Exploration
Repsol-YPF SA
disclosed a large oil and gas find on Caipipendi Block in southern Bolivia. On test, Margarita X3 well flowed 2,300 b/d of oil and 2 million cu m/day of gas from one formation. Drilling is continuing; Repsol-YPF said it expects to discover additional pay zones. The firm postulates estimated reserves for the current find at more than 300 million boe, but it says this figure could double. License interests are: operator Repsol-YPF, 37.5%; BG PLC, 37.5%; and ARCO, 25%.
Petrochemicals
BP Amoco PLC
asked the Oman government to cancel construction of a 500,000 tonne/year ethylene plant at Sohar, Oman (OGJ, May 18, 1998, p. 44). The decision to call off the $900 million project followed a feasibility study in which BP Amoco found that fluctuating global petrochemical prices would not support the project. BP Amoco was to have a 49% stake, and Oman Oil Co. 11%. A 40% public subscription float was planned.
Qatar Fuel Additives Co.
(QAFAC) made the first methanol shipment from its new $700 million plant at Mesaieed, southeast of Doha. The plant has capacity to produce 830,000 tonnes/year of methanol and 610,000 tonnes/year of methyl tertiary butyl ether. QAFAC is a joint venture of: Qatar General Petroleum Corp., 50%; Taiwan's Chinese Petroleum Corp., 20%; Lee Chang Yung Chemical Industry Corp., 15%; and International Octane Ltd., 15%.
Chinese Petroleum Corp.
withdrew from a project to build a naphtha cracker and related downstream units in the Philippines. CPC cited a combination of factors, including strained trade ties between Taiwan and the Philippines (see related story, p. 35) and the earthquake that struck central Taiwan Sept. 21. CPC will place top priority on investment within Taiwan. The $600 million Philippine project-a joint venture of CPC, Japanese firm Itochu Corp., and Philippine Petrochemical Development Corp.-received Philippine approval in August.
Oilsands
Alberta Energy and Utilities Board
approved construction of a $3 billion (Can.) upgrader at Syncrude Canada Ltd.'s oilsands plant near Fort McMurray, Alta. The unit is part of a $6 billion expansion program that will double synthetic crude production to 480,000 b/d by 2007. AEUB said the upgrader will increase sulfur dioxide emissions to 56 tonnes/day and requires Syncrude to submit a report on emissions by March 2001.
Power
Columbia Electric Corp.,
Herndon, Va., plans to develop the Grassy Point Energy natural gas-fired power plant at Haverstraw, NY. The 550-Mw plant will use advanced combined-cycle and emission-control technology. Columbia Electric, through its unit Haverstraw Bay LLC, will work with New York state officials over the next 18 months to complete the application and permitting process, which focuses on the use of a brownfield site.
An gas-fueled power plant
to be built at CPC's Taoyuan refinery has passed the environmental impact assessment (EIA) required by Taiwan's Environmental Protection Administration and is awaiting approval from the Ministry of Economic Affairs. The 600-Mw plant will use imported LNG as feed and will consist of two generators. It will be built by a joint venture of CPC, TotalFina SA, and local engineering firm CTCI Corp. Power output will be used mainly by the refinery, with any excess sold to the state-run Taiwan Power Co.
Drilling-production
Chevron Corp.
said it will spend $3 billion over the next 4 years to expand production capacity at Tengiz oil field in Kazakhstan. The company will drill exploration and development wells, upgrade existing processing facilities, and add new processing units. Tengiz output is expected to increase from 220,000 b/d in 1999 to 370,000 b/d in 2004.
Production at Hibernia oil field
off Newfoundland was cut to 68,000 b/d from 145,000 b/d after an Oct. 5 production platform fire. The Hibernia management group said the fire was quickly extinguished and the platform was not evacuated. Production was expected to return to normal by Oct. 19. The fire was caused by hot exhaust gases leaking from a turbine and igniting a flange.
