INDUSTRY BRIEFS

June 19, 1995
PENNZOIL PRODUCTS CO. unit Atlas Processing Co. let contract to Jacobs Engineering Group Inc., Pasadena, Calif., for engineering, procurement, and construction management services for a $200 million upgrade of Atlas' Shreveport refinery that will boost gasoline production to 16,000 b/d from 6,500 b/d. The project includes addition of a 10,500 b/sd resid catalytic cracking unit and new alkylation, isomerization, and sulfur recovery units. Upgrade is to be complete in late 1996.

REFINING

PENNZOIL PRODUCTS CO. unit Atlas Processing Co. let contract to Jacobs Engineering Group Inc., Pasadena, Calif., for engineering, procurement, and construction management services for a $200 million upgrade of Atlas' Shreveport refinery that will boost gasoline production to 16,000 b/d from 6,500 b/d. The project includes addition of a 10,500 b/sd resid catalytic cracking unit and new alkylation, isomerization, and sulfur recovery units. Upgrade is to be complete in late 1996.

KUWAIT NATIONAL PETROLEUM CO. will hike capacity at its Shuaiba refinery by more than 45,000 b/d to 200,000 b/d the next 2 years, resulting in almost 80,000 b/d more capacity than before the Persian Gulf war. Repairs at the refinery have been progressing steadily, and Kuwait's total refining capacity of about 840,000 b/d is up 30,000 b/d from prewar levels.

PIPELINES

NORWAY'S Den norske stats oljeselskap AS (Statoil) plans to resume laying an oil pipeline from Mongstad terminal to West Troll field after the first section of pipe was dropped from the lay barge. A faulty safety clamp on Castoro Sei lay barge, which should have secured the pipe on the vessel, is the likely cause, Statoil said. Pipelaying had reached 1.3 km from shore when the accident occurred, and a 500 m section of pipe was dropped in a loop outside the pipeline route. Statoil said the repair will take about 2 weeks and will not delay start-up of Troll field oil exports.

AXIS GAS CORP., Dallas, and Beacon Group Energy Investment Fund L.P., New York, agreed to negotiate purchase of Exxon Pipeline Co.'s Crane-Baytown, Tex., crude oil pipeline. The deal includes about 550 miles of pipeline and an 18 in. trunk line that transports crude from West Texas to Houston, The Axis group plans to reverse the trunk line and connect it with systems in El Paso, enabling it to transport refined products from the Gulf Coast to markets across Texas, other southwestern states, and Mexico.

TRANSCANADA PIPELINES LTD., Calgary, asked Canada's National Energy board for approval to double its proposed expansion spending in 1997. The company wants to increase spending on its system to Central Canada and the U.S. to $493 million (Canadian) from $221 million (OGJ, May 8, p. 31). The change would add 242 MMcfd of capacity. Construction is to begin this year and be complete by November 1996.

NOVA CORP. UNITS PanAlberta Gas Ltd. and Novagas Clearinghouse Ltd., in partnership with Natural Gas Clearinghouse, Houston, plan to market and ship surplus PanAlberta gas to Ohio year-round, to Mississippi and Florida in summer, and to Tennessee in winter. Novagas said the plan could reduce surplus deliverability to the U.S. Midwest by 250 MMcfd. Members of the PanAlberta supply pool will vote on the proposal, which if approved, would be implemented in November 1997 after the Northern Border pipeline system is expanded.

PETROCHEMICALS

BP CHEMICALS LTD. let a $22.5 million contract to Stone & Webster Engineering Ltd., Milton Keynes, U.K., for engineering procurement for expansion of its ethylene cracker at Grangemouth, Scotland. Addition of a sixth furnace will increase ethylene capacity by 100,000 metric tons/year to 450,000 tons/year (OGJ, May 8, p. 32). Modifications to the downstream recovery unit will take place during a scheduled turnaround in June 1996. The new furnace will be completed in April 1997.

DRILLING-PRODUCTION

A SYRIAN BLOWOUT that occurred in May resulted in the deaths of five firefighters more than a month later. On May 3, Al Furat Petroleum Co.'s 23 El Isba blew out, spewing oil and gas. Syria Shell Petroleum Development BV, an interest owner in the well, said pumping heavy fluids into the well failed to control it, so relief wells were started. On June 10, a fire erupted at the wellhead, killing the workers. All were subcontractors for Al Furat, and three worked for firefighter Wright, Boots & Coots, Houston.

HUNGARY'S MOL plans to invest 1.5 billion forints ($12 million) to develop two gas fields in Southeast Hungary. They are expected to go on stream by early 1997. Both fields are in Bekes county, bordering Romania. VOL estimates reserves at 26.9 bcf for the two fields.

