INDUSTRY BRIEFS

ENVIRONMENT

A MONTANA COURT ordered City Oil Corp. Pres. Christopher M. Pederson to pay a $1.8 million civil penalty by May 20 for allegedly violating federal rules that protect against contamination of underground sources of drinking water. The court order halts the Cut Bank, Mont., company's saltwater injection into 19 injection wells and orders abandonment of 14 of those wells.

U.S. ENVIRONMENTAL PROTECTION AGENCY settled an administrative enforcement action against Ashland Petroleum Co. for alleged violations of Sec. 304 (a and c) of the Emergency Planning and Community Right to Know Act. The $1.56 million settlement stems from sulfur dioxide emissions from Ashland's 213,400 b/cd Catlettsburg, Ky., refinery during 1988-91.

TANKERS

MOBIL CORP. ordered a double hull, 280,000 dwt, 2 million bbl capacity very large crude carrier from Japan's Sumitomo Heavy Industries Ltd. The vessel is scheduled for completion in mid-1996.

SPILLS

TAIWANESE OFFICIALS are assessing contamination from an underground refined products spill traced to a ruptured military products pipeline that remained unrepaired for at least 4 months. The pipeline supplies products to an air force base near Pingtun. After local press reports of petroleum products flowing from watertaps, Taiwanese military authorities located and repaired the leak.

GAS STORAGE

TRANSCANADA PIPELINES LTD. and Alberta Natural Gas Co. Ltd. acquired 40% and 20% interests, respectively, in an $80 million (Canadian) natural gas storage site planned by Amoco Canada Petroleum Ltd., Calgary. The site, near Amoco's East Crossfield gas processing plant 18 miles north of Calgary, will have injection and withdrawal capacity of 400 MMcfd.

DRILLING-PRODUCTION

INDIA'S Petroleum Ministry received 54 bids from 30 companies for development of 14 small and seven medium size oil and/or gas fields. Medium size fields are to be developed by private foreign and/or domestic firms in joint ventures with state owned Oil & Natural Gas Commission and Oil India Ltd. Smaller fields are to be developed by private companies.

SHELL DEVELOPMENT CO. OF NIGERIA LTD. let a $3 million/year drilling fluid additives contract to World Fluids plc of Bury St. Edmunds, U.K. The contract at first covers eight wells to be drilled on Nigeria's Nun River development beginning this month.

BP EXPLORATION OPERATING CO. LTD. won U.K. Department of Trade & Industry approval to begin test production of Machar field on U.K. North Sea Block 23/26a, A converted semisubmersible rig and storage tanker will be used to produce as much as 7 million bbl of oil at a maximum rate of 30,000 b/d for a year beginning late in May.

EBCO RESOURCES INC., Oklahoma City, will auction oil and gas leases in 50 U.S. fields for Louisiana Land & Exploration Co. July 14 in New Orleans. Leases are in Louisiana, Michigan, New Mexico, Texas, and Wyoming.

PHILLIPS PETROLEUM CO. U.K. LTD. let a multimillion dollar contract to Rockwater Ltd., Aberdeen, Scotland, for subsea installation work on North Sea Judy/Joanne fields development, Work calls for installation of production equipment, 15 spool pieces. and a hyperbaric weld on the gas export system. Work is to start in May 1995 for completion in August that year.

AMERADA HESS LTD. let a 4.5 million ($6.75 million) contract to ABB Vetco Gray U.K. Ltd., Aberdeen, Scotland, for seven subsea trees to be installed in North Sea Fife field. Delivery is scheduled for early 1995. Five will be installed by mid-1995 with two more to be in place by 1996.

U.S. BUREAU OF INDIAN AFFAIRS issued a rule that drops premium, bonus, and other such payments from consideration in the calculation of the royalty price for Osage Reservation crude oil. BIA had included bonuses in the price it used for computing royalties for all crude of the same quality sold in Osage County, Okla., but decided that practice may be discouraging purchasers from offering bonus prices.

EXPORTS-IMPORTS

INDIA will import North Sea crude oil for the first time. Indian Oil Corp. (IOC) signed contracts with Norway's Den norske stats oljeselskap AS for supply of 1.8 million bbl of crude and 730,000 bbl of motor diesel. Previously, New Delhi purchased crude only from former U.S.S.R. and Persian Gulf countries.

