INDUSTRY BRIEFS

SPILLS

SHELL PIPELINE CORP. agreed to an $8 million settlement with U.S. and Missouri attorneys general regarding a Dec. 24, 1988, crude spill in Missouri's Gasconade River. The U.S. will receive $1 million, Missouri the rest. Shell operates Ozark Pipe Line, which failed when pipeline pressure changed during a switch between crude delivery locations, spilling about 20,000 bbl of crude into the river. Shell spent $14 million on cleanup.

GAS PROCESSING

ENRON GAS PROCESSING GO. received a permit to build a $13 million butane isomerization plant at Bushton, Kan. Enron applied to the Kansas Department of Health and Environment last May, but was told prevention of significant deterioration regulations applied. The resulting permit process was to take 6 months, jeopardizing Enron's plan to meet expected isobutane demand in 1992. Consultants Burns & McDonnell, Kansas City, Mo., documented emissions control credits. That allowed the project to go ahead as scheduled.

PIPELINES

PETROLEOS BRASILEIRO SA revived plans for a 946 km, 133,000 b/d refined products pipeline from the Paulinia refinery in Sao Paulo state to Brasilia in Brazil's interior. Construction will begin in April, completion is scheduled for 1994, and cost is estimated at $370 million. The pipeline is expected to save the country $200 million/year in transportation costs. Petrobras shelved the project last year because of budget constraints (OGJ, Sept. 9, 1991, p. 24).

PETROBRAS let contract to Rockwater Ltd., Aberdeen, for a study of an oil and gas gathering system for supergiant Albacora field in the Campos basin off Brazil. It will study feasibility of using rigid pipe for gathering production from 74 wells in water depths of 820-3,936 ft and transporting production to two floating production facilities. The study will focus on pipeline bundles.

CANADA'S National Energy Board will conduct a hearing May 11 in Niagara Falls, Ont., to review its 1991 decision denying TransCanada PipeLines Ltd.'s Blackhorse extension application (OGJ, Jan. 20, p. 23). The $38.9 million, 13 mile line would connect the TransCanada system at Niagara Falls, Ont., to deliver gas to New York state via the Empire State pipeline. The board said alternative pipeline connections are available.

COGENERATION

AMOCO ENERGY TRADING CORP. signed 15 year contracts with units of Economic Energy Alternatives Inc., Washington, D.C., to supply a total of 29 MMcfd of gas for two proposed cogeneration plants in New Jersey. The contracts cover 50% of gas requirements for the plants (OGJ, Feb. 10, p. 47), and Amoco expects to provide 160 bcf during the life of the contract. The plants are to start up by Jan. 1, 1995.

REFINING

TOTAL PETROLEUM (NORTH AMERICA) LTD. plans to spend about $200 million installing hydrotreaters at its Ardmore, Okla., and Alma. Mich., refineries, enabling it to meet new low sulfur motor diesel specifications in its entire market area. The program will allow the Ardmore refinery to process low cost crude and convert heavy fuel oil into light products.

MARAVEN SA let contract to Badger Co. Inc. to provide services for an oxygenates complex to be built at its Cardon refinery at Punto Fijo, Venezuela. The complex, to include a 66.300 metric ton/year methyl tertiary butyl ether unit and a 335,000 ton/year tertiary amyl methyl ether unit, is to cost about $30 million and be complete in 1993.

MOBIL CORP. and Badger are offering for license the Mobil benzene reduction (MBR) process for reducing benzene content of light reformate. MBR, an extension of Mobil's olefins to gasoline process, works by reacting with refinery dilute olefinic streams such as fluid catalytic cracking fuel gas. It is based on a ZSM-5 catalyst.

IRAN'S Arak refinery is under construction and is to be on stream in fiscal 1993-94. About $1.1 billion in equipment has been ordered, including 71 storage tanks with capacities of 3.000-500,000 bbl. Six storage tanks with total capacity of 3 million bbl were manufactured in Iran. Crude for the refinery will be supplied from the Asmari region near Ahvaz in Khuzestan province.

CONOCO INC. let contracts to M.W. Kellogg Co. to provide technology, engineering, and management services for upgrades of fluid catalytic cracking units at refineries in Ponca City, Okla., Lake Charles, La., and Denver. The upgrade at Ponca City and engineering on the Lake Charles project are to be complete this year. Completion of the Denver upgrade is expected in first quarter 1993.

