INDUSTRY BRIEFS

LNG

SPAIN AND NIGERIA earlier this month were to sign an agreement under which Nigeria will export 777 bcf/year of liquefied natural gas to Spain during 1997-2019, Daily Times, Lagos, quoted Carlos Portoles, Spain's ambassador to Nigeria, as saying. Nigeria Liquefied Natural Gas Co. will supply 35 bcf/year to Spain's Engas at a price to be determined. Similar agreements are expected soon to supply Nigerian LNG with entities in France, Italy, and the U.S., the newspaper said.

ENVIRONMENT

U.S. ENVIRONMENTAL PROTECTION AGENCY plans to spend $2.3-7 million cleaning up soil and groundwater contamination at the Pacific Coast Pipeline Superfund site in Fillmore, Calif., site of a Texaco Inc. refinery during 1928-50. Under an earlier agreement, Texaco conducted and paid for a study of contamination at the site. In 1986 Texaco excavated and disposed of 33,000 cu yards of waste material and contaminated soil and installed groundwater monitoring wells. The site was placed on the Superfund list in October 1989.

ACQUISITIONS

PARKER & PARSLEY PETROLEUM CO., Midland, Tex., completed purchase of most of the oil and gas leases of Damson Oil Corp., New York, and its interest in natural gas processing plants for $100,000 and 1,430,495 shares of Parker & Parsley common stock (OGJ, Dec. 2, 1991, p. 30).

COGENERATION

ENSERCH DEVELOPMENT CORP. let a $35 million contract to GE Power Generation to provide three gas turbine generators, a steam turbine generator, and four transformers for the 160,000 kw Encogen Northwest Cogeneration Project in Bellingham, Wash. (OGJ, Jan. 20, p. 23). Ebasco Construction Services Inc. is turnkey contractor for the plant, scheduled for commercial start-up in June 1993.

DESTEC ENERGY INC., Houston. commenced operations at the $67 million, 46.000 kw Live Oak cogeneration plant near Bakersfield, Calif. (OGJ, Jan. 6, p. 28). The project provides electricity to Pacific Gas & Electric Co. and as much as 40.000 lb/hr of steam to Texaco Inc.

DESTEC arranged refinancing of its CoGen Lyondell cogeneration plant in Channelview, Tex. The plant generates 465,000 kw of electricity and more than 1 million lb/hr of steam (OGJ, Aug. 8. 1988, p. 26). Refinancing is in the form of an operating lease arranged by Merrill Lynch & Co. Terms are undisclosed.

PIPELINES

TRANSCANADA PIPELINES LTD., Calgary, applied with Canada's National Energy Board for permission to construct $499.5 million (Canadian) worth of new pipeline loop and compression facilities on its mainline system at locations in Saskatchewan, Manitoba, and Ontario. The application is in response to customer requests for increased long term firm transportation service. Plans include 366.1 km of new pipeline and 42,800 kw of compression to provide new service capacity totaling 227 MMcfd. Construction could begin next January and be complete in 1993-94.

FEDERAL ENERGY REGULATORY COMMISSION ruled Blue Dolphin pipeline in the Gulf of Mexico is a gathering system and no longer subject to FERC jurisdiction. The ruling allows Blue Dolphin Energy Co., Houston, to set market based transportation rates for shippers and expand the system to other area locations. Blue Dolphin pipeline is a 20 in. oil and gas gathering system extending about 40 miles from Buccaneer field on Galveston Blocks 288, 289, 295, and 295 to Blue Dolphin's onshore facilities near Freeport, Tex.

CALIFORNIA PUBLIC UTILITIES COMMISSION (CPUC) ordered Southern California Gas Co. to end an agreement that gave gas pipeline capacity rights to its Pacific Interstate Transmission Co. unit. CPUC said the agreement violates state and federal rules because SoCalGas did not obtain authorization to broker or assign capacity rights from CPUC or FERC. The agreement allows Pacific Interstate to transport 218 MMcfd on the El Paso Natural Gas Co. interstate pipeline for SoCalGas core customers.

OPI INTERNATIONAL INC., subsidiary of Offshore Pipelines Inc., Houston, started laying 34 miles of 8 in. pipeline for Texaco Inc. from Garden Banks Block 189 to High island Block A-377 in water 320-720 ft deep in the Gulf of Mexico. DLB 423 derrick/pipelay barge began the project in March with completion expected in mid-April. OPI previously laid 15 miles of 12 in. line for Texaco in 670-720 ft of water from Garden Banks 149 to Garden Banks 189.

CETEX PIPELINE INC., subsidiary of Continental Ozark Inc., Fayetteville, Ark., effective Apr. 1 acquired Conoco Pipe Line Co.'s oil gathering system in East Texas, formerly known as ConDor Pipe Line Co., that consists of 200 miles of 6-8 in. pipeline. Cetex plans to increase throughput by adding injection points in Titus, Wood, Smith, Franklin, and Hopkins counties. Cost of the acquisition was undisclosed.

