Spills
Totalfina Elf
and the French government plan to use a novel approach to pump out the 146,000 bbl of heavy fuel oil that remains in the sunken Erika tanker, which broke up Dec. 12 off the coast of France (see Watching Government, p. 34, and OGJ, Jan. 24, 2000, p. 28). The plan incorporates technology akin to Petroleos de Venezuela SA's proprietary Orimulsion process for converting extra-heavy crude to a liquid boiler fuel. The 400 million-franc plan involves mixing the fuel with an emulsifying agent while using hydrostatic pressure within the ship's hold to transfer the fuel to a submerged intermediate vessel. A double screw pump then will bring the fuel to the surface.
Gas gathering
Conoco Inc.
and 50-50 partner Elf Aquitaine SA, a subsidiary of Totalfina Elf, let a $160 million contract to Houston-based Kvaerner ENC, a division of Kvaerner US Inc., for engineering, procurement, and construction of the $430 million Deir Ez Zor natural gas project in Syria's eastern desert. The contract involves construction of a two-train, 450 MMcfd gas processing complex, six compressor stations, a 100-mile gathering system, and a 150-mile trunk pipeline. The project will gather, process, and transport a large associated gas stream being flared in oil fields in the Deir Ez Zor area under a gas development service contract with Syrian Petroleum Co. (OGJ, Nov. 30, 1999, p. 34).
Exploration
Repsol-YPF SA
and partners Apache Corp., Houston, and Novus Petroleum Ltd., Sydney, found more natural gas on the Khalda concession in Egypt's Western Desert. On test, the Shams-8X well flowed 25.3 MMcfd of gas and 139 b/d of condensate from perforations at 13,168-210 ft. Working interests in the well are held by operator Repsol (50%), Apache (40%), and Novus (10%). The find is the fourth in which Apache has participated in three Egyptian concessions-and its sixth worldwide-since the start of this year (OGJ, Feb. 21, 2000, p. 34).
Alberta Energy Co. Ltd.
(AEC), Calgary, acquired a 75% interest in a 400,000-acre block in the Beaufort Sea off Canada's Mackenzie Delta from Husky Oil Ltd., Calgary. AEC acquired the stake in exchange for heavy oil properties in Alberta's Primrose region, among other assets. Gulf Canada Resources Ltd., Calgary, holds the remaining 25% stake in the delta acreage.
Inuvialuit Regional Corp.,
Inuvik, NWT, a native group in Canada's Arctic, will accept bids until Apr. 14 for six new oil and gas blocks in the Mackenzie Delta area on 34,750 sq miles of land that it owns. The acreage is near Inuvik and Tuktoyaktuk, close to the Beaufort Sea. Four major oil companies recently announced plans to study the feasibility of gas development in the delta area and a pipeline to southern markets (OGJ, Mar. 6, 2000, p. 34).
West Australian Petroleum Pty. Ltd.
(WAPET) partners made what they are calling a significant natural gas discovery on the North West Shelf off Western Australia. The Urania 1 wildcat, WAPET's third find on the WA-267-P permit, was drilled to 4,010 m TD in 1,200 m of water as a deepwater extension of Gorgon field. Although the size of the find is yet to be determined, WAPET says the net pay zone measured 54.4 m; preliminary estimates suggest the find could add several tcf of reserves to the gas-prone region. Urania follows successes nearby with the Geryon and Orthrus discoveries, which added an estimated 13.8 tcf to the Gorgon inventory, now standing at more than 40 tcf.
Gas processing
El Paso Field Services Co.
(EPFS), a unit of El Paso Energy Corp., Houston, will acquire the 42.3% nonoperated interest in the Indian Basin gas processing and treatment plant and related gathering lines from Oneok Inc., Tulsa, for $55 million. The facilities-which are in Eddy County, NM, and operated by Marathon Oil Co.-border EPFS's 800-mile Carlsbad gathering system and include a 240 MMcfd cryogenic processing plant and amine treating facility, 20,000 hp of plant and field compression, and more than 60 miles of gathering lines.
Government
Mexico's Energy Regulation Commission
(CRE) published its sales directive regulating all contractual relationships between Petroleos Mexicanos and natural gas buyers. More than 20 companies-including transporters, distributors, marketers, and customers-provided CRE with input in drawing up the regulations to assure transparency, fairness, and equity in the contracts. Within weeks, Pemex will submit for CRE's approval its general terms and conditions for gas sales subject to those guidelines.
