INDUSTRY BRIEFS

DEEPWATER POSTS

U.S. DEPARTMENT OF TRANSPORTATION proposed setting a liability limit for deepwater ports in general and specifically for Louisiana Offshore Oil Port, the only U.S. deepwater port in operation. DOT, seeking comment on the proposed rule, is considering three options with $50-350 million of limited liability.

COMPANIES

ARCO BRITISH LTD.bought St. James's Oil & Gas Ltd., London, for an undisclosed sum. The deal brings ARCO added interests of 25% in North Sea Block 44/18 and 18.75% in Block 43/24, which contain Tyne and Trent gas discoveries, respectively. ARCO is operator of both blocks. The purchase also covers a 25% share in Block 49/9a, operated by Texaco Ltd.

ARCO BRITISH exchanged North Sea assets with BP Exploration Operating Co. Ltd. in a noncash deal. ARCO obtained BP's 25% interest in Block 53/4a, which includes a 11.24% stake in Welland field that ARCO operates. In return, BP acquired ARCO's 10% stake in Block 211/18a Thistle and Deveron fields, operated by BP, and ARCO's 50% share of BP operated Block 48/7a license, which includes a gas discovery near West Sole field.

SHELL INTERNATIONAL TRADING CO. and Shell International Shipping Ltd. on Apr. 1 will merge into a single company, Shell International Trading & Shipping Co. Ltd. No immediate layoffs are planned, although some duplication is expected after the operations merge. The new unit will trade 2.5 million b/d of crude oil and 500,000 b/d of products while operating 40 oil tankers, 1 8 liquefied natural gas carriers, three liquefied petroleum gas ships, and a fleet of 30 time-chartered vessels.

PREMIER CONSOLIDATED OILFIELDS PLC, LONDON, secured 54-44% of the shares of Pict Petroleum plc, London, making its takeover bid unconditional. The $160 million deal was aided by Amerada Hess Ltd., a major shareholder in Pict, which sold Premier 48.3% of Pict's issued shares in return for a stake in the enlarged Premier (OGJ, Jan. 16, p. 28).

REFINING

Clark Refining & Marketing Inc.'s proposed $200 million purchase of Chevron U.S.A. Products Co.'s Port Arthur, Tex., refinery was reinstated Feb. 4. That followed a Jan. 13 termination of the agreement, when Clark had difficulty obtaining financing for the purchase (OGJ, Jan. 23, p. 18). The two companies began negotiating in March 1994 and signed a sale agreement last August. The new sale agreement is expected to close Feb. 27.

PHILIPPINE President Fidel Ramos inaugurated Pilipinas Shell Petroleum Corp.'s Batangas refinery Feb. 4. The plant, built at a cost of $670 million, has throughput capacity of 110,000 b/d. Existing 30,000 b/d and 40,000 b/d units at the site will be mothballed and later upgraded (OGJ, Dec. 19, 1994, p. 28).

SAFETY

TWO SERVICE COMPANIES received a total of 1 5 citations and $94,1 25 in fines for alleged safety violations related to the deaths of three oil field workers in Ventura County, Calif., last year (OGJ, Aug., 22, 1994, p. 22). Pride Petroleum Services, Houston, and the wireline/testing division of Schlumberger Well Services, Sugar Land, Tex., plan to appeal citations from California's Division of Occupational Safety and Health Administration. The workers were overcome by carbon monoxide fumes while injecting water into a well being converted to water injection. Officials at first thought the workers were killed by hydrogen sulfide until an autopsy proved CO fumes were the cause.

PIPELINES

NORTHERN BORDER PIPELINE CO. asked the Federal Energy Regulatory Commission to approve a $370 million plan to extend its 969 mile interstate gas pipeline system to provide direct gas transportation service from Canada. the Williston basin, and the Great Plains, N.D., coal gasification project to customers in Iowa, Illinois, and Indiana. Northern Border wants to add compression and lay 218 miles of 30 in. line to create 262.5 MMcfd of capacity from Northern Border's terminus at Harper, Iowa, to Manhattan, Ill., and 45 miles of 24 in. line to add 132.5 MMcfd from Manhattan to Griffith, Ind. The new facilities could be in service by November 1997.

