INDUSTRY BRIEFS

Spills

The collision of a German cargo ship, leaving for Brazil from the port of Buenos Aires, with a Liberian-flagged Shell Oil Co. tanker caused a large oil spill on Jan. 15. The collision occurred 25 km offshore in the Rio de la Plata estuary. The spilled oil covered 100,000 sq m of water. According to reports, the spill did not reach the coast or the shipping canal. Cleanup efforts-involving 2,500 m of floating dykes, support barges, and vacuum pumps-resulted in the pickup of over 150 cu m of crude oil. No injuries were reported.

The Port Authority
of Milford Haven, Wales, was fined a record £4 million for a 528,000-bbl oil spill that occurred when the Norwegian-owned Sea Empress ran aground at the port's entrance in February 1996 (OGJ, Jan. 18, 1999, p. 30).

Refining

An explosion and fire killed three contract workers on Jan. 13 at Cross Oil & Refining Co. Inc.'s refinery at Smackover, Ark. The cause of the blaze was under investigation at presstime.

Sinclair Oil Corp.,
Salt Lake City, Utah, plans to build an 11,000 b/d hydrocracker and a 26 MMcfd hydrogen plant and make several other upgrades at its refinery at Sinclair, Wyo. The project is slated for completion in first quarter 2000. It will increase production of gasoline, jet fuel, and Nos. 1 and 2 diesel by 11,000 b/d.

Italian firm Enichem
chose two of Institut Fran?ais du P?trole's (IFP) technologies-Aromizing and Arofining-to increase the aromatics output of its Priolo, Sicily, refinery by 22,000 b/d. Aromizing is a continuous-catalyst-regeneration reforming process oriented to aromatics production, and Arofining selectively hydrogenates olefins, said IFP.

British Petroleum plc
let contract to a joint venture of Finland's Imatran Voima Oy (IVO) and Japan's Mitsubishi Corp. to build, own, and operate a natural gas and refinery gas-fired combined heat and power (CHP) plant at its Grangemouth, Scotland, refining and petrochemical complex (OGJ, Nov. 23, 1998, p. 32). IVO unit IVO Power Engineering Ltd. let an $18 million subcontract to Foster Wheeler Energia Oy for design and manufacture of a heat-recovery steam generator and process steam boiler. The plant, scheduled to start up by yearend, will produce 230 tons/hr of steam and 130 MW-equivalents of electricity.

Coalbed methane

Western Gas Resources Inc., Denver, plans to participate in the building of a 106-mile, 24-in. gathering header in the Powder River basin in northeast Wyoming. Interests in the header will be Western Gas 23.33%, CMS Energy Corp. unit CMS Gas Transmission & Storage 33.33%, Enron Capital & Trade Resources Corp. 33.33%, and Coastal Corp. unit CIG Resources Co. 10%. The header will have an initial capacity of about 450 MMcfd and will deliver coalbed methane to a treating plant to be built near Glenrock, Wyo. Header construction is slated to begin in April 1999, and operations will begin in September 1999.

Power

InterGen, Boston, and the Netherlands' Eneco plan to jointly develop and operate a gas-fired combined heat and power plant of up to 800 MW capacity, to be built in the Rotterdam area. Interests in the project will be InterGen 60% and Eneco 40%. An InterGen affiliate signed a gas supply agreement for at least 50% of the project's feed requirements with the Dutch gas distribution and trading firm, NV Nederlandse Gasunie.

Courts

Saybolt Inc., a Boston-based gasoline inspection firm, pleaded guilty in the U.S. District Court to submitting false test data to the U.S. Environmental Protection Agency over a 2-year period. Saybolt, hired by refiners and importers to test their reformulated gasoline for compliance with EPA regulations, was accused of reporting higher-than-measured oxygen contents in order to meet EPA standards. The company was fined $3.4 million.

Companies

Naftex Operating Co., Los Angeles, acquired producing oil and gas assets in Kern County, Calif., from Chevron U.S.A. Inc. for an undisclosed price. The properties include more than 4,000 acres of fee land in Railroad Gap, Asphalto, and McKittrick fields, near Elk Hills oil field. The properties produce 420 b/d of oil and 3.5 MMcfd of gas and associated liquids.

