Refining
Seventeen workers
at Irving Oil Ltd.'s St. John, NB, refinery were treated on site for respiratory and ocular symptoms and later taken to a hospital after exposure to sulfur dioxide on Oct. 27, according to the Calgary Herald. The gas reportedly escaped from a sulfur containment unit stack after a series of power outages disrupted unit operation. The 17 were among 30 employees present; the other 13 returned to work. The incident followed a similar one 2 days prior when 14 people working atop a unit being installed found themselves in the path of exhaust from another stack when the wind changed. Irving Oil is talking with NB Power to establish a more reliable power supply.
Environment
A federal appeals court
in Washington, DC, reaffirmed a May decision blocking the US Environmental Protection Agency from enforcing a controversial rule imposing stricter ozone and particulate matter emissions limits. In May, a three-judge panel from the US Court of Appeals prevented EPA from implementing the regulation, drafted in 1997 (OGJ, May 24, 1999, p. 39). On Oct. 29 in a 6-5 decision, the full court rejected EPA's appeal of that decision. EPA plans to appeal to the US Supreme Court.
Exploration
Total Exploration Production Bolivie SA
and its partners confirmed the discovery of 7.3 tcf of natural gas and 160 million bbl of condensate with their ITAU X-1 (A) well on Block XX (Tarija West) in Bolivia's Gran Chaco province (OGJ, Aug. 16, 1999, p. 36). The find increases Bolivia's proven and probable gas reserves to 27.3 tcf.
Apache Corp.,
Houston, made an oil and gas discovery in Production License Area TL/1 in the Barrow sub-basin of the Carnarvon basin off Northwest Australia. On test, North Gipsy-1 flowed 5,940 b/d of 44.9° gravity oil with 1,065 psi flowing tubing head pressure through a 56/64-in. choke. The well cut a 63-ft interval at 7,336-7,399 ft in Late Triassic Brigadier sandstone. It also encountered a gas-condensate column in the North Rank- in, but a test was not conducted. The discovery increases the possibility of early development of the Gipsy-Rose-Lee complex, says Apache. Partners are: operator Apache, 68.5%; Kuwait Foreign Petroleum Exploration Co., 19.3%; and Tap Oil, 12.2%.
West Australian Petroleum Pty. Ltd.,
Perth, made another major gas find on the North West Shelf off Western Australia. Wildcat Orthrus 1, drilled to 3,570 m TD in 1,200 m of water on Permit Area WA-267-P, cut a net gas zone of 53 m. Last month, Geryon 1 in the same permit area cut 113 net m of gas (OGJ, Oct. 4, 1999, p. 42). Both wells lie about 30 km from Gorgon gas field. Drilling in WA-267-P will continue, with another four wells planned in the first quarter of 2000, when the deepwater rig Marine 500 returns from other drilling commitments.
Lasmo PLC,
London, made an oil and gas discovery in the southeastern area of Venezuela's Dacion block, on which it acquired a redevelopment contract in 1998 (OGJ, Oct. 19, 1998, p. 32). Well LM-226E (Tortola-1), Lasmo's first exploratory well on the block, was drilled to 2,082 m TD and cut 21 m of oil and gas-bearing pay in the Middle-Lower Miocene Oficina. Lasmo is testing four oil zones, three of which have been perforated and are flowing a combined 3,600 b/d of 22-25° gravity oil. An appraisal well is slated for early 2000. Tortola-1 is the first well in a 17-well exploration drilling program; nine wells are slated to be drilled by yearend 2000.
Petrochemicals
Spanish oil firm CEPSA
and a Quebec government agency announced plans to build a $440 million (Can.) petrochemical plant at Montreal. The firms have not chosen a site but are evaluating several mothballed petrochemical complexes. The plant, which would have production capacity of 400,000-500,000 tonnes/year of plastics for manufacturing bottles and other products, is slated for completion by 2002. CEPSA already operates in Quebec under the name Petresa-Canada, producing components for biodegradable detergents. Quebec's Societe Generale de Financement is expected to be a project partner.
