INDUSTRY BRIEFS

EXPLORATION

CANADIAN FRACMASTER LTD.,

Calgary, and Hungary's Mecseki Szenbanyak FA formed Methane Master Kft, a joint venture that has acquired exclusive rights to explore for and produce coalbed methane in the Mecsek basin of Hungary. Estimated reserves to a depth of 1,500 m are 3 tcf. Fracmaster said there are substantial reserves below that depth. Investment in the project is to exceed $75 million. Drilling under a 35 year concession is to start Mar. 1. Full scale development, to start next January, will include drilling 300 wells.

ARCO ALASKA INC.

and Phillips Petroleum Go. placed apparent high bids totaling $66 million in Alaska state Sale 75 on 32 tracts in Cook Inlet near their 1 Sunfish discovery the two companies plan to develop (OGJ, Feb. 1, p. 24). ARCO said the tracts are mainly south and west of the discovery. ARCO holds a 60% interest in the tracts, Phillips 40%.

PANCANADIAN PETROLEUM LTD.,

Calgary, will earn a 15% working interest in 3.9 million acres in Libya under an agreement with Fina Exploration Libya By. The agreement covers blocks NC 170, NC 171, and NC 172 in the Sirte basin. The work commitment calls for acquiring 8,500 line km of seismic data and drilling 12 wells. The agreement is subject to Libyan approvals, but drilling is expected to start at midyear. Westcoast Petroleum Ltd., Calgary, and Chieftain International Inc., Edmonton, signed a similar agreement with Fina last year (OGJ, Sept. 7, 1992, p. 34).

HADSON ENERGY LTD.,

Oklahoma City, took a farmout on Exploration Permit WA-209-P in the Carnarvon basin off Australia. Hadson will operate and hold a 37.5% working interest in the block. The Hadson group plans in second quarter to drill a wildcat about 15 miles from and on trend with the Wandoo discovery (OGJ, Aug. 17, 1992, p. 29).

SPILLS

U.S. COAST GUARD

plans to award a $2 million grant to the International Oceanographic Foundation (IOF) to establish the South Florida Oil Spill Research Center, which will operate in conjunction with the University of Miami's Ocean Pollution Research Center. Work at the center will include attempts to improve predictions of variables that affect spills, technology development, studies of oil's behavior in warm water, investigations of environmental effects, and training and contingency planning.

MARKETING

TOTAL PETROLEUM (NORTH AMERICA) LTD.

will place its logo on all service stations in its U.S. retail network during the next 2 years. In addition to its own logo, Total currently markets in the U.S. through Vickers, Apco, and Road Runner brands. The image upgrade program is part of a restructuring focusing Total's U.S. marketing operations around its four refineries in Colorado, Kansas, Michigan, and Oklahoma. Total also will cut the number of its U.S. Midwest service stations to 2,200 in 12 states from 2,600 in 22 states.

DRILLING-PRODUCTION

BAROID CORP.,

Houston, acquired SubSea International Inc., New Orleans, a service and equipment supplier to the offshore industry. Baroid, mainly involved in drilling services, said the acquisition will expand its presence into activities that take place before and after the drilling phase of offshore projects. Baroid's international presence will be expanded by the deal because more than 80% of SubSea's revenues come from outside the U.S.

BROOKLYN UNION EXPLORATION CO. INC.,

Houston, completed three gas wells in 175 ft of water on Mustang Island Block 785, 20 miles south of Corpus Christi in the Gulf of Mexico. A-1, A-2, and A-3 OCS-G-8975 wells are producing more than 35 MMcfd of gas. Opportunities are being evaluated for further development drilling. Operator Brooklyn Union owns a 56.25% interest in the block, Sonat Exploration Co. 25%, Smith Offshore Exploration Go. 12.5%, and others 6.25%.

NOBLE AFFILIATES INC.,

Ardmore, Okla., increased its oil reserves 8% in 1992 to 47.4 million bbl, marking the fifth straight year of oil reserves growth. U.S. oil reserves, which make up 84% of Noble's total, increased 5%. Total natural gas reserves slipped 6.1% to 372.2 bcf. Noble added 19.2 million bbl of oil equivalent (BOE) after reducing exploration, development, and acquisition spending 48% to $76 million. New reserves were added at a cost of about $3.96/BOE.

HARDY OIL & GAS U.S.A. INC.'S

4 OCS-G 4001 wildcat in 110 ft of water on South Timbalier Block in the Gulf of Mexico, 40 miles southwest of Grand Isle, La., flowed at a combined rate of 18.8 MMcfd of gas from three of five productive zones at 7,500-9,400 ft. A caisson has been set, and production is to start by August 1993. Partners with Hardy are Apache Corp. and Seneca Resources Corp., all of Houston and all with one-third interests.

CABOT OIL & GAS CORP.,

Houston, plans to buy from an undisclosed private seller oil and gas leases in the Anadarko basin of Texas and Oklahoma with reserves of about 52.5 bcf of gas equivalent, 80% of which is gas. Cabot will issue stock valued at $36.5 million to the seller. The leases include 150 net wells that produce about 8 MMcfd of gas and 550 b/d of oil. Cabot will operate almost 70% of the wells. The deal is to close by Apr. 1 with an effective date of last Jan. 1.

NUEVO ENERGY CO.,

Houston, bought a package of producing leases and interests from Gemini Exploration Co., Dallas, for $5.7 million. Most of the producing wells and acreage are in Giddings field of Lee and Fayette counties, Tex., and certain interests are in Pearsall field, Frio County, Tex. The deal adds 590,000 bbl of oil and 407 MMcfd of gas to Nuevo's reserves effective Dec. 1, 1992. Net production is 1,064 b/d of oil and 494 Mcfd of gas. Gemini will retain a small interest in the leases and maintain operatorship.

TEXAS RAILROAD COMMISSION

in 1992 issued 698 permits to drill horizontal wells in the state, a decrease of more than 22% from 1991 and 400 fewer permits than it issued in 1990. TRC statewide in 1992 issued 13,452 drilling permits, about 2.6% less than the previous year. Since 1984, commissioners have issued 2,922 permits for horizontal wells in Texas, including 1,197 in Pearsall and 811 in Giddings fields. Texas operators have reported a total of 2,237 horizontal well completions.

DEN NORSKE STATS OLJESELSKAP AS

received approval from Norway's Ministry of Industry and Energy to develop West Gullfaks oil field, 31/2 km west of the Gullfaks B platform on North Sea Block 34/10. The 20 million bbl field will be produced through two extended reach wells drilled from the Gullfaks platform. it is expected on stream in October.

A SOUR GAS WELL

blew out near Twin Butte in Southwest Alberta and was killed by Safety Boss Ltd., Calgary. Gas from the well, operated by Palmer Ranch Ltd., has a 13% hydrogen sulfide content. