OPEC's decision to call an emergency meeting of its ministerial monitoring committee May 2 relieved the downward pressure on world crude prices.
North Sea Brent blend for June delivery rebounded to $17.50/bbl Apr. 25 from $16.20/bbl a week earlier. WTI futures for June delivery closed at $18.66/bbl, up $1.70 on the week.
All 13 ministers will attend the May 2 meeting in Geneva. As a result, the midyear ministerial meeting has been postponed to June 25 from May 25.
Crude traders look for the Geneva meeting to result in significant cuts in OPEC output of 24 million b/d--2 million b/d above the official OPEC ceiling. OPEC overproduction was largely responsible for the sharp price declines in mid-April.
Any agreed production cuts would remain in force until a new quota is set for second half 1990 at the end of June.
Countries that have produced close to official quotas want the big Persian Gulf overproducers to carry the bulk of any cuts. However, there are doubts among OPEC sources about the size of any cuts made by Abu Dhabi, Kuwait, and Saudi Arabia.
Market sources say at least 1.5 million b/d must be taken out of the system to have any noticeable, sustained effect on prices.
Plans for a 2.5 billion cu m/year liquefied natural gas export project based on gas from the Norwegian North Sea have been dropped.
The gas would have been sold to the U.S. through an agreement between Enron Corp. and Den norske stats oljeselskap AS.
Statoil said geological difficulties with South Gullfaks field and improved prospects for selling North Sea gas in Europe are responsible for the decision.
Attention will now focus on marketing in the U.S. gas from Tromsoflaket off far northern Norway. An LNG scheme in these arctic waters will require minimum throughput of 5 billion cu m/year and cannot come on stream before 1997, 2 years later than the North Sea project was to have started up.
A proposed $600 million oil pipeline expansion in Canada will remain on hold until a federal environmental and safety study of export tanker traffic is completed, says Trans Mountain Pipe Line Ltd., Edmonton.
The study requested by Ottawa of traffic in the port of Vancouver will not likely be completed until December.
Looping of the 795 mile Trans Mountain line from Edmonton to Vancouver, first proposed in 1988, would double capacity of a system that moved about 189,000 b/d in 1989.
The old section would be dedicated to shipment of Alberta heavy crude.
U.S.S.R. Ministry of Oil and Gas Industry and several companies will go ahead with a feasibility study of big Stockmanovskoye gas field in the Soviet Barents Sea (see p. 31).
The non-Soviet parties are Norsk Hydro AS, Du Pont Services BV of the Netherlands, and Oy Wartsila AB, Imatran Voima Oy, and Neste Oy of Finland.
The field, discovered in 1988 about 375 miles off the Kanin Peninsula, is believed to be among the world's largest.
The study is to be finished later this year, with the parties to decide in early 1991 when and how to begin development.
Britain will offer 117 deepwater blocks in the lightly explored Atlantic Ocean off the west coast of Scotland in its first frontier licensing round early next year.
The 117 blocks will be grouped in 11 two part licenses.
In the first 3 years companies will shoot and interpret seismic. Work programs will be agreed on the basis of seismic results.
The House merchant marine committee has reported out a bill that would subject U.S. offshore lease sales to state coastal zone management plans.
The bill would overturn a 1984 U.S. Supreme Court ruling that a lease sale did not have to be consistent with California coastal plans.
The bill also would encourage states to consider issues such as the proper siting of coastal energy facilities.
Scientific drilling research is alive in the U.S. National Science Foundation awarded Maurer Engineering Inc., Houston, a $49,000 grant to study the feasibility of coring to 50,000 ft using coiled tubing.
That could sharply cut sampling time and costs in deep research and exploratory wells.
Oil field service companies that make and use coiled tubing/coring systems will assist with the project.
The U.S. Department of Energy and Federal Energy Regulatory Commission plan to finish a deliverability study by yearend to determine how to encourage gas reduction at the wellhead and how to assure delivery at the burnertip.
Robert Gentile, assistant secretary for fossil energy, said the highest priority in DOE's gas research effort is to develop a set of gas atlases that aggregate available data on the geology and production history of the most important gas reservoirs in main U.S. producing regions.
U.S. motorists are being cheated out of octane at the gasoline pump, a General Accounting Office report says.
GAO found 9% of gasoline sold in the U.S. in 1988 was mislabeled by at least 1/2 an octane number.
Rep. Phil Sharp (D-Ind.), who asked for the inquiry, said the discrepancy amounts to an overcharge of at least $150 million and could total four times that. He plans to introduce a bill to more tightly control octane labeling.
Exxon Co. U.S.A. plans to reformulate its premium and midgrade gasolines in 20 Gulf Coast and East Coast states and the District of Columbia in June to cut air emissions.
The company will back out butane during summer in the two grades of gasoline, cutting Reid vapor pressure to 8.5 psi.
MTBE will replace butane year round in the New York metropolitan area but won't be used to replace butane elsewhere.
Reformulated gasoline sales are expected to hit 8 million gal/day, more than 50% of Exxon's branded gasoline sales in the 20 states.
The U.S. Occupational Safety and Health Administration will expedite a rulemaking to tighten chemical plant safety procedures as a result of the Oct. 23, 1989, accident at Phillips 66 Co.'s Pasadena, Tex., petrochemical plant (see p. 46).
The agency also will adjust its inspection priorities with an eye to preventing similar accidents.
Oil India Ltd. is seeking government approval to develop Disang oil shales in Northeast India.
OIL estimates deposits covering 10,000 sq km in the hilly areas of Manipur, Nagaland, Arunachal Pradesh, and Mizoram contain a resource of 438 billion bbl of shale oil equivalent.
A Brazilian product may challenge Venezuela's Orimulsion.
ABB Lummus Crest Inc. and Hidrol Processes e Sistemas Ltda. of Brazil will market and license Hidrol's proprietary water in oil emulsion combustion system worldwide.
Hidrol Combustion System provides thorough combustion that minimizes carbon particulate emissions of No. 6 fuel oil grades and heavier.
The technology produces a stable water in oil emulsion without an emulsifying agent that can be fired through a conventional burner with steam, air, or pressure atomization.
Upon leaving the burner tip, micron size water droplets in the emulsion explode, shattering the surrounding oil film into small droplets to facilitate complete combustion, Lummus said.
The first commercial unit started up in 1982. Three units are operating, one is starting up, and a fifth is being built.
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