Oilsands
Alberta Energy and Utilities Board
recommended that the provincial government approve the proposed $500 million (Canadian) expansion of Imperial Oil Ltd.'s oilsands operations at Cold Lake, Alta. Imperial is reviewing the board's recommendations and conditions and will make a decision on funding when it receives provincial approval. The project will include: three development phases, adding a combined 30,000 b/d of bitumen production from a new operating area called Mahkeses; installation of cogeneration equipment; and development work to maintain bitumen production from existing operations.
Refining
California Department of Industrial Relations'
Division of Occupational Safety and Health (Cal OSHA) issued six citations to Chevron Corp. for alleged workplace safety violations regarding a Mar. 25 explosion and fire in the hydrocracker at the firm's Richmond, Calif., refinery (OGJ, Apr. 5, 1999, p. 40). Cal OSHA found Chevron negligent in performing checks to ensure proper equipment installation. Chevron said the fire was the result of a leak in the unit's piping system, which occurred when a valve failed. It will replace all valves similar to those included in the citations. Penalties to Chevron total $30,935; it has not decided whether to appeal.
Yukos Oil Co.
started production at its new $20 million Strezhevskoy refinery at Strezhevoy in western Siberia. The 4,400 b/d plant will meet the needs of TomskNeft as well as consumers in Alexandrov, Parabelsky, Kargosoksk, and other areas of the Tomsk region. The refinery will produce diesel oil, gasoline, and aviation kerosine.
Heavy flooding
in the wake of Hurricane Floyd's path along the U.S. East Coast caused the temporary shutdown of at least three refineries. Sunoco Inc., Philadelphia, shut down the 200,000 b/d Girard Point crude unit at its Philadelphia plant Sept. 20 for at least a week. And Citgo Petroleum Corp., Tulsa, closed two asphalt refineries: a 28,000 b/d plant at Savannah, Ga., and an 80,000 b/d plant at Paulsboro, N.J.
Exploration
Trinidad Shell Exploration & Production BV
and Agip Trinidad & Tobago Exploration BV will spud an exploration well in late September on Block 25(a), 80 km east of Trinidad. The firms signed a production-sharing agreement on the block with Trinidad and Tobago early last year (OGJ, Feb. 16, 1998, p. 38). Operator Shell (60%) will drill the wildcat with the Stena Tay semisubmersible to 3,000-3,500 m TD in 1,070 m of water. Agip says the well "will start a frontier exploration phase in the Trinidad and Tobago deepwater offshore." The partners must acquire 3D seismic data and drill three wells in the first 4 years of the contract period.
Algerian national oil firm
Sonatrach made an oil and gas discovery in the southern part of the country, west of Hassi Messaoud. On test, Benkahla-1, drilled on Block 438 of the Oued Mya Basin, flowed at a rate of 3,650 b/d of 42.8° gravity crude and 107,000 cu m/day of gas with 3,212 psi outlet pressure. Algeria's Energy and Mines Ministry said, "The discovery has rekindled interest in the block, where the hydrocarbons potential is now thought to be considerably more important."
Drilling-production
Northern Endeavor,
a floating production, storage, and offloading (FPSO) vessel built for Woodside Energy Ltd., Perth, was launched from Singapore. The vessel will be used for Woodside's $1.3 billion (Australian) development of the Laminaria-Corallina oil fields in the Timor Sea (OGJ, Feb. 8, 1999, p. 34). The 273-m vessel-in tow to its mooring about 550 km northwest of Darwin, Australia-is capable of processing and storing up to 1.4 million bbl of oil. Proven reserves in Laminaria and Corallina are estimated to be 137 million bbl; the field has an estimated 12-year life span.
Texaco Inc.'s Nigeria unit
resumed production from five production platforms in oil fields off southeastern Nigeria. Production had been shut in for a month due to attacks by protesting youths demanding social amenities and employment. Output from the fields has reached 30,000 b/d; the five platforms had been producing 50,000 b/d. Texaco signed an agreement earlier this month to bolster spending in the area for piped water and supplies for electricity.
Santa Fe International Corp.,
Dallas, took delivery of the Galaxy III, a Keppel Fels Mod VI design, Universe class, heavy-duty jack up capable of operating in harsh environments. BP Amoco plc will use the $179 million rig-after it arrives from Singapore-in the North Sea under a 3-year contract starting in mid-November. Galaxy III is equipped with set-off capability and will operate in the tender assist set-off mode on its first platform location.
