Table of Contents

• New methods boost 4D seismic role in reservoir management
  Seismic receiver network placed at the seabed to get high repeatability in 4D seismic (Fig. 1; photo courtesy BP FARM.) Seismic source monitoring system to check the repeatability of the seismic source signal (Fig. 2 [29,656 bytes] ).
• Neural network classification method helps seismic interval interpretation

  The shape of a seismic wiggle trace and its geologic use can help classify a seismic interval parallel to a horizon in a 3D data volume. A new technology that uses neural network methods for pattern recognition successfully applied this classification method to geological interpretation of seismic data in central South Texas.

• 3D full tensor gradient method improves subsalt interpretation
  Imagine you're working the deepwater Gulf of Mexico, looking for potential subsalt prospects to guide your company's bidding in an upcoming lease sale. There are no speculative 3D surveys in the area, just 2D seismic and a few well logs. So you obtain some regional 2D lines across a number of promising salt features and begin your initial structural interpretation.
• Seismic pressure-prediction method solves problem common in deepwater Gulf of Mexico
  A novel method of predicting pore pressure gradients from seismic velocities has overcome a problem common in the deepwater Gulf of Mexico. The method, based on a model of geopressures that uses available formation temperature measurements, does not require the normal shale compaction trend. This is crucial in deep water, where geopressures often start shallow below mud line and make establishing the normal trend difficult.
• How to achieve value behind the deal during merger integration
  Mergers and acquisitions (M&A) have long been a part of the oil and gas industry. For the most part, however, mergers have been asset plays-acquisitions of properties or infrastructure to "round out" a portfolio. In these cases, post-merger integration-the formation of the new company after a deal is closed-became an exercise of assimilating the acquired property or company. The integration effort-measured in time or resource requirements-was not significant.
• U.S. petroleum industry acquisition activity on track for record year
  ACQUISITION ACTIVITY IN THE U.S. oil industry appears poised to set records this year, based on early third quarter statistics. A summary of upstream acquisition and divestiture (A&D) activity by Randall & Dewey Inc., Houston, reveals that, following second quarter activity that was slower than in 1997, recently announced deals such as the enormous BP-Amoco alliance virtually assure that 1998 will set a record for transaction volume, "perhaps a headline-grabbing double the $23 billion recorded
• Canadian petroleum company acquisitions up, financings down
  Canadian M&A Activity, First Half [77,226 bytes] First Half Canadian Oil Industry Financing [68,747 bytes] CANADIAN ENERGY FIRMS SET a record for merger and acquisition (M&A) activity in first half 1998. The total value of M&A transactions during the period was $10.1 billion (Canadian), an increase of $2.2 billion, or 28%, from the same period last year, and almost double that of first half 1996 (see chart this page). These are the conclusions of Calgary-based Sayer Securities Ltd.'s
• Shell/Texaco pursues European R&M merger
  Shell Europe Oil Products Inc.'s Stanlow refinery in the U.K. has 260,000 b/d crude distillation capacity and supplies the industrial north and midlands of England. Despite Shell's earlier decision to close its Shell Haven refinery on England's south coast to balance supply and demand, the inclusion of Texaco's Pembroke refinery puts the Shell/Texaco combine in surplus for products in the U.K. Photo courtesy of Shell. [111,960 bytes]
• Multinationals lining up for Brazil's boom
  Multinationals are lining up for the rush to begin for investment in Brazil's newly demonopolized petroleum sector. Most of the initial focus is on upstream joint ventures, especially in the prolific deepwater Campos basin off Rio de Janeiro state. But companies also are pursuing downstream investments in Brazil as well (see related story, this page).
• Oil and gas key to Russia's revival
  Russia's parliament last week rejected for the second time the reappointment of Victor Chernomyrdin as prime minister. President Boris Yeltsin sees Chernomyrdin as the best hope for repairing the economic and political damage caused by the ruble's freefall. The energy industry is probably the only sector strong enough to halt Russia's decline into chaos, and Chernomyrdin's experience as prime minister, energy minister, and head of Gazprom may be critical. Russia's oil
• Russian roundup
  U.S. President Bill Clinton and Russian President Boris Yeltsin have agreed that several pipelines will be needed to bring Caspian oil production to western markets. After a 2-day summit with Yeltsin, Clinton said, "Multiple pipeline routes are essential to bring energy from the Caspian region to international markets and to advance our common security and commercial interests."
• INDUSTRY BRIEFS
  A Japanese tanker spilled 1,610 bbl of gas oil off northern Japan Sept. 4 after colliding with a small fishing boat, a coast guard official said. The 998-metric ton tanker, No. 8 Daiju-maru, struck the boat 25 km off Esashi, Hokkaido, in the Sea of Japan. "The tanker lost all the light oil it carried following the collision," the official said. "But since it was not crude oil, the impact of the leakage on the environment is likely to be limited." No one was injured in the accident. Norway's

