INDUSTRY BRIEFS

REFINING

AN EXPORT CREDIT PACKAGE arranged to finance construction of a $400 million, 50,000 b/d grassroots condensate refinery in Uzbekistan is complete. Uzbekistan will finance 40% of the plant, to be delivered under a turnkey contract to state owned Uzbekneftegas by France's Technip and Japan's Marubeni and JGC Corp. Basic engineering was completed in 1994, and detailed engineering and offsites work is under way.

KUWAIT NATIONAL PETROLEUM CO. let contract to Technip for conceptual design services of an integrated computer network at its three refineries and Kuwait City headquarters. The project is part of a major modernization program at the Mina al-Ahmadi, Mina Abdullah, and Shuaiba refineries.

COMPANIES

OCCIDENTAL PETROLEUM CORP. and the U.K.'s privately held Gulf Resources will acquire interests in independent refiner/marketer Clark USA Inc., St. Louis, and receive $246.9 million in exchange for proceeds from the sale of 21 million bbl of oil the next 6 years. The deal will give interests in Clark of 19% to Oxy and 4% to Gulf, reducing stakes in Clark held by investment holding companies Horsham Corp., Toronto, and Tiger Asset Management, New York, to 46% from 60% and to 31% from 40%, respectively.

AMERADA HESS CORP. plans to sell its Amerada Hess Canada unit. No reason was given for sale of the Calgary unit, which produced 11,400 b/d of crude oil and natural gas liquids and 217 MMcfd of gas the first 9 months of 1995. Reserves at yearend 1994 were 130 million bbl of oil equivalent. The proposed sale is expected to close in first half 1996.

PT MEDCO ENERGI CORP., Jakarta, agreed to buy all outstanding capital stock of PT Stanvac Indonesia and affiliates from units of Exxon Corp. and Mobil Corp. Stanvac operates the Kampar, Extension, Rimau, and Pasemah production sharing contracts (PSCs) in Central and South Sumatra. In all, the onshore PSCs cover 19,283 sq km and include 23 oil and gas fields that produce 13,000 b/d and 40 MMcfd. Pasemah is an 8,559 sq km exploration block.

INUVIALUIT ENERGY INC., a unit of Inuvialuit Petroleum Corp., extended to Nov. 14 a $2.75 (Canadian)/share its offer for Omega Hydrocarbons Ltd. Omega is fighting the takeover bid and expects to receive new offers. It claimed the offer fails to recognize the underlying value of Omega. More than 50% of Omega shares are held by directors and shareholders currently opposed to the takeover offer. Inuvialuit says it must have 50% of all shares tendered before it will complete the takeover. Both are Calgary companies.

EXPLORATION

CANADA-NOVA SCOTIA Offshore Petroleum Board accepted a bid representing a proposed work expenditure of $86.4 million (Canadian) from Mobil Canada Properties, Shell Canada Ltd., and Imperial Oil Resources Ltd. for an exploration license off Nova Scotia. The license covers almost 183,000 acres west of Sable Island and has an initial term of 5 years, extendable to 9 years.

SNYDER OIL CORP. (SOCO), Fort Worth, suspended an apparent oil discovery on Block XIX in Northeast Mongolia's Tamtsag basin. SOCO suspended until spring the 19-2 Sotamo wildcat after drilling it to 9,875 ft and setting pipe. It logged 55 ft of apparently productive oil sands beginning at 8,879 ft and identified another 144 ft of possible oil and gas sands. SOCO recovered traces of oil with a gravity of 40-45. Testing was postponed until spring because of a lack of equipment and onset of winter. Plans also call for drilling an offset to the apparent discovery and a wildcat on nearby Block XXII.

ESSO NORGE AS found another oil field on Block 25/8 175 km off Norway. Its 25/8-8S Tau wildcat flowed 6,700 b/d of oil from Paleocene pay. Two sidetrack holes also found hydrocarbons on the eastern and western flanks of the structure in 415 ft of water. Tau is 4 km southeast of Esso's 25/8-5S Elli discovery of 1994 that flowed 7,000 b/d from Paleocene pay. Operator Esso and 50-50 partner Enterprise Oil Norge Ltd. are considering coordinated development of the light oil finds.

