Table of Contents

• Temperature method can help locate oil, gas deposits
  One can expect hydrocarbon deposits to be accompanied by overlying negative temperature anomalies. The method entails the construction and interpretation of temperature anomaly maps to locate subsurface hydrocarbons (quantitatively) without the need for previous exploration data. It can locate stratigraphic trap reservoirs, predict reservoir shape and boundaries, explore below the bottom of drilled holes, and faulting or the presence of intervening salt do not adversely affect it.
• BP Amoco-ARCO merger promises to change the oil industry's landscape
  BP Amoco-Arco key operating areas [80,357 bytes] How BP Amoco-Arco combined production compares [99,091 bytes] BP Amoco-Arco rankings by sector [139,636 bytes] The accelerating consolidation of the petroleum industry has taken another major leap forward with the announcement that BP Amoco plc and ARCO plan to merge.
• BP Amoco buys out Enron's stake in joint solar power firm
  BP Amoco announced last week it would pay Enron Corp. $45 million for the 50% the combine does not already own in Solarex, a company formed in 1973 that became an Amoco Corp./Enron joint venture in 1995. In 1998, Solarex had a turnover of $58 million, while BP Solar, established in 1981 and with worldwide annual capacity to manufacture solar panels with combined capacity of 13.2 MW, had a turnover of $95 million.
• Upstream focus of Total Fina 1999 spending
  The soon-to-be-merged Total Fina group will make upstream its priority, as far as spending is concerned, says Total Chairman and CEO Thierry Desmarest. This year, the upstream sector will account for 60% of the 4 billion euros earmarked for investments. "The Middle East and Latin America is where we will invest most over the next 2 years," said Desmarest. Iran is a key focus for Total, with its heavy involvement in the Sirri A and E fields (OGJ, Apr. 5, 1999, p. 30).
• Elf's 'painless' U.K. restructuring
  With job losses accompanying every merger or takeover at the moment, it feels like the petroleum industry's boom/bust cycle is inescapable. Elf Exploration U.K. plc is as lean and mean as any North Sea operator, but through good timing managed to restructure without much pain to the employees it laid off. Pierre Godec, managing director of Elf Exploration U.K., said the unit had 1,200 staff 3 years ago but now employs 566. Of these, only 68 are offshore, because Elf hired Kvaerner Oil & Gas
• Key Pemex projects to escape budget ax
  Because of fiscal difficulties facing the Mexican government, stemming largely from the slump in oil prices, state-owned petroleum company Petroleos Mexicanos has seen its budget cut in 1999, in real terms, by 4.3% from 1998's level, to 78.3 billion pesos. Pemex had originally requested 80.2 billion pesos, but with a late spending-cut frenzy by the federal Congress in late December, another 2 billion pesos was trimmed off.
• Antitrust probe targets Petrobras gas activity
  Brazilian antitrust authorities have launched an investigation of activity by state petroleum firm Petroleo Brasileiro SA in Brazil's natural gas sector. Until 1997, when new legislation ended the state firm's 43-year-old monopoly over the nation's petroleum sector, no antitrust issues would have arisen. The Administrative Council for the Defense of the Economy (CADE), the antitrust regulatory board of the Brazilian Treasury, and the National Petroleum Agency (ANP) are investigating
• U.K. announces plan to boost offshore E&D
  The U.K. Department of Trade and Industry (DTI) has announced new measures aimed at boosting U.K. offshore oil and gas exploration and development. While the measures fall short of operators' requests for a lighter taxation regime, they include streamlined licensing rules and a chance to postpone spending on some drilling commitments. The new measures were formulated by a joint government and industry task force, chaired by Energy and Industry Minister John Battle. The group's mission
• Canadian oilsands projects facing hurdles
  Canadian oilsands operators persist with development plans despite new hurdles thrown up before an oil industry bedeviled by low oil prices and retrenchment. In recent action by Calgary firms: Suncor Energy Inc. has begun construction of a $2 billion (Canadian) expansion of its oilsands operations in northern Alberta following regulatory approval. Mobil Oil Canada Ltd. said it is delaying a construction start on a $2.5 billion oilsands project in the same region for 2 years to 2002.
• EIA predicts higher oil, gasoline prices
  The U.S. Energy Information Administration predicts that crude oil prices will remain on an upward track through 2000. In addition, EIA estimates that U.S. gasoline prices will average $1.13/gal for regular self-serve this summer, up 9-10¢/gal from the same period last year. "Gasoline demand is expected to be up by 2% over last summer, aided by solid economic growth and by prices that, while noticeably higher than last summer, are still moderate by historical standards. Highway travel in
• U.S. gas resource base decline seen in 1998
  PGC's gas resource base decline seen in 1998 [98,784 bytes] The Potential Gas Committee has estimated that the U.S. natural gas resource base has slipped to 1,205 tcf, or a 63-year supply at current production rates. PGC estimated the yearend 1998 gas resource at 1,038 tcf, excluding proved reserves but including 896 tcf attributable to traditional reservoirs and 141 tcf in coalbed methane reservoirs. It said that, compared with yearend 1996, traditional resources decreased 2.7%, and the
• Sanctions and logic
  U.S. sanctions policy is coming under hard attack early in the 106th Congress. Legislation-with unusually wide support-recently was filed in Congress to restrain the use of unilateral economic sanctions (see editorial and OGJ, Mar. 29, 1999, Newsletter). Meanwhile, the influential Center for Strategic and International Studies in Washington, D.C., issued a report slamming the U.S. approach. An 18-month study by a blue-ribbon panel concluded that U.S. policy should be junked in favor of a
• INDUSTRY BRIEFS
  Shell Eastern Petroleum (Pte.) Ltd.
• Trinidadian state firm in U.S. retail marketing venture
  Petrotrin, Trinidad and Tobago's national oil company, has agreed to set up a joint venture with U. S. partners to build a series of full-service truck stops in the U.S. and to market its high-value refined products directly through gasoline/diesel stations to be located at the stops.
• EA required for Longhorn pipeline start-up
  Longhorn Partners Pipeline LP (LPP), Dallas, will have to perform an environmental assessment (EA) of its 700-mile pipeline before it can ship refined motor fuel products from refineries on the Gulf Coast to markets in El Paso and further west.

