OGJ NEWSLETTER

March 5, 1990
More oil spills bedevil industry (see story, p. 24). Illinois environmental officials hiked the estimate of a Feb. 19 crude spill caused by a pipeline rupture at Shell Oil Co.'s Wood River, Ill., refinery to 16,000 bbl, about 16 times the level Shell originally reported, state officials said. Illinois Environmental Protection Agency called for a study of the refinery, which has had a string of mishaps the past 2 years. In pipeline leaks alone, nearly 23,000 bbl of crude or product has been

More oil spills bedevil industry (see story, p. 24). Illinois environmental officials hiked the estimate of a Feb. 19 crude spill caused by a pipeline rupture at Shell Oil Co.'s Wood River, Ill., refinery to 16,000 bbl, about 16 times the level Shell originally reported, state officials said.

Illinois Environmental Protection Agency called for a study of the refinery, which has had a string of mishaps the past 2 years. In pipeline leaks alone, nearly 23,000 bbl of crude or product has been lost since mid-December at the Shell plant, the agency said.

Barry Williamson, U.S. Minerals Management Service director, says the initial draft of the next 5 year lease sale schedule will be delayed.

Williamson said MMS will wait for the president's decision on a Florida and two California lease sales and for guidance from the Department of Energy's draft National Energy Strategy due Apr. 2.

He predicted the next sale schedule will be a "slower, more prudent, more focused approach." MMS will pay more attention in advance to environmental concerns, hold fewer sales, and offer less acreage.

Halliburton's Brown & Root Inc. is discussing with a potential purchaser the possible sale of a large part of its marine construction assets. The assets consist mainly of offshore construction vessels in the U.S., Middle East, and Far East.

Excluded are Brown & Root's interests in European Marine Contractors Ltd., Rockwater Offshore Contractors, Highlands Fabricators, and its U.S. and Indonesian fabrication operations.

U.K. North Sea production is beginning to crank up. Shell U.K. Exploration & Production restarted Cormorant A platform, out of commission since Apr. 18, 1989.

Shipments are to resume in early March from the platform, producing about 40,000 b/d before the shutdown.

Shell Expro's 100,000 b/d Brent Charlie platform, shut down since May 22, 1989, remains idle, and the operator says output will not resume until the first half of April.

Esso Exploration & Production U.K. Ltd. has begun the first phase of a project to develop designs for a diverless inspection system for tethers on tension leg-platforms in as much as 3,000 ft of water.

It awarded AEA Technology, Harwell, England, a 70,000 ($117,000) contract for the conceptual design of a system that will result from consideration of several inspection methods.

The Indian Petroleum Ministry's efforts to invite foreign oil companies to bid for offshore acreage, stymied by Rajiv Gandhi's government last year, will be delayed further as the new National party government studies the proposal.

The ministry has recommended three deepwater blocks off Bombay be offered for production sharing contracts under a fourth exploration round. State owned Oil & Natural Gas Commission opposes the idea as detrimental to security and creating operating problems in the adjoining Bombay High offshore area.

A cabinet decision is unlikely before July.

Bangladesh has another gas/condensate strike, this time by a foreign company.

Scimitar Exploration Ltd. 1 Jalalabad flowed a combined

rate of more than 70 MMscfd of gas and as much as 1,050 b/d of 45-52 gravity condensate from three of five main gas bearing sands.

Scimitar will submit a development proposal to state owned Bangladesh Oil & Gas Minerals Corp. (Bogmc) in 3-4 months. Bogmc gave no further details but claims reserves at 1.5 tcf of gas and 30 million bbl of condensate. Until this strike, Bangladesh reserves from 14 fields totaled about 14.14 tcf and 39.78 million bbl of condensate.

The strike is on Scimitar's 1,650 sq km production sharing contract near 7 Haripur, the country's sole oil discovery.

Petroleos de Venezuela SA is making headway toward a goal of sales of 1 million b/d by 2000 of Orimulsion, the extra heavy crude-30% water-emulsifier mix it hopes will compete with coal and fuel oil. Pdvsa will supply Great Britain's Power-Gen with about 1 million metric tons of Orimulsion. It will be the first large commercial shipment.

Pdvsa is negotiating with a power company in Sweden for sale of 2 million metric tons of Orimulsion, which costs about $3/bbl to produce and sells for about $9/bbl. Pdvsa targets sale of 500,000 b/d of Orimulsion by the mid-1990s.

Refining developments are reported in Nigeria, China, and the U.S.

Jibril Aminu, Nigerian petroleum resources minister, warned state run Warri refinery to increase throughput or face penalties, OPEC News Agency reported. He termed the 125,000 b/d plant's 58% throughput wasteful. A refinery spokesman blamed an April 1989 mishap involving the crude distillation unit. Aminu also ordered reactivation of the Warri petrochemical plant. The spokesman blamed an electric power shortage and said gas turbines are being built.

China's state Sinopec completed start-up of a fifth hydrofluoric acid alkylation plant built with design and assistance from Phillips Petroleum Co. The units are at refineries in Shanghai, Tianjin, Zhejiang, Luoyang, and Dalian.

Sinopec has engineered and built eight other HF alky units based on the Phillips design.

Sulfur oxide emissions from Mobil Oil Corp.Is 130,000 b/sd Torrance, Calif., refinery were more than 90% lower in 1989 than 1988. Mobil started up a $200 million FCC feed hydrotreater in December 1988.

The unit cut cat cracker SOx emissions to less than 2% of the level allowed by South Coast Air Quality Management District.

Senate Majority Leader George Mitchell, seeking to force an agreement on the U.S. Clean Air Act, said he will bring the bill back to the Senate floor so on.

He had suspended debate last month so key senators and administration officials could negotiate a compromise bill in private. But those talks have snagged on several issues.

However, negotiators reportedly have agreed to relax pollution improvement targets for problem cities, making it possible for cars burning reformulated gasolines to meet the goals as well as those using alternative fuels such as methanol.

Phillips 66 Co., pointing to propane's cleanliness and distribution infrastructure, began a 2 year, $1 million test of propane as an automotive fuel in the U.S.

The company will evaluate and quantify available data on propane, convert a 31 vehicle fleet to obtain performance data, and market propane as UltraClean Fleet LPG propane in several U.S. cities this spring.

Government officials from Japan and Saudi Arabia will begin negotiations in Tokyo later this month on Saudi plans to break into the Japanese downstream business.

The talks are a spinoff from the visit of Saudi oil minister Hisham Nazer to Japan in January (OGJ, Feb. 5, Newsletter).

Copyright 1990 Oil & Gas Journal. All Rights Reserved.