LOUIS DREYFUS NATURAL GAS CORP., Oklahoma City, agreed to acquire producing leases and acreage in the Sonora area of West Texas from American Exploration Co. and related partnerships for about $93 million. The deal includes 700 producing wells and more than 100,000 gross leasehold acres. Dreyfus will assume operations of most of the leases on closing, expected in late July. The leases are producing about 45 MMcfd, about 33 MMcfd net to Dreyfus.

BP EXPLORATION OPERATING GO. LTD. let a life-of-field well services contract to Baker Hughes Ltd., Aberdeen, for Andrew and Cyrus fields in the U.K. North Sea. Baker Hughes said 10-12 development wells, an appraisal well, and a gas injector will be drilled from Andrew platform in the first 3 years. Two wells will also be drilled n subsea satellite Cyrus field.

KERR-MCGEE CORP. plans fast track development of its South Timbalier 265/266/278 property in the Gulf of Mexico. The company won a lease on South Timbalier Block 266, for which it bid $21 million at the recent Gulf of Mexico lease sale (OGJ, May 22, p. 24). The production facility is being designed for 150 MMcfd of gas and 10,000 b/d of liquids to be produced from three pools through two platforms on South Timbalier 265. The new facilities are to come on stream in 1996.

CONOCO (U.K.) LTD. plans to bring into production in August an extension of Victor gas field on U.K. North Sea Block 49/17. Northwest Victor bets estimated reserves of 180 bcf of gas. Development involves a three well subsea template tied back to Victor platform 5 km away. The pipeline from Northwest Victor will be tied into the existing Victor 16 in. pipeline beneath the platform by means of a subsea hot tap, for which the pipe will be depressurized but still filled with gas.

UNION TEXAS PETROLEUM LTD. acquired a 15.5% stake in U.K. North Sea Alba field from Oryx U.K. Energy Co. for $270 million. Alba production is about 75,000 b/d of oil and is to peak at 90,000 b/d in 1997-98. Union Texas averaged 41,000 b/d of production from U.K. operations in 1994.

SHELL OIL CO. UNIT Pecten International Co. acquired a 20% interest in exploration and production assets in Georgia held by JKX Oil & Gas, Guildford, U.K. JKX will retain 30% and operatorship of the venture, which is currently drilling appraisal wells to Shromi Subani discovery southeast of Poti. JKX holds licenses to explore in Georgia's Kartli depression and Rioni basin and in the Black Sea (OGJ, Jan. 23, p. 20).

FOUNTAIN OIL INC., Houston, signed a preliminary agreement to acquire a private company that owns a 31% interest in Maykop gas/condensate field in Russia's Adygea republic for $8 million. Maykop has proved reserves of 495 bcf of gas and 4.3 million bbl of condensate but produces only the gas equivalent of 2 MMcfd. Fountain expects to begin a program of 20 infill wells and selected workovers by the end of October and sees prospects on trend with the 12.500 acre Maykop in 5,000 adjoining acres.

MOBIL OIL CANADA LTD. and Shell Canada Ltd. approved a $5 million (Canadian) second phase study on producing natural gas from six Sable Island fields off Nova Scotia. The initial study focused on technical aspects and marketing. Second phase includes technical evaluations, public consultation, and regulatory talks. First gas is expected after 2000 (OGJ, Jan. 16, p. 18).

GARNET RESOURCES CORP., Houston, and Aviva Petroleum Inc., Dallas, are planning five development wells in Mary field in Colombia's Putumayo region after moving the bottomhole location of 4 Mary development well, which produced an unspecified volume of oil and water from Cretaceous Villeta at 7,697-8,223 ft. The companies in May boosted gross production on their Colombian acreage to 10,000 b/d from 4,400 b/d in January 1995 and plan to spud 1 Palmera, an 8,1 00 ft wildcat, in third quarter 1995.

ENRON OIL & GAS GO., Houston, boosted its holdings in East Texas Carthage field to 17,000 acres and netted 115 bcf of gas equivalent reserves by acquiring a combined 65% interest through two deals covering 9,500 acres in the center of the field. Enron by yearend intends to boost gross production of the acquired properties to 35 MMcfd from 10 MMcfd and net output to 24 MMcfd from 6 MMcfd. About 80 wells are planned on the acreage the next 3 years, mostly to develop Jurassic Cotton Valley and lower Cretaceous Travis Peak.

BEAU CANADA EXPLORATION LTD., Calgary, bought Ausquacan Energy Ltd., Dallas, for $16.5 million (Canadian). Beau Canada said the deal will add 900 b/d of crude and 4 MMcfd of natural gas to its production, mostly from Alberta fields. It expects second quarter production of about 6,200 b/d.

