U.S. BRIEFS

PETROCHEMICALS

DOW CHEMICAL CO. plans to build a $100 million, 20 acre wastewater treatment unit at its Freeport, Tex., petrochemical complex. To consist of 22 aboveground, 1 million gal plus capacity steel tanks, the treatment unit has an estimated completion date in first quarter 1994.

TANKERS

DELPHIA OIL TANKER ran aground in Weymouth Four River off Massachusetts near Boston May 3, spilling about 100 bbl of No. 2 fuel oil. The 610 ft Liberian flag tanker was on its way to a Citgo products terminal when it scraped bottom, cutting a gash in a 40,000 bbl cargo tank. Damage extent was not determined at presstime.

PATRIOT SHIPPING INC. plans to buy Ashland Oil Inc.'s Cleveland Tankers Inc. unit, including two double hulled oil tankers and a barge with combined capacity of 170,000 bbl for an undisclosed amount pending approval by U.S. Maritime Administration. Patriot will operate the vessels under the Cleveland Tankers name.

REFINING

GIANT INDUSTRIES INC., Scottsdale, Ariz., plans to purchase a 13.5 million gal/year, dry mill ethanol plant at Portales, N.M., from a group of banks that foreclosed on the property. Giant is seeking a captive oxygenates supply to meet air quality standards in its refining/marketing operations. Purchase price is less than $10 million. The plant is the biggest in the Southwest and 11th biggest in the U.S. Built in 1985, it can be expanded to produce 15 million gal/year.

GOLD LINE REFINING LTD. reopened American International Petroleum Corp.'s 30,000 b/d refinery at Lake Charles, La. Gold Line is operating the plant under a lease agreement with AIP that expires Sept. 3, 1992, with an option to extend 1 year. Throughput is expected to be 10,000 b/d the next few months, increasing to the minimum rate of 18,000 b/d stipulated under the lease by October.

PHILLIPS 66 CO.'S 175,000 b/d Sweeny, Tex., refinery is operating at more than 85% of capacity. An Apr. 13 fire damaged the atmospheric residuum desulfurization (ARDS) unit (OGJ, Apr. 22, p. 46). Since the fire the refinery has been processing sweet crude and producing 75,000 b/d of gasoline vs. normal production of 85,000 b/d. Partial operation of the ARDS unit is expected by end of June.

DRILLING-PRODUCTION

KERR-MCGEE CORP. will purchase Sonat Inc.'s oil and gas leases in Wyoming's Powder River basin for $65.6 million. The leases will complement Kerr-McGee's Powder River holdings, which include North Buck Draw enhanced oil recovery unit and its proposed Sand Dunes unit. The sale is to close by the end of May.

EXXON CO. U.S.A. let contract to GEC Avionics Ltd. of the U.K. to supply subsea production control equipment for the first phase of its deepwater Zinc field development in Mississippi Canyon Block 354 in the Gulf of Mexico. The first phase calls for three subsea wells with possible addition of 10 wells later. Gas will move through a 6 mile pipeline to Alabaster platform, 50 miles southeast of Grand Isle, La. (OGJ, Apr. 8, p. 59).

UNOCAL CORP. last week completed cleanup of a May 10 crude oil spill from Platform Gina in the Santa Barbara Channel off California. About 50 bbl of crude spilled after a workboat, grappling for a lost anchor, snagged a pipeline and damaged the riser. No crude reached shore.

FORELAND CORP., Ogden, Utah, plans to participate in as many as 14 wells in North Central Nevada this year, of which eight will be exploratory and six development. Foreland is negotiating for 50,000 acres in the area, which would increase its gross holdings to more than 123,000 acres (OGJ, Apr. 22, p. 98).

TIDE WEST OIL CO., Holdenville, Okla., 1 Bermuda in Pearsall field, Dimmit County, Tex., flowed 603 b/d of oil and 727 Mcfd of gas through a 22/64 in. choke with 370 psi flowing tubing pressure from Cretaceous Austin chalk. The company planned to drill horizontally but encountered a fracture system while still vertical. The well may be reentered later to drill the horizontal phase.

EBCO U.S.A. INC. will auction 450 oil and gas leases in 13 states at a no minimum bid sale June 13 in Dallas.

GOVERNMENT

BUREAU OF LAND MANAGEMENT plans to tighten environmental rules for well completions, workovers, and abandonments on onshore federal and Indian oil and gas leases. Onshore Order No. 8, published in the May 6 Federal Register, is similar to standards in effect in Texas, Oklahoma, and New Mexico. It would require operators to conduct a casing integrity test before temporary abandonment.

MARKETING

SUN REFINING & MARKETING CO. is offering a new marketing program to its East Coast contract distillate distributors and resellers. Customers can choose a fixed price contract for terms from 1 month to 1 year or a price pegged to the New York Mercantile Exchange on a date chosen by the customer. Signups began May 6 for contracts commencing June 1.

EXPLORATION

SEAGULL ENERGY CORP., Houston, tested two gas discoveries on Brazos Block 399, 25 miles southwest of Freeport, Tex. The 2 ST 1 OCS-G-7217 flowed at a combined rate of 21 MMcfd of gas through 20/64 and 24/64 in. chokes with 1,567-2,167 psi flowing tubing pressure from three zones at 8,151-8,730 ft. The 5 OCS-G-7218 flowed at a combined rate of 17.8 MMcfd of gas and 32 b/d of condensate through various chokes with 2,445-2,987 psi flowing tubing pressure from four sands at 7,087-7,730 ft.

COMPANIES

CABOT OIL & GAS CORP., Houston, increased its 1991 capital spending budget to $64.9 million from an initially planned $52.2 million due to the extension of the federal tight sands tax credit. The increase enables Cabot to drill 54 additional wells, increasing the number of net wells planned to 192, compared with the 117 drilled last year.

TREN-FUELS INC. is in Austin, Tex., not Owensville, Ky., as incorrectly reported (OGJ, May 6, p. 44).

PIPELINES

WASHINGTON NATURAL GAS CO. signed a 22 year service agreement with Questar Pipeline Co., Salt Lake City, to obtain 9.8 bcf/year firm storage service at Questar's Clay Basin storage reservoir in Northeast Utah, purchasing all available capacity. Separately, Northwest Pipeline Corp. notified Questar it will reduce its Clay Basin storage requirements to 4.8 bcf from 10.2 bcf, making 5.4 bcf of space available. Questar is accepting requests for firm and interruptible service for the added capacity.