INDUSTRY BRIEFS

Sept. 13, 1999
Shell Eastern Petroleum Pte. Ltd.
and Germany's BASF AG formed a joint venture to build a $500 million petrochemical plant in Singapore. The JV, called Basell Eastern (Pte.) Ltd., will construct the plant on Singapore's Jurong Island. The plant will produce 550,000 metric tons/year of styrene monomer and 250,000 tons/year of propylene oxide. Start-up is slated for second half 2002.

Petrochemicals

Shell Eastern Petroleum Pte. Ltd.
and Germany's BASF AG formed a joint venture to build a $500 million petrochemical plant in Singapore. The JV, called Basell Eastern (Pte.) Ltd., will construct the plant on Singapore's Jurong Island. The plant will produce 550,000 metric tons/year of styrene monomer and 250,000 tons/year of propylene oxide. Start-up is slated for second half 2002.

Pipelines

Maritimes & Northeast Pipeline LLC
is holding an open season until Sept. 30 for expanded main line firm natural gas capacity on its system. The proposed expansion would extend the Maritimes system-slated to start up Nov. 1-to Salem, Mass., where it would tie into Algonquin Gas Transmission Co.'s proposed HubLine project (OGJ, Aug. 23, 1999, p. 34; and Aug. 2, 1999, p. 36).

U.S Department of the Interior
will study the environmental impact of Navajo Pipeline Co.'s proposed 12-in., 232-mile products pipeline from Bloomfield, N.M., to Grand Junction, Colo. The planned line would use the TransColorado Pipeline right-of-way for about 210 miles. The study is due in May 2000.

U.S. Department of Transportation's
Research and Special Programs Administration advised pipeline operators to review their damage-prevention programs to prevent excavators from rupturing lines when drilling directionally. The National Transportation Safety Board urged the action after its investigation of a fatal accident near Indianapolis.

Gas processing

Magnum Hunter Resources Inc.
unit Hunter Gas Gathering Inc., Irving, Tex., and Carrera Gas Gathering Co. LLC, Tulsa, signed an agreement to acquire a gas processing plant and associated gathering system in Marshall and Bryan Counties, Okla., from Dynegy Inc. unit Dynegy Midstream Services LP. Terms of the deal were not disclosed. The cryogenic plant includes 3,350 hp of high-speed compression and 18 MMcfd of gas processing capacity. In a separate deal, Hunter Gas Gathering sold its 100% interest in the North Appleby gas gathering system in Rusk and Nacogdoches Counties, Tex., to an undisclosed buyer for $900,000.

Refining

A flash fire
in the crude distillation unit of Indian Oil Corp.'s Panipat refinery at Haryana, India, forced a shut-down Sept. 5 of both the crude and vacuum distillation units. The incident marks the fourth such event in 4 months to result in work disruption at the refinery, which started up late last year (OGJ, Dec. 21, 1998, p. 28). IOC Chairman M.A. Pathan attributed the frequent shutdowns to "teething troubles" of the project.

Farmland Industries Inc.,
Kansas City, and National Cooperative Refinery Association (NCRA), McPherson, Kan., formed an operating alliance to jointly manage their refineries. Cooperative Refining LLC, based in McPherson, began managing NCRA's 75,000 b/d McPherson refinery and Farmland's 95,000 b/d refinery at Coffeyville, Kan., on Sept. 1. The partners expect to save $10 million/year. NCRA is owned by: Cenex Harvest States, St. Paul; Growmark Inc., Bloomington, Ill.; and MFA Oil, Columbia, Mo.

Sunoco MidAmerica Marketing & Refining,
a unit of Sunoco Inc., Philadelphia, shut down one of the two 70,000 b/d crude units at its Toledo, Ohio, refinery for repairs following a Sept. 7 pump fire. The unit, which was expected to resume operations within a week, was not extensively damaged, said Sunoco. No injuries were reported, and Sunoco says it is taking steps to minimize the effects on its supply contracts.

Turkmenistan's
ministry of oil and gas let a 180 million euro turnkey contract to Technip Germany, a unit of France's Technip SA, for design and construction of a lube oil unit at the Turkmenbashi refinery on the Caspian Sea coast. The work, which will involve the revamp of an 80,000 metric ton/year vacuum distillation unit and intermediate storage tanks, is slated for completion in April 2001. The project was partially financed through a German export credit and bank credits. Technip is also building a 1.8 million ton/year catalytic cracking unit at the Turkmenbashi plant; it is due on stream in mid-2000.