Canadian Imperial
signed a farmout agreement and will put into production an oil and gas discovery on Port au Port Peninsula, Newf. The discovery was made in 1995 by a unit of Hunt Oil Co., Dallas, and PanCanadian Petroleum Ltd., Calgary, and was later abandoned due to lack of sufficient reserves to support development. Canadian Imperial will develop the 84,000-acre permit area, which it estimates as holding 13 million boe of reserves and having the capability to produce at least 3,270 b/d of oil and 48 MMcfd of gas. Production is slated to begin in 2000. Canadian Imperial will hold a 100% interest in the field and pay Hunt Oil and PanCanadian a production royalty.
A group led by ARCO
secured an extension of rights, to July 16, 2000, from the Qatari government for gas sales from North field off Qatar. The extension provides a continuing framework for initiatives of the consortium to finalize a gas sales contract and commence development of the field. The group comprises: operator ARCO, 27.5%; Gulfstream Resources Canada Ltd., 27.5%; BG PLC, 25%; Wintershall AG, 15%; and Preussag Energie GMBH, 5%.
Shell Oil Co.
claimed a Gulf of Mexico production record with a well in Ursa field on Mississippi Canyon Block 809. On Sept. 8, the A-7 well produced 39,317 b/d of oil and 60.67 MMcfd of gas, or 50,150 boe/d. This exceeded the previous production mark of 46,475 boe/d at the Troika development, also in the gulf. Shell said the record was achieved by executing a frac-and-pack at a rate of 40 bbl/min and by using shunt tubes to ensure a solid pack, in addition to using 51/2-in. tubulars. The Ursa field is owned by operator Shell, 45%; BP Amoco, 23%; Conoco Inc., 16%; and Exxon Corp., 16%.
American Eco Corp.,
Houston, a wholly owned subsidiary of United Eco Systems, High Point, NC, teamed up with Mexico's Residuous Industriales Multiquim SA de CV on a $10 million-plus contract for Pemex Explorac
Texaco Exploration & Production Inc.
began oil and gas production from Vermilion 379 field in 350 ft of water off Louisiana in the Gulf of Mexico. The field is producing about 1,041 b/d of oil and 18.1 MMcfd of gas from six wells. Interest holders are: operator Texaco, 50%; Noble Affiliates Inc. unit Samedan Oil Corp., 25%; and Petrobras America Inc., 25%.
Refining
Equilon Enterprises LLC,
a joint venture of Shell and Texaco Inc., sold its 109,000 b/d El Dorado, Kan., refinery to Frontier Oil Corp. The deal includes long-term product off-take and crude oil supply agreements with Equiva Trading Co. Frontier owns a 41,000 b/d refinery at Cheyenne, Wyo.
Formosa Petrochemical Co.
will begin trial production in January 2000 from its 450,000 b/d refinery being built at Formosa Plastics Group's Mailiao petrochemical complex in Taiwan. Commercial production is slated to begin 2 months later. The refinery has three crude units, each with 150,000 b/d of capacity. Formosa's initial commercial throughput target will be 100,000 b/d in one crude unit. Products will include heavy fuel oils, diesel, and aviation fuel.
Hurricane Hydrocarbons Ltd.,
Calgary, agreed to pay $57 million (US) and one third of its stock-worth about $16 million (Can.)-for the 160,000 b/d Shymkent refinery in Kazakhstan. Hurricane is operating under court protection from creditors. The company ran into financial problems in 1998 and became involved in a financial dispute with the refinery owners (OGJ, Nov. 23, 1998, p. 40). Bondholders are still seeking legal action to recover investments in Hurricane. Hurricane's shareholders, bondholders, and creditors are owed about $200 million (US); they must approve the refinery purchase.
Tankers
The Ras Laffan,
a new Aframax double-hull crude carrier, was delivered to QM Tanker, a 50-50 joint venture of Mobil Shipping & Transportation Co. and Qatar Shipping Co. The 105,775 dwt carrier, built by South Korea's Hyundai Heavy Industries Ltd., can carry 755,000 bbl of crude oil. The tanker is 244 m long and 42 m wide and will be used worldwide.
