INDUSTRY BRIEFS

SPILLS

AN UNKNOWN VOLUME of No. 6 bunker oil spilled when an explosion and fire injured a crew member and damaged a cargo tank on the Florida Express tanker Feb. 27 in the Gulf of Mexico about 53 miles off Galveston, Tex. The U.S. Coast Guard spotted an oil slick extending about 1 mile from the vessel. Spill containment and salvage responses were under way at presstime last week. Owner is Tortuga Shipping Go., Miami, and operator is Coscol, Houston.

STORAGE

PORTUGAL'S state owned Petrogal unit CLC let a $100 million contract to Raytheon Engineers & Constructors, Lexington, Mass., for construction of a petroleum products storage complex and loading terminal at a 600,000 sq m site 40 km from Lisbon. To be complete in fourth quarter 1996, the complex will have nine 2,200 cu m capacity propane spheres, five 2,200 cu m capacity butane spheres, 10 gasoline tanks with total capacity of 503,200 bbl, and four diesel tanks with total capacity of 597,550 bbl.

MARKET HUB PARTNERS LP, Houston, is developing a salt cavern gas storage site in Tioga County, Pa. Phase I will offer 2.5 bcf of working gas capacity, with service to start in winter 1997-98. Deliveries will be to CNG Transmission and Tennessee Gas Pipeline, and an open season is expected in May 1995. Market Hub is a partnership led by Tejas Power Corp.

PETROCHEMICALS

YANGZI-BASF STYRENICS CO., a venture of China's Yangzi Petrochemical Co. (YPC) and Germany's BASF AG, let contract to ABB Lummus Crest Inc. for a 120,000 metric ton/year ethylbenzene/styrene monomer plant to be built at YPCs Nanjing, China, petrochemical complex. The ethylbenzene unit will include liquid phase zeolitic alkylation technology licensed by Lummus, Unocal Corp., and UOP. The styrene unit will use technology licensed by Lummus, Monsanto Co., and UOP and process feed from Yangzi's associated ethylene plant.

EXPORTS-IMPORTS

A 50-50 VENTURE of Larmag Energy NV, Amsterdam, and domestic Turkmen firm NGDU Chelekeneft exported the first shipment of crude oil from Turkmenistan in more than 70 years with a 24,500 bbl cargo lifted last month at Aladja jetty on the Caspian Sea near Cheleken, Turkmenistan. The exported crude was produced from two Caspian fields the venture has operated since May 1993. The venture has boosted production to 11,000 b/d from 6,000 b/d and plans to hike output to about 80,000 b/d.

GAS PROCESSING

YPF SA let contract to Italy's Snamprogetti for basic design, project planning, and cost estimates of an integrated project to process and market gas and products from Loma La Lata gas field in Neuquen province, Argentina. Included are a gas production system, 1.5 bcfd gas processing and cryogenic natural gas liquids extraction plant, residue gas recompression system, and 600 km pipeline to deliver as much as 70,000 b/d of NGL to Bahia Blanca on the Atlantic coast. Product fractionation/purification, storage, handling, and tanker loading facilities are to be installed at Bahia Blanca.

DRILLING-PRODUCTION

SONAT OFFSHORE DRILLING INC., Houston, offered $100 million in cash and common stock to acquire Reading & Bates Corp., also of Houston, and urged R&B's board to immediately begin negotiating a definitive agreement allowing the two firms to merge. R&B acknowledged the unsolicited merger proposal but agreed only to evaluate the offer, set to expire Mar. 10.

AMERADA HESS (DENMARK) AS and partners' 1 Rigs appraisal of the South Arne discovery off Denmark flowed 2,341 b/d of 35 gravity oil through a 24/64 in. choke with gas:oil ratio of 1.35:1 from two chalk zones on Block 5604/29. Further evaluation is planned, including a 3D seismic survey of South Arne, which Gulf Oil Corp. discovered in 1969.

ALASKA COOK INLET platform operators Unocal Corp., Marathon Oil Co., Shell Western E&P Inc., and Phillips Petroleum Co. received U.S. Environmental Protection Agency administrative complaints seeking a total $1,526,600 in civil penalties for alleged noncompliance with wastewater discharge permits.

PHILLIPS PETROLEUM CO. NORWAY let a 5 year contract, with a 2 year extension option, to Transocean Petroleum Technology AS, Oslo, for coiled tubing and related nitrogen services in the Norwegian North Sea's Ekofisk field. The contact, effective Jan. 1, 1995, has a potential value of $13.5 million if it runs all 7 years.