BP Amoco plc
let a 3-year contract for an undisclosed sum to Wellman Graham Ltd., Gloucester, U.K., to supply and refurbish shell and tube heat exchangers at its refinery and petrochemicals complex at Grangemouth, Scotland. Wellman Graham is to maintain a reliable source of plant equipment and provide 24-hr services to prevent unscheduled shutdowns or equipment failures.

Companies

Costilla Energy Inc.,
Midland, Tex., filed for bankruptcy protection under Chapter 11 of the U.S. bankruptcy code. Costilla intends to restructure its liabilities, which comprise $180 million in unsecured 101/4% senior notes, $26.5 million in secured debt under a bank credit facility, $50 million in convertible preferred stock, and hedging obligations. The firm will maintain its oil and gas operations while filing a reorganization plan with the U.S. Bankruptcy Court.

Agip Guyana BV,
a unit of Italy's ENI, signed a farm-out agreement with Maxus Guyana Ltd., a unit of Argentina's YPF SA, to acquire a 25% interest for exploration on the Georgetown Block about 80 km off Guyana. The block, in which Maxus held 100% interest, lies in 30-200 m of water and covers 13,200 sq km. Agip said the acquisition is a result of its strategy to expand its Latin American holdings.

A consortium
comprising Mondoil Cote d'Ivoire LLC and Saur Energie Cote d'Ivoire acquired all of the shares held by Apache Corp., Houston, in Apache Cote d'Ivoire Petroleum LDC for $45 million. The Apache unit was operator of the Foxtrot natural gas field off Abidjan, in which it held a 24% interest. The consortium will assume management control of the project; Apache will continue to provide technical services through its interest in Mondoil Corp. Other interest holders in the project are: Saur Energie, 24%; Ivorian state oil firm Petroci, 40%; and Gaz de France-Electricite de France joint venture Enerci, 12%.

Weatherford International Inc.,
Houston, acquired Petroline WellSystems Ltd., Aberdeen, for £20 million in cash and £84 million in Weatherford common stock. The purchase of Petroline "adds critical components to (our well) completion capabilities," said Weatherford.

PP&L Global Inc.,
the international development unit of PP&L Resources Inc., Allentown, Pa., acquired about 2.7 million additional shares from minority shareholders of Chile's largest electricity distribution company, Empresas Emel SA, for about $44 million. The purchase brings to 85.4% PP&L's holdings in the Chilean firm. In July, PP&L acquired a 29.2% interest in Emel from various shareholders (OGJ, July 12, 1999, p. 34).

Cody Energy LLC,
Denver, and an oil and gas unit of GE Capital Structured Finance Group formed a limited partnership to acquire 75% of Cody's interest in 12 million bbl of proven oil reserves in Kurten field in Brazos County, Tex., for an undisclosed sum. Cody intends to continue as operator of the wells. In a related transaction, GE SFG became 50% partner in Cody's $110 million revolving credit facility, which will provide the firm with added capital for acquisitions in the Gulf Coast area and South Texas, says Cody.

Shenandoah Energy Inc.,
a firm recently formed by Chandler Co., plans to acquire Chevron USA Production Co.'s oil and gas assets in Utah's Uinta basin in exchange for an undisclosed sum of cash and an equity ownership interest in Shenandoah. Shenandoah will also acquire all of Chandler's stock. Chevron's production in the region, which includes properties in the Red Wash, Wonsits Valley, Gypsum Hills, and Brennan Bottom Unit areas, averages 2,280 b/d of oil and 5.9 MMcfd of natural gas.

Sonat Inc. unit
Sonat Exploration Co., Houston, will close its Tyler, Tex., and Oklahoma City offices on or shortly after Oct. 31. Sonat says the move is part of a plan to improve the efficiency of its exploration and production business. About 160 employees will be affected. Sonat will conduct all operations from its main Houston office following the close.

Gas marketing

Amoco Energy Trading Co.,
BP Amoco's North American natural gas marketing arm, signed an agreement to market Nova Scotia Resources (Ventures) Ltd.'s 8.4% share of natural gas production from the Sable Offshore Energy Project. Amoco will market the 45 MMcfd of gas, slated to begin flowing Nov. 1, primarily in New England and the U.S. Northeast (OGJ, Aug. 23, 1999, p. 33).

Drilling-production

Unocal Corp.
unit Unocal Thailand Ltd. began natural gas production from Trat field on Block 11 in the Gulf of Thailand. With five wells-including Trat A-07, Unocal's first horizontal well in the gulf-the firm is producing 70 MMcfd of natural gas and 2,100 b/d of condensate (OGJ, Mar. 22, 1999, p. 95). Unocal plans to drill another three wells in the central Trat area, which is estimated to hold 240 bcf of recoverable gas, says Unocal. Partners in Trat field are: operator Unocal, 71.25%; Mitsui Oil Exploration Co. Ltd., 23.75%; and PTT Exploration & Production Public Co. Ltd., 5%.

