INDUSTRY BRIEFS

Exploration

BHP Petroleum Pty. Ltd. obtained an exploration license for Block W94-10 in the Timor Sea off Northwest Australia. The block is in the Bonaparte basin next to the AC/P8 permit area, which contains the Laminaria and Corallina oil discoveries, and next to the Australia-Indonesia Zone of Cooperation, where industry has found a string of oil fields.

Taiwans Chinese Petroleum Corp. plans to sign an agreement with one or more Chinese oil companies to conduct joint seismic surveys of Chinas Pearl River delta.

LPG

Calor Gas Ltd., a U.K. liquefied petroleum gas supplier; and joint venture partner SHV Energy BV, Netherlands, paid $62 million for a 49% interest in Brazils fourth biggest LPG distributor, Supergasbras Distribuidora de Gas SA. Earlier, Calor and SHV bought a majority interest in Minasgas, Brazils fifth largest LPG distributor. The two Brazilian firms can supply a combined 1.35 million metric tons/year of LPG.

Drilling-production

ARCO China Ltd. started gas sales from two platforms in Yacheng 13-1 field in the South China Sea off Chinas Hainan Island to Hong Kong through a 778 km pipeline, capping an 11 year, $1.2 billion project. Yacheng 13-1, Chinas biggest offshore gas field with reserves of 3.4 tcf, will deliver 277 MMcfd to feed a Hong Kong power plant. Plans also call for delivering 53 MMcfd to a power plant and chemical plants on Hainan Island through a 91 km pipeline from the field.

Amoco Canada Ltd. estimates costs of killing an Alberta oil and gas well blowout and cleaning up a resulting oil spill will run in the millions of dollars. Amoco crews last week were still working to control the Evansburg well, which had spewed as much as 1,000 b/d of oil since Dec. 21. On Dec. 25, Amoco spudded the first of two relief wells. The company said the blowout was caused by a casing failure at 50-200 m.

U.K. Health & Safety Executive last week continued to investigate the cause of AMEC plcs Howden fabrication yard blast that killed three workmen and injured four (OGJ, Jan. 1, p. 26). HSE said there was a catastrophic pressure release while workers were pressure testing pipework on a platform module being commissioned for installation in a Danish North Sea oil field.

Australias Western Mining Corp. and partners signed a long term gas supply contract covering delivery of gas from East Spar gas/condensate field off Western Australia. BHP Minerals will take 8.55 MMcfd to generate power at its iron ore mine at Newman in the Pilbara region beginning in March. That brings total East Spar gas under contract to 52.3 MMcfd, with a maximum of 58 MMcfd, all dedicated to Western Australian mines. East Spar is to start up in October, so BHP will be supplied by alternate sources until then.

Abacan Resources Corp., Calgary, raised $36.5 million from U.S. and European investors to develop NGO oil field off Nigeria. The company and its Nigerian partners plan to produce about 50,000 b/d of oil from their Nigerian concessions starting this year (OGJ, Jan. 1, p. 26).

Titan Resources LP, Midland, Tex., closed the purchase of Permian basin producing leases in Texas and New Mexico from Anadarko Petroleum Corp., Houston, for $42.3 million cash. The leases consist of interests in 21 fields12 operated and nine nonoperated. Total net production is 1,200 b/d of oil and 10 MMcfd.

Vintage Petroleum Inc., Tulsa, closed its purchase of producing acreage from Shell Cia. Argentina de Petroleo SA for $38.7 million. Involved is Shells 65% working interest in seven concessions on the southern flank of Argentinas San Jorge basin. The purchase raises Vintages working interest in the seven concessions to 100%. Production is about 3,960 b/d of midgravity, sweet crude from reserves estimated at 22.6 million bbl as of last Sept. 30. Plans call for boosting production through workovers, development and extension drilling, and improved and new waterfloods.

South Koreas Korea Petroleum Development Corp. agreed to buy a 15% interest in the U.K. North Seas Captain oil field from Texaco Ltd. for about $210 million. Captain, with reserves of more than 300 million bbl, is to start production at 60,000 b/d in fourth quarter 1996.