EMERGENCY RESOURCES INTERNATIONAL (ERI), Houston, in late February began moving firefighting and well control crews and equipment to southern India after state owned Oil & Natural Gas Commission (ONGC) hired it to control a burning gas blowout near Amalapuram. The well has been flowing wild as much as 50 MMcfd since Jan. 4 (OGJ, Jan. 16, p. 29). ONGG earlier called in Neil Adams Firefighters Inc., Houston, to kill the well (OGJ, Jan. 23. p. 19). Reuters reported Adams left the site last week after a dispute with ONGC over well control efforts.

NORWAY'S Den norske stats oljeselskap AS let a $70 million contract to Aker AS, Oslo, for assembly and hookup of process equipment on the Norne field production vessel in the Norwegian North Sea. The vessel will leave Aker's Stord yard in late 1996 for hookup in the field in spring 1997.

THE WINTERSHALL (U.K.) LTD. unit of Germany's Wintershall AG was named operator of U.K. North Sea Block 49/9b, where a group recently completed testing of an appraisal to the Windermere discovery and is considering development options. Wintershall holds a 60% interest in the block in partnership with U.K. independents Brabant Petroleum Ltd. and Sovereign Exploration Ltd. 20% each.

PETRO-HUNT CORP., Dallas, affiliate William Herbert Hunt Trust Estate acquired Texaco Exploration & Production Inc.'s interests in 14 fields in the Williston basin of North Dakota and Montana for about $22.8 million. Included are production of more than 2,200 b/d of oil and 10 MMcfd of gas from 130 wells and Texaco's 5.39% interest in the Fairway gas processing plant in Henderson County, Tex.

CXY ENERGY INC., Dallas, had Tarpon Systems Inc. install CXY's fourth marginal field production structure on Gulf of Mexico Eugene Island Block 258J in 152 ft of water. The structure, designed and fabricated by Tarpon, consists of an underwater anchor pile and cable guy wire assembly that supports a well protector caisson, boat landing, deck, and related production equipment.

NORSK HYDRO AS let contract to Rockwater AS, Stavanger, for subsea installation work on Gamma Nord development, a single well to be tied back to Norway's Oseberg field facilities. Work will include installation of a wellhead protection frame, a 7 in., 4 km flexible flowline, and a 7.5 km services umbilical. Installation will occur in August-September, with field start-up slated for December.

ENERVEST MANAGEMENT CO. L.C. and EnCap Energy Capital Fund, both of Houston, acquired for $11 million Union Pacific Resources Co. interests in producing leases in Arkansas and New Mexico with combined net reserves of 2.5 million bbl of oil and 9.3 bcf of gas. Most reserves are assigned to Dorcheat Macedonia field in Columbia County, Ark., where the partnership budgeted $6 million for recompletions and related work to begin about mid-March, and Sand Dunes field in Eddy County, N.M.

REFINING

YPF let lump sum turnkey contracts totaling $110 million to Foster Wheeler Iberia SA, Madrid, for project management in adding four processing units at its 129,000 b/d Lujan de Cuyo and 216,000 b/d La Plata refineries in Argentina. Included are a 3,500 b/sd isomerization unit and 2,700 b/sd alkylation unit at Luyan de Cuyo and 6,300 b/sd isom unit and 20,400 b/sd coker naphtha hydrotreater at La Plata. Start-up is set for mid-1996.

DIAMOND SHAMROCK INC., San Antonio, this spring will begin expanding capacity of its Three Rivers, Tex., refinery to 85,000 b/d from 72,000 b/d as part of a phased upgrade that also will enable the plant to refine heavy oil into higher value products. A 5,000 b/d hydrocracker, a 6 MMcfd hydrogen plant, and a pressure swing absorption unit are to be complete by second quarter 1996. Construction of a 50 ton/day sulfur recovery unit is to begin in May with completion by yearend 1995.

CLARK REFINING & MARKETING INC. closed its purchase of Chevron U.S.A. Products Co.'s 200,000 b/d Port Arthur, Tex., refinery for about $200 million (OGJ, Feb. 13, p. 26). If refining margins exceed agreed levels, Clark could pay Chevron another $125 million during 5 years. Chevron Chemical will continue to operate petrochemical units at the refinery site, and Chevron U.S.A. will retain its lube oil packaging/distribution center at Port Arthur.

COMPANIES

CONOCO INC. disclosed an incentive pay program under which its nonmanagement employees worldwide can receive bonuses of as much as 12% of their annual pay according to how the company performs relative to its business goals. A maximum payout would cost Conoco $75 million/year if it significantly exceeds financial targets.

