Correction
The cogeneration plant
to be built at DuPont Co.'s Sabine River Works facility will be owned and constructed by Conoco Global Power, not by DuPont, as incorrectly reported (OGJ, Aug. 16, 1999, p. 36). DuPont will operate the plant and will buy a portion of its power output and all of the steam production under a contract with an affiliate of Conoco Inc., parent company of Conoco Global Power.
Exploration
Elf Exploration Angola
and partners made another oil discovery on Block 17 off Angola (see map, OGJ, June 7, 1999, p. 33). Orquidea 1, drilled to 2,500 m TD in 1,200 m of water about 200 km northwest of Luanda, cut 157 ft of oil-bearing sands. The well marks the sixth oil discovery on the block; others are Girassol, Dalia, Rosa, Lirio, and Tulipa. Angola state oil firm Sonangol is concessionaire of Block 17, while interest holders are: operator Elf, 35%; Esso Exploration Angola (Block 17) Ltd., 20%; BP Exploration Angola Ltd., 16.67%; Statoil AS, 13.33%; Norsk Hydro ASA, 10%; and Fina Exploration MB BV, 5%.
Canadian Forest Oil Ltd.,
a unit of Forest Oil Corp., Denver, and 50-50 partner Ranger Oil Ltd., Calgary, announced results from their N-61 well in Canada's Northwest Territories. The well reached 10,334 ft TD, and the well bore cut a highly porous dolomite in the Nahannai, revealing "strong gas shows," said Forest. N-61 is 6 miles southwest of P-66A, a discovery well also drilled by the Canadian Forest-Ranger joint venture, of which Ranger is operator. Tests on N-61 will be conducted in the coming weeks.
Forest Oil
made a natural gas discovery on High Island Block 116 off Texas in the Gulf of Mexico. B-2 was drilled to 15,975 ft TD and 13,694 ft TVD and cut 412 net ft (TVD) of pay. All net pay lies in overpressured zones, says Forest, with 150 ft in the Rob L sands and 262 ft in the Rob M. Forest plans to evaluate about 250 net ft of additional prospective pay in the Rob M with core analysis. Block 116 is owned by operator Forest, 54.75%, and Louis Dreyfus Natural Gas Corp., Oklahoma City, 45.25%.
Drilling-production
Newfield Exploration Co.,
Houston, said its A-2 well, 140 miles south of New Orleans in the Gulf of Mexico, blew out Sept. 9. The blowout sparked a fire on the Ship Shoal Block 354 production platform during workover operations Sept. 12. The well was producing 6 MMcfd of gas and 1,400 b/d of condensate. At presstime, Boots and Coots Inc., Houston, was assisting with well-capping operations, and a relief well was being drilled to kill the blowout. Newfield detected a light, silvery sheen extending from the platform but says it poses no threat to the shoreline. The company and the Coast Guard believe the contamination is nondispersible and unrecoverable; the high-gravity condensate is expected to evaporate quickly. Skimming boats and booms are on site, however, should they be needed.
Talisman North Sea Ltd.
announced first oil from Orion oil field in the U.K. North Sea (OGJ, May 31, 1999, p. 21). Orion was developed as a single-well, subsea satellite of Talisman's Clyde platform, to which it was tied back with a 10-mile, 10-in. pipeline. Production will increase to 7,000 b/d of oil and 16 MMcfd of gas, says Talisman. The development cost was $65 million (Canadian), which Talisman said was equivalent to $3.25/boe of reserves. Orion license partners are: operator Talisman, 87.5%; Enterprise Oil Exploration Ltd., 6.25%; and Summit U.K. Oil Ltd., 6.25%.
Burlington Resources (Irish Sea) Ltd.
(BRIS), a unit of Burlington Resources Inc., Houston, began gas production from Millom and Dalton fields in the U.K. East Irish Sea. Combined production from three wells was 100 MMcfd of gas during initial commissioning, marking the first operated production outside North America for Burlington. By the end of the third quarter, a sustained gross production rate of 100 MMcfd is expected. BRIS used subsea technology to tie the wells back to the North Morecambe platform, which is operated by Centrica plc unit Hydrocarbon Resources Ltd. Millom-Dalton interests are BRIS, 90%; and Alliance Resources plc unit Difco Ltd., 10%.