DELHI GAS PIPELINE CORP., Dallas, sold several gathering systems in Arkansas, Oklahoma, and Texas. In the deals, Delhi sold 196 miles of pipeline in Arkansas and eastern Oklahoma to Indian Nation Gas Gathering Co., Houston. Combined throughput capacity on the systems was 23.5 MMcfd in 1994. Delhi also sold 175 miles of gas pipelines in South Texas, 149 miles in West Texas, and 46 miles in the Texas Panhandle. The transactions are part of the company's asset disposition program that to date has realized $13.7 million.

PHILLIPS NORWAY let a $1.6 million contract to JP Kenny AS, Stavanger, for detailed engineering of subsea pipelines for Ekofisk field redevelopment in the Norwegian North Sea. The contract includes options for further work until installation of a new processing/transport platform in 1998. The contract covers critical rerouting and tie-in of nine oil and gas pipelines to the new development hub.

EXPLORATION

SAMEDAN OIL OF TUNISIA INC.'S 1 Zelfa wildcat flowed a combined 4,540 b/d of oil and condensate and 20 MMcfd of gas from three zones with thicknesses of 51-112 ft on its 1.2 million acre Cap Bon Marin permit off Tunisia. It was drilled 11 miles offshore in 190 ft of water to 10,270 ft. Operator Samedan, a unit of Noble Affiliates Inc., Ardmore, Okla.; and Neste (E&P) Tunisia Oy, a unit of Finland's state owned Neste Oy; each holds a 50% working interest in the well. Plans call for delineation drilling this year.

TRITON ENERGY CORP., Dallas, signed a production sharing contract with China National Offshore Co. covering exploration of the 3,200 sq km Block CA 16/22 in 100-200 m of water in the Pearl River Mouth basin 175 km southeast of Hong Kong. Seismic reprocessing is to begin in April, with the first wildcat to spud in late 1 995 or early 1 996.

PETROCHEMICALS

PHILLIPS PETROLEUM CO. will add 400 million lb/year of polyethylene capacity at its Houston chemical complex at Pasadena, Tex., through debottlenecking, boosting total nameplate capacity to 2.2 billion lb/year. The project, to begin in March, is to be complete in 1997. Because work will occur during normally scheduled maintenance, production will not be reduced.

POLYSAR selected CDTech's Isomplus skeletal isomerization process for converting n-butylenes. CDTech will provide license and basic engineering for a 300,000 metric ton/year unit to be built at Polysar's Sarnia, Ont., petrochemical plant. Included in the project is CDTech's CDHydro process for selective hydrogenation of butadiene.

REXENE CORP., Dallas, let contract to Litwin Engineers & Constructors Inc. for a 50 million lb/year REXflex plant at Odessa, Tex. The plant will produce flexible polyolefins for use in cast and blown film and in molded and thermo-formed products. Construction is to begin this year, with start-up scheduled for 1 996.

GOVERNMENT

PORTUGAL is laying claim to Timor Sea oil and gas resources through the International Court of Justice in The Hague. Although Indonesia and Australia agreed in December 1989 on a treaty to pursue joint exploitation of disputed areas in the Timor Sea, Portugal reckons it has a claim because it held sovereignty of East Timor before Indonesia invaded and annexed the region in 1975. The case was expected to start Jan. 30.

AZERBAIJAN will sell Turkey an added 5% interest in the group developing three Caspian Sea offshore fields, raising Turkey's stake 6.75%, provided other shareholders approve. This follows Azerbaijan's recent inclusion of Iran in the group, a decision made without consulting western partners (OGJ, Jan. 30, p. 31 ).

GAS MARKETING

WESTERN MARKET CENTER (WMC) partners agreed to let Union Pacific Fuels Inc. (UPF), a unit of Union Pacific Resources Co., Fort Worth, acquire a 10% interest in the gas trading and service center hub project scheduled to begin commercial operation in April at Muddy Creek, Wyo. UPF unit Overland Trail Transmission Co. is to operate WMC's facilities. WMC will link as many as six interstate gas pipelines serving markets in the U.S. Midwest, Pacific Northwest, Rocky Mountains, and southern California.