BHP PETROLEUM PTY. LTD. planned to shut in production from Jabiru field in the Timor Sea for 2 weeks beginning June 16. The Jabiru Venture production ship was expected to arrive in Darwin Harbor June 18 for routine maintenance. BHP plans remedial work on the ship's production riser swivel, replacement of some pipework and process valves, and surveys of port and starboard boilers. Jabiru recently had been producing 130,000 b/d of oil. Later this year, BHP plans a similar shutdown of Griffin Venture production ship operating off Northwest Australia.

COMPANIES

MAXUS ENERGY CORP. stockholders approved the merger of Maxus into YPF SA Maxus effective June B. YPF now owns all of the outstanding common stock of Maxus.

ENSERCH EXPLORATION INC., Dallas, completed the $340 million purchase of Dalen Corp., Dallas, a unit of Pacific Gas & Electric Co. Enserch also repaid Dalen's bank debt of $115 million. Dalen's reserves at Jan. 1 totaled 307.4 bcf of gas and 11.7 million bbl of oil (OGJ, Apr. 24, p. 34).

EXPLORATION

COPLEX RESOURCES NL, Hobart, Tasmania, expected to spud 1 Manila Bay wildcat at presstime in Philippines' Manila Bay. Pioneer Driller semisubmersible rig will drill the well in 75 ft of water The target is a well defined structure at 11,000 ft. Coplex said the prospect has potential to hold reserves of 400-500 million bbl of oil or 1-2 tcf of gas. Drilling is expected to take 45 days.

OMV (PAKISTAN) EXPLORATION GMBH 1 Khipro on Block 20 in Sindh Province flowed at a rate of 11.1 MMcfd during a barefoot test of Cretaceous Lower Goru B sand at about 3,300 m, license partner Hardy Oil & Gas plc reported. The well will be drilled to 4,100 m total depth to cut Cretaceous Samber.

ELF PETROLEUM NORGE AS 1/3-7 new pool wildcat west of Norway's North Sea Gyda field flowed at a rate of 792 b/d of oil and 1.3 MMcfd of gas through an 11 mm choke from Paleocene pay, Norwegian Petroleum Directorate reported. The well was drilled to total depth of 3,300 m by West Epsilon rig in 72 m of water.

INTERNATIONAL PETROLEUM LIBYA LTD. (IPLL) spudded June 10 the A1 NC176 wildcat on onshore Libya's Block NC176. It will be drilled to about 10,000 ft to test a large reefal prospect identified on seismic data acquired in late 1992 (OGJ, Sept. 21, 1992, p. 46). Drilling and testing is expected to take about 6 weeks at a total cost of about $5.2 million, Potential reserves are postulated at more than 500 million bbl. Operator IPLL holds 40% interest, Sands Petroleum AB 40%, Hardy Oil & Gas (U.K.) Ltd. 15%, and Seven Seas Petroleum Libya Inc. 5%.

SAFETY

U.K. HEALTH & SAFETY COMMISSION published a code of practice and guidelines for protection of offshore workers from fire and explosion and for organizing effective emergency response. The guidance will help offshore installation operators comply with the Offshore Installations (Prevention of Fire & Explosion and Emergency Response) Regulations 1995, which come into force June 20. This is one of four blocks of legislation arising out of the inquiry into the Piper Alpha platform blast of 1988 (OGJ, Dec. 14, 1992, p. 25).

SPILLS

A PIPELINE RUPTURE in Russia's far north spilled an undisclosed quantity of oil near Usinsk, where a massive spill last year is being cleaned up by a team financed by World Bank (OGJ, May 22, p. 30). The spill is about 5 km from the Kolva River, a tributary of the Pechora. An Emergencies Ministry spokesperson said the rivers are not in danger The pipeline, recently repaired, was closed down after the leak, and oil was being collected in containment booms.

TEXACO INC. shut down its 20,000 b/d Cimmarron crude pipeline after a June 7 rupture occurred amid flooding near Ponca City, Okla. At presstime, Texaco still was cleaning up remnants of the estimated 1,600 bbl of light Kansas crude that spilled into the Salt Fork River. Most of the crude either dissipated or was collected in containment booms. The line was transporting about 3,000 b/d at the time of the rupture. Texaco could not estimate when it will restart the pipeline because rising river levels have hampered repair efforts.

GEOTHERMAL

CALPINE CORP., San Jose, Calif., agreed with Grupo EPN SA de CV and its Perforadora Magma SA unit to participate in geothermal steam production, well drilling, and repair projects at the Cerro Prieto geothermal resource in Baja California, Mexico. The projects will be under two contracts valued at $26 million with Mexico's national utility CFE. EPN and Calpine agreed to produce about 1,600 tons/hr of steam at Cerro Prieto for CFE. Calpine and Magma plan to drill 10 geothermal wells to expand capacity for the Cerro Prieto field and work over 20 of CFE's geothermal wells at Cerro Prieto.

Copyright 1995 Oil & Gas Journal. All Rights Reserved.