• Too many measured punches
  Which comes first in American foreign policy-the economic sanction or the cruise missile? It's getting hard to tell. Various levels of government have come to impose sanctions so readily that Congress might limit the tactic (see Watching Government, p. 37). In a telling coincidence, bills to force officials into thinking before enacting sanctions emerged in both houses while American aerial weapons were pounding Yugoslavia under auspices of the United Nations.

• Mexico's Burgos development not hobbled by budget woes
  Development of the Burgos basin natural gas fields in northern Mexico by state-owned petroleum company Petroleos Mexicanos will continue as planned, despite the budgetary constraints faced by Pemex this year, said Pemex Director Adrian Lajous (see story, this page). "Because the production of each well declines rapidly, an intensive drilling schedule is needed to maintain production at Burgos," Lajous said during a recent visit to the region. "It is not possible for us to stop drilling."
• Phillips to develop U.K. Jade discovery
  Phillips Petroleum Co. U.K. Ltd. has begun the search for a front-end engineering and design contractor for the development of its Jade discovery in the U.K. North Sea. Block 30/2c Jade is a high-pressure/high-temperature discovery made in March 1996 and appraised with one well in early 1997 (OGJ, Mar. 17, 1997, p. 36). The find lies in 250 ft of water, and Phillips intends to develop it with an unmanned wellhead platform tied back with a 16-in. multiphase pipeline to its Judy platform, which
• Novel screening unit provides alternative to conventional shale shaker
  The Pansep screen is a nonvibational device that separates cuttings through the use of gravity and particle separation. Shown here is the first 4 cu m unit installed at the Optimum Coal Colliery in South Africa. A fine coal is being fed to the top deck (Fig. 1) A solids/liquid separation unit may provide an alternative method to screen drill cuttings and fines before entering the active mud system (wet classify), possibly replacing conventional equipment including the shale shaker, desander,
• DOE signs SPR oil contracts with three majors
  The U.S. Department of Energy has signed the first contracts to add U.S. federal royalty oil to the Strategic Petroleum Reserve, opening the way for oil to begin moving into the reserve by early May. Energy Sec. Bill Richardson said DOE and the Interior Department completed arrangements with three of the largest producers in the central Gulf of Mexico-Texaco Inc., Shell Oil Co., and BP Amoco plc-to begin transferring 38,600 b/d of royalty oil to the SPR.