Exports-imports
Thailand
signed a 1-year renewable agreement with Oman for the purchase of 17,000 b/d of oil beginning in January 2000. The transaction marks the first such direct arrangement between the two countries; Thailand previously purchased about 30% of Oman's oil exports through a third party. After Japan, Thailand is the second largest importer of Omani crude, taking 200,000 b/d.
Drilling-production
US Minerals Management Service
awarded contracts to Duke Energy Trading & Marketing LLC and Dynegy Marketing & Trade Inc. to receive federal gas production from a royalty in-kind pilot project on the Gulf of Mexico Outer Continental Shelf. The companies will deliver processed gas to the General Services Administration; the gas will be used at federal facilities through March 2000. This is the third such pilot program MMS is "pursuing to test the effectiveness of taking royalties in-kind as an alternative to the traditional cash basis for mineral royalties," said MMS.
Occidental Petroleum Corp.
began production from the first of seven wells planned by second quarter 2000 for the Idd el Shargi South Dome initial development/enhanced oil recovery project off Qatar (OGJ, Apr. 27, 1998, p. 40). The field is producing an initial 2,500 b/d. Operated as a satellite of Oxy's Idd el Shargi North Dome, Shargi South is connected via a 22-km subsea pipeline. Oxy expects to decide on a full development plan by yearend 2000.
A semisubmersible
drilling-production platform built by Davie Industries at Levis, Que., left Sept-Iles by barge Oct. 28 on the St. Lawrence River bound for Roncador oil field off Brazil (OGJ, Sept. 20, 1999, p. 33). The barge and the 35,000-tonne platform were welded together for the 30-day voyage.
Government
US Department of Commerce
issued regulations for the $500 million Emergency Oil and Gas Guaranteed Loan Program, mandated by a law earlier this year (OGJ, Mar. 29, 1999, p. 18). Independent producers and small service-supply companies may be eligible for up to $10 million in federally guaranteed loans at a "reasonable" interest rate. Applications must be made to the DOC by Dec. 30.
Pipelines
Caspian Pipeline Consortium
members approved a $1.3 billion budget for 2000-a significant increase over last year's financial plan, says 15% equity partner Chevron Corp. The increase was made to complete construction of the 900-mile oil pipeline from western Kazakhstan's Tengiz oil field to the Russian port city of Novo- rossiisk on the Black Sea by mid-2001.
A unit of Williams,
Tulsa, signed an agreement with Oceaneering International Inc., T.D. Williamson, and Oil States Hydro Tech Systems Inc. to design equipment for diverless deepwater pipeline connections. The equipment and processes, called Deep Tap technology, will use remotely operated vehicles to connect gathering lines to transmission lines in water depths up to and beyond 8,000 ft. Deep Tap can be applied on pipelines up to 20 in. that are operating at pressures up to 2,000 psi with ANSI pressure ratings up to 1,500 psi. The firms expect to complete development and testing in spring 2000.
Russia's
Ministry of Urban Planning and Civil Engineering signed an agreement with US-based Ambo LLC for the elaboration of a feasibility study for the construction of a trans-Balkan oil pipeline passing through Bulgaria, Macedonia, and Albania. The US government will provide financial assistance for construction of the pipeline (OGJ, June 7, 1999, Newsletter). Additional funding is being sought. The feasibility study will cost nearly $1 million and is to be completed by February 2000. Construction is projected to be completed by 2004 at a cost of about $826 million.
LNG
Brunei Shell Petroleum Co. Sdn. Bhd.
let a $100 million contract to Malaysia's OGP Technical Services and its partner Nuovo Pignone SPA for design and construction of a compression plant for an LNG complex at Lumut, Brunei. OGP-a 60-40 joint venture of state oil firm Petronas and TransCanada International unit Nova Gas (M) Sdn. Bhd.-will serve as project leader and provide full engineering, design, procurement, construction, and commissioning services. The plant is slated to come on stream in mid-2002; it will consist of a slug catcher and three 22-Mw compressor sets. Nuovo Pignone will supply gas turbines, compressors, boilers, gas coolers, and valves.
Companies
DuPont Co.
renewed a 2-year agreement with Conoco Inc. unit Conoco Gas Marketing for the acquisition, scheduling, dispatching, transporting, balancing, and accounting of US natural gas supplies for 31 of its plants. Terms of the contract were not disclosed.