PETROCHEMICALS

ALGERIA'S Sonatrach and Total let contract to Snamprogetti to provide licenses and engineering design for the Snamprogetti-Yarsintez fluidized bed dehydrogenation process and the Snamprogetti-Ecofuel methyl tertiary butyl ether synthesis process for its proposed 600,000 metric ton/year MTBE complex at Arzew, Algeria (OGJ, Dec. 16, 1991, P. 35). A feasibility study for the complex is in progress.

MANUFACTURERS HANOVER TRUST CO. (MHT) and Banca Commerciale ltaliana (BCI) agreed to jointly develop and finance a $350 million methanol plant at the Jose petrochemical complex near Puerto Piritu, Venezuela, with Pequiven SA and Ecofuel SPA (OGJ, Mar. 18, 1991, P. 135). Each will be a shareholder in the project company Supermetanol CA. The plant will have a capacity of 670,000 metric tons/year of methanol fed by domestic natural gas.

IRAN'S petrochemical production increased 44% to 4.3 million metric tons/year in the Iranian calendar year ended Mar. 20, OPEC News Agency (Opecna) reported. Product value increased by $600 million. About 1.2 million tons of the output was fertilizer. About 970,000 tons of petrochemicals worth $100 million were exported, up 172% in volume and 186% in value compared with the previous year.

BAHRAIN exported 837,991 metric tons/year of ammonia and methanol in 1991 compared with 825,428 tons/year in 1990, Middle East Economic News Network reported. Exports in 1985 were 214,958 tons/year.

PETROLEOS MEXICANOS produced a record 212,764 metric tons/year of high density polyethylene in 1991, an increase of 21% from the previous year, allowing Mexico to achieve self-sufficiency in polyethylene and export surpluses to European markets. Mexican industry consumed 125,000 tons/year of HDPE, a 24% increase from the prior year.

COMPANIES

MORGAN STANLEY LEVERAGED EQUITY FUND 11 LP agreed to buy a 50% stake in the natural gas gathering, processing, and marketing business of Presidio Oil Co., Denver, for at least $55 million. The assets are held by Presidio's Mountain Gas Resources Inc. unit. Presidio and Morgan Stanley will each own 50% interest in Mountain Gas Resources LP, a new partnership that will own and operate facilities in Green River basin in Southwest Wyoming and market gas and gas liquids in the Rocky Mountain, Pacific Northwest, and Midcontinent regions. The deal is to close by mid-April.

OTTAWA approved purchase by a Hong Kong group led by Cheng Yu-Tung of 41% controlling interest in Numac Oil and Gas Ltd., Edmonton, from principal shareholder Consolidated Enfield Corp. for $70 million. The sale is the first approved by Investment Canada under recently liberalized rules for foreign investment (OGJ, Apr. 6, p. 48). Federal Industry Minister Michael Wilson said the new majority shareholders promised to double Numac's exploration budget to at least $38 million by 1995 and increase jobs.

PHILLIPS PETROLEUM U.K. LTD. and British Gas Exploration & Production Ltd. agreed to an exchange of interests whereby Phillips assigns its 35% equity stake in Block 47/4A in the U.K. North Sea to BG, and BG assigns its 7.22% equity interest in each of Blocks 49/6A and 49/11A, excluding Audrey field, and its 7.22% equity interest in Block 48/10A containing Ann field to Phillips. BG will become operator of Block 47/4A.

OCCIDENTAL PETROLEUM CORP. will ask FERC to reject an administrative law judge's recommendation FERC uphold most of a 1988 remedial order issued by the Department of Energy charging its Cities Service Co. unit with violating price regulations in certain crude oil transactions made in 1979-80. The remedial order would require Cities to refund about $245 million plus interest. Cities maintains the regulations did not apply to its transactions.

SHELL CHEMICAL CO. intends to buy Goodyear Tire & Rubber Co.'s polyester resins business, which employs about 700 and includes a polyethylene terephthalate plant at Point Pleasant, W.Va., a technical center in Akron. Ohio, and related sales activities. Value of the deal was not disclosed.

EXPORTS-IMPORTS

CANADA'S National Energy Board issued eight natural gas export licenses totaling about 321 MMcfd, bringing current approved exports to 1.1 tcf. Mobil Oil Canada Ltd., Unigas Corp., and Western Gas Marketing Ltd. as agent for Northern Minnesota Utilities received one license each, and five licenses were issued to Western Gas Marketing Ltd. Export applications by Amoco Canada Ltd., Canadian Hunter Exploration Ltd., Canadian Occidental Ltd., ProGas Ltd., Shell Canada Ltd., and North Canadian Marketing Ltd. are being reviewed.

