REFINING
CHEVRON USA PRODUCTS CO. called off a deal to sell its 185,000 b/cd Port Arthur, Tex., refinery to Clark Refining & Marketing Inc. for $200 million after concluding Clark would not be able to arrange financing. Chevron negotiated more than a year with Clark, which canceled a December 1994 public offering of stock that was to have funded the plant purchase.
PETROCHEMICALS
SOLVAY POLYMERS INC., a unit of Solvay Group, Brussels, will build a gas phase line at its Deer Park, Tex., polypropylene plant, which together with more debottlenecking of existing lines will increase plant capacity to 350,000 metric tons/year from 200,000 tons/year' Start-up of the new line is expected during third quarter 1 996.
ABB LUMMUS CREST INC., Bloomfield, N.J., started up Yanshan Petrochemical Corp.'s expanded Beijing, China, ethylene plant. Capacity is increased to 450,000 metric tons/year from 300,000 tons/year via Crest's maximum capacity expansion technology.
TERMINALS
CHINA late last month started operating a new single point mooring (SPM) terminal, a facility that will increase crude oil supplies to the 170,000 b/cd Maoming refinery in Guangdong province. Tankers may moor 15 km off the port of Zhanjiang and move oil ashore via pipeline to storage at Bei Shan Ling, then through 63 1/2 km onshore pipeline to the refinery. Previous oil imports were limited because the port could handle tankers only as large as 60,000 dwt. The new SPM can accommodate tankers as large as 250,000 dwt.
TANKERS
THE U.S. COAST GUARD plans to propose a rule designating lightering zones in the Gulf of Mexico off Texas, Louisiana, and Alabama for single hull tankers. The three zones are more than 60 miles offshore, so single hull tankers being phased out by the 1990 Oil Pollution Act can lighter in the areas until 2015.
PIPELINES
TUSCARORA GAS TRANSMISSION CO., Reno, Nev., placed an order with Stupp Corp., Baton Rouge, for 231 miles of 20 in. pipe. Tuscarora expects to start laying a gas transmission line this spring that originates at Malin, Ore., and ends near Reno. The pipeline is to be in service on Nov. 1, supplying as much as 113 MMcfd of gas from western Canada to markets in California and Nevada.
U.S. FEDERAL ENERGY REGULATORY COMMISSION proposed a rule that would not require gas pipelines to post capacity release transactions covering 30 days or less on electronic bulletin boards. Current rules exempt prearranged transactions of 29 days or less from posting. FERC said gas supplies are typically sold on a calendar month basis, and this led to 1,500 "29 day-1 day" transactions/year.
FERC gave permission to NorAm Gas Transmission, a unit of NorAm Energy Corp., Houston, to proceed with the spindown of its gathering facilities into deregulated company NorAm Field Services Group, also a NorAm Energy unit. The spindown is scheduled for completion by Feb. 1.
CORNERSTONE NATURAL GAS INC., Dallas, acquired the Willow Springs and North Lansing gas gathering systems in East Texas from private Louisiana firm Bayou South Gas Gathering Go. LC. The systems, in Gregg and Harrison counties, consist of 65 miles of line with 70 MMcfd capacity.
AOG GAS TRANSMISSION CO. LP, a unit of K N Energy Inc., Lakewood, Colo., agreed to pay a total $80.1 million to units of Meridian Oil Inc. for gas transmission pipelines and gas storage assets in Texas. AOG gets the Morgan Creek and MoTrans pipelines, which consist of a combined 347 miles in West Texas, 10.8 bcf of gas in a leased Gulf Coast storage field, and the remaining 50% interest it did not own in a 90 mile joint venture pipeline near Midland, Tex.
CANADA'S National Energy Board postponed until Feb. 6 hearings on expansion projects by Westcoast Energy Inc., Vancouver, B.C. The hearing on pipeline and system expansion in the Fort St. John and Grizzly Valley areas of Northeast British Columbia was to have begun Jan. 23 in Fort St. John.