• European owners assess quality of E&C companies
  Since 1995, owners of European downstream operating companies have changed the way they choose engineering and construction (E&C) contractors. Several trends have been identified: The price of E&C jobs is a more significant factor this year than last. Behavioral factors are playing a larger part of contractor selection. The decentralized organization of operating companies has raised the costs of E&C companies. Retirement by key technical personnel in operating companies has spurred increased
• European refineries separating more oils from wastewater
  Although surveyed Western European refinery throughputs increased by more than 10% between 1993 and 1997, the ratio of oil discharged to the amount of oil processed fell. Total quantity of oil discharged in 1997 is 42% less than that in 1993. The total volume of effluent discharged from tracked refineries has remained relatively constant. The combination of a reduction of oil discharged and a constant effluent volume suggests that the efficiency of the effluent purification has improved. About

• NGL recovery influences Louisiana processing
  The Larose gas-processing plant consists of two parallel 300-MMcfd cryogenic turboexpander processing trains (Fig. 1). The Paradis fractionation plant, west of New Orleans, has a standard four-tower train (Fig. 2)[74,789 bytes]. The Discovery Project, the first of the new wave of NGL-recovery projects developed in Southeast Louisiana, started up last year in three processing segments: Phase I: A 350-MMscfd dew point control unit at the Larose gas processing plant that was placed in operation

• PennzEnergy joins exploration and development rush in Brazil
  Pennsenergy's Brazilian Block [91,828 bytes] PennzEnergy Co., Houston, is the latest entrant in the scramble to participate in exploration and development in Brazil. Legislation that Brazil enacted in 1997 to end the 43-year-old monopoly of state petroleum firm Petroleo Brasileiro SA has spawned a rush among foreign firms to participate in Brazilian E&D, including joint ventures with Petrobras (OGJ, Sept. 14, 1998, p. 33). PennzEnergy last month signed a participation agreement with
• Amazon find boosts Brazil gas, power sectors
  Development of gas reserves in Brazil's Amazon region has received a major boost with the discovery of a significant gas field in a new area much closer to potential markets. Petroleo Brasileiro SA noted that its latest discovery of natural gas in the Amazon basin is located only 200 km east of Manaus, the capital of Ama- zonas state, which underscores its strategic importance. The Urucu pro- vince, the other gas-producing region in the Amazon, is 600 km from Manaus.
• Depth imaging shows salt-like shale features on Scotian slope
  Velocity modeling and prestack depth imaging by GX Technology (GXT) show a previously unrecognized deformation mechanism in the area of our test lines, south-southwest of Sable Island. Shale, not salt, tectonics dominates the deformation of the late Cretaceous and Tertiary section on the upper to mid slope in this area. A layer that resembles an allochthonous salt sheet results in the formation of minibasins 1 and structural highs. However, the distinctively lower velocities indicate that this
• Independents' exploratory wells probe San Joaquin's deep potential
  Two wells, one a spectacular blowout that has outlasted eight surface kill attempts, are enhancing perceptions of deep potential in California's San Joaquin basin. Neither well is yet completed, and revenues from hydrocarbons sold from the one that blew out are being placed in escrow. The wells, both drilled below 15,000 ft, lie about 35 miles apart in a province where the well depth averages about 2,000 ft.

• Advanced well stimulation vessel joins Gulf of Mexico fleet
  Captain Tommy Dupre of Edison Chouest Offshore, stands on the bridge of Stim Star, Halliburton's stimulation vessel which is equipped with the latest navigation guidance system and vessel control instrumentation, including full dynamic positioning capability (Fig. 2) [10,675 bytes]. HALLIBURTON ENERGY SERVICES HAS ADDED A NEW deep water stimulation vessel to its Gulf of Mexico fleet, the M/V Stim Star (Fig. 1).

OGJ Newsletter

• OGJ Newsletter
  U.S. INDUSTRY SCOREBOARD 4/12 [43,644 bytes] Listen for sighs of relief throughout the oil industry now that the price of Brent crude oil futures has pushed above $15/bbl for the first time since May 1998. While few expect the improvement to last long, it appears the relative boom stems from last month's decision by OPEC and some non-OPEC nations to cut production by a further 2.1 million b/d (OGJ, Mar. 29, 1999, p. 18).
• Area Drilling
  Total Gabon was starting a 4,400 sq km, 4 month 3D seismic survey on the Astrid and Anton Marin blocks off southern Gabon. Schlumberger Geco-Prakla's Geco Triton will acquire the data deploying eight streamers each 6,600 m long and with dual sources. Equatorial Energy Inc., Calgary, completed five shallow wells at Tanjung Lontar field east of Bengkulu in South Sumatra for a combined 500 b/d of oil. The company noted that its Indonesian production sharing contracts provide for an increased