MOBIL OIL CORP. started a 2 year seismic program that entails acquiring new data and reprocessing existing data on five blocks in Northeast Hungary it won last year. A Hungarian contractor last month started seismic surveys on an 800 sq km portion of Mobil's Heves II area 30-90 miles from Budapest (see map, Aug. 29, 1994, p. 32).

SHELL CHINA PETROLEUM DEVELOPMENT BV soon will spud a wildcat on its Subei block in East China's Jiangsu province. Site is at Laotang, about 80 km south of Yancheng in northern Jiangsu. That follows 3 years of seismic surveying and data processing. Shell's production sharing contract is scheduled to expire in March 1996. It let integrated drilling contracts worth a combined $3.5 million to local companies Zhongyuan Drilling Corp. and Jiangsu Oil Exploration Corp.

GAS PROCESSING

TURKMENISTAN'S Gas and Oil Ministry agreed with a venture of France's Sofregaz and Technip to carry out a turnkey project setting up a gas pro- cessing plant and related petrochemical units at Seidi, Turkmenistan. The $420 million project is tied to development of Samane Tepe gas field. it includes ethane extraction and desulfurization, the downstream units, and laying a 130 km Seidi- Samane Tepe gas pipeline. Financing will be sought through international credits.

NGC CORP., Houston, will build and operate a 100 MMcfd cryogenic gas processing plant at Waskom, Tex., for Waskom Gas Processing Co., a venture of NGC's Trident division and NorAm Energy Corp. unit NorAm Field Services Corp. With ethane recovery, residue gas volumes from the new plant will reach 83 MMcfd, natural gas liquids output 190,000 gal/day. it will be operating by yearend 1996 and cost $12-18 million. The existing plant will be shut down once the new plant is built.

DRILLING-PRODUCTION

MOBIL NORTH SEA LTD. started production from Galahad gas field on U.K. North Sea Blocks 48/12a and 48/13b. Reserves are estimated at 153 bcf, and production is expected to rise from an initial 70 MMcfd to a peak of 120 MMcfd. All field output is under contract to Mobil Gas Marketing for resale. Galahad gas is sent to shore through a 16 kin, 12 in. pipeline to a tie-in on Lancelot field's export line, then on to Bacton terminal. 'iota[ project development time was only 11 months because of technological advances that included a minimum facilities platform design Amoco (U.K.) Exploration Co. developed (OGJ, Oct. 23, p. 46).

PRIDE PETROLEUM SERVICES INC., Houston, closed its acquisition of Marlin Colombia Drilling Co. Inc. from Shell Overseas Trading Ltd. Marlin owns six drilling/workover rigs in Colombia (OGJ, Oct. 30, p. 20).

AMOCO CORP. Jet contract to Sonat Offshore Drilling Inc. for its Discoverer 534 dynamically positioned deepwater drillship. Amoco hired the rig for about 27 months beginning in fall 1996, with one well plus 1 year guaranteed. The guaranteed term of the contract is expected to generate revenue of about $56 million. The rig is currently working in the Gulf of Mexico, and Amoco is expected to use it there as part of a deepwater exploration and appraisal drilling program.

MINERALS MANAGEMENT SERVICE rescheduled to Jan. 10-11 a public meeting in Houston on its proposal to clarify who may be held liable for unpaid or underpaid royalties. It previously was slated for Nov. 29.

TOTAL THAILAND exercised an option to hire the Smedvig AS T-1 rig for another year in Bongkot gas field in the Gulf of Thailand off Thailand. It will drill 18 wells in the giant field under a contract extension valued at $9 million.

KUWAIT OIL CO. (KOC) let a $75 million, 5 year contract to Geco-Prakla International Ltd. to conduct 3D seismic surveys of Kuwait's Greater Burgan, Minagish, Raudhatain, Sabriya, and Umm Gudair oil fields. An effort meant to optimize crude oil production, the surveys will be the first 3D surveys of Kuwait's major fields. KOC also recently let a $50 million contract to Western Atlas for 2D seismic surveys of Kuwait's fields.

HIBERNIA MANAGEMENT & Development Co. Ltd. let a $120 million contract to AOC Brown & Root Canada Ltd., St. John's, Newf., for operations and engineering services related to development of Hibernia oil field off Newfoundland.