Western Australia
will proceed with the sale of its gas distribution company, AlintaGas. The sale will occur within 18 months and is expected to raise up to $1.1 billion (Australian). About $200 million of this would be used to cancel AlintaGas's current debt, and the rest would be used to retire general government debt and undertake capital projects. AlintaGas supplies gas to 400,000 households in Western Australia. A steering committee will now decide how and when the utility should be sold, including a decision about a public float. Legislation will be introduced into Parliament before mid-1999.

Altra Energy Technologies Inc.
unit Altra Streamline LLC, Houston, plans to acquire QuickTrade LLC and QuickTrade Canada LP from units of Dynegy Inc., Sempra Energy, and Nicor for an undisclosed sum. QuickTrade operates an electronic trading system used in Canada and the U.S. Altra's Streamline and Chalkboard systems are used to trade natural gas, liquid fuels, and electric power. The two systems will be merged into a single trading platform by yearend, said Altra.

Core Laboratories,
Houston, plans to acquire all the outstanding shares of GeoScience Corp. through a combination of $25 million in cash and 6.8 million shares of Core's common stock. Under terms of the merger agreement, each GeoScience share will be exchanged for 0.6788 shares of Core stock and $2.46 in cash. GeoScience, which produces marine streamers, ocean bottom cables, radio telemetry systems, and other products, will operate under its tradename, Syntron.

ABB Group
received approval from the U.S. Federal Trade Commission to complete its $2.1 billion acquisition of Dutch firm Elsag Bailey Process Automation NV (OGJ, Oct. 26, 1998, Newsletter). ABB can now close the deal.

Petrochemicals

China's Yangtze River Acetyls Co. started up a $200 million acetic acid plant at Chuanwei, near Chongqing in southwest China. The company is owned by BP Amoco plc 51%, state firm China Petrochemical Corp. (Sinopec) 44%, and Chongqing Investment & Construction Co. 5%. The plant has capacity to produce 150,000 metric tons/year of acetic acid, some of which will be supplied to a Sinopec fibers plant at the site. China's demand for acetic acid is expected to grow 6%/year.

Fina Oil & Chemical Co.,
Plano, Tex., started up the Train 9 polypropylene unit at its La Porte, Tex., manufacturing plant. The new unit, with a capacity of 550 million lb/year, makes it the second largest producer of polypropylene in the U.S. The plant's production includes homopolymers, random copolymers, and impact copolymers.

Nova Chemicals Corp.,
Calgary, says its acquisition of styrenics producer Huntsman Corp., Salt Lake City, is worth $637 million, plus working capital, instead of the $685 million originally stated (OGJ, Aug. 3, 1998, p. 28). U.S. regulators reviewed the deal and ordered that Huntsman's North American expandable polystyrene capacity be excluded from the sale.

Drilling-production

Elf Exploration U.K. let contract to ABB Vetco Gray to supply a 20,000 psi wellhead for use in Elgin/Franklin fields in the U.K. North Sea. Elf will use the wellhead to re-enter a development well to explore zones in the Triassic. The order requires ABB Vetco Gray to extend the capability of an existing system to 20,000 psi and 450° F. from 15,000 psi and 400° F. "It will be the first time offshore in Western Europe that a well has been extended to such high temperatures and pressures," said ABB.

Pipelines

Leviathan Gas Pipeline Partners LP acquired a 49% interest in Viosca Knoll Gathering Co. from El Paso Energy Corp. unit El Paso Field Services Co. for a combined $21.315 million in cash and newly issued Leviathan common shares. The deal is valued at $85.26 million. The gathering system consists of 125 miles of primarily 20-in. pipe, 7,000 hp of compression, and related facilities. It can deliver about 1 bcfd into certain major U.S. interstate systems.

TransCanada PipeLines Ltd.,
Calgary, canceled its plans to build a $45 million (Canadian), 30-km pipeline loop project near Hearst, Ont. The decision came after falling behind on its construction schedule due to the inability to finalize negotiations with the aboriginal group Constance Lake First Nation. The project was part of a planned $403 million system expansion program across Canada to transport natural gas to markets in eastern Canada and the U.S. by November 1999. Trans- Canada said the cancellation will not prevent the expansion from proceeding.

Maritimes & Northeast

Pipeline Management Ltd. received approval from Canada's National Energy Board (NEB) for the construction of a 34.2-mile, 8-in. natural gas lateral from its main line near Goldboro, Guysborough Co., N.S., to Point Tupper, N.S. The project, expected to cost $21 million (Canadian), is slated to be in service by Nov. 1, 1999.

