INDUSTRY BRIEFS

LNG

JAPAN'S Mitsubishi Corp., Mitsui & Go., and C. Itoh & Co. agreed to provide capital for and take part in a liquefied natural gas project in Oman led by Royal Dutch/Shell Group (OGJ, Feb. 17, p. 34). The three Japanese companies, which will conduct a 2 year feasibility study, plan to begin commercial work on the project in 1999, Tokyo daily Nihon Keizai Shimbun reported.

ALTERNATE FUELS

TAMPA ELECTRIC CO. chose Texaco Inc.'s coal gasification technology for a 260,000 kw coal fueled, integrated gasification, combined cycle, power plant in Polk County, Fla., east of Tampa. The Texaco gasification power system is to be on stream in 1996, gasifying about 1,900 tons/day of high and low sulfur coal.

COMPANIES

BURLINGTON RESOURCES INC., Seattle, approved a spinoff of El Paso Natural Gas Co. to Burlington shareholders (OGJ, Dec. 16, 1991, p. 32). Burlington will distribute its 31.4 million shares of El Paso common stock, about 85% of the total outstanding, to Burlington shareholders of record as of June 15. Thereafter, Burlington's main business will be its Meridian Oil Inc. exploration and production unit.

CHALLENGER MINERALS INC., a unit of Global Marine Inc., Houston, settled a take or pay dispute with Transcontinental Gas Pipe Line Corp., Houston. Terms call for Challenger to receive $20 million in cash, eight quarterly principal payments beginning in October 1993 totaling $20 million, and 750,000-1,500,000 shares of Transco Energy stock, depending on the average price per share in January 1994. Settlement closing is expected by May 30.

GULF CANADA RESOURCES LTD. and GW Utilities Ltd. hired First Boston Corp. to sell their combined 63.5% interest in Home Oil Ltd., Calgary, valued at about $400 million (Canadian). Gulf Canada and GW are controlled by Olympia & York Developments Ltd., Toronto, an arm of the financially troubled Reichmann real estate empire. Home holds interests in about 300 fields in western Canada with production of 24,417 b/d of oil, 8,020 b/d of natural gas liquids, and 210 MMcfd of gas.

USX CORP. received settlement of a tax refund claim dealing with the Marathon Group's production taxes for 1982-83. Overpayments resulted in refunds of $96 million plus interest of $152 million, which will be reflected in the company's financial results for the fiscal year ending June 30.

ENCOR INC., Calgary, will reduce capital spending to about $30 million (Canadian) in 1992 from $87 million spent in 1991. Staff levels are to be cut by about 20% to 475 by yearend. Nickle's Daily Oil Bulletin reported Encor was told by a group of bankers that its Canadian oil and gas reserves are worth $118 million less than its outstanding loans. The company continues to seek a buyer or merger candidate and is considering debt restructuring.

RESEARCH

ETHYL CORP., Richmond, Va., plans to build a $70 million world class petroleum additives research unit at Richmond. The complex will support research and development by Ethyl Petroleum Additives Inc. in gasoline and diesel engine lubricants, hydraulic fluids, automotive and industrial gear lubricants, transmission fluids, and fuels. Scheduled to open in mid-1994, it will employ about 200 persons.

DRILLING-PRODUCTION

RUSSIA'S Uralmash heavy machine manufacturing plant will sell a number of its products, including several types of drilling rigs, at no profit. The huge industrial complex east of the Ural Mountains, now worker controlled, has experienced declining rig sales because prices for its equipment have soared much faster than producer prices for oil and gas, which are still largely decreed by the government. Uralmash manufactures almost all of the heavy drilling rigs produced in the Commonwealth of Independent States.

COLOMBIA'S Empresa Colombiana de Petroleos accepted a request from American International Petroleum Corp. (AIPC) for a declaration of commerciality for Toqui-Toqui field in AIPC's Puli contract area (OGJ, Dec. 30, 1991, p. 113). AIPC has eight productive wells in the field. The declaration provides for Bogota to reimburse AIPC for 50% of certain development costs and become AIPC's partner in the field, sharing future development costs.