REFINING

OMANI government will take a 20% stake in a 120,000 b/d refinery Caltex Oil Thailand plans to build at Rayong, Thailand. Caltex's agreement with Thailand allows it to take on a partner to strengthen crude supply arrangements. The $600 million project will process crude from Oman.

KUWAIT NATIONAL PETROLEUM CORP. let a 3 year contract to Catalytic Maintenance Ltd., subsidiary of Delta Catalytic Corp., Calgary, for work at Shuaiba refinery south of Kuwait City. Contract calls for modifications, repair of damage resulting from the Persian Gulf war, and continuing maintenance after refinery start-up.

BP OIL GRANGEMOUTH let a detailed engineering procurement and construction assistance contract for its 240 million ($68.8 million) catalytic reformer revamp to Stone & Webster Engineering Ltd., Milton Keynes, England.

DRILLING-PRODUCTION

NEW MEXICO GOV. BRUCE KING signed legislation that provides a tax incentive of 1.87% for secondary and tertiary enhanced oil recovery programs certified by the New Mexico Oil Conservation Division. The incentive applies for the life of the project except for periods when the average price of oil exceeds $28/bbl. Projects may apply immediately for certification. Tertiary projects will receive the tax when positive production occurs, and secondary projects will qualify after Jan. 1, 1994.

QUESTAR CORP., Salt Lake City, increased nonutility oil and gas reserves 5% in first quarter 1992, in part due to formation of an enhanced recovery unit in Southwest Wyoming's Henry field. Questar expects to recover another 7 million bbl of oil, condensate, and natural gas liquids from the field the next 15 years from EOR operations. Questar unit Celsius Energy Co. holds 30% working interest in the field.

AGIP SPA will acquire a 45% stake in Qatar's offshore Block 5 where the operator, a unit of Ste. Nationale Elf Aquitaine, discovered Al-Khalij oil field last summer.

POLAND'S state oil and gas exploration company PGNG placed a $62 million order with IRI International Corp., an Ingersoll-Rand Co. and Dresser Industries joint venture, for five mobile and five stationary land rigs to drill for gas in Poland. The contract will be financed from a $250 million World Bank loan to Poland's mining industry.

KELT U.K. LTD. and Edinburgh Oil & Gas plc agreed to buy BP Exploration's interests in Malton, Kirby Misperton, Marishes, Pickering and Hatfield Moors gas fields onshore U.K. in Yorkshire County. The interests are held through Candecca Resources Ltd. Three of the fields will provide gas for a proposed power generation project in the area.

DORADO OFFSHORE LP, San Francisco, purchased for $28 million Reading & Bates Corp.'s W.T. Adams Marathon LeTourneau 116-C class jack up rig, currently operating in Abu Dhabi. R&B will continue to operate and market the rig for 42 months under a bareboat charter agreement with Dorado. R&B will use proceeds from the sale to repay short term debt incurred last year by purchase of and/or investments in Arcade Shipping AS and Arcade Drilling AS.

SHELL U.K. EXPLORATION & PRODUCTION let contract worth more than l.2 million to Peter Brotherhood Ltd. to supply a gas treatment and compression package for Shell's Auk Alpha oil platform. Delivery is scheduled this summer. BP Exploration let a 600,000 contract to Peter Brotherhood to supply compressors for BP's Kinneil oil and gas processing terminal at Grangemouth, Scotland. Brown & Root (U.K.) Ltd. is prime contractor for BP's project and consulting engineer on Shell's project.

NEDERLANDSE AARDOLIE MIJ. BV let a 25 million guilders ($18.71 million) contract to Volker Stevin Offshore By, Rotterdam, for construction of an offshore tanker loading tower to serve the F3-FB oil and gas development project in the Dutch North Sea. Work is due for completion in second quarter 1993.

GERRITY OIL & GAS CORP., Denver, completed purchase of part of the assets of Coors Energy Co., Golden, Colo., for $15.25 million (OGJ, Mar. 2, p. 27). The deal includes a substantial part of Coors' eastern Colorado oil and gas assets.

ANADARKO PETROLEUM CORP., Houston, purchased 100% of the outstanding stock of Calley & Fowler Production Co., Snyder, Tex., for $11 million. Assets include primary and secondary recovery oil producing leases in Permian basin of West Texas. About 200 wells on the leases produced about 500 b/d of oil in 1991. Anadarko plans to spend about $15 million the next 2 years adding to secondary recovery operations and expects to double or triple production. Reserves are pegged at 6 million bbl. The deal is to close by the end of May.

MARKETING

BP OIL CO. received approval from the Washington state attorney general for its acquisition of Exxon Corp. marketing operations in the Puget Sound area. BP is expected to take over Exxon stations this month and will rebrand and begin upgrading facilities.

