INDUSTRY BRIEFS

April 10, 1995
AN ANCHORAGE superior court judge ruled Exxon Corp. does not have pay anything to Alaskan native corporations to compensate for damage to native and public lands as a result of the Mar. 24, 1989, Exxon Valdez tanker spill off Alaska. That followed a jury verdict 6 months ago calling for Exxon to pay the plaintiffs $9.7 million in damages. The judge, who presided over that trial, said the native corporations were more than compensated through a federal liability fund and a previous legal

SPILLS

AN ANCHORAGE superior court judge ruled Exxon Corp. does not have pay anything to Alaskan native corporations to compensate for damage to native and public lands as a result of the Mar. 24, 1989, Exxon Valdez tanker spill off Alaska. That followed a jury verdict 6 months ago calling for Exxon to pay the plaintiffs $9.7 million in damages. The judge, who presided over that trial, said the native corporations were more than compensated through a federal liability fund and a previous legal settlement.

PIPELINES

MICHIGAN PUBLIC SERVICE COMMISSION (MPSC) approved CMS Gas Transmission & Storage Co.'s (Cmsgts) proposed Bluewater Pipeline linking U.S. and Canadian gas pipeline systems. The $3.3 million project will provide a direct connection between Ontario's Union Gas Ltd. and Consumers Power Co. systems via the Grands Lacs hub at Marysville, Mich. Federal regulatory applications are planned or under way in both countries. Cmsgts and Consumers are units of CMS Energy Corp., Dearborn, Mich.

MPSC approved plans by MCN Corp. unit Michigan Consolidated Gas Co. to expand its northern Michigan gas gathering system. The $40 million project calls for laying 64 miles of 10-30 in. pipeline mostly near existing lines to transport Antrim shale gas. Pipelaying will begin this summer, with completion scheduled for fall.

NORWAY'S Den norske stats oljeselskap AS said the Europipe I gas pipeline from the Norwegian North Sea Block 16/11 transmission hub to Emden, Germany, will be ready for operation by July, 4 months ahead of schedule. The 620 km line will be pressure tested with seawater beginning early this month. Norway plans to lay another five pipelines by 2000 to meet increasing demand for Norwegian gas in continental Europe (OGJ, Feb. 6, p. 23).

LNG

INDONESIA'S Pertamina let a $550 million contract to Chiyoda Corp. and Mitsubishi Corp. for construction of the seventh liquefied natural gas train at Bontang, Kalimantan. Scheduled for completion in late 1997, the project will add 2.6 million metric tons/year of capacity. Exports of LNG from the new train to Taiwan, South Korea, and Japan are expected to begin in 1998.

OVERSEAS BECHTEL INC. began engineering design on Trinidad's proposed LNG export complex and marine terminal under a contract from a group led by Amoco Trinidad LNG Co. and British Gas Trinidad LNG Ltd. Design work under the contract focuses on Phillips Petroleum Co.'s optimized cascade LNG process. Design contracts were awarded last year covering another LNG process proposed for the project (OGJ, Nov. 21, 1994, p. 47). Final project authorization and award of main engineering, procurement, and construction contracts is expected in the third quarter.

TAIWAN'S Chinese Petroleum Corp. (CPC) will receive in May the first shipment of LNG purchased from Malaysia under a 20 year contract that calls for delivery of 540,000 metric tons of LNG this year, with the volume rising to 2.2 million tons/year. Work is under way to double storage capacity at CPC's Yung An LNG receiving terminal near Kaohsiung. CPC had considered building a terminal in northern Taiwan but instead chose to expand Yung An.

PETROCHEMICALS

FORMOSA PLASTICS GROUP, (FPG) Taipei, plans to spend $500 million to build its second ethylene plant in the U.S. FPG's 680,000 metric ton/year capacity Point Comfort, Tex., plant can't meet demand from its U.S. midstream and downstream customers. With completion of the second U.S. plant and another under construction at Mailiao, Taiwan, FPG's ethylene production is expected to reach 2.71 million tons/year.

JAPAN'S Mitsui Petrochemical Industries Ltd. and Ube Industries Ltd. merged their polypropylene operations in a bid to improve competitiveness by cutting costs. The 50-50 venture will have capacity of 400,000 metric tons/year, almost equal to that of Japan's largest producer, Mitsubishi Chemical Corp.