THE CMS NOMECO OIL & GAS CO. unit of CMS Energy Corp., Dearborn, Mich., acquired Walter International Inc., Houston, for $45.9 million. Walter operates and holds interests in Congo's Yombo field, Equatorial Guinea's Alba field, and Tunisia's El Franiq field. The trade boosts Nomeco's reserves by 20 million bbl of oil equivalent (BOE) to 113 million net BOE.

BELDEN & BLAKE CORP., North Canton, Ohio, budgeted capital spending of $19 million in 1995, a jump of 73% from 1994 outlays. The drilling budget of $15.4 million is up 67% from last year and calls for $10.7 million for 88 shallow wells and $4.7 million for 39 deeper wells in the Appalachian and Michigan basins.

EXPLORATION

PHILLIPS PETROLEUM CO. ZOC and partners' 1 Bayu wildcat in the Timor Gap area flowed a combined 90 MMcfd of gas and 5,250 b/d of condensate on four drillstem tests, each through a 1 in. choke, conducted over a gross interval of 459 ft in upper Jurassic below 9,615 ft. The well was drilled to 10,443 ft in 236 ft of water on Block ZOCA 91-13 in Zone of Cooperation Area A jointly administered by Australia and Indonesia in the Timor Sea (OGJ, Jan. 4, 1993, p. 26).

CHEVRON OVERSEAS PETROLEUM LTD. signed a production sharing agreement with China National Offshore Oil Corp. covering exploration in the South China Sea southwest of Hainan Island. Chevron's new Block 62/23 lies in a gas prone area near ARCO's development project in giant Yacheng 13-1 gas field. ARCO is laying gas pipelines to Hainan and mainland China coasts.

CHEVRON unit Cabinda Gulf Oil Co. and partners won a contract from Angola to explore for oil on deepwater Block 14 about 70 km off the coast of Angola's Cabinda enclave. The tract, in 650-5,000 ft of water, covers 1,011,644 acres. Plans call for a seismic survey to start in April, with drilling to follow early in 1996.

NAMIBIA'S Ministry of Mines and Energy extended the deadline for the country's second petroleum licensing round to Nov. 30 from the earlier scheduled July 31. It said most Namibian operators have been tightening seismic grids to high grade wildcat locations, which has resulted in delaying spud dates. Only one of eight committed wells in the first round has been drilled, with the next three to be spudded during March-May. The ministry said results from several wells should be available before the second round closes.

TULLOW OIL PLC, London, 1 Kishma wildcat in Syria's East Ash Sham license area flowed at a stabilized rate of 4,800 b/d of 460 gravity oil and 6.4 MMcfd of gas through a 3/4 in. choke from a 13.5 m interval at about 2,150 m. Tullow plans to confirm the strike.

PIPELINES

NORWAY'S STATOIL let a $300 million contract to Dresser Industries Inc.'s Bredero Price Norway AS unit for internal and external coating for the Zeepipe II B pipeline in the North Sea and its spurs from Norway to Germany and France. Total pipeline to be coated is about 2,770 km, with work to occur during 1995-99.

IPL ENERGY INC., Calgary, and the Canadian Association of Petroleum Producers agreed on an incentive based method to set 1995-99 tolls for transporting crude oil through IPL's Interprovincial pipeline, which moves about 75% of the liquid hydrocarbons produced in western Canada to market. Involved are a base level revenue requirement, an incentive mechanism for volumes shipped, and revenue sharing/cost recovery incentive mechanisms. The National Energy Board is reviewing the proposed toll settlement.

HOWELL CORP., Houston, agreed to acquire three Exxon Pipeline Co. crude oil pipeline systems with a combined capacity of 200,000 b/d on the U.S. Gulf Coast. The systems are in Texas, Louisiana, Mississippi, Alabama, and Florida and include 900 miles of 2-16 in. gathering and trunk pipelines, 2.5 million bbl of crude oil storage capacity, and direct connections to six refineries.

ALTERNATE FUELS

CONTRACTORS BROKE GROUND for Sierra Pacific Power Co.'s $220 million, 100,000 kw, Pinon Pine bituminous coal fired, integrated gasification combined cycle power plant near Reno, Nev. The project is to be commissioned in late 1996. Foster Wheeler USA Corp. is performing engineering, procurement, and construction work, and M.W. Kellogg Co. is subcontractor for its KRW fluidized bed coal gasification process.