U.S. BRIEFS

COURTS

DAKOTA GASIFICATION CO., Bismarck, N.D., filed suit in Bismarck federal court against ANR Pipeline Co., Natural Gas Pipeline Co. of America, Tennessee Gas Pipeline Co., and Transcontinental Gas Pipe Line Corp. to enforce a gas purchase contract. Dakota claims the four firms are required to buy 100% of the 165 MMcfd production from its Great Plains coal gasification plant near Beulah, N.D., and have understated the gas's calculated selling price.

COMPANIES

PLAINS PETROLEUM CO., Lakewood, Colo., has a preliminary budget of $23 million for 1991 -up more than 50% from 1990-to fund increased production, exploration, and development. Plains also plans to intensify its acquisitions.

FOREST OIL CORP. will combine its onshore Lower 48 exploration and production activities into one division in Denver, closing its Midland, Tex., office. It expects to save more than $10 million/year from the consolidation. Forest's offshore division operates in Lafayette, La., and its Canadian operations are based in Calgary.

PIPELINES

BP OIL CO. will halt its lease crude oil purchases and seek bids for purchase of its gathering systems in Illinois, Indiana, Kentucky, Louisiana, Oklahoma, and Texas.

ENDEVCO INC., Dallas, completed an open season transportation request period for its proposed Cornerstone Pipeline with requests from 11 shippers for firm service totaling 870 MMcfd and from 47 shippers for interruptible service totaling 5.427 bcfd. The 44 mile, 36 in. Cornerstone line is to move gas from Delhi, La., to Endevco's Mississippi Fuel Co. near Vicksburg, Miss., with initial capacity of 600 MMcfd.

DELTA PIPELINE CO.'S Arkoma basin project is expected to cost $82.1 million, not $2.1 million as reported earlier (OGJ, Oct. 8, p. 50).

MARKETING

UNOCAL CORP. will close its 100 million gal/year Edmonds, Wash., products terminal by May 1, 1991, as part of a restructuring of its retail/wholesale motor fuels marketing business in the Pacific Northwest. Unocal will serve customers in Northwest Washington from its Tacoma terminal thereafter, The 53 acre Edmonds site on Puget Sound includes 27 storage tanks with total capacity of 697,000 bbl, truck loading racks, and maintenance shops.

DRILLING-PRODUCTION

PUEBLO OIL & GAS INC., Carpinteria, Calif., plans to rework five wells and drill several infill wells in Vernalis gas field, San Joaquin and Stanislaus counties, Calif. It bought the 5,563 acre lease, producing 200 MMcfd, from Chevron U.S.A. Inc. Pueblo also plans to test deeper zones.

EXXON CO. U.S.A. will sell 26 producing leases in Eddy and Lea counties, N.M., and Williams and McKenzie counties, N.D. Bids are due Nov. 30, with effective sale date of Feb. 1, 1991.

READING & BATES CORP., Houston, proposed a recapitalization plan to its senior creditors that would eliminate about $267.2 million of senior debt and lease payments and cancel contingent debts to senior creditors in exchange for stock, senior secured notes, and lease obligations. The plan also contains a new stock option program.

GENERAL ATLANTIC RESOURCES INC., Denver, bought interests in Rocky Mountain oil fields from Dekalb Energy Co., also of Denver, for about $7.7 million. General Atlantic also bought interests in Jennings Townsite field, Jefferson Davis Parish, La., from Freeport-McMoRan Oil & Gas Co., New Orleans, for about $4.1 million.

LOUISIANA LAND & EXPLORATION CO. plans to participate in six more West Butler prospect area wells in the western Anadarko basin in Custer County, Okla., after testing its 2-19 Flick extension well. Drilled to more than 12,400 ft, the well flowed 6.1 MMcfd of gas and 307 b/d of condensate through an 1%4 in. choke with 4,400 psi flowing tubing pressure from Pennsylvanian Red Fork sand.

SWIFT ENERGY CO., Houston, agreed to buy interests in 361 leases in Acadia and Jackson parishes, La., Canadian, Custer, and Roger Mills counties, Okla., and 11 counties in Texas from undisclosed sellers for a total $28.6 million. The purchased lease interests have reserves of 39.5 bcf of gas and 766,000 bbl of oil.

CONOCO INC. is seeking bids for its interests in 25 producing leases in Texas and New Mexico. Offers are due Nov. 8, and effective sale date is Dec. 1.

GOVERNMENT

DEPARTMENT OF ENERGY will sell 56,700 b/d of oil from its Elk Hills, Calif., Naval Petroleum Reserve to nine bidders under 6 month contracts. Winning bids ranged from $26.50 to $28.73/bbl.

DOE made its first awards in the test sale of Strategic Petroleum Reserve crude (OGJ, Oct. 8, p. 25). It let contracts to Sun Refining & Marketing Co. for the purchase of 540,000 bbl of sweet crude from the West Hackberry site near Lake Charles La., and to Shell Oil Co. for 95,000 bbl of sour crude from the Bryan Mount site near Freeport, Tex. They were among 11 companies whose bids were accepted.

GAS PROCESSING

MARATHON OIL CO. started up a 100 MMcfd gas processing plant in Yates field, Pecos County, West Texas. The new plant's refrigeration process increases Yates NGL production by 1,200 b/d.

UTILICORP UNITED INC.'S PSI unit, Omaha, completed its $31 million purchase of the Elk City gas gathering and processing system in western Oklahoma from Valero Hydrocarbons LP (OGJ, Sept. 24, p. 59).

REFINING

CASTLE ENERGY CORP., Blue Bell, Pa., started up the crude unit at its Lawrenceville, Ill., refinery, Castle expects the refinery and all downstream systems to reach full 55,000 b/d capacity in November.

EXPLORATION

CELSIUS ENERGY CO., Salt Lake City, and Exxon Co. U.S.A. agreed to drill a Mississippian Madison test to 17,000-18,000 ft in Canyon Creek Dome unit, Sweetwater County, Wyo. It is the first project under an exploration contract between the two firms that creates an area of mutual interest in Wyoming and Colorado. Exxon plans to begin drilling by Dec. 1 the first of additional wells under the contract.

Copyright 1990 Oil & Gas Journal. All Rights Reserved.