Mobil Corp.
and its partners began oil production from Buckland field on Block 9/18 in the U.K. North Sea, with output reaching more than 37,000 b/d of oil and 1.5 million cu m/day of associated gas, which will be mixed with production from Beryl Alpha platform and transported via pipeline to St. Fergus, Scotland. The field was developed withg subsea wells tied back to the Beryl platform about 10 km away. Buckland field interests are: operator Mobil, 35%; Repsol-YPF SA, 33.3%; Enterprise Oil plc, 14.4%; Amerada Hess Ltd., 14.1%; and OMV AG, 3.2%.
Algerian state oil and gas firm
Sonatrach let a $107 million turnkey contract to Italy's GE Nuovo Pignone to supply a power plant for the Ghadames oil field production project in southeastern Algeria. The 300-MW, simple-cycle plant will be based on three MS9001E gas turbine generators and will supply electricity for production operations and for regional power supplies. It will be installed at Hassi Berkine, about 250 km east of Hassi Messaoud. The three generators, to be built at Nuovo Pignone's Florence plant and shipped in late fourth quarter and early first quarter, are slated to begin operations in February, March, and April 2001.
Refining
Coastal Corp.
unit Coastal Eagle Point Oil Co. signed a 3-year supply and processing agreement with Statoil Group unit Statoil Marketing & Trading (U.S.) Inc. Statoil will supply 64,000 b/d of crude oil that Coastal will process at its Eagle Point refinery at Westville, N.J., under a fee arrangement. The agreement will "play a significant role in reducingellipsemargin vol- atility (and provide) more predictable earnings," said Coastal.
Colorado Refining Co.
and TPI Petroleum Inc. must make major environmental improvements to a refinery they once owned in Commerce City, Colo. The work is part of a settlement negotiated by Ultramar Diamond Shamrock Corp. (UDS), which acquired both the firms in September 1997. The U.S. Department of Justice had brought air pollution and hazardous waste charges against the companies on behalf of the U.S. Environmental Protection Agency. EPA alleged the firms had operated tanks and loading docks with an ineffective vapor recovery system; the companies must pay a $1.1 million penalty. UDS will install emission-control systems on storage tanks and closely monitor flaring of recovered vapors.
LNG
Japanese firms
Tokyo Electric and Tohuku Corp. will renew their contract with Indonesia's six-train Arun liquefied natural gas complex in northern Sumatra but will reduce their take to 1 million metric tons/year from 3.5 million tons/year in 2005, when the current contract expires. According to Indonesian state oil firm Pertamina, the companies indicated they are seeking other sources of LNG-from Malaysia, Australia, and the Middle East-rather than remaining dependent on a single source. The Arun complex produces 12.3 million tons/year of LNG.
Coral Energy Resources LP,
Houston, acquired a spot cargo of 125,000 cu m of LNG from Woodside Energy Ltd. for an undisclosed sum. Woodside is operator of Australia's North West Shelf LNG export plant and said the fob cargo will be loaded in fourth quarter for delivery to CMS Trunkline LNG Co.'s terminal at Lake Charles, La. Coral is a new customer for the North West Shelf venture, said Woodside, which has sold five other spot cargoes so far this year.
Courts
A Nigerian Federal High Court
upheld President Olusegun Obasanjo's revocation of 16 oil prospecting leases (OPLs) just after he assumed office in July. The decision was reached in a 15 billion naira general-damages suit brought by Heritage Oil & Gas Co. Ltd. The Nigerian firm had challenged the revocation of its OPL No. 247. The court ruling stated, "There is no contract between the federal government and (Heritage)." Counsel for the firm and its chairman, Uche Uko Uche, immediately indicated Heritage's intention to appeal the ruling. The 16 canceled leases had been awarded to 16 indigenous operators by the former administration of Gen. Abdulsalam Abubakar during March-May of this year.
Companies
Fortum Energie GmbH,
the German unit of Finland's Fortum Corp., will acquire Germany's second-largest regional utility firm, Eliktrizitaetswerk Wesertal GmbH, for $390 million euros. Fortum has been targeting Germany-Europe's largest energy market-as an area of strategic focus since Germany underwent deregulation in April 1998. Fortum is active in the German energy market through a cogeneration plant in Berghausen that it co-owns with Wacker Chemie.
KeySpan Energy Corp.,
Hicksville, N.Y., will explore strategic alternatives for Houston Exploration Co., including the possible sale of all or part of the company, of which KeySpan owns 64%. KeySpan plans to focus on expanding its core downstream businesses, including gas and electric distribution, electric generation, and energy services. PaineWebber Inc., New York, estimates Houston Exploration's sale price at $330-350 million and says the company has historically brought KeySpan returns of 8%. In concert with KeySpan's plans, it will not renew an announced joint-venture drilling program between the companies, which is subject to annual review, says PaineWebber. KeySpan has hired J.P. Morgan Securities Inc. as its financial adviser.