• U.K. tax uncertainty
  The U.K. government has responded to uncertainty over North Sea fiscal policy by declaring that taxes on oil and gas won't increase-at least not immediately. Last week's announcement gave producers little to cheer. They have had to plan investments around the threat of a tax hike since July 1997, when the Treasury began a review of the offshore oil and gas fiscal regime. The tax uncertainty has combined with slumping oil and gas prices to chill exploratory drilling and stall several

• Sasol eyes options for Mozambique gas
  Sasol Ltd., Johannesburg, plans to study the feasibility of three options for development of the Temane gas find in Mozambique. The company is a partner in the recent Temane-3 appraisal well drilled 600 km northeast of Maputo by license operator ARCO Mozambique (Temane) Ltd. (for well results see related story, p. 98). The Temane discovery was made by Gulf Oil Corp. in 1956, but the company relinquished the license after drilling an appraisal well in 1967. Now ARCO and partners plan to drill up
• Temperature model provides information for well control
  Equations [20,865 bytes] Equations [20,094 bytes] The misinterpretation of well bore signals, especially those concerning drilling-fluid temperatures and volumetric expansion, has been identified as a key problem when drilling high-pressure, high-temperature (HPHT) wells offshore Norway. Several severe incidents have occurred over the past 8 years, the worst case being an underground blowout that took 1 year to control.
• Shell, Mobil to form Australian refining JV
  Shell Australia Ltd. and Mobil Oil Australia Ltd. have signed a memorandum of understanding (MOU) to combine their Australian refining operations into a new 50-50 joint venture. If approved, the move will create a firm with 400,000 b/d of refining capacity, putting both partners among Asia's most prominent downstream players. More important, the companies say the new JV will provide the economies of scale Australian refiners desperately need to match the large export refineries in the
• Thyssen plans world-class grassroots refinery in Brazil
  THYSSEN INTERNATIONAL, part of German group Thyssen Krupp AG, plans to invest about $2 billion to build a world-class grassroots refinery in northern Brazil. Thyssen International Chairman Hans Ulrich Gruber disclosed that, after about 8 months of negotiations with the government of Cear state in northern Brazil, the company has formally requested permission from Brazil's National Petroleum Agency (ANP) to proceed with the project. Sources at ANP said that the request will most likely be

• NMR enhances mass-spec FCC feedstock characterization
  To characterize fluid-catalytic cracking (FCC) feedstock, Stone & Webster Engineering Corp. (SWEC) and Institut Français du Pétrole (IFP) adopted a combination of conventional physical properties coupled with detailed Hreims (high-resolution electron-impact mass spectrometry) and an NMR (nuclear magnetic resonance)-based MIFF (magnetic imaging of FCC feedstock) system. These combined technologies yielded significantly improved predictions over the conventional approaches for feedstock

• Trays, process changes improve frac plant operation
  Modifications at Shell Midstream Enterprises' Norco, La., NGL fractionation plant are ongoing but have already resulted in improved performance and efficiencies. (Photograph courtesy of Shell Midstream Enterprises, Houston) The Shell Norco, La., NGL fractionation plant is being revamped from a nominal feed capacity of 43,000 b/d to 70,000 b/d. This was achieved with existing columns and process heaters but also with addition of several heat-integration measures and replacement of the column

• API urges quick NPR-A leasing
  The American Petroleum Institute has urged the Bureau of Land Management to set an early date for lease sales in the northeastern area of the National Petroleum Reserve-Alaska (NPR-A). The Interior Department recently decided to allow renewed leasing in the reserve (OGJ, Aug. 24, 1998, p. 26). A sale is expected next summer. API said expedited leasing would maximize an opportunity to offset the decline in U.S. oil and gas production. It said the oil industry's record on the North Slope
• New depositional model improves outlook for Clear Fork infill drilling
  For over 30 years, the Clear Fork Group (Leonardian), a major reservoir interval of the Permian Basin with nearly 1 billion bbl of original oil in place, has been interpreted as an arid or semi-arid deposit. Thin-bedded, anhydrite-bearing dolostones of the Clear Fork have been deposited as the result of cyclic sedimentation in an evaporitic 1 or, more specifically, a sabkha/salt pan-type setting. 2 Until very recently, such models have gone unquestioned despite mounting evidence for more

OGJ Newsletter

• OGJ Newsletter
  The recent flurry of merger and acquisition activity and the softening of reserves values are indicators of a transition from a seller's market to a buyers' market, says Cornerstone Ventures (see story, p. 22). Illustrating this transition is the $385 million (Canadian) acquisition of Barrington Petroleum by Sunoma Energy (OGJ, Sept. 7, 1998, p. 42).