ARGENTINA'S YPF SA is part of a group that agreed to lay a 50 mile gas pipeline to the Argentina-Chile border from Tierra del Fuego to supply 2 million cu m/day to Methanex Chile Ltd. Chile's ENAP will tie that line to one it will lay to Methanex's Punta Arenas, Chile, methanol plant. The pipeline is expected to begin operation in July 1996.
COMPANIES
QUESTA OIL & GAS CO., Tulsa, tentatively agreed to merge with Unit Corp., also of Tulsa. Unit is to acquire all Questa shares in exchange for Unit stock.
MCFARLAND ENERGY INC., Santa Fe Springs, Calif., settled for $25.7 million a lawsuit with Chevron U.S.A. Inc. stemming from preferential purchase rights to producing leases in the Los Angeles Basin. McFarland expects to invest the funds for growth through exploration and acquisitions.
PAN-ALBERTA GAS LTD., Calgary, settled a long gas contract dispute with Southern California Gas Co., Los Angeles. Pan-Alberta suppliers will receive a total $195 million (U.S.) in payments during the next 6 years under the settlement. The dispute arose from a restructuring of the long term contract price paid to producers for gas by the California firm. Under a new contract to run until 2003, Canadian producers will receive payments more closely linked to the market price for gas in southern California.
CANADIAN OCCIDENTAL PETROLEUM LTD., Numac Energy Inc., and Fletcher Challenge Ltd., all of Calgary, formed Oxy International Venezuela SA, an oil field development company with headquarters in Caracas. The new company expects to bid for one of 10 exploration and development contracts Petroleos de Venezuela is expected to grant this year.
AMOCO CANADA PETROLEUM LTD., Calgary, is considering bids from several undisclosed companies for heavy oil leases in Northeast Alberta. Amoco is talking to a number of companies about the Elk Point and Lindbergh areas in which it holds majority interests. Amoco's working interest in production is 11,000 b/d gross and 8,500 b/d net.
DRILLING-PRODUCTION INDIA'S Oil & Natural Gas Corp. called in Neil Adams Firefighters Inc., Houston, to help kill a gas well blowout in southern India (OGJ, Jan. 16, p. 29). ONGC expects the job to require 30-40 days to control the well, which is burning an estimated 35.31 MMcfd.
MIDLAND RESOURCES INC., Midland, Tex., acquired a $20 million credit facility with First Union National Bank of North Carolina and will use the funds mainly to buy producing oil and gas leases. A separate line of credit will augment working capital used in part to develop producing leases.
DI INDUSTRIES INC., Houston, completed the acquisition of 100% of the stock of An-Son Drilling Co.'s Venezuelan unit, PAP Tratamiento y Perforaciones de Pozos SA. Di paid $2.2 million cash and 190,000 shares of stock for PAP, which has two drilling rigs and two workover rigs under contract, in addition to a labor contract in Venezuela.
STATE PETROLEUM CO., a unit of Arakis Energy Corp., Vancouver, B.C., started a $30 million (U.S.) exploration/development program on its Sudan acreage. Work at first will include more flow tests on 34 wells in Unity and Greater Heglig oil fields. Arakis is moving a rig, a 93 person camp, and drilling equipment to Sudan from Dubai.
U.K. OFFSHORE oil production reached a 7 year high last November, averaging 2.66 million b/d, reported Royal Bank of Scotland plc, Edinburgh. This was up from a 2.63 million b/d average the previous month, also a recent high. The bank attributed much of the rise to Tern field production, which hit an average 62,000 b/d after a shutdown for maintenance in October.
NORWEGIAN crude oil and gas liquids production averaged 2.89 million b/d last November, reported Wood Mackenzie Consultants Ltd., Edinburgh. The volume was 10,000 b/d ahead of October's average, Norway's record.
PETER LINDER, energy analyst with BZW Canada Ltd., Calgary, predicted Canadian natural gas prices will average $1.35-1.65/Mcf in 1995, not $1.36-1.47/Mcf in 1994, as reported (OGJ, Jan. 2, Newsletter). Linder also expects first quarter 1995 Canadian gas prices to average near $1.25/Mcf. All prices are in Canadian dollars.