DRILLING-PRODUCTION

NORWAY'S Norsk Hydro AS claims a world record for measured depth in an extended reach well. From North Sea Oseberg C platform, Hydro drilled a well to measured depth 9,723 m. The well, which required 91 days to drill, has a 1,800 m horizontal section. This beats the previous mark of 8,761 m measured depth set by Den norsk stats oljeselskap AS, drilling from Statfjord C platform (OGJ, Feb. 1 5, 1 993, p. 31 ).

RANGER OIL (U.K.) LTD. won U.K. approval to develop Columba field's D terrace on North Sea Block 3/8a with extended reach wells from nearby Ninian field's south platform operated by Chevron U.K. Ltd. First oil is expected when a lengthy well test begins in September. Reserves are estimated at 15 million bbl of oil. This is one of a number of developments boosting third party business for Ninian (OGJ, Dec. 13, 1993, p. 24).

AMOCO NETHERLANDS BY let a $5.9 million contract to Grootint BY, Zwijndrecht, Netherlands, to build a gas compression module for installation on its P/15-P/18 offshore development. The unit is to be complete in September and be installed on the P/15-D central processing platform scheduled to begin operation late this year. The unit will boost production from the fields, placed on stream in November 1993 (OGJ, Feb. 21, 1994, p. 40).

ORYX U.K. ENERGY CO. drilled its first well as a North Sea operator on a Hutton field extension for which it became operator in late December (OGJ, Sept. 19, 1994, p. 37). Oryx is producing 20,000 b/d from a fault block previously thought to have limited potential.

U.S. MINERALS MANAGEMENT SERVICE distributed more than $537 million to 38 states last year, the states' share of federal oil, gas, and mineral royalties. States receive 50% of federal onshore mineral royalty revenues (Alaska gets 90%) and coastal states with federal offshore tracts receive 27% of royalties from those.

KELLEY OIL CORP., Houston, completed the first Humphreys field well based on a recent 125 sq mile 3D seismic survey of a 29,000 acre leasehold in the Orange Grove area of Terrebonne Parish, La. Kelley's 15 Riggs development well flowed 15.1 MMcfd of gas, 323 b/d of condensate, and no water through a 20/64 in. choke with 5,460 psi flowing tubing pressure from perforations in a middle Miocene First Hollywood sand at 11,967974 ft.

REDMAN-SMACKOVER JOINT VENTURE (RSJV) partners agreed to acquire East Texas assets from Unocal Corp., including interests with reserves estimated at 25 bcf in three Smackover gas fields in Henderson, Van Zandt, Rains, and Wood counties, East Texas, and a 22.5% nonoperating interest in the Eustace gas processing plant and associated gathering lines serving the fields. RSJV partners are Western Gas Resources Inc. 50%, the DDD Energy Inc. unit of Seitel Inc. 40%, and Redman Energy Inc. 10%, all of Houston.

ORYX ENERGY CO., Dallas, by first quarter 1996 expects to boost combined production from two Patton project discoveries to 20,000 b/d of oil equivalent (BOE/day) from 7,000 BOE/day with a one rig drilling program in 1995 on the four tract High Island 384 unit off Texas in the Gulf of Mexico.

STATOIL secured government approval for development of Yme field on North Sea Block 9/2. A modified jack up rig and storage tanker development is under way and due on stream Oct. 15 (OGJ, Jan. 9, p. 18). Statoil said Yme's breakeven price is 90 kroner ($1 3.63)/bbl.

GAS STORAGE

TEJAS POWER CORP., Houston, received a U.S. patent for a solution mining method developed to construct underground gas storage caverns in relatively small horizontal or bedded salt formations like those found in some large gas consuming areas in the northern U.S. Tejas is spearheading development of high deliverability storage caverns in the U.S. to provide peak day gas supplies and balancing services.

CENTANA INTRASTATE PIPELINE CO., a unit of Panhandle Eastern Corp., placed a second gas storage cavern in service at its Spindletop, Tex., site, more than tripling the facility's capacity to a total working gas capacity of 5.2 bcf. A third cavern is under development.

TERMINALS

DIAMOND SHAMROCK INC. received first oil delivery Jan. 28 at its Corpus Christi storage site when the Neptune Subaru tanker unloaded 535,000 bbl of North Sea crude. The terminal includes three storage tanks with total capacity of 1.2 million bbl. Diamond Shamrock plans to add a fourth 400,000 bbl tank in 1996.