CANADA'S National Energy Board (NEB) begins public hearings July 26 in Calgary on five applications for licenses to export to the U.S. a combined volume of 97.2 MMcfd of natural gas. The gas would be sold to a proposed combined cycle power generation plant at Hermiston, Ore., to an Omaha marketer, and to a distributor and utilities in New England and Michigan.

COMPANIES IOC's six refineries logged record crude runs of 494,000 b/d during fiscal 1993-94, exceeding a target of 490,000 b/d. That resulted in a combined refinery utilization rate of 101.2% despite a 66.7% utilization at Barauni refinery caused by a crude supply shortfall in Assam state. IOC sold 664,400 b/d of products in the year, up from 659,600 b/d the previous year, and its 3,850 km pipeline network moved a record 476,000 b/d of crude and products.

NOVA CORP. OF ALBERTA shareholders approved restructuring that makes new company Nova Corp., Calgary, its parent (OGJ, Mar. 14, p. 38). Its Alberta Gas Transmission Division will become a stand alone pipeline company called Nova Gas Transmission Ltd.

IPL ENERGY INC. shareholders approved a company name change and a head office move to Calgary from Edmonton. The company previously was named Interprovincial Pipe Line Systems Inc.

CABOT OIL & GAS CORP., Houston, completed its $168.6 million acquisition of Washington Energy Co. unit Washington Energy Resources Co., Seattle. The merger gives Cabot proved gas reserves estimated at more than 1 tcf equivalent, a 24% increase from yearend 1993.

CHINA'S Offshore Industrial Corp. and AMEC plc, London, signed a memorandum of understanding for joint construction of petrochemical plants and offshore oil and gas production facilities at Huang Pu shipyard in Guangzhou province of southern China. The yard can handle modules weighing as much as 5,000 metric tons.

LASMO PLC, London, claimed a 96.5% acceptance in an offering of more than 214 million new shares to stockholders at 1.05 ($1 .57)/share. Lasmo is currently fighting a takeover bid by Enterprise plc, London, which values Lasmo shares at 1.50 ($2.25) each (OGJ, May 9, p. 31).

PIPELINES

ASIA PACIFIC HOLDINGS CORP. (APHC), an investment arm of Taiwan's ruling Nationalist party, is evaluating a proposal to help lay a 100 km crude oil pipeline from Musi to Dumai in Sumatra. APHC proposes to conduct engineering work in exchange for a share of oil the pipeline will transport.

NEB approved Trans Mountain Pipe Line Co. Ltd.'s request for a $27.5 million (Canadian), 38,000 b/d capacity addition to its crude oil pipeline system. Work calls for 50 miles of looping in Alberta, new pump station and a roof on a storage tank in British Columbia, and modifications at 10 pump stations.

NEB seeks comments on its proposed amendments (OGJ, May 9, p. 30) to onshore pipeline regulations. It is calling for input from pipelines under its jurisdiction and from other interested parties, such as government agencies.

AN ADMINISTRATIVE LAW JUDGE ruled Sonat Inc. unit Southern Natural Gas Co., Birmingham, Ala., will not be allowed to include in its rates the $45 million cost of pipelines it placed in service in 1992 to tie its interstate pipeline system to gas reserves in Mississippi Canyon and Ewing Bank area blocks off Louisiana. The decision in the case before U.S. Federal Energy Regulatory Commission (FERC) was entered this month.

IROQUOIS GAS TRANSMISSION SYSTEM, Shelton, Conn., received FERC approval to build a 6,960 hp compressor station in Croghan, N.Y., to provide firm service of 55 MMcfd to Selkirk 11 Cogeneration Partners' 252,000 kw cogeneration plant in Bethlehem, N.Y. The station will be operating by yearend.

TRANSCANADA PIPELINES moved record gas volumes on its transcontinental pipeline system in the first quarter. Shipments increased 9% to 611 bcf from first quarter 1993. A 1 day record of 7.9 bcf was achieved Jan. 18. Deliveries in Canada and the U.S. averaged a combined 6.8 bcf in the first quarter.