EXPLORATION
MARATHON OIL CO. unit Marathon Petroleum China Ltd. signed a production sharing contract with China National Offshore Oil Co. covering Kaiping Block 27-35 in the South China Sea. Marathon holds a 100% interest in the 1.2 million acre block, 180 miles south of Hong Kong.
OCCIDENTAL PETROLEUM CORP., Los Angeles, signed a production sharing contract with Petrobangla to explore a 3.4 million acre area consisting of Blocks 12, 13, and 14 in the gas producing region of Northeast Bangladesh and to appraise a 1989 gas discovery made by another operator. During the initial exploration period, Oxy will conduct a 1,250 km seismic program starting this year and drill two wildcats.
RUSSIA'S Gazprom let contract to Hydroscience Inc., a unit of Whitehall Corp., Dallas, to deliver a data acquisition system for use in upgrading the MY Rjabinkin marine seismic vessel. The contract calls for delivery of a 240 channel Hydroscience CenturyMux digital streamer, an Alliant Techsystems Aesop recording system, and peripheral equipment. Contract value isn't specified.
CHINA'S Bureau of Geophysical Prospecting paid a total $4.4 million for three more radio frequency telemetry acquisition systems from Opseis Inc., Tulsa. Opseis' Eagle systems will add 1,680 channels to the Chinese government's seismic capabilities. Delivery is scheduled for first quarter.
PERUPETRO awarded 12,100 sq km Block 50 in Northwest Peru's Maranon basin to a joint venture of Argentina's YPF SA 80% and Quintana Minerals Corp., Houston, 20%. Terms of the 7 year agreement call for outlays of at least $36 million, as well as seismic evaluation and drilling four wildcats during the first 3 years.
DENMARK'S Minister for Environment & Energy Svend Auken expressed satisfaction with applications received from 17 companies under the country's fourth licensing round. Auken is expected to complete negotiations for licenses with companies by early April. Danish Energy Agency listed applicants under Denmark's revised licensing terms as Amerada Hess, A.P. Moller, BHP, Danop, Denerco, Enterprise, EWE, LD Energi, Mobil, Pelican, Phillips, Premier, RWE-DEA, Shell, Statoil, Texaco, and Wintershall.
MARKETING
OK PETROLEUM AB, Stockholm, agreed to buy Polish retail company Va-Po, Poznan, Poland. OK will acquire 20 service stations in the Poznan area, along with wholesale gasoline and diesel fuel operations and a products storage terminal. OK plans to expand its acquisition through investments in the terminal, transport system and stations, along with cooperation agreements with existing small Polish retailers.
COGENERATION
SOUTHWESTERN PUBLIC SERVICE CO., Amarillo, Tex., proposes to build a $121 million cogeneration plant next to Phillips Petroleum Co.'s 110,000 b/cd Borger, Tex., refinery. Southwestern's gas fired plant will produce 200,000 kw of electricity for its power grid and as much as 970,000 lb/hr of steam for use by Phillips. Work on the plant could start early in 1997 if regulatory approvals are received.
DESTEC ENERGY INC., Houston, and Consolidated Natural Gas Co., Pittsburgh, arranged financing for their $57 million, 46,000 kw Bear Mountain cogeneration project near Bakersfield, Calif. The gas fired plant will sell power to Pacific Gas & Electric Co. and steam to Shell Oil Co. unit Shell Western E&P Inc. The plant is expected to start operations this year.
GAS PROCESSING
CANADIAN 88 ENERGY CORP., Calgary, completed expansion of its Three Hills, Alta., gas plant last December, increasing capacity to 40 MMcfd from 30 MMcfd. The plant's -360 C. refrigeration capability allows it to extract a high percentage of gas liquids. Nearly 5 MMcfd of production in the area has been shut in since late December because of low spot prices.
LNG
SPAIN'S Gas Natural SDG unit Gas Natural BAN let a $9 million contract to Air Liquide Engineering, Houston, to design, supply, and build the liquefaction section of an LNG peak shaving plant to be built west of Buenos Aires at General Rodriguez, Argentina. The plant is to start operations in September.
Copyright 1995 Oil & Gas Journal. All Rights Reserved.