Petroleo Brasileiro SA
began production from P-35 platform in the Campos basin near Rio de Janeiro. The platform is installed at the 7-MRL-64D well in the western part of Marlim field off Brazil. The well is producing 11,000 b/d of oil and 173,000 cu m/day of natural gas. By the end of 2000, Petrobras plans to be producing from another 14 wells at the platform, which would bring P-35's production to 100,000 b/d, its design capacity.

Samedan Oil Corp.,
a wholly owned unit of Noble Affiliates Inc., Ardmore, Okla., began production from two blocks off Louisiana in the Gulf of Mexico. Vermillion 335 is producing about 900 b/d of oil and condensate and 14.5 MMcfd of natural gas. Vermillion 335 interest holders are: operator Samedan, 50%; Murphy Exploration & Production Co., 35%; and Walter Oil & Gas Corp., 15%. The second field, West Cameron 600, is producing about 13 MMcfd of gas and 15 b/d of condensate; Samedan holds a 100% interest in the field.

Derek Resources Corp.,
Vancouver, B.C., let contracts to Bateman Engineering Inc. and Silvertip Project Partners Inc., both of Denver, for the development, financing, construction, and start-up of its LAK Ranch oil project in the Powder River basin near Newcastle, Wyo. Silvertip will serve as project manager, and Bateman will provide turnkey design, construction, and start-up of the following systems: surface steam production and distribution, oil recovery and separation, raw water supply, and wastewater injection. Construction is slated to begin in early 2000.

ATP Oil & Gas Corp.
let contract to Oceaneering International Inc., Houston, for the subsea completion and 6.4-mile tieback of a well on High Island Block A253 to a platform on High Island Block A270. The work will be divided into two phases, the second of which will depend on the success of the drilling operations that begin this month.

Terra Nova Alliance,
a consortium led by Petro-Canada Corp., let contract to BJ Process & Pipeline Services Ltd. (BJ PPS), Aberdeen, for precommissioning and commissioning support services for the Terra Nova oil field facilities off Newfoundland. The field is being developed with a floating production, storage, and offloading vessel linked to subsea wells. BJ PPS will perform the work in fabrication yards at Bull Arm, Newf., and Ardersier, Scotland, and at the well site. The work began in August and is slated for completion in third quarter 2000. It will include leak-detection commissioning, ultrasonic valve testing, nitrogen purging and testing, and pipe freezing.

Power

An international energy consortium
led by IVO Energy Ltd., London-a unit of Finland's Fortum Group-plans to build a 400-MW, £190 million (Irish) combined-cycle natural gas-fired power plant in County Kildare, Ireland. The plant is slated to begin operation within 2-3 years, pending licensing and other approvals. Other consortium partners are France's Elf Aquitaine Gaz and Bord na Mona Energy Ltd., Newbridge, Ireland.

North American Energy Services Co.
(NAES), Bellevue, Wash., signed two contracts and renewed another for operations and maintenance services on three Latin American power plants. IGC/ERI Thermal Generating Ltd. let a contract for a reciprocating-engine 96-MW power plant being built at La Chorrera, Panama. The 50-50 joint venture Pan-Am Generating-comprising Noresco, Framingham, Mass., and Illinova Generating Co., Decatur, Ill.-is developing the project. NAES will also provide services to TermoCandelaria SCA ESP's 314-MW gas turbine, simple-cycle merchant plant at Cartegena, Colombia, under development by KMR Power, Arlington, Va. Energia del Sur SA extended a contract with NAES for its 79-MW, simple-cycle merchant plant at Comodoro Rivadavia, Argentina.

Gas distribution

The province of New Brunswick,
Canada, awarded a 20-year, $300 million contract to Enbridge Gas New Brunswick-a joint venture of Enbridge Inc., Calgary, and 28 local New Brunswick investors-to develop a natural gas distribution system in the province. Construction is slated to begin in spring of 2000, with first deliveries expected to reach customers later that year.

Frontier Energy,
a unit of Sempra Energy Utility Ventures, Los Angeles, will begin construction of a natural gas transmission and distribution system in Warren County, N.C., on Sept. 20. Frontier Energy has been laying more than 100 miles of transmission pipe to serve industrial customers in seven North Carolina counties. The firm is a joint venture of North Carolina's Frontier Utilities and Energy Pacific-itself a JV of Pacific Enterprises Inc. and Enova Corp., San Diego (OGJ, Jan. 26, 1998, p. 54). It was formed early last year to construct the distribution system, which will begin operations later this year.