Energy Africa Ltd.,
Cape Town, acquired farm-outs in two licenses off Equatorial Guinea from operator and 100% interest holder Triton Equatorial Guinea Inc. Details of the deal were not disclosed. Energy Africa said it had acquired a 15% interest in Blocks F and G in the Rio Muni basin. Triton is drilling its first well in the area, the Mbini-1 wildcat, on Block G.
Columbia Natural Resources Inc.,
Charleston, W.Va., acquired properties and producing wells in New York's Seneca and Cayuga counties from Meridian Exploration Corp., Pittsburgh, for an undisclosed sum. The deal involves 319 producing wells, an 88-mile gathering system, and two gas fields covering 51,000 acres and containing 17 bcfe of proven reserves. Columbia intends to begin an exploration and drilling program on the newly acquired property.
BP Amoco plc's solar division,
BP Solarex, acquired solar electric firm APEX, based in Montpellier, France, for an undisclosed sum. BP says its purchase of APEX, which specializes in the design and implementation of electrical systems, will build on its presence in the French market. BP will continue to market its Solarex-branded products through Paris-based distributor Serelio. Solar electricity is one of the French government's main focuses in the development of renewable sources of energy.
Gas processing
Mitchell Energy & Development Corp.,
The Woodlands, Tex., signed a letter of intent to purchase Conoco Inc.'s 50% interest in the Jameson gas processing plant in Coke County, Tex., and an associated 2,600-mile natural gas gathering system in West Texas. Mitchell operates these assets through a partnership with Conoco. The Jameson plant can process 65 MMcfd of natural gas and produce 10,000 b/d of NGL. Mitchell says the acquisition will boost its overall production of NGL to about 50,000 b/d.
Pipelines
Oman
is planning to take bids for the construction of two natural gas pipelines to be laid across the country, according to local press reports. The first line, expected to cost $230 million, will transport gas from central Oman to Sohar, on the Gulf of Oman, for use in power generation. The second line, estimated to cost $295 million, will transport gas to the southern Raysut industrial zone near Salalah-the locale of a planned 300-MW power plant.
Transco,
the U.K. gas distribution unit of BG plc, let a £30 million ($48 million) contract to a joint venture of Alfred McAlpine plc and Preussag Wasser & Rohrtechnik GmbH. The JV will design and build a 25-mile, 42-in. trunk line between Mawdesley and Warrington in Northwest England to help meet growing demand for gas in the northwest, North Wales, and the Midlands. The bulk of the construction work is expected to take place during April 2000-October 2001.
Plains Scurlock Permian LP,
an operating partner of Plains All American Pipeline LP, Houston, acquired Marathon Ashland Petroleum LLC's crude oil terminal and associated pipeline system in Louisiana for an undisclosed sum. Included in the deal are about 300,000 bbl of oil storage and terminal capacity, a 6-mile oil transmission system, and ship and barge dock facilities near Venice in Plaquemines Parish, La. The terminal and pipeline have a throughput capacity of 10,000 b/d, which Plains All American says it plans to double through slight modifications.
Petrochemicals
Nan Ya Plastics Corp.
plans to build a second 100,000 metric ton/year phthalic anhydride (PA) plant at Formosa Plastics Group's naphtha cracker complex in Mailiao, Taiwan. The $59.4 million unit is slated to come on line at the end of 2001. Nan Ya needs about 120,000 tons/year of PA for its own use, primarily as feed for its 170,000 ton/year dioctyl phthalate (DOP) plant. Nan Ya hopes to sell its excess PA output to other Taiwanese firms. It also is reportedly looking to relocate its DOP plant at Kaohsiung's Linyuan Petrochemical Industrial Park to the Mailiao site, closer to the PA supply source. In addition, a planned DOP plant at Mailiao, once completed, will boost the firm's total DOP capacity to 320,000 tons/year.
Environment
An agreement was signed by
Texas Railroad Commission (RRC) and Texas General Land Office (GLO) that will work to plug non-compliant coastal oil and gas wells on state leases. After compiling an inventory of all known non-compliant wells, RRC and GLO will assess each well based on its potential to pollute and to threaten navigation in state waters. The agencies expect the assessment to be completed by Oct. 15. Those wells found to be most non-compliant will be plugged first, using GLO's funding and RRC's technical knowledge.