AMOCO OIL CO. is equipping 115 service stations in the St. Louis area with its proprietary user friendly vapor recovery nozzles. Amoco began installing the V-1 system at 15 area service stations in 1988. Positive customer reaction led Amoco to install the system throughout the area, except for a few stations with dispensers that can't be modified to the V-1 system. Installation was to be complete Apr. 1.

TERMINALS

SHANGHAI ORIENT TERMINAL CO. LTD., a China-Hong Kong joint venture, completed first phase construction of a terminal and storage facility at Shanghai's Pudong new development zone at the mouth of the Yangtze River. The dock can handle 35,000-50.000 dwt tankers, and storage capacity of 566,000 bbl of oil and liquid chemicals is available. Plans are to increase storage to 1.4 million bbl and construct facilities for storage tank manufacturing. Total investment for the project is expected to be about $27.1 million.

TANKERS

ALL SAFETY DEVICES functioned Mar. 23 when Greek freighter Grace L collided with Hall-Houston Oil Co.'s platform on Mustang Island Block 781, severing the structure 10 ft above the water line and interrupting production. The platform was unmanned at the time of the accident. OPI International Inc.'s derrick barge Sarita last week was on location performing repairs and salvage operations.

EXPLORATION

TOTAL INDONESIA 1 Janu wildcat off East Kalimantan flowed at a rate of 2,597 b/d of crude and 970 Mcfd of gas from a zone at 3,575 m, Opecna reported. Total is studying the discovery to determine commerciality.

CLYDE PETROLEUM PLC soon will begin a seismic survey on the 6,930 sq km Howarime Block 32 in Yemen after the government ratifies the acreage award. In the initial 3 year phase Clyde will shoot 1,000 line km of seismic and drill three wells. Clyde's block lies partly in Hadramaut (Masila) basin and north of Canadian Occidental's Masila block, where four oil discoveries have been made. Clyde Expro plc has 38% interest in the block with Norsk Hydro AS 31%, Ansan Wikfs (Hadramaut), a private Yemeni company 16%, and Oranje-Nassau Yemen By 15%.

UTAH DEPARTMENT OF NATURAL RESOURCES Division of State Lands and Forestry will offer about 4,000 acres of trust lands in Grand and San Juan counties for oil and gas leasing. The decision to offer the lands was issued Mar. 30, and the public has 14 days to appeal the decision. The lands are part of 12,000 acres originally withdrawn from oil and gas leasing to facilitate potash mining. Developments in regulation and horizontal drilling technology and recent oil discoveries in the Cane Creek area (OGJ, Mar. 23, p. 123) prompted the board to authorize leasing.

TEXACO INC. was awarded the first exploration contract in Egypt's Upper Nile region covering a 34,000 sq km area from Asyut to Qana. Egypt's Oil Minister Hamdi A Banbi said the agreement calls for Texaco to spend $20 million. Meantime, Egypt is negotiating with Spain's Repsol SA for exploration in the area between Qana and the border with Sudan.

MOSCOW PRESS reported discovery of a "large" oil/gas basin in a desert area of Central Kazakhstan near the Baikonur space center. Three fields have been found there to date. Crude from one of the fields, Yuzhno-Tugaiskoye, is described as light with low sulfur content.

ENERGIEVERSORGUNG WESER-EMS AG, Oldenburg, Germany, purchased interests of Holland Sea Search Holding NV (HSS), The Hague, in 13 Dutch exploration licenses effective Jan. 1 , 1992, subject to government approval. HSS will reduce exploration and development spending and receive an undisclosed amount of cash with prospect of further payments based on exploration success on the license areas. HSS plans in 1992-93 to take part in exploratory drilling on Q/2c and J/6 blocks and formed a group to bid in the Netherlands' eighth round for offshore acreage.

SHELL U.K. EXPLORATION & PRODUCTION let a $34 million contract to FMC Corp. (U.K.) Ltd. and FMC Subsea Systems for design, manufacture, testing, and delivery of subsea equipment for Nelson field in the U.K. North Sea (OGJ, Oct. 28, 1991, p. 21). FMC Subsea will supply subsea wellheads, subsea production/injection trees, a central subsea manifold and protection structure, and installation and workover equipment.

GAS PROCESSING

AMERICAN OIL & GAS CORP., Houston, competed purchase of the assets of Maple Gas Corp., Dallas, for about $80 million (OGJ, Mar. 9, p. 42). Assets include 10 gas processing plants and related gathering lines.

ALTERNATE FUELS

READING ENERGY CO., Philadelphia, let contract to Foster Wheeler Power Systems Inc., Clinton, N.J., to design, construct, and operate a $280 million, 1,600 ton/day waste to energy project in Robbins, 111. Scheduled for completion in 1995, the plant will process about 60% of the household trash from Chicago's south suburbs. After removing recyclable materials with front end equipment, boilers will burn processed refuse-derived fuel to produce enough electricity to serve 50,000 homes.