MONTELL POLYOLEFINS, the joint venture formed by merger of most of the polyolefins interests of Royal Dutch/Shell and Montedison SpA, began operations Apr. 1. Headquarters is at Hoofddorp, Amsterdam, with regional offices in Wilmington, Del., and Brussels (OGJ, Jan. 23, p. 16).

REFINING

ELF AQUITAINE is considering selling its 70% interest in the Milford Haven, U.K., refinery if it can't find a partner to hike its share of Britain's retail market to at least 5% from less than 4%. If Elf can't expand its retail network of 700 outlets by yearend to better match the refinery's 108,000 b/d capacity, it will consider selling its refinery interest and the retail network. Elf will consider alliances with other petroleum companies or other firms such as supermarket chains.

NORWAY'S Statoil cut construction time for a condensate unit at its 65,000 b/d Kalundborg, Denmark, refinery. Construction is nearly complete, and testing has begun, enabling Statoil to predict the plant will start up in September. It will process condensate from Statoil's West and East Sleipner gas fields. Last summer Statoil admitted construction would cost $160 million more than intended, and start-up at the time was expected to be delayed to fourth quarter 1 995 (OGJ, July 4, 1994, Newsletter).

TOSCO CORP.'S Bayway Refining Co. hired UOP to provide technology and process design for a butamer unit that incorporates a Huels complete saturation process unit at its 200,000 b/d Linden, N.J., refinery. UOP also will supply a prefabricated pressure swing absorption system to supply needed hydrogen. The new units will enable Bayway to convert various sulfur and olefin contaminated C4 streams into isobutane.

DRILLING-PRODUCTION

CHEVRON NIGERIA LTD. let contracts worth $320 million to four groups or companies for construction of onshore and offshore facilities for the Escravos gas project. It is the first phase of a 14 year gas utilization program to halt flaring and begin gathering and processing natural gas in Nigeria's Okan and Mefa offshore oil fields. Phase I is to start up in 1997.

KUWAIT plans to raise its crude oil productive capacity to 3.5 million b/d by 2005, Middle East Economic Survey reported. Oil Minister Abd Al-Muhsin Al-Mudij told a Johannesburg conference Kuwait plans to invest $15 billion the next 10 years to boost production and expand downstream operations. The target for domestic refining capacity was said to be 1 million b/d, compared with 800,000 b/d at present.

SAGA PETROLEUM AS let a $50 million contract to Transocean AS, Tananger, Norway, for drilling services and maintenance on the Snorre platform off Norway. The contract is for 4 years beginning June 6.

SOEKOR PTY. LTD., Capetown, formed a venture with the Halliburton (Pty.) Ltd. unit of Halliburton Energy Services, Houston, to provide integrated drilling services throughout sub-Saharan Africa. Halliburton will provide drilling services for Soekor, at first to include cementing, drilling mud, mud logging, navigation and geological laboratory services. Soekor also recently acquired about 600 sq km of 3D seismic data in two surveys off South Africa conducted by PGS Exploration AS, Oslo, Norway, a unit of Petroleum Geo-Services AS.

COFLEXIP STENA OFFSHORE and Deeptech International Inc. signed a final agreement to form a limited partnership, DeepFlex Production Partners LP. DeepFlex will supply floating production systems (FPSs) to operators in the Flex trend and deepwater areas of the Gulf of Mexico (OGJ, Mar. 13, p. 43). In addition, Coflexip agreed to supply flexible pipe under a 7 year contract to DeepFlex. Separately, DeepFlex acquired at auction for $29.3 million Deeptech unit FPS I Inc.'s FPS Laffit Pincay semisubmersible rig, slated for conversion to an FPS.

NORWAY'S Transocean AS and Wilrig AS plan to merge to create one of the world's biggest offshore drilling contractors, with revenues projected at more than $487 million/year. Under an exchange of stock, Transocean will take over Wilrig.

SMEDVIG AS, Stavanger, entered a venture with Canadian well service company Northland to employ underbalanced drilling technology for improved, more cost-efficient oil and gas recovery in offshore wells. Smedvig claims the technology hitherto has been used only onshore. The deal gives Smedvig exclusive international rights for offshore use of the technology.

COGENERATION

BP ENERGY LTD. commissioned a gas fired cogeneration plant at Nestle U.K. Ltd.'s chocolate factory in York, U.K., which it operates under a 470 million, 10 year contract. It replaced 60 year old coal fired boilers with a 9,600 kw gas turbine expected to cut fuel costs at the plant by $4.7 million/year. The plant uses 2.3 MMcfd of gas supplied on an interruptible basis.

