Table of Contents

• Successful fishing operations requires teamwork, risk management
  This piranah mill is designed to eliminate the possibility of coring while milling up the cemented pipe (Fig. 1). This cone-buster mill is designed to mill up bit cones and loose junk (Fig. 2). [13,589 bytes] Bladed mills are used to mill up cement, junk, and packers (Fig. 3). [13,620 bytes] This concave mill shows wear features incurred after milling off a tool joint (Fig. 4). [14,416 bytes] Boot baskets catch junk during the milling operation. Once the pumps are kicked out, material falls
• Russia shares technical know-how with U.S.
  Rigs similar to this Burovaya Ustanovka 75 metric-ton unit on location in the Sergeevskiya field, helped drill more than 3,200 wells in Bashkiria using electrodrill technologies. In 1988, Bashneft drilled 205 wells with the electrodrill, falling to 37 in 1997 (Fig. 1). Photo courtesy of Bashneft. This workshop in Ufa, Bashkiria, shows the variety of components used in electrodrill technologies (Fig. 3). Photo courtesy of Bashneft. [42,507 bytes]
• Guidelines provide framework for deepwater drilling operations
  An industry task force has compiled guidelines based on current knowledge and best practices to help operating and service companies work safer and more efficiently in deep water. According to committee member Stan Christman of Exxon Upstream Development Co., "From the start, our philosophy was to prevent incidents in the first place rather than react to them. Because of this emphasis, the largest section of the guidelines is devoted to well design and well control planning."
• Clinton administration opposes tax credits
  The Clinton administration is opposing legislation that would provide tax credits for U.S. producers beset by record low oil prices. The tax-writing House Ways and Means Committee has legislation pending that chairman Bill Archer (R-Tex.) may include in a tax bill this spring. One bill would allow a marginal well tax credit of up to $3/bbl when oil prices are $14/bbl or less, and 50¢/Mcf when gas prices are $1.56/ Mcf or less. The credits would phase out after oil prices rose to $17/bbl
• Supply-demand disparity tops 1998 oil trends
  Global oil markets were characterized by oversupply and falling prices in 1998. This trend marked a turnaround from recent years, when supply and demand were relatively balanced. Demand growth began to slow in late 1997, as the effects of the Asian economic crisis began to take hold. But markets did a turnaround in 1998, and demand growth for the year was at its lowest level since 1985.
• White House summit
  U.S. Energy Sec. Bill Richardson has released a barrage of small measures to help oil companies through the current depression, and has more coming. So far, none of the Energy Department initiatives would improve producers' bottom line (OGJ, Feb. 22, 1999, p. 24). That's one reason small producers want federal tax relief for marginal wells. Although the Treasury Department-somewhat predictably-opposes such tax breaks (see story, p. 30), Richardson maintains it's not a dead issue yet.
• Petroleum industry opportunities persist despite downturn
  Contrary to the opinion of some observers outside the industry, petroleum does have a future, and that future is full of opportunities and challenges. So said several speakers at Cambridge Energy Research Associates' annual CERAWeek conference, held last month in Houston. Despite the current downturn, many in the industry remain optimistic about opportunities for growth and profit in oil and gas. One reason for this optimism is increasing access to reserves in areas that were formerly
• Venezuela plans to fine tune 'La Apertura'
  Venezuelan Energy and Mines Minister Ali Rodriguez has pledged that the new government of President Hugo Chávez will continue the country's policy of opening the oil industry to foreign investment, called La Apertura. "Of course, we will honor all commitments made by the Republic of Venezuela," said Rodriguez. "Nevertheless, we need to address and resolve, once and for all, the legal and fiscal inconsistencies with which the Apertura was conceived and approved."
• Nigeria's oil hopes
  On Mar. 1, Nigeria declared Olusegun Obasanjo its new president elect, the country's first democratically chosen leader in 15 years. The return to democracy in Nigeria after years of sometimes brutal military rule has been welcomed by foreign petroleum companies with investments there. Whether the new political set-up will lead to an end to the civil unrest, kidnappings, and killings that have caused oil companies to shut in operations remains to be seen.
• Seris compares global gas firms
  Spanish distribution and transmission company Gas Natural SDG is the most dynamic natural gas firm in the world, based on its increase in customers, throughput, and revenues in 1997. This is the finding of Sheffield Energy & Resources Information Services (Seris), Sheffield, U.K., which ranked 170 gas companies from 49 countries according to production, reserves, throughput, and financial performance in 1997.
• INDUSTRY BRIEFS
  Boral Ltd.,
• Y2K program merges concerns of power, petroleum, gas industries
  REPRESENTATIVES OF THE OIL AND GAS PRODUCTION, transmission, and distribution industries are joining a technical program established by EPRI, Palo Alto, Calif., to gather data related to the Y2K problem.

• Japan and globalization
  Having embraced international commerce and the global flow of capital for much of this decade, the governments of some developing countries now wonder whether they made a mistake. The dark side of economic liberalization has cast a nasty spell over key parts of once-booming, now-recessionary Asia and Latin America. It turns out that good times can turn bad as quickly as money, in the age of computers, crosses international borders. Globalization isn't the rosy deal everyone once believed it

• Elf, Agip sign Dorood contract with Iran
  Elf Petroleum Iran and Agip Dorood BV have signed a 10-year, $540 million buy-back contract with National Iranian Oil Co. (NIOC) for redevelopment of giant Dorood field. The field is mostly off Kharg Island, although a portion of it is onshore. Elf is operator and holds a 55% interest, with Agip holding the remaining 45%. The Elf-Agip combine will be repaid for their investment with a share of production.
• Joint team probes steel riser vibration
  To test the vibration behavior of deepwater risers, 2H Offshore Engineering towed 200-m, 10-in. pipes at speeds of up to 3 m/sec. The tests were carried out near Stavanger, with the lead boat pulling a tow wire to adjust the angle of the riser model, which was weighted to hang beneath the rearward boat. Photo courtesy of 2H. [158,788 bytes] Two model risers were used for the towing trials: one was an unmodified pipe, and the other, shown above in the photo on the left,

