INDUSTRY BRIEFS

LNG

A group of Japanese shipping companies led by Mitsui O.S.K. Lines will spend 250 billion yen to build ten 135,000 cu m liquefied natural gas carriers to transport LNG from Qatar to Japan. This follows a recent contract under which Qatar Liquefied Natural Gas Co. agreed to supply 6 million tons/year of LNG to Japan for 25 years starting in 1997.

Refining

Middle East Oil Refineries, an Egyptian-Israeli joint venture, reportedly let contract to Italys Technipetrol and Frances Technip for construction of a $1 billion refinery at Alexandria. The venture disclosed a $300 million loan from European Investment Bank to help fund the project. The 100,000 b/d refinery, expected on stream by 1999, will produce fuels for sale in Israel, Egypt, and other eastern Mediterranean countries.

U.S. Commerce Departments Foreign Trade Zones (FTZ) Board granted four U.S. refineries FTZ subzone status. The plants are Mobil Corp.s refinery and facilities in St. Bernard, Jefferson, and St. Charles parishes, La., Bayway Refining Co.s plant at Linden, N.J., Mobils refinery in Gloucester County, N.J., and Crown Central Petroleum Corp.s plant in Harris County, Tex.

A group led by the Hydrocarbon Engineering (France) unit of Krebs-Eurisys Group agreed to rebuild and modernize Kazakhstans Atyrau refinery, boosting feed capacity to 100,000 b/d. New process modules are to include a fluid catalytic cracker, MTBE-TAME unit, amine treater, and sulfur recovery unit. Other group members are Ferrostaal AG of Germany, Ronar Services Ltd. of the U.K., and JGC Corp., Nichimen Corp., Chiyoda, Itochu, Marubeni, and Nissho Iwai, all of Japan.

Angarsk Petrochemical Co., let a $70 million contract to M.W. Kellogg Co. to modernize the 34,000 b/d fluid catalytic cracking unit at its Angarsk, Russia, refinery, as part of an overall upgrade.

BP Oil Co. let contract to Scaltech Inc., Houston, for management of oily hazardous wastes at its refineries in Toledo and Lima, Ohio, and Belle Chasse, La. Scaltech will use its recycling technology to process wastes onsite at each plant. The process separates waste into oil and hazardous solids. The oil is reprocessed in the refinery, and solids are burned as fuel in cement kilns.

Companies

Kvaerner AS, Oslo, failed in its 360 million ($560 million) bid to acquire AMEC plc, London. Kvaerner reportedly bought 26.1% of AMECs common shares and received support from 10.4% of AMECs shareholders, leaving it short of the 50% needed.

Rigel Energy Corp. is negotiating a $380 million (Canadian) takeover of Inverness Petroleum Corp., both of Calgary. Rigel is offering 0.625 share of its stock for each Inverness share, or about $7.73/share. The companies have common interests in Albertas gas prone Peace River region. Inverness has production of 16,400 b/d of oil equivalent and substantial debt.

Talisman Energy Inc., Calgary, made a 131 million ($203 million) bid to acquire Goal Petroleum plc, London. Goals assets include a 5% interest in U.K.s Wytch Farm field and 32% of Blenheim field and 2.5% of Magnus field, both in the U.K. North Sea.

Amoco Corp. and Paz Oil Co. group, Israel, agreed to jointly pursue transmission, storage, and distribution projects in Israels emerging gas industry. The agreement combines Amocos global gas expertise with Pazs experience marketing petroleum products and LPG in Israel, where it holds market shares of 40% and 35%, respectively.

Public Service Enterprise Group Inc. (PSEG) plans to divest Energy Development Corp. (EDC), Houston, including onshore and offshore exploration and production operations in the U.S., U.K., Argentina, Senegal, Tunisia, and China with combined reserves of about 900 bcf of gas equivalent, 67% of which is gas. Morgan Stanley & Co. is studying PSEGs strategic alternatives.

Exploration

Australia offered Santos Offshore Pty. Ltd. the T94-2 and L94-2 exploration permit areas in 80-150 ft of water in the Carnarvon basin off Western Australia. Targeted prospects are analogous to Stag field, about 20 km northwest. Work is to include acquiring seismic data early in 1996 and exploratory drilling in 1997, pending formal permit awards.