PETROLEOS MEXICANOS (Pemex) hired Gulf Interstate Engineering, Houston, to perform rehabilitation engineering services on 10 and 14 in. products pipelines in Mexico, which include three pump stations. Gulf Interstate will prepare construction bid packages for Pemex approved rehabilitation and provide a recommended maintenance program.

PETROCHEMICALS

FORMOSA PLASTICS GROUP expects to accelerate construction of its Mailiao naphtha cracker following an agreement with area residents to end a yearlong blockade of the construction site. FPC agreed to assist residents develop reclaimed land for fish ponds displaced by the petrochemical complex and provide loans to build the ponds, pending government approval.

SULFUR

HUSKY OIL LTD., Calgary, plans to switch to a Swiss sulfur marketing company Jan. 1, 1995. Husky, which produces 800,000 metric tons/year, will hook up with Interacid Holdings Ltd., Lausanne, which is jointly owned by IMIC Holdings Inc., Virgin Islands, and Sumitomo Corp. Husky plans to leave sulfur marketer Prism Corp., Calgary.

TERMINALS

DIAMOND SHAMROCK INC., San Antonio, agreed to build a crude oil storage terminal at Corpus Christi's inner harbor. Plans call for three storage tanks with combined 1.2 million bbl capacity and a 120,000 bbl capacity, 70 mile, 16 in. pipeline to tie the terminal to Diamond Shamrock's 70,000 b/cd Three Rivers, Tex., refinery. Work is scheduled for completion in first quarter 1995.

EXPLORATION

CAIRN ENERGY PLC, Edinburgh, signed a production sharing contract for Block 16 in Bangladesh. It covers 8,621 sq km near Chittagong. The contract covers the Kutubia gas discovery with reserves estimated at 55 bcf. Operator Cairn holds 75% interest, Holland Sea Search Holding NV, Hague, 25%.

PHILLIPS PETROLEUM CO. U.K. LTD. 48/29-9 new pool wildcat cut gas pay at 5,650 ft in Jurassic Rotliegendes sandstone. The discovery well, near Phillips, Hewett gas platform in the southern North Sea, flowed 42 MMcfd of gas at 1,300 psi tubing head pressure. Phillips is considering development.

FRONTIER OIL EXPLORATION CO., Salt Lake City, received initial approval of its 6 year concession application on more than 2 million acres southeast of Gdansk in northern Poland's onshore Baltic region. Terms call for a 3 year technical evaluation phase and 3 years for wildcat drilling.

ELF GABON'S 1G Assala Marine discovery off Gabon tested 1,600 b/d of 23 gravity oil. The well is in 90 m of water 6 km north of Cap Lopez in the Apari Marin license area.

REFINING

AIR PRODUCTS & CHEMICALS INC. and Kinetics International Corp. started up a 25 MMscfd hydrogen plant at Tosco Refining Co.'s 148,000 b/cd Avon refinery near Martinez, Calif.

TEXACO REFINING & MARKETING INC. plans to build a $75 million gasification power plant at its 80,000 b/cd El Dorado, Kan., refinery. The plant will convert coke and refinery wastes into electricity and steam. Work is to begin in first quarter 1995, with plant start-up in second quarter 1996.

COGENERATION

J. MAKOWSKI CO., Boston, completed financing for its 345,000 kw Selkirk Cogen Project, a natural gas fired cogeneration plant south of Albany, N. Y.

GAS PROCESSING

TRIDENT NGL INC., The Woodlands, Tex., expects to complete repairs in August at the Mont Belvieu, Tex., gas liquids fractionation plant it operates for Gulf Coast Fractionators. An explosion and fire there last month injured two persons (OGJ, May 2, p. 52). When the plant resumes operation, it will have throughput capacity of 102,000 b/d, an increase of 20,000 b/d.

POWER

CMS ENERGY CORP. unit CMS Generation Co. acquired 25% ownership interest in a 235,000 kw mixed fuel independent power generating project to be built in Jefurupadu, Andhra Pradesh, India. CMS Generation will provide project management services and operate the plant.