• New correlations estimate P b , FVF
  EQUATIONS AND NOMENCLATURE [41,389 bytes] PDF FORMAT New semiempirical correlations use dimensionless variables to provide better estimations of bubblepoint pressure (P b ) and formation volume factor (FVF). The new correlations were used in a computer program developed by the authors for well bore hydraulics calculations. The resulting calculations provided a better description of the experimental data than existing models by Aziz 1 and Orkiszewski. 2 The empirical correlations commonly used
• Pressure building to restructure Japan's beleaguered refining-marketing sector
  Japan's network of service stations, such as this one, owned by Idemitsu Kosan Co. Ltd., faces a massive consolidation in the wake of deregulation of the country's refining-marketing sector. Photo courtesy of Idemitsu Kosan. [34,099 bytes] Nippon Oil-Mitsubishi Oil Combination [55,220 bytes] Trends In Japanese Service Station Closures [42,798 bytes]
• ESAI: Japan's petroleum deregulation to be completed by 2001
  Deregulation of Japan's petroleum industry is likely to be completed by 2001. Protectionists measures, such as high tariffs on fuel oil imports, will also be eliminated. Thereafter, the government's focus will be on energy security, safety, and the environment. But the government will avoid excessive regulation, as it seeks to improve efficiency and competition in the industry.
• French refiners prepare for EU fuel specs
  France's refiners have earmarked investments totaling 6.7 billion francs during 1998-2001 to meet impending European Union specifications for motor fuels. Beginning Jan. 1, 2000, EU member states will be required to meet tighter restrictions on sulfur and aromatics in gasoline and diesel fuel. This will be followed in 2005 by even stricter requirements. France's refiners have estimated their expenditures through 2001 to meet the new fuel specs (see table). Planned spending to meet the

• Filter system expected to extend catalyst life
  IN DECEMBER 1998, PHILLIPS PETROLEUM CO. PURCHASED A new filter for its 60,000 b/d atmospheric resid-desulfurization unit in the Borger, Tex., refinery from Pall Corp. The Rigimesh Backwash filter will be installed upstream of the guard reactor. The filter installation is expected to be complete in July 1999. The purchase is a result of an extensive research and development program that the Phillips Borger complex began in 1995. Phillips and Pall worked together to fine-tune the operating
• U.S. refinery-sulfur production peaked in 1996
  U.S. production and recovery of sulfur increased at an average annual rate of 1%/year between 1988 and 1997. This growth is expected to continue through the next decade. About 50% of U.S. sulfur production is used to produce phosphatic fertilizers, and the other 50% is used in chemically oriented businesses.
• Pasadena refinery has initial success with on-site amine-purification system
  The Crown Central Petroleum Corp., Pasadena, Tex., refinery successfully commissioned an ion-exchange unit for its amine gas-treating plant in October. The refinery's amine system absorbs hydrogen sulfide from sulfur-containing streams. High heat-stable salt (HSS) concentrations in amine solution contribute to corrosion and foaming. High levels of HSSs increase the need for corrosion-related maintenance and filter replacements. Eventually, HSSs are removed by either discarding a portion of
• Colonial to pay $7 million fine for spill
  Colonial Pipeline Co., Atlanta, has pled guilty to federal charges and will pay a record $7 million fine for a June 1996 spill of 960,000 gal of diesel fuel in South Carolina.

• Yucatan pipeline signals new era in Mexican gas transportation
  Field-joint coating and inspection takes place ahead of lowering in along one of the rugged areas on the Yucatan gas pipeline (Fig. 2). Photograph from Bechtel de M?xico, Mexico City. Additional lengths of pipe, concrete coated, are pulled through one of the swampy areas (Fig. 3). Photograph from Bechtel de M?xico, Mexico City. [46,642 bytes] Construction advances along rocky right-of-way in the Mexican states of Yucatan and Chiapas as the Yucatan Peninsula gas pipeline makes progress toward

• Low oil prices dampening seismic spending
  As a result of extended low oil prices, seismic spending is becoming increasingly dependent on economic factors and less contingent on technical and operations factors, according to a survey by Merrill Lynch & Co., New York. The investment firm polled more than 100 oil and gas companies about seismic activity, spending, and trends: "In our 1997 survey, top actors seen driving seismic activity growth were acquisition technology, 3D reshoots, and lease activity. In 1998, the top drivers were oil
• Naval oil shale lands may hold large Piceance gas potential
  For many years, federal agencies have debated the fate of the Naval Oil Shale Reserves by juxtaposing the value of their natural resources and recreational value against ongoing operating costs. Recently, the decision was made to commence divestiture of these properties, and the Bureau of Land Management was instructed to conduct lease auctions.

OGJ Newsletter

• OGJ Newsletter
  A brief boost in oil prices was expected to subside at presstime, as news broke that an Iraqi oil export pipeline, briefly shut down as a result of a U.S. air strike, was restored to its full 1 million b/d capacity.
• Area Drilling
  Work progressed toward eventual startup of sustained production from Rubiales heavy oil field in the Llanos basin. Tests by Southwest Research Institute, San Antonio, showed that a blend of 74% vis-broken Rubiales crude and 26% raw Rubiales crude will result in a blended crude of 21° gravity and a density of less than 100 centistokes, said operator Coplex Resources NL, Hobart, Tasmania.