SAMEDAN OF TUNISIA INC. received approval from the Tunisian government of its development plan for Isis field in the Gulf of Gabes. First phase development includes conducting a 3-D seismic survey, engineering design, and drilling the 6 Isis well. Production is to begin in 1994.

PHILLIPS PETROLEUM CO. reached a settlement with Alaska's Department of Revenue resolving a dispute over state income tax and production tax liabilities for North Cook Inlet gas production. Phillips agreed to pay $165 million in taxes and interest. It paid Alaska $60 million and agreed to pay the remainder by June 30, 1993.

SAUDI ARAMCO and Aramco Services Co. let turnkey contracts to Stone & Webster Engineering Corp. and Bugshan S&W Co. Ltd., S&W's Saudi Arabian affiliate, for construction of a crude oil stabilization unit and modifications to storage and handling facilities. The project is part of development of Hawtah area oil field in Central Saudi Arabia. Crude from Hawtah will move from a new gas/oil separation plant via pipeline to the new facilities. Project is scheduled for completion in fourth quarter 1994.

CANADIAN OCCIDENTAL PETROLEUM LTD.,

Calgary, increased its reserve estimate to more than 300 million bbl of oil from 235 million bbl for its Masila block in Yemen. CanOxy's 2 Heijah on the block recently produced 10,500 b/d of oil from three of four pay zones (OGJ, May 11, p. 34).

REFINING

TEXACO INC. will close its lubricants manufacturing plant at Manchester and technical center in Kings Langley, England. The company signed a 15 year contract with Century Oils Ltd., Stoke on Trent, to produce Texaco brand products using Texaco technology. Lube production will be divided between Century and Texaco's Pembroke, South Wales, refinery. Century will begin manufacturing Texaco lubricants next month, and Manchester and Kings Langley facilities will close by yearend.

HOWELL HYDROCARBONS & CHEMICALS INC. sold its 7,000 b/cd San Antonio refinery to an undisclosed private Dallas company. Sale terms included a cash payment and promissory note secured by a mortgage on underlying assets. Howell in late 1991 consolidated research and reference fuels and chemical toll processing operations at its 2,400 b/cd Channelview, Tex., plant.

EXPLORATION

UZBEKISTAN petroleum industry officials believe their Mingbulak oil field discovery in the Fergana Valley is a giant-if not supergiant-field. They describe Mingbulak as "unikalnyi," unique or rare. Since 1983 geologists in the former U.S.S.R. have classified as unikalnyi any field with reserves exceeding 2.19 billion bbl. The Mingbulak discovery blew wild for 2 months but has been brought under control (OGJ, May 11, p. 37). Moscow sources reported flow of as much as 146,000 b/d, but other reports pegged the well stream at 35,000-62,000 b/d.

ANSCHUTZ IBERIA CORP., a unit of Anschutz Corp., Denver, was awarded 13 exploration permits covering about 1.2 million acres in the Asturias area of Northwest Spain to explore for coalbed methane. Anschutz said the permits are also prospective for conventional oil and gas trapped in fold-thrust structures. The permits, carrying a primary term of 6 years, are in Asturias, Leon, Santander, and Palencia provinces. Anschutz plans to begin a drilling program late this year.

CHINA found five more oil fields in the northern part of the Tarim basin in the Xinjiang Uygur autonomous region, Beijing's Xinhua News Agency reported. To date China has found reserves with potential productive capacity of 100,000 b/d in the basin. Current production is about 15,330 b/d.

LOUISIANA LAND & EXPLORATION CO. 1 Continental Land & Fur Co. wildcat in Terrebonne Parish, La., flowed 662 b/d of oil and 1.03 MMcfd of gas through an 8/64 in. choke with 4,655 psi flowing tubing pressure from a pay at 12,928-938 ft. Total depth is 13,310 ft. The well cut two oil bearing zones, and LL&E is considering more drilling in the area.

SOUTHERN PETROLEUM (OHANGA) LTD. acquired a 29% interest in New Zealand's PPL 38705 exploration license from New Zealand Petroleum Co. Ltd. (Nzpco) in exchange for paying certain seismic and drilling costs attributable to Nzpco's retained interest in the tract. Plans include collecting 50 line km and reprocessing 350 line km of seismic data by Aug. 1 and drilling a wildcat by Aug. 1, 1993. Subject to government approval, Southern Petroleum will become license operator with 59% interest. Other interest owners will be Nzpco 20%, New Zealand Minister of Energy 11%, and Crusader Inc. 10%.