MESA Inc., Dallas, sold all of its January Gulf of Mexico gas production, 43 MMcfd, for $3.10/Mcf, the highest price it has received for offshore gas since June 1986. That compares with a price of $1.58/Mcf MESA received for 40 MMcfd of Gulf Coast production in January 1995.

Terminals

Kuwait Petroleum Corp. (KPC) let a $350 million contact to China National Petroleum Corp.s engineering and construction arm to construct two crude oil tank farms in Kuwait. Work is to be complete in 3 years. KPC said the project will enable it to hike Kuwaits productive capacity by 410,000 b/d to 2.5 million b/d.

Gas processing

Morrison Petroleums Ltd., Calgary, will build a $48 million (Canadian) gas processing plant in Bulrush gas field, 65 miles north of Fort St. John, B.C. The raw gas processing plant and related pipeline facilities will be completed in 1996.

Williams Field Services Group doubled capacity of the Echo Springs, Wyo., gas processing complex plant its owns with Union Pacific Resources to 240 MMcfd by adding a cryogenic unit and 17,000 hp of compression. The complex is tied to transmission systems of Williams Natural Gas Co. and Colorado Interstate Gas Co. The latter recently added a 12 in. loop line to boost the Echo Springs complex takeaway capacity to 300 MMcfd.

Refining

Tosco Corp. expects to close Feb. 1 its purchase of BP Oil Co.s 180,500 b/d Marcus Hook, Pa., refinery and related U.S. Northeast downstream assets for $235 million. Because of a lack of agreement with the Oil, Chemical, and Atomic Workers union local at the Marcus Hook refinery, Tosco asked BP to turn over the refinery in a shutdown mode. Tosco said it could operate the refinery profitably only if it cut about 130 of the plants 530 jobs. Contract talks with the union later collapsed. Tosco expects to use its 240,000 b/d Bayway, N.J., refinery to supply the retail system it is acquiring from BP.

Texaco Refining & Marketing Inc. let contract to CDTech for process license and basic engineering for a first of its kind CDHydro unit for selective hydrogenation of benzene in reformate feedstocks. Texaco will install the unit and an associated reformate splitter column at its 57,760 b/d Bakersfield, Calif., refinery to produce reformulated gasoline.

Singapore Refining Co. Pte. Ltd. started up an effluent-refrigerated sulfuric acid alkylation unit at its 270,000 b/d refinery on Pulau Merlimau, Singapore. The 4,500 b/sd unit, which processes butylene feedstock, is part of SRCs new resid catalytic cracking complex (OGJ, Aug. 14, 1995, p. 39).

Chevron U.S.A. Products Co. licensed Setpoint Inc.s InfoPlus-X real time process monitoring system and associated applications. The system will be installed in Chevrons U.S. refineries as part of a multiyear program to modernize and standardize plant process monitoring.

Agip Petroli SpA let contract to Ralph M. Parsons Co. Ltd. for engineering support services related to upgrade of the Claus unit at Agips Venice refinery. Agip will install the Parsons/BOC oxygen-enhanced sulfur recovery process, which minimizes sulfur emissions during refining of high sulfur crudes. The upgrade will increase refinery sulfur production to 45 tons/day from 30 tons/day.

Petrochemicals

Taiwans Investment Commission approved plans by Taiwan Synthetic Rubber Corp. (TSR) for an $85 million joint venture to build a polybutadiene rubber plant in Thailand. Thai Petrochemical Industry Co. will control a 51% interest in the project, with TSRC holding 12% and two undisclosed Japanese partners the remainder. TSR also will supply technology to the venture. Construction is to begin early this year and be complete in late 1997. Initial output will be 65,000 metric tons/year for domestic and export sales.

Taiwans

China Petrochemical Development Corp. (CPDC) plans to build an $80 million acrylonitrile butadiene styrene (ABS) plant at Guangzhou, China. CPDC set up a holding company in Hong Kong to enter into a venture with a Chinese ethylene producer to develop the project. The plant is to start up this year and produce 60,000 metric tons/year of ABS.