UK Minister of Energy
Helen Liddell is pressuring offshore operators to explore and develop "fallow" blocks in UK waters. Operators of 150 undeveloped discoveries and 200 blocks, on which there has been no drilling for 6 years or more, will be invited to discuss plans for those properties with government officials. The discussions are part of a push to stimulate new work for idle coastal fabrication yards while maintaining UK offshore oil and gas production at 3 million boe/d through 2010. UK Offshore Operators Association maintains that the government's big tax bite is an obstacle.
Oilsands
Canadian Natural Resources Ltd.
(CNR), Calgary, is moving closer to the development of a $6.5 billion (Can.) oilsands and heavy oil operation in the Fort McMurray region of northern Alberta. The Mic Mac project would be developed on leases acquired from BP Amoco PLC in 1999. Initial studies are to be completed by September, said CNR. The project, which would begin production in 7 years, pending regulatory approvals, would have initial production of 300,000 b/d from a combination of open pit mining and a heavy oil operation. CNR Chairman Al Markin said a long lead time is needed on the project because the company has not been involved in oilsands before.
Companies
Tecnimont SPA,
Milan, signed an agreement to acquire 66% of Gaz de France's (GDF) engineering unit Sofregaz for an estimated 25-50 million euros. GDF will retain a 34% equity share of the unit and continue to assist it with plant management. GDF in mid-1999 launched its bid for the stake, which is yet to receive regulatory approval. Sofregaz's sales have declined in recent years to 442 million francs in 1999 from 1.1 billion francs in 1995.
Canadian Occidental Petroleum Ltd.
(CanOxy), Calgary, and the Ontario Teachers' Pension Plan Board joined to acquire the 29.2% interest in CanOxy held by Occidental Petroleum Corp., Los Angeles, for about $1.2 billion (Can.). The pension fund is to buy 20.2 million shares of CanOxy stock for $598.1 million-increasing its holdings in CanOxy to 19% from 2.2%-and CanOxy will purchase the other 20 million shares for $592 million. CanOxy then will cancel the stock it acquires, reducing outstanding shares to 118.3 million. In addition, Oxy is swapping its 15% interest in CXY Chemicals for CanOxy's 15% share in Ecuador's Block 15, leaving each as full owner of their respective entities.
A group of investors
received approval from Iowa Utilities Board for their acquisition of MidAmerican Energy Holding Co., Des Moines (OGJ, Nov. 1, 1999, p. 46). The group-consisting of Berkshire Hathaway Inc.; Walter Scott Jr., MidAmerican's largest individual stockholder; and David Sokol, MidAmerican chairman and CEO-purchased MidAmerican for $2.35 billion in cash and assumed debt.
Anderson Exploration Ltd.,
Calgary, will sell its 50% interest in Federated Pipe Lines Ltd., Calgary, for up to $126 million (Can.). The company is a joint-venture partner with Imperial Oil Ltd., Toronto, in the 232,000 b/d pipeline that moves oil and NGL in Alberta and British Columbia. Anderson is taking bids for the pipeline interest until May or June.
Pipelines
AEC
will be lead partner in a consortium planning to build an $800 million heavy crude oil pipeline in Ecuador. The company said government approval for the 342-mile pipeline is expected in 2-3 months, with construction to start by yearend. The line would cross the Andes to connect AEC oil fields with a tanker terminal on the Pacific Coast. AEC would have a 30% interest in the project, and other partners would include Occidental Petroleum Corp. and Italy's Agip SPA. AEC also said it is in talks to acquire a 30,000 b/d Oxy oil project in Ecuador.
Petroecuador
is due to complete the first phase of the Trans-Ecuadorian Pipeline (SOTE) expansion at the end of March (OGJ, Aug. 2, 1999, p. 25). The expansion will add about 45,000 b/d to the system. The second expansion, which will add another 15,000 b/d, is due to be completed in May and will take the pipeline's total throughput capacity to 410,000 b/d.