TransCanada PipeLines Ltd.,
Calgary, plans to sell $3 billion (Can.) worth of assets by 2001 as part of a program to reduce debt and streamline operations in Canada and the US. TransCanada said it will sell businesses not earning their cost of capital and those that no longer fit its focus on power and pipeline operations. TransCanada is in the process of selling its US petroleum and gas liquids marketing business. And earlier this year, it sold its Angus Chemical unit for about $600 million. CEO Doug Baldwin said the company will announce before yearend which operations outside pipelines and power generation it will keep.
An international arbitration panel
found in favor of Himpurna California Energy Ltd. (HCE) and Patuha Power Ltd. (PPL) in an arbitration brought by them against the Indonesian government for breach of sovereign performance undertakings related to defaulted payments on power-purchase contracts in the wake of the Asian economic downturn. The panel ordered Indonesia to pay HCE more than $393.4 million and PPL about $182.3 million. HCE and PPL are affiliates of MidAmerican Energy Holdings Co., Des Moines, Iowa.
The board of Columbia Energy Group,
Herndon, Va., rejected NiSource Inc.'s latest unsolicited offer of $74/share, calling it "inadequate" and not in the best interests of Columbia or its shareholders (OGJ, June 28, 1999, Newsletter). Columbia intends to explore other alternatives to enhance its shareholders' interests, it said, adding "ellipseWe will initiate discussions with third parties-including NiSource, if it is interested-regarding possible transactions designed to significantly enhance value for our shareholders."
Petro-Canada,
Calgary, will sell conventional crude oil properties in western Canada, including its two largest properties, Valhalla and Pembina fields in Alberta. The package will also include production at Wapiti and Boundary Lake and heavy oil properties in Sas- katchewan at Marsden and Luseland. Total production from the properties is about 17,200 b/d of oil and liquids and 18 MMcfd of associated natural gas. Petro-Canada said the sale is part of its plan to focus on other assets, such as its operations off Newfoundland.
Pengrowth Corp.,
a royalty trust, acquired certain natural gas properties in west-central Alberta from Renaissance Energy Ltd., Calgary, for $61.1 million (Can.). The assets, in the McLeod River area of northern Alberta, produce about 14 MMcfd of natural gas and 570 b/d of liquids. The sale also includes interests in three gas plants with net capacity of 23 MMcfd. Renaissance said it will apply the proceeds to debt reduction.
Power
InterGen
will move forward with its agreement with Brazilian utility Cia. Paulista de Forca e Luz and Shell Brazil Gas for the development of a 1,025-Mw, natural gas-fired, combined-cycle power plant at Mericana, in the west-central region of Brazil's Sao Paulo state. Considered by the Brazilian Ministry of Mines and Energy to be one of the country's key thermal power projects, the plant will cost $550-600 million and is expected to be completed in fourth quarter 2000. Commercial operation of the plant, which will be fueled with gas from the Bolivia-Brazil pipeline, is expected to begin in 2002-03.
LPG
Wesfarmers Energy Pty. Ltd.,
Perth, formed a consortium with Malaysia's Elpiji and Bangladesh's Palmal Group to import, market, and distribute LPG in Bangladesh. Wesfarmers will hold a 55% stake in the venture. The group plans to build an import terminal within 1 year and establish distribution points in southern Bangladesh. Wesfarmers produces about 250,000 tonnes/year of LPG, which it markets and distributes throughout mainland Australia. Bangladesh, with a population of 120 million and a recently deregulated industry, represents a market of significant potential, says Wesfarmers.
Lubes
Infineum Singapore Pte. Ltd.
signed a letter of intent with China's Shanghai Gaoqiao Petrochemical Corp. to establish a joint venture to produce lubricants additives in Shanghai. The JV will build a 20,000 tonne/year additives plant at an estimated cost of $10 million. Construction is to start next year, with completion slated for 2001. Infineum is a 50-50 joint venture of Royal/Dutch Shell and Exxon Corp.; Gaoqiao is a subsidiary of China Petrochemical Corp.