Sud-Chemie AG, Munich, will take over the petrochemical catalysts business of EniChem SpA, Milan. The deal includes production and marketing rights, manufacturing plants, and know-how for catalysts used in cumene synthesis, olefin oligomerization, and oxychlorination. Sud-Chemie will continue to supply cumene catalysts to EniChem.

Companies

Amoco Canada will sell its remaining shares in Crestar Energy Inc., Calgary, as part of a divestiture commitment it made to Ottawa when it acquired Dome Petroleum Ltd. in 1988. The sale is scheduled early this year. Amoco earlier agreed to sell its 50% interest in Crestar but retained 7 million shares.

Mobil Exploration & Producing U.S. Inc. is completing a restructuring that will cut 500 jobs by Mar. 31. Mobil operates about 260 U.S. oil and gas fields and employs 3,300 in 10 states and the Gulf of Mexico. The restructuring also will result in loss of 30 jobs at Mobil Drillings U.S. unit. Mobil will book a $21 million after tax charge against fourth quarter 1995 earnings related to the move. Mepus expects the restructuring to cut pretax operating costs by $100 million by yearend. It is restructuring to refocus spending on fields that have the greatest potential.

Research

U.S. Department of Energy will set up a national energy technology center by June to oversee fossil energy technology development programs. The center will be formed as the result of consolidating DOEs Morgantown, W.Va., and Pittsburgh, Pa., energy technology centers and a DOE field office in Golden, Colo.

Tankers

U.S. Coast Guard is seeking further comment on its proposed rulemaking to require structural improvements for tankers larger than 5,000 gross tons that do not have double hulls.

Pipelines

Williams Cos., Tulsa, agreed to buy Tenneco Energys 50% interest in Kern River Gas Transmission Co. for $205 million, giving it 100% ownership of the 904 mile gas pipeline from Opal, Wyo., to Daggett, Calif. Questar Pipeline Co., Salt Lake City, dropped its $225 million bid for the Kern River pipeline at yearend 1995 when the U.S. Federal Trade Commission, citing antitrust concern, threatened to seek a court order to block the purchase.

Phillips Petroleum Corp. unit GPM Gas Corp. closed purchase of all stock of two Enron Corp. units that operate 3,200 miles of gas gathering lines, mainly in the Anadarko basin of Oklahoma and Texas. The system gathers about 280 MMcfd through 1,900 meter stations. GPM plans early this year to lower line pressure on some of the acquired systems as well as offer processing services on some systems for the first time.

Trailblazer Pipeline Co., Lombard, Ill., is conducting an open season through Jan. 31 to determine the feasibility of expanding its system. Trailblazer is considering expanding its 445 mile line from Weld County, Colo., to Gage County, Neb., by building a compression station near Wellfleet in Lincoln County, Neb. The station could be on line by August 1997.

Aquila Gas Pipeline Corp., San Antonio, completed its 25 mile, 24 in., 225 MMcfd Southern Extension pipeline. It connects Aquila gas gathering facilities in southern Grimes and Washington counties, Tex., with its Katy pipeline. Aquila expects the added capacity to encourage more Cretaceous Georgetown formation development in the Independence area of the downdip Austin chalk trend, crimped by lack of pipeline capacity since mid-1995.

Gas distribution

Pacific Enterprises unit Pacific Enterprises International signed a memorandum of understanding to acquire from Citicorp Equity Investments SA a 12.5% interest in each of Argentine natural gas utility holding companies Sodigas Pampeana SA and Sodigas Sur SA for a total $47-52 million. Each holds a controlling interest in gas distribution companies operating, respectively, in Argentinas Pampeana and Sur regions. Combined, the two companies, privatized in 1992, distribute about 625 MMcfd to 1 million customers.

Exports-imports

Taiwans CPC expects to begin importing crude oil from Alaskas North Slope (ANS) as early as April. CPC reportedly is near agreement with undisclosed North Slope producers to purchase about 10,000 b/d of ANS crude. The U.S. government recently lifted a ban on exports of ANS crude.