BP OIL CO. broke ground at its Toledo refinery for a $138 million diesel desulfurization unit, part of BP's push to cut diesel sulfur levels 10-fold. Construction is to begin in March, with completion scheduled for June 1993. The new unit will enable BP to meet U.S. Clean Air Act regulations that take effect Oct. 1, 1993.

EXPLORATION

LASMO OIL (COLOMBIA) LTD.'S 1 Venganza wildcat on the Espinal block in Colombia's Upper Magdalena basin flowed at stabilized rates of 2,800 b/d and 3,000 b/d of 28 gravity oil from two intervals. Total depth is 6,790 ft. The well is believed to be on a larger structure than the Purification discovery (OGJ, Dec. 2, 1991, p. 32), 7 km west. Appraisal drilling is to begin later this year. Sun Colombia Oil Co. is a one-third partner in the block.

PETRO-CANADA completed a wildcat in British Columbia's Grizzly Valley about 90 miles south of Fort St. John flowing about 40 MMcfd of gas. The well is near a pipeline connection with the Pine River gas processing plant and Westcoast Natural Gas Transmission system. Petro-Canada holds a 50% interest in the strike, Phillips Petroleum Resources Co. 25%, Amoco Canada Petroleum Co. 18.75%, Encor Inc. 3.45%, and Texaco Canada Petroleum Inc. 2.8%.

APACHE INTERNATIONAL INC., Denver, agreed to acquire a 20% working interest in the WA-214-P exploratory block off Western Australia from Western Mining Corp. Ltd., Melbourne. The 330,000 acre block is in the Carnarvon basin 50 miles offshore in water depths of 200-300 ft. The first well is to be drilled in second half 1992. Also, the Commonwealth-Western Australian Offshore Petroleum Joint Authority may grant Apache an exploration permit for Block W91-9 in the North Carnarvon basin.

GREECE'S DEP-EKY plans to study hydrocarbon bearing formations of the greater Epanomi area about 18 miles south of Thessalonica. The project, partly funded by the European Community, includes reprocessing and special processing of selected seismic data to evaluate the structure and fluid distribution in tight carbonate reservoirs in the area. The company also seeks to build a geological model of the area.

GARNET RESOURCES CORP., Houston, received a 4 year exploration permit from the French government covering 107,000 acres near Nimes, about 60 miles northwest of Marseilles. In September 1991, the government awarded Garnet a 4 year exploration permit on a 132,000 tract in the southwestern Paris basin, about 40 miles south of Paris.

PETROCHEMICALS

PETROQUIMICA DE VENEZUELA SA and Eastman Chemical Co. plan a 250,000 metric ton/year acetic acid plant in Jose, Venezuela, where natural gas feedstock is available. First phase is a joint feasibility study. A portion of plant production will meet South American demand for acetic acid, and the remainder will be sold outside the continent.

INDONESIA'S Bakrie & Brothers and Japan's Mitsubishi Kasei will form a joint venture company, Bakrie Kasei Corp., to build a $355 million, 250,000 metric ton/year purified terephthalic acid plant at Merak, West Java, to provide feedstock for Indonesia's polyester producers. International Finance Co. agreed to provide $30 million and guarantee a $125 million loan from Japanese banks. Financing for the rest of the project is to come from Japan's Ex-Im Bank and other sources.

DRILLING-PRODUCTION

A MAJOR OIL WELL FIRE was reported near Grozny north of the Caucasus Mountains in the autonomous Chechen republic of Russia. The well had been producing 5,100 b/d and was one of the most prolific wells in the Grozny area. Moscow also reported Chechen oil flow has fallen to 80,000 b/d. Grozny was once a leading Russian oil producing area, but its 320,000 b/d capacity refinery is now mainly supplied from other Russian areas.

MARATHON PETROLEUM INDONESIA LTD. suspended its KRA-2X delineation well on the Kakap block in the Natuna Sea off Indonesia after drillstem tests of Tertiary sands at 5,312-5,436 ft and 7,105-7,243 ft flowed a combined rate of 4,000 b/d of 45 gravity oil through variable chokes with 300 psi flowing tubing pressure. KRA-2X is 2.6 miles southeast of the KRA-1X discovery (OGJ, Oct. 28, 1991, p. 40). The rig has been moved to the KRA-3X drillsite about 1-1/2 miles southeast of the discovery.