St. Clair Pipelines (1966) Ltd.,
on behalf of TriState Canada LP, filed an application with NEB for construction of a 5-mile, 24-in. natural gas pipeline. The pipeline, valued at $14 million (Canadian), will extend from a point along the international border at the St. Clair River, near Sarnia, Ont., to an interconnecting point with Union Gas Ltd. facilities at Bickford, Ont. TriState signed a transportation service agreement with Union Gas to transport natural gas from Bickford to Dawn, Ont. Construction of the pipeline is scheduled to begin early in 2000. The line is slated to begin service by November 2000.

Exploration

Santos Ltd. discovered gas in the South Australian section of the Cooper/Eromanga basin. On test, Raven 1 flowed 9 MMcfd of natural gas and 165 b/d of 56° gravity condensate through a 1/2-in. surface choke from reservoir sands at 2,622-2,632 m in the early Permian, Patch- awarra formation. The well, 7 km southwest of Moonanga field, reached 2,987 m TD. Interest holders in the Patchawarra Southwest block are Santos 59.75%, Delhi Petroleum Pty. Ltd. 20.21%, Boral Energy Resources Ltd. 13.19%, Gulf Australia Resources Ltd. 4.75%, and Cultus Group 2.1%.

Participants
in the proposed $8 billion (Australian) Gorgon gas project in the Carnarvon basin off Western Australia announced proved gas reserves of 13.8 tcf in five fields-Gorgon, Chrysaor, Dionysus, West Tryal Rocks, and Spar. In addition, say the firms, the greater Gorgon area may have proved plus probable reserves of 17.6 tcf, while adding possible reserves could push the figure to 21.5 tcf. An LNG export project is in the planning stage (OGJ, Nov. 9, 1998, p. 45). It is contingent on signing long-term gas contracts with South Korea and China, and possibly India.

Gas storage

Texas Utilities Australia will begin construction of an underground gas storage facility in western Victoria this month, 1 year ahead of the original schedule. Work was brought forward to ensure back-up gas supplies, after an explosion at the Longford gas plant left most of Victoria without gas for 2 weeks last year (see Newsletter). Texas Utilities will operate the $60 million (Australian) facility, along with a 152-km gas pipeline to Geelong, west of Melbourne. The gas will be stored in depleted reservoirs in the Otway basin, beginning with Iona field. Texas Utilities acquired the rights to the structures from Victoria for $24 million.

Cogeneration

Dearborn Industrial Generation LLC, a combine of CMS Energy Corp. and DTE Energy Services, awarded a contract to Duke/Fluor Daniel for engineering, procurement, construction, commissioning, start-up, and testing services of a cogeneration plant fueled by natural and blast-furnace gas. The contract's value was undisclosed. The $240 million, 550-MW plant will be built at Rouge Steel Co.'s complex at Dearborn, Mich. Full operation is slated for June 2001.

Australia's Comalco has short-listed five companies to build, own, and operate a cogeneration plant at a planned alumina refinery. The move edges Comalco closer to building the $1 billion (Australian) refinery. All five bidders-CS Energy, Edison Mission Energy, NGR Asia-Pacific, Sithe Energies, and Stanwell Corp.-expect the refinery will be built in Gladstone, Queensland, but Comalco says it has yet to decide whether to base the facility there or at Sarawak, Malaysia (OGJ, Dec. 14, 1998, Newsletter).

Terminals

Williams completed the purchase of 12 petroleum products terminals in the southeastern U.S. from BP Amoco for an undisclosed amount. Williams now owns 28 independent terminals. The terminals-sold to achieve FTC approval of the merger of BP with Amoco Corp.-have 2 million bbl of storage capacity.

LNG

A feasibility study conducted by international port consultants Safrogaz and Sogreah found that a terminal for liquefied natural gas (LNG) is viable at the minor port of Dahej in India's Gujarat state. The findings sharply contradict those of consulting firm Scott Wilson, which concluded that Dahej was an unsuitable site. Safrogaz and Sogreah concluded that Dahej would not only be the most cost-effective site but also has weather suitable for handling imports throughout the year. The cost of building the facility at Dahej is estimated at $108 million.