Stone Energy Corp.,
Lafayette, La., completed and tested the OCS-G 3135 No. 2 well on the Pylos prospect on Vermilion Block 255 off Louisiana. On test, the well flowed 12.6 MMcfd of gas and 269 b/d of condensate through a 24/64-in. choke with 3,400 psi flowing tubing pressure. The well was drilled to 12,136 ft TD and cut 98 net ft of pay in three sands at 7,700-11,100 ft. Stone Energy-with an 83.3% working interest and a 69% net revenue interest in Pylos-said production is expected to begin in November.
PT Caltex Pacific Indonesia
began production from Piala field in Riau Province, Indonesia, where a single well, drilled to 4,000 ft TD, is flowing 2,000 b/d of oil. The field was thought to contain reserves of 3.3 million bbl and have 9.3 million bbl of original oil in place. The main reservoir, said PT Caltex, is in the Sihapas formation at 2,800 ft.
Coflexip Stena Offshore SA,
Paris, let contract to Korea's Hyundai Mipo shipyard to build an ultradeepwater pipe-lay and construction vessel, with first operation expected in second quarter 2001. The $170 million ship is designed for subsea construction and laying of rigid and flexible pipe and umbilicals in up to 2,500 m of water. The contractor is targeting the West Africa, Gulf of Mexico, and Brazil deepwater field development markets.
Mallon Resources Corp.,
Denver, began a $65.5 million program to develop natural gas in the San Juan basin of northwestern New Mexico. The firm's program entails the drilling or recompleting of 30 wells by yearend and 59 wells during 2000 in an area it has identified as holding more than 300 bcf of natural gas reserves net to its interest holdings. These reserves are in East Blanco and La Jara Canyon acreage blocks in the Ojo Alamo, San Jose, Nacimiento, and Pictured Cliffs formations.
Tanganyika Oil Co. Ltd.
unit Dublin International Petroleum (Egypt) Ltd. completed the Hana-2 appraisal well on Egypt's West Gharib Block (OGJ, June 22, 1998, p. 82). The well, drilled to 5,549 ft TD, was cased as a Miocene Kareem sand oil well and was drilled as a step-out to the Hana-1 discovery well. The top of the pay zone was 73 ft higher than that of Hana-1, the entire Kareem is oil-bearing, with about 76 ft of net pay with 21% porosity over a gross interval of 146 ft, said partner TransAtlantic Petroleum Corp. Interests in West Gharib are: operator Dublin International, 50%; TransAtlantic unit GHP Exploration (West Gharib) Ltd., 30%; and Drucker Industries unit Drucker Petroleum Inc., 20%.
Mariner Energy Inc.,
Houston, announced the successful installation by Oceaneering Multiflex-a unit of Oceaneering International Inc., Houston-of a 28-mile steel tube umbilical in the deepwater Gulf of Mexico. The umbilical will provide high-pressure chemical injection for Mariner's Pluto development on Mississippi Canyon Block 674 in 2,800 ft of water.
Pipelines
Talisman Energy Ltd.,
Calgary, said an explosion occurred about 174 miles northeast of Khartoum, Sudan, on a new 1,500-km oil pipeline (OGJ, July 12, 1999, p. 34). The firm called the blast a "minor event" and said it doubts that it was caused by mechanical failure, although no one has claimed responsibility for it. Talisman said oil production in central Sudan will not be disrupted by the incident. The company has a 25% interest in the $1.4 billion project; other partners are the national oil firms of China, Malaysia, and Sudan. Talisman reported a production record for the project of 136,000 b/d on the day of the blast.
Wyoming Interstate Co. Ltd.
(WIC), the Rocky Mountain pipeline unit of Coastal Corp., Houston, filed an application with the Federal Energy Regulatory Commission to expand its Medicine Bow lateral pipeline, under construction in Wyoming's Powder River Basin (OGJ, Sept. 20, 1999, p. 88). The 150-mile, 273 MMcfd Medicine Bow system is slated for completion in early December. The expansion plans calls for installation of an additional 7,170 hp of compression at the Douglas compressor station and construction of a 5.6-mile, 24-in. line, which would increase the entire system's capacity to 400 MMcfd by Oct. 1, 2000.
Companies
Westcoast Energy Inc.,
Vancouver, B.C., paid $150 million (Canadian) to acquire a 30% interest in the Vector natural gas pipeline, which will transport gas from southern Ontario to the Chicago area starting in October 2000 (OGJ, June 7, 1999, p. 34). Other partners are Enbridge Inc., Calgary, 45%; and MCN Energy Group Inc., Detroit, 25%. Westcoast will reimburse the firms for money already spent and will pay 30% of the remaining costs. Westcoast says the purchase dovetails with its holdings in the Alliance and Millennium pipeline projects. Westcoast has committed to supplying 240 MMcfd of gas to Vector; Enbridge will supply 260 MMcfd and MCN 200 MMcfd, with the rest to be contracted.