EXPLORATION

A CONOCO MINERALOEL GMBH GROUP spudded the first of five coalbed methane exploratory wells in the Muenster region of northern Germany in a search for natural gas in the area's massive coal deposits. The wells, to be drilled on the Sigillaria license area (see map, OGJ, Nov. 14, 1994, p. 44), are intended to provide data on gas reserves and flow rates, as well as coal seam permeability.

NUEVO ENERGY CO., Houston, and the Output Exploration Co. Inc. unit of Input/Output Inc. (10), Stafford. Tex., completed a 16 sq mile 3D seismic survey of the Brownsville salt dome complex in Hinds County, Miss. Grant Geophysical Inc., Houston, acquired the data with an 10 land seismic acquisition system that allowed simultaneous recording of 2,600 active channels, said to be the largest number of active recorded traces used in a seismic survey.

SHANGHAI BUREAU OF MARINE GEOLOGICAL SURVEY operated the 3 Baoyunting wildcat in the East China Sea, not Shanghai Oceanic Geology Survey, as reported (OGJ, Mar. 20, p. 44).

SCANA PETROLEUM RESOURCES INC., a unit of Scana Corp., Columbia, S.C., and FINA Oil & Chemical Co. signed a 5 year, 5050 exploration/development agreement calling for exclusive oil and gas development rights covering about 183,000 acres in Terrebonne and LaFourche parishes of South Louisiana. The two will begin an extensive 3D seismic survey on the acreage this summer that will continue for the next several years. The first wildcat, 1 Fina Fee, will be drilled to about 18,000 ft in northern Terre bonne Parish.

COMPANIES

JORDAN will set up a $29 million state oil company t explore for gas and revive foreign company interest in drilling in the country. Energy Mineral Resources Minister Samih Darwazah said the company aims to double the current 30 MMcfd of gas production from the Reishah area near the border with Iraq t fuel electrical power generation projects.

NOVA CORP., Calgary, and NGC Corp., Houston, agreed to combine NOVA subsidiary Pan-Alberta Gas Ltd. (PAG) with Novagas Clearinghouse LP (NCL), a venture of NGC and NOVA. PAG will become a wholly owned subsudiary of NCL, and NGC will contribute about $15 million cash to NCL. PAG markets about 1.5 bcfd of aggregated gas for producers in western Canada, and NCL offers gas supply services to Canadian consumers as well as gathering, processing, storage, and marketing services to Canadian producers covering about 1 bcfd.

TAIWAN'S CPC applied to the domestic Ministry of Economic Affairs for permission to open a branch office in Beijing to explore the South China Sea in cooperation with China's Chinese National Offshore Oil Go. (Cnooc) To avoid running afoul of Taiwan's restrictions on direct contact with mainland China, the project will be carried out by a CPC subsidiary registered abroad, most likely Overseas Petroleum Investment Corp., Singapore.

SEAGULL ENERGY CORP., Houston, plans a major restructuring. Company wide, 90-95 of about 770 positions will be eliminated. Seagull will close exploration and production offices in Shreveport and Amarillo, transferring about 90 of those offices' 160 jobs to Houston. It also will dispose of interests in 23 gas gathering pipelines, four liquids/petrochemical pipelines, and one gas processing plant as well as sell Section 29 tax credits representing about 30 bcf of gas reserves.

LPG

TAIWAN'S CPC plans to set up a liquefied petroleum gas terminal at Haiphong, Viet Nam, through a venture with Taiwan's Chinfong Group and Vietnamese company Cotitab. Initial capitalization will be $10 million. CPC sees the venture as a springboard into Viet Nam's lubricants and asphalt markets.

EXPORTS-IMPORTS

CANADA'S National Energy Board will begin hearings May 23 in Calgary on two applications for gas exports to the U.S. Brooklyn Navy Cogeneration Partners LP applied for a 5 year license to export 26.5 MMcfd for a cogeneration plant at Brooklyn Navy Yard, N.Y. Crestar Energy Ltd. and PanCanadian Petroleum Ltd., both of Calgary, will supply the gas. Renaissance Energy Ltd., Calgary, applied for a 9 year license to export 2.8 MMcfd to Renaissance Energy (U.S.) Inc. for sale to Delmarva Power & Light Co., Wilmington, Del.

Copyright 1995 Oil & Gas Journal. All Rights Reserved.