LNG
Coral Energy Resources LP,
Houston, purchased a spot cargo of 2.9 bcf of LNG from Australia's North West Shelf Venture (NWSV) for delivery to the US. Terms of the transaction were not released. The vessel for the cargo shipment is the LNG Delta, which will be loaded in the fourth quarter at Withnell Bay, Western Australia, for delivery to CMS Energy's CMS Trunkline LNG terminal at Lake Charles, La. Woodside Energy Ltd. is operator of NWSV.
CMS Energy
purchased seven additional cargoes of LNG from Qatar Liquefied Gas Co. to be delivered in 2000 at its CMS Trunkline LNG terminal. The natural gas will then be shipped through the CMS Trunkline system. The first LNG cargo will be loaded on the tanker Aquarius in January 2000, with remaining shipments to be loaded in 55-day intervals. Terms of the deal were not disclosed.
Alternate energy
Automakers
Honda and Volkswagen AG joined the California Fuel Cell Partnership, an Anaheim-based public-private venture formed to demonstrate fuel-cell vehicles in California. The partnership started up in April and includes: automakers Daimler Chrysler and Ford Motor Co.; energy providers ARCO, Shell, and Texaco; fuel-cell company Ballard Power Systems; and state agencies California Air Resources Board and California Energy Commission. The partnership has been developing strategies for resolving fueling infrastructure issues and vehicle placement as well as creating a public awareness plan.
Companies
Investment fund Industri Kapital
will acquire Neste Chemicals, a unit of Finland's Fortum Corp., for 505 million euros. The deal, which awaits European Union approval, will provide a capital gain of 90 million euros.
China National Offshore Oil Corp.
postponed its initial public offerings-due to close Oct. 15-citing adverse market conditions (OGJ, Oct. 18, 1999, Newsletter). CNOOC has not rescheduled the issues.
Ingersoll-Rand Co.
will acquire the interests in two joint ventures-Dresser-Rand (DR) and Ingersoll-Dresser Pump (IDP)-from Dresser Industries Inc., a unit of Halliburton Co., Dallas, for about $1.1 billion (OGJ, Aug. 30, 1999, p. 47). Dresser holds 51% of DR and 49% of IDP, while Ingersoll-Rand owns the remaining interests. The sale is set to close on Dec. 30. Simultaneous with closing, Dresser will repay the JVs about $220 million for outstanding advances made to Dresser. Net of taxes and all related costs, the sales will result in a net cash inflow of about $630 million, which Dresser will use to repay short-term debt.
National Oilwell,
Houston, signed a definitive agreement to purchase all of the outstanding shares in Hitec ASA in a deal valued at $120 million in cash and stock. National Oilwell will merge Hitec's drilling business with its own. All non-drilling Hitec business units have been sold to newly formed holding firm Hitec-Vision AS.
Global Energy Inc.,
Cincinnati, acquired the gasification assets and proprietary gasification technology and patents of Dynegy Inc., Houston, for an undisclosed sum. The deal includes a synthesis gas unit at the Wabash River coal gasification repowering project at Terre Haute, Ind. It also includes rights to projects in development. "This sale will enable us to place our technology and assets with a company whose strategic interest is to further develop the technology to its full potential at Wabash and subsequent projects," Dynegy said.
Enterprise Oil PLC
paid $20 million for a 7.5% stock holding in Khanty Mansiysk Oil Corp., a US-registered independent with exploration and production assets in western Siberia. The deal gives Enterprise the right to acquire a further 3% interest in KMOC in return for financial and technical support, plus an option to acquire another $20 million worth of common stock. John Shute, general manager of new business at Enterprise, said, "We have had a small team working in Russia over the past 2 years. We believe this agreement now provides us with an excellent opportunity to gain further experience of, and a managed exposure to, Russia and West Siberia in particular."
Environment
Natural Gas Supply Association
reports its member companies have reduced methane emissions by 50 bcf since 1993 under the US Environmental Protection Agency's voluntary Natural Gas STAR Program (OGJ, July 19, 1999, Newsletter). The reductions came from: replacing high-bleed pneumatic devices with low or no-bleed devices, installing flash-tank separators on glycol dehydrators, reducing glycol circulation rates in dehydrators, installing vapor-recovery units on storage tanks, and using plunger lifts to prevent well blowdowns.