El Paso Energy Corp.,
Houston, acquired Bonneville Pacific Corp., Salt Lake City, for $63 million. Bonneville's assets include a 50% interest in the 85-MW, gas-fired Garnet Valley cogeneration plant near Las Vegas and wholly owned unit Bonneville Pacific Services.
Cross Timbers Oil Co.,
Fort Worth, sold two groups of oil and gas assets to unnamed parties for a combined $63.5 million. In one transaction, it sold nonoperated assets in Oklahoma, the Permian Basin, the San Juan Basin, and Wyoming's Green River Basin for $41 million. In another, Cross Timbers unit Spring Resources Inc. sold $22.5 million of properties in the Texas Panhandle and Coal County, Okla. The deals will reduce Cross Timbers' well count by 2,800, or about 30%, but its reserves will decline by only 5%. The firm will use $44 million of the proceeds to pay for the purchase of Lehman Bros. Holdings' 50% interest in Spring Holding Co. (OGJ, May 31, 1999, p. 28), while the remaining $19.5 million will be used to pay down debt.
Weatherford International Inc.,
Houston, acquired Williams Tool Co., Fort Smith, Ark., for $64 million in Weatherford common stock, or about 1.75 million shares. Williams supplies rotating control heads, a technology used for well control in underbalanced drilling, completion, and workover activities.
Elf Aquitaine SA
unit Elf Hydrocarbures Alg?rie signed an agreement to acquire a farm-out in an Algerian field from ARCO unit ARCO El-Djazair Co. Under terms of the deal, Elf will acquire a 40% interest in ARCO's wholly owned production-sharing contract with Algerian state oil firm Sonatrach for the Rhourde El Baguel field. Overall investment is estimated to be about $1.5 billion over the term of the 25-year contract.
Enervest Management Co. LC,
Houston, acquired Appalachian properties with 59.5 bcfe of reserves from Cabot Oil & Gas Corp., Houston, for $46.2 million. Cabot says it will use a portion of the proceeds to buy 10.3 bcfe of proved reserves that lie next to its Wyoming Green River Basin properties in the Rocky Mountains. Along with previously closed deals, this transaction reduces Cabot's total well count by 25%, or about 1,108 wells, and reduces its production by 6%, or 13 MMcfed.
Power
Mexico's Energy Regulatory Commission
issued a private generation permit to Termoel?ctrica Pe?oles for a merchant power plant at Tamuin, San Luis Potos!, Mexico. The $260 million station will have 230-MW of net generating capacity and production of 1,850 Gw-hr/year; it will consume 630,000 metric tons/year of petroleum coke as fuel. Construction, slated to begin next year, will be completed by December 2002.
El Paso Energy International Co.,
a unit of El Paso Energy Corp., Houston, assumed ownership of the 158-MW Rio Negro power plant at Manaus, Brazil. Last year, El Paso had signed a turnkey contract with Wartsila NSD and Wartsila NSD SO Brazil to engineer and construct the plant. Power from the $116.5 million project will be sold to Brazilian federal electric utility Eletronorte under a long-term contract.
Conectiv,
Wilmington, Del., plans to build a 500-MW combustion turbine, combined-cycle natural gas fired power plant at its Hay Road/Edge Moor complex in northern New Castle County, Del. The project is estimated to cost $300 million. Conectiv considers the proposed plant's site ideal, as it will have access to adequate supplies of natural gas and sufficient transmission facilities. The first phase of the project is slated for completion in summer 2001; the second phase, which involves conversion to combined-cycle mode, is expected be completed in 2002.
Terminals
Total Gas & Power India,
a unit of TotalFina SA and Hindustan Petroleum Co. Ltd., signed a shareholders agreement to develop jointly, on a 50-50 basis, a liquefied petroleum gas import terminal at Andhra Pradesh state on India's East Coast. With 60,000 metric tons of storage capacity, the terminal will reportedly be the largest of its kind in the region. It will help India meet its demand for LPG, which is expected to rise to 10 million tons after 2005-06 from 4.5 million tons in 1998. The terminal is slated for completion in 2003.
Oiltanking Trinidad & Tobago Ltd.
was launched as a joint venture of Portrin (35%) and Oiltanking Caribbean Ltd. (65%). The new JV will handle storage and transshipment of petroleum products for Petro- trin's 3.6 million bbl terminal at Point Fortin, Trinidad.