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OGJ NEWSLETTER

Feb 19, 1990 The oil spill off California should have no bearing on whether to hold offshore lease sales, says President George Bush (see story, p. 30). He has read a task force's report on controversial California and Florida lease sales and should decide "fairly soon" on their future. Bush said, "The tanker had a hole punched in it, and I see a bunch of guys jumping up and down saying this proves you can't have any offshore drilling...I'm not sure I understand the connection (with) tankers.

BRITTLE FRACTURE OF OLD STORAGE TANKS CAN BE PREVENTED

Feb 19, 1990 Johannes de Wit The Hague Brittle fracture of older storage tanks, that can lead to catastrophic spills of hydrocarbon materials, can be reduced by applying preventive measures based on good knowledge of the critical properties of the tanks, and the critical conditions in which the tanks are used. Some preventive measures include: insulating the tank, not filling the tank to maximum level during lowest temperatures, fully water-testing the tank, repairing serious corrosion, releveling the tank,

CALIFORNIA CLEANUP PROGRESSES, POLITICAL FALLOUT ACCELERATING

Feb 19, 1990 Bob Williams Senior Staff Writer Cleanup continued last week of a Feb. 7 spill of about 9,458 bbl of Alaskan North Slope crude off the southern California coast amid renewed furor over the U.S. petroleum industry's ability to work safely offshore. BP America, which took responsibility, expected to have most of the gross contamination cleaned up by the end of this week. At presstime, the focus was shifting to second phase cleanup.

U.S. INDUSTRY HIKES BUDGET FOR DOMESTIC OPERATIONS

Feb 19, 1990 Robert J. Beck Economics Editor G. Alan Petzet Senior Staff Writer U.S. oil and gas companies plan to boost domestic capital and exploration spending in 1990 following a drop in outlays in 1989. Oil & Gas Journal's annual survey shows the industry plans to spend a total of $31.4 billion on U.S. projects in 1990, up 13.1% from estimated 1989 spending. OGJ figures indicate that downstream spending will exceed upstream spending for the first time since 1971, even though higher oil and gas

PAPUAN PETROLEUM SCENE GROWING BRIGHTER

Feb 19, 1990 Papua New Guinea is poised to become a crude oil exporter in the mid-1990's. A group led by Chevron Nuigini Pty. Ltd. has proved enough reserves to justify the country's first oil field development program. It's in the lagifu-Hedinia area of the Southern Highlands. The group plans to submit a detailed field development schedule to Papuan authorities in May. Oil exports could begin in 1993. In addition, BP (Papua New Guinea) Pty. Ltd. has drilled Papua New Guinea's first

REFINERS LIST BETTER TIMES IN FRANCE

Feb 19, 1990 Restructuring of the French refining industry is almost complete. Thirteen refineries, down from 22 in 1980, are working at 88% of their 1.82 million b/d capacity, up from 83% at yearend 1988. French refining got a boost last year from a 3.5% increase in domestic oil consumption to 1.6 million b/d, the highest level since 1983. The boost came from increased motor fuel consumption, especially diesel.

INTERNATIONAL BRIEFS

Feb 26, 1990 U.S. EXPORT-IMPORT BANK approved a $13.2 million loan to Algeria's Sonatrach to help refurbish its Arzew liquefied natural gas plant, which is operating at only 60% of capacity (OGJ, Feb. 19, p. 34). Sonatrach will use the money to pay for engineering services from M.W. Kellogg, Houston, turbine parts from General Electric, and turbo-compressor parts from Elliot Turbo Machinery and Turbodyne.

GAS TRANSPORTATION ACTION KEEPS GAINING MOMENTUM IN U.S. WEST

Feb 26, 1990 Gas transportation activity in the U.S. West continues to heat. Three companies have teamed up to lay a $100 million, 300 mile pipeline in Colorado to move Rocky Mountain gas to California and Midwest markets. The venture, TransColorado Gas Transmission, plans to lay the line from the Piceance basin northeast of Grand Junction, Colo., to Ignacio in Southwest Colorado. The line would connect with existing interstate lines from Texas to southern California and the Midwest. The TransColorado

U.S. BRIEFS

Feb 26, 1990 MINERALS MANAGEMENT SERVICE set terms for OCS Sale 123 of 5,698 blocks covering 30.5 million acres in the Central Gulf of Mexico. The sale, scheduled Mar. 21 at Le Meridien Hotel, New Orleans, will offer tracts 3220 miles off Louisiana, Mississippi, and Alabama in 4-3,200 m of water.

PRIVATE SECTOR GAS BUSINESS EXPANDING IN GREAT BRITAIN

Feb 26, 1990 Britain's private sector gas industry activity continues to expand. Quadrant Gas, a joint venture of Shell U.K. and Esso U.K., became the first direct supply company to sign an agreement with British Gas plc for transportation of its gas through the BG transmission system. In a separate move, Enterprise Oil plc acquired a 25% interest in Gas Transmission U.K. Ltd., which plans to lay and operate an independent gas pipeline between the southern North Sea gas terminal at Bacton and the

CHEVRON RESTRUCTURING U.S. UPSTREAM UNIT

Feb 26, 1990 Chevron Corp. has begun a major restructuring of its U.S. upstream operations in a program designed to cut costs and reduce layers of management. The reorganization of Chevron U.S.A. Inc. will involve an acceleration of its property sales program calling for the sale of more than ,$700 million worth of properties in 1990-91. In addition, the program will eliminate a total of 8001,000 jobs-10-12% of the organization-including middle and senior level management.

CANADIAN GAS PIPELINE TOLL FORMULA AT ISSUE

Feb 26, 1990 A Federal Court of Canada ruling involving pipeline tolls could reduce or delay plans for added gas exports from Alberta to the U.S. Northeast. The court's Madam Justice Barbara Reed ordered the National Energy Board to conduct an inquiry into formulas used to finance pipeline construction. Projects affected include the proposed $580 million U.S. Iroquois Gas Transmission System and a $2.6 billion expansion program by TransCanada PipeLines Ltd.

INDUSTRY PRESSES PROGRAM TO BOOST OIL AND GAS PRODUCTION IN NIGERIA

Feb 26, 1990 Roger Vielvoye International Editor Nigeria, West Africa's biggest oil producer, has started a major spending program to boost its oil flow in the mid-1990s. The goal is to take advantage of an expected increase in demand for oil from members of the Organization of Petroleum Exporting Countries. Money also is being plowed into gas development. Nigeria's biggest single investment in the early 1990s aims to turn the country into West Africa's first gas exporter.

NPRA O&A-1 1990S FUEL SPECIFICATIONS WILL REQUIRE PROCESS CHANGES

Feb 26, 1990 Increased demand for higher-quality fuels and tougher air-quality regulations will substantially alter the specifications for gasoline and diesel fuels in the 1990s. Higher-octane gasoline with lower vapor pressure, and diesel fuel with lower sulfur and aromatics, will require process changes to produce. These altered fuel specifications prompted several questions at the most recent National Petroleum Refiners Association annual question and answer session on refining and petrochemical

GAS INJECTION AT RISER BASE SOLVES SLUGGING, FLOW PROBLEMS

Feb 26, 1990 T.J. Hill BP Research Sunbury Research Centre Sunbury-on-Thames, U.K. Test-rig studies and operating experience by BP International have shown that riser-base gas injection can help prevent severe slugging and smoothen start-up transients in subsea pipelines. The studies were based on predictions that multiphase lines proposed as part of the Forties field extension would be subject to severe slugging.
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