British Gas plc plans to drill a wildcat on Block 110/14 in the Irish Sea off Northwest England. The Global Adriatic XI jack up will test a postulated reservoir at 1,350 m, which British Gas said is in the same formation as the Morecambe fields to the northwest. Block 110/14 lies between two blocks on which BHP Petroleum Ltd. is completing development of Douglas, Hamilton, Hamilton North, and Lennox fields (OGJ, Aug. 28, p. 60).

Seven Seas Petroleum Argentina Inc. unit of Seven Seas Petroleum Inc., Houston, acquired a 25% interest in the 7,000 acre Sur Rio Deseado prospect, a seismically defined anticline on the San Bernardo fold belt oil trend in Argentinas San Jorge basin. Partners in mid-January expected to reach total depth on an 8,200 ft wildcat that was to spud in mid-December.

Pipelines

Oleoducto Central SA let contracts for components for the 800 km oil pipeline included in Phase II development of Colombias Cusiana-Cupiagua fields (OGJ, Nov. 20, p. 27). Distral, Colombia, is to build a pump station at the Cusiana central processing site and upgrade pump stations at El Porvenir, Miraflores, Vasconia, and Caucasia. Argentine-Colombian group Techint-Cotecol will build oil export facilities, including three 350,000 bbl storage tanks, at Covenas on the Gulf of Morrosquillo.

Norsk Hydro AS let a $58 million contract to Coflexip Stena Offshore SA, Paris, for manufacture and installation of flow lines for development of Njord field in the Norwegian Sea. Work will involve engineering, construction, and installation of more than 10 miles of flexible flow lines, risers, umbilicals, and power cable. Work is planned for mid-1997.

Delhi Gas Pipeline Corp., Dallas, started work on a $44 million, 275 MMcfd expansion of its East Texas gas pipeline. To be complete in third quarter 1996, the project will boost Delhi takeaway capacity serving a rapidly developing pinnacle reef gas play in East Texas as well as Smackover and Cotton Valley trends. It calls for laying 85 miles of 20 in. pipeline, adding 8,000 hp of compression, and hiking capacities at Delhis Aker and Teague, Tex., treating plants.

Canadas National Energy Board scheduled a hearing for Apr. 15, 1996, in Calgary on an inquiry into stress corrosion cracking in oil and gas pipelines. Deadline is Feb. 16 for written submissions from interested parties and Mar. 15 for letters of comment. The NEB inquiry was established after a number of pipeline ruptures. There have been seven failures in the natural gas pipeline system operated by TransCanada PipeLines Ltd., Calgary, since 1985.

Beijing Natural Gas Transportation Co., a venture of Chinese National Petroleum Corp. (CNPC) and Beijing, hired Tenneco Energy as technical adviser on a 600 mile gas pipeline to link Jingbian gas field in central Chinas Ordos basin with Beijing. CNPC affiliates are to start construction of the line in March 1996, with service expected to begin in October 1997.

LPG

Caltex China Ltd. and Shantou Ocean Enterprises (Group) Petroleum & Petrochemical Co. Ltd. formed Caltex Ocean Gas & Energy Co. Ltd. to build and operate an LPG terminal at Shantou City, Guangdong. With three ocean berths, more than 100,000 metric tons of LPG storage capacity in two caverns, and eight tank truck bays, the $125 million facilities at start-up in mid-1998 are expected to begin establishing Chinas largest LPG import operation.

Drilling-production

Santa Fe Energy Resources Southeast Asia and partners on the Jabung block in Central Sumatra delineated their North Geragai discovery with the 2 North Geragai well, which flowed 2,839 b/d of oil and 1.9 MMcfd of gas through a 12 in. choke with 500 psi flowing tubing pressure from perforations at 4,199-4,209 ft. The well also produced 9.1 MMcfd and 115 b/d of condensate from another zone at undisclosed depth.

Minerals Management Service proposed a rule setting a deadline of 2 years for lessees on the U.S. Outer Continental Shelf to bring their bond coverage into compliance with new levels of coverage. The MMS bond rule also updates bond coverage required of right-of-way holders and geological and geophysical exploration companies.

MMS scheduled a Jan. 22 public meeting in Houston on a proposed rule amending gas valuations for production from federal leases. MMS also may amend its rules on valuing crude oil produced from federal and Indian leases. It is considering using posted prices as a means to value oil not sold under arms length conditions and wants to revaluate what nearby prices should be considered in setting royalty values.