GAS PROCESSING

VALERO ENERGY CORP., San Antonio, completed an $83 million purchase of natural gas liquids assets 'in South Texas from Oryx Energy Co., Dallas. The purchase includes two gas processing plants in Starr and Dimmit counties with combined NGL extraction capacity of 11,000 b/d, 450 miles of associated gas gathering pipelines, a 59 mile liquids pipeline, and a 17.5% interest in a gas processing plant in Nueces County (OGJ, Mar. 23, p. 36). Valero Natural Gas Partners LP will operate the assets.

PETROCHEMICALS

RELIANCE INDUSTRIES LTD. let contract to Stone & Webster Engineering Corp. for design, engineering, and procurement services for a grassroots natural gas liquids/naphtha cracker project at Hazira, Gujarat, India. The plant will include a 400,000 metric ton/year ethylene unit, pyrolysis gasoline and C4 hydrogenation units, a spent caustic oxidation unit, and a flare system. The project, utilizing S&W's ultraselective conversion pyrolysis technology, is expected to last 36 months.

TRANSPORTATION

RUSSIA started construction of a 188 mile gas pipeline from Novosibirsk in western Siberia south to Barnaul. The first 1 billion cu m of gas will be delivered to Altai territory towns and industries in 1993, with volume tripling in 1994. Source of the gas is supergiant Urengoi field, Russia's largest, on the Arctic Circle about 1 000 miles north of Barnaul.

CHEVRON CORP.is constructing its first underground natural gas storage facility at a site on Petal salt dome near Hattiesburg, Miss. The $30 million facility, to be designed and constructed by Chevron's Warren Petroleum unit, will have a working capacity of 3.2 bcf and a design delivery rate of 320 MMcfd. Chevron said it is a peaking rather than seasonal storage system, and the entire volume can be withdrawn in 10 days. Plans are to add compression so the system can fill in 20-25 days. The site is to be operational by winter 1993-94.

GATEWAY PIPELINE began moving gas May 5 from Mobile Bay fields off Alabama, and parent United Gas Pipe Line Co., Houston, expects to ship 135 MMcfd the first month. The $22 million, 30 in. line has 600 MMcfd capacity and extends from the terminus at Bayou Labatre 25 miles to United's main line near Mobile, Ala. (OGJ, Feb. 10, p. 19).

PENNSYLVANIA'S Department of Environmental Resources (DER) approved cleanup plans for three polychlorinated biphenyls contaminated Texas Eastern Gas Pipeline Co., Houston, sites in Fayette and Dauphin counties. Cleanup at compressor stations near Uniontown and Connelsville, Fayette County, and Grantville, Dauphin County, is to begin later this month and be complete in early 1993. The three sites are among 19 Texas Eastern sites in the state contaminated with PCBs (May 27, 1991, p. 46).

U.S. COURT OF APPEALS for the 10th Circuit in Denver reversed a judgment of about $28 million plus interest entered against Occidental Petroleum Corp. unit Natural Gas Pipeline Co. of America, Lombard, Ill., for Colorado Interstate Gas Co., Colorado Springs, Colo., for alleged contract, antitrust, and tort violations. The opinion, which overturns a judgment by Wyoming's federal district court, reduces damages to about $8 million plus interest. The original judgment was entered against NGPL in 1986.

COGENERATION

ENRON EUROPE LTD., Wing-Merril Group, both of Houston, and Turkey's GAMA group plan to conduct feasibility studies to build, own, and operate a 1.7 million kw cogeneration plant in Turkey's Aegean region. The plant would provide electricity to the Turkish Electric Authority and steam and electricity locally.

INDONESIA let contract to Japan's Sumitomo Corp. to build a $225 million, 300,000 kw cogeneration plant in Tambak Lorok, Central Java, to be complete in about 17 months.

SPILLS

MARINE SPILL RESPONSE CORP. received an electronic communications command center designed to oversee a marine spill response operation. The center, developed by EDS Corp., will allow MSRC to link all communications media in order to direct spill cleanup operations from land, sea, or air.