of the proposed project and British Gas plc operator of the expanded distribution system. The transmission system would cross the Andes Mountains into Chile and the distribution system.
Argentina's Yacimientos Petroliferos Fiscales (YPF) in fourth quarter 1993 agreed to join a group of companies developing plans to construct the trans-Andean portion of the system. When the network is fully operational, as much as 175 MMcfd of gas could enter Chile from Argentina.
BOLIVIA-BRAZIL GAS LINE
Argentina also wants to be included in plans to expand and integrate South America's gas pipeline grid to serve emerging markets in Brazil.
However, current plans for the long discussed Bolivia-Brazil gas pipeline, sponsored by Petroleo Brasileiro SA (Petrobras) and Yacimientos Petroliferos Bolivianos (YPFB), do not include YPF. Instead, Petrobras and YPFB have turned to Tenneco, British Gas plc, and BHP Petroleum for their combined knowledge of resource development, gas pipeline transportation and distribution systems, and international power generation projects.
As now conceived, the integrated Brazil-Bolivia gas transmission and distribution grid would stretch 2,200 miles across the two countries. Plans include speeding development of Bolivian gas reserves and creation of new gas markets in both nations.
If financing for the multiyear pipeline project can be completed, crews could begin laying the system's $1.5 billion first segment as early as second half 1995, with service to begin by yearend 1997. Gas on the first pipeline span could move from Rio Grande, Bolivia, about 1,180 miles to Sao Paola, Brazil, then south 208 miles to Curitiba in Brazil's Parana state.
Gas volumes in the first Year could reach 280 MMcfd and double by the end of the third year of operation. The system eventually is to extend another 418 miles south to Porto Alegre in Rio Grande do Sul state.
Earlier plans called for a 1,900 mile system extending north from Campo Duran, Argentina, to Santa Cruz, Bolivia, then east to Sao Paulo, Brazil, with laterals to large markets in areas traversed by the pipeline (OGJ, Feb. 8, 1993, p. 25).
To give Brazil a reason to support Argentina's inclusion in the Southern Cone gas pipeline grid-and as part of the campaign to privatize Argentina's oil and gas industry-YPF has granted development rights to Petrobras in fields in the northern Argentine provinces of Santa Cruz and Salta.
Copyright 1994 Oil & Gas Journal. All Rights Reserved.