ARCO CHINA INC. will exercise its options to drill two more wells using Reading & Bates Corp.'s Jack Bates semisubmersible rig off China. It ear- lier exercised the first of three options for another well off China. The Jack Bates first will work for British Gas plc off Viet Nam beginning late this month and then for Occidental Petroleum Corp. off the Philippines before returning to work for ARCO off China and then Mobil U.K. Ltd. in the North Sea. Each of the three option wells for ARCO commands a different rate, reflecting the continued tightening of the fourth generation semisubmersible market.

EXPORTS-IMPORTS

CHINA will cut its crude exports to Japan the next 5 years. Under a recently renewed long term trade accord, China will export 120,000160,000 b/d to Japan. Under the earlier accord, China shipped 200,000 b/d of Daqing field crude to Japan for direct burning in power plants.

PETROCHEMICALS

EXXON CHEMICAL CO. let contract to M.W. Kellogg Co. for full engineering, procurement, and construction of a polypropylene plant at its Baytown, Tex., complex. The project will boost polypropylene capacity at the Exxon complex by 240,000 tons/year when completed in 1997.

CHEM TECH MEXICANA, Monterrey, plans to build a 2 million metric ton/year naphtha derivatives petrochemical complex in Mexico's Altamira region at a cost of $500 million. Stone & Webster is to handle project engineering. Chem Tech is a new private Mexican company with international financing that is capitalizing on Mexico's 50% domestic shortfall of naphtha derivatives. It plans to supply Altamira region petrochemical producers, including BASF, Alfa, and Hercules, with naphtha derivative feedstocks and export the balance.

PETROLEOS MEXICANOS' Pemex Petroquimica, slated for privatization beginning this year (OGJ, Nov. 6, p. 15), will complete by yearend installation of automated distribution control systems in half of its 61 petrochemical plants.

GROUND SUBSIDENCE is threatening the site of Taiwan's sixth naphtha cracker complex a group led by Formosa Plastics Group is building at Taiwan's Mailiao industrial zone, Taipei newspapers reported. A team from National Taiwan University determined land at the project site has sunk by more than 30 cm since August 1991. The team blamed excessive pumping of an underground aquifer by many fish farms in the area - many illegal - and said subsidence is likely to worsen. The project entails a 450,000 metric ton/year unit ethylene plant and downstream units and a 300,000 b/d refinery.

TAIWAN'S Chinese Petroleum Co. (CPC) and 13 partners signed final contracts to proceed with Taiwan's eighth naphtha cracker/refining complex. It involves building a 900,000 metric ton/year ethylene unit and 200,000 b/d refinery. Interests are CPC 35%, Koo's Group - including Grand Petrochemical Corp. and China Synthetic Rubber Corp.33%, Far Eastern Group and Lee Chang Yung Chemical Industry 10% each, and a group of 10 other petrochemical companies 12%.

PIPELINES

AUSTRALIAN GAS LIGHT LTD. (AGL), Sydney, proposed buying the 1,600 km Dampier-Bunbury gas trunk line in Western Australia in an effort to expand into gas distribution there. The line delivers gas from Northwest Shelf fields to Southwest Western Australia. The state government is considering privatization, an ownership partnership involving major customers of the line, or a contract management arrange- ment. It is conducting a review of pipeline operations. The line, operated by state utility AlintaGas, has more than $1 billion (Australian) in debt.

U.S. TRANSPORTATION DEPARTMENT'S Research and Special Programs Administration approved Columbia Gas Transmission Corp.'s request to temporarily lay 1,000 ft of 2 in. plastic pipe near Kirby, Pa., to replace two existing underground lines that ground subsidence is expected to rupture soon. It will bury the plastic pipe after it obtains local permits in 6-8 months.

ENVIRONMENT

U.S. ENVIRONMENTAL PROTECTION AGENCY suspended a 4 year old rule requiring that winter gasoline sold in the Washington, D.C., area contain at least 2.7 vol % oxygen. EPA said use of reformulated gasoline with 2 vol % oxygen is adequate to keep carbon monoxide levels in the region at acceptable levels.

EPA deferred until Dec. 15, 1997, the deadline for gasoline distribution facilities to comply with U.S. federal emissions standards for hazardous air pollutants. This will give industry and government more time to prepare for the tougher emissions limits.

TANKERS

U.S. COAST GUARD proposed tougher operating measures to reduce oil spills from single hull oil tankers. They would require tankers of more than 5,000 gross tons to train for the possibility of oil spills and carry onboard equipment for emergency lightering.