Petrochemicals
Qingdao Kilian Group
and Montell Polyolefins BV unit Taiwan Polypropylene Co. Ltd. (TPP) signed a memorandum of understanding to assess the feasibility of forming a joint venture to build a polypropylene plant based on Montell's Spherilene process in Qingdao, China. Partnership interests in the JV will be TPP 90% and Kailian 10%. Kilian will provide propylene and ethylene feed from its Qingdao refinery, while Montell will supply its technologies and catalysts.
USI Far East Corp.
and Union Petrochemical Corp., both based in Taipei, plan to form a joint venture that will produce polyvinyl chloride in China. The JV will build a 150,000 tonne/year plant at Zhongshan, which is expected to reach commercial operations in about 2 years.
Catalysts
W. R. Grace & Co.,
Columbia, Md., acquired Crosfield Group's hydroprocessing catalysts business in Chicago from Imperial Chemical Industries PLC for $30 million. Through such acquisitions, Grace-which will integrate the Corsfield business into its Davison catalyst business-is taking steps to broaden its capabilities in the hydroprocessing catalyst market, especially in the higher-growth light oils processing segment, it said.
Drilling-production
Elf Petroleum Qatar
and ENI's Agip Qatar BV received approval for full development of Alkhalij field on Block 6 in 59 m of water off Qatar. Operator Elf holds 55% interest, Agip 45%. Development of the field's eastern portion is expected to increase production to 60,000 b/d from 30,000 b/d and cost $200 million. Work will include the installation of two new production platforms, one injection platform, and additional process facilities and pipelines. Also, the partners plan to drill nine new production wells and four injection wells. First oil is expected in third quarter 2001.
Nigeria's AMNI International Petroleum Development
(AMNI) signed a $19.5 million, 1-year loan with Shell Capital-a joint venture of Royal Dutch/Shell and Baker Hughes Etto Ltd.-to drill two development wells and perform workovers of two shut-in wells in AMNI's Ima field in Nigeria. The project is expected to increase production by 6,000-8,000 b/d of condensate. Ima field's production has declined sharply in recent years, due mostly to well damage. The loan is said to be the first of its kind in Africa.
Noble Drilling Corp.,
Houston, resolved its breach of contract suit with Mariner Energy Inc., Houston, over use of its Noble Homer Ferrington semisubmersible, which was upgraded to work in 6,000 ft of water. Mariner agreed to use the rig at least 660 days over the next 5 years, giving Noble working interests in seven of its deepwater exploration prospects in lieu of market-based day rates. Mariner also will pay Noble's share of cost on each initial test well. A similar suit by Noble Drilling is still pending against Samedan Oil Corp., a subsidiary of Noble Affiliates Inc., Ardmore, Okla.
Esso Norge AS
let contract to ABB Offshore Systems AS for the engineering, procurement, and construction of subsea systems for its Ringhorne development project, which consists of several reservoir locations that surround Balder field in the Norwegian North Sea. The new subsea wells will be tied back to the Balder floating production vessel. ABB will deliver three subsea production systems and two subsea water injection systems. Work is to begin immediately, and delivery of equipment is slated for December 2000.
Conoco (UK) Ltd.
and partners leased the 131,000-dwt Nordic Apollo double-hulled floating storage and offloading vessel from PGS Atlantic Power to be permanently moored in Banff field, 125 miles east of Aberdeen in the UK North Sea. The vessel replaces a single-anchor loading system. Nordic Apollo, to begin operation in August, has a storage capacity of 900,000 bbl. Interest holders in the field include operator Conoco, 31.7%; Ranger Oil (UK) Ltd., 26.2%; Enterprise Oil Exploration Ltd., 27.9%; British Borneo Oil & Gas PLC, 12.4%; and Petrobras North Sea Ltd., 1.8%.
Gas distribution
Gas Natural Mexico
(GNM), a unit of Spain's Repsol-YPF SA, plans to invest nearly $34.6 million (US) over the next 5 years to build a 719-km pipeline serving more than 55,715 customers, including 1,413 commercial and 385 industrial users, in Mexico's Bajio Norte region in Zacatecas state. GNM has obtained a distribution permit from Mexico's CRE for the proposed line. Throughput is expected to average 42.4 MMcfd over the next 5 years. As winning bidder, GNM offered an average tariff of $1.095/gigacalorie.