Maersk Oil Qatar AS let contract to National Petroleum Construction Co. of Abu Dhabi for procurement, fabrication, loadout, transportation, and installation of the Al-Shaheen STAR wellhead platform on Block 5 off Qatar.

Oryx Energy Co., Dallas, is producing 20.6 MMcfd of gas and 3,389 b/d of oil at its Sherman project on High Island Block 576, about 110 miles in the Gulf of Mexico off Texas. Production came on line 15 months after discovery. Oryx, which holds 100% interest in the field, estimates reserves at 40-60 bcf of gas equivalent.

Britannia Operator Ltd. (BOL), a venture of Chevron U.K. Ltd. and Conoco (U.K.) Ltd. formed to operate Britannia field in the North Sea, let contract to SIF Holland Offshore, Roermond, Netherlands, for fabrication of 20 tubular steel piles to secure the Britannia jacket. BOL said the piles will be the largest installed in the North Sea at 123 m long, 2.74 m outside diameter, and 560 metric tons.

Pertamina and partners logged the best test to date on the Tuban block off Java. Their 5 Mudi well flowed a combined 10,500 b/d of oil with 224 psi flowing tubing pressure through a 112 in. choke on tests of a 535 ft interval at 8,365-8,900 ft in Tuban limestone. Interests are Pertamina 50% and Santa Fe Energy Resources Java Ltd., Total Tuban, Rislad Salim Resources Petroleum (Tuban) Ltd., and Enserch Far East Ltd. 12.5% each.

Total Oil Marine plc let a $4.5 million contract to Wood Group Engineering Ltd., Aberdeen, for maintenance on North Alwyn platform in the U.K. North Sea. The 3 year contract is for mechanical, electrical, and instrumentation maintenance and has an optional 2 year extension.

Petrochemicals

OxyMar let contract to Bechtel Corp. for engineering, procurement, and construction in a project to expand capacity of its 1.4 billion lb/year vinyl chloride monomer plant at Ingleside, Tex., by 700 million lb/year. The project will be complete in April 1997. OxyMar is a venture of OxyChem and Tokyos Marubeni.

Fauji F.C. Jordan Fertilizer Co. Ltd. let a $250 million turnkey contract for a fertilizer complex in Pakistan to a group of Germanys Klockner INA, Frances Krebs, and Pakistani companies Descon and Habib Rafiq. The complex at Bin Qasim will produce 1,270 tons/day of ammonia, 1,670 tons/day of urea, and 1,350 tons/day of diammonium phosphate.

Westlake Group is expanding ethylene capacity at its Sulphur, LA., plant to 2.3 billion lb/year from about 1 billion lb/year (OGJ, May 8, P. 31). ABB Lummus global will design and build a new section using Lummus' short residence time pyrolysis heaters. Feedstocks will be ethane and propane.

Arcadian Corp., Memphis, let contract to M.W. Kellogg Co. to build a 650,000 ton/year ammonia plant at its Point Lisas, Trinidad, complex. Construction, to begin in February 1996, will require 23 months. Arcadian also will start up a 250,000 ton/year ammonia plant in Trinidad in March 1996 and is studying an ammonia project in Venezuela.

Spills

U.S. Supreme Court agreed to hear Exxon Corp.s appeal of a case involving a 1989 oil spill off Hawaii. Exxon argued Hawaii Independent Refinery Inc. and a moorings manufacturer should be liable for the spill cleanup costs and loss of cargo.

Exports-imports

Commerce Departments Bureau of Export Administration slated hearings to determine economic and environmental effects of the recently lifted ban on export of Alaskan North Slope crude oil (OGJ, Dec. 4, p. 40). Hearings are planned Jan. 3 in Washington, D.C., Jan. 5 in Seattle, Jan. 8 in Anchorage, and Jan. 10 in Bakersfield, Calif.

Lubricants

Pennzoil Products Co. (PPC) acquired 50% interest in a venture with Lithcon Petroleum Inc., Tianjin, China, which plans to manufacture and market lubricants from facilities at Tianjin. Lube demand in the five provinces around Tianjin amounts to about one third of Chinas lube demand. PPC also acquired a 45% interest in Isopetrol SA, Lima, a marketing and manufacturing joint venture that includes a 4 million gal/year lube blending plant at Callao, Peru. Copyright 1995 Oil & Gas Journal. All Rights Reserved.