A SCHLUMBERGER LTD. UNIT bought a 50% interest in Sedco-Phillips Offshore Drilling Co. for $21 million. Another Schlumberger unit holds the other 50% interest. The Sedco 712 semisubmersible rig, the main asset of Sedco-Phillips, will be operated by Sedco Forex. The rig, currently drilling in the U.K. North Sea, was built in 1983 and is rated to 25,000 ft in 1,600 ft of water. The Sedco 712 sale is part of Phillips' effort to boost cash flow.

WASHINGTON ENERGY RESOURCES CO. and partners received federal and state approvals to form an enhanced recovery unit in Southwest Wyoming's Henry oil and gas field. Plans call for reinjecting produced natural gas into the Cretaceous Dakota 4A sand in a new Uinta County unit covering about 7,380 acres. The project is expected to almost double total commercial production over the life of the field, adding an incremental 7 million bbl of liquids plus 40 bcf of gas that includes 16 bcf of reinjected gas. Work is to get under way this spring.

SAMEDAN OIL CORP., Ardmore, Okla., began producing 1,600 b/d of oil from two wells on Eugene Island Block 208 in 100 ft of water off Louisiana. Samedan and New England Energy Inc., subsidiary of New England Electric System, Westborough, Mass., are 50-50 partners in the block.

DIAMOND M CORP., Houston, closed the purchase of Odeco Drilling Inc. from Murphy Oil Corp. Following the purchase, Diamond M-Odeco Drilling Inc. and Ben Line Group Ltd., Edinburgh, divided their joint venture. A Ben Line Offshore Contractors Ltd. (BLOC) unit will acquire the Ocean Benloyal semisubmersible and Ocean Tide jack up, and BLOC will sell its 50% interest in Ben Odeco to Diamond M-Odeco. Ben Odeco's main remaining asset will be a 50% interest in the Ocean Alliance semisubmersible, British Petroleum Co. plc holds the other 50% interest.

PEDAYO AB, Gothenburg, Sweden, let contract to Jacques Cable System Ltd., Cambridgeshire, England, to supply two hydraulic umbilicals for blowout preventer valves for the Valentin Shashin Russian drillship. Pedayo is refitting the vessel.

ALTERNATE FUELS

LAWRENCE LIVERMORE NATIONAL LABORATORY, Livermore, Calif., signed a research and development agreement with Amoco Corp., Chevron Shale Oil Co., and Conoco Shale Oil Inc. to study oil shale technology under the Shale Oil Semiworks Joint Venture. Industry partners will contribute at least $100,000/year for 3 years, as well as advice, direction, and research evaluation. The group will use Livermore's 4 ton/day, hot recycled solids retort, which extracts oil from shale and other facilities.

O'BRIEN ENVIRONMENTAL ENERGY, Philadelphia, will develop a 2,500 kw landfill gas fueled power plant at Rowley, Burnley, Lancashire, in Northwest England, under the Non-Fossil Fuel Obligation program sponsored by the U.K. government. The Rowley landfill is owned by Lancashire County Council. O'Brien will pay a royalty to the council in exchange for long term rights to develop the gas. Electricity from the plant will be sold to the local utility.

CNG

UNITED PARCEL SERVICE plans to install two compressed natural gas refueling stations in Oklahoma to fuel as many as 140 UPS vehicles in Oklahoma City and Tulsa. UPS will receive tax incentives from the state for building the stations and converting the vehicles to operate on CNG.

SHELL OIL CO. later this year will open New Orleans' first and Louisiana's second public CNG refueling station. The Shell operated station is being built jointly by Shell and Louisiana Gas Service Co., a division of Citizens Utilities Co., New Orleans. A Shell jobber in Lafayette operates Louisiana's first CNG station.

MARKETING

PETRO SERVICE, a joint venture owned 51% by Neste Oy and 49% by Russian companies Lennefteprodukt and PKAO, last month opened a 24 hr service station in St. Petersburg, formerly Leningrad. Customers may use foreign currency, international credit cards, or Neste cards to buy 98 and 95 octane unleaded gasoline, car products, and food. Ninety-two and 76 octane gasoline is available for rubles. Petro plans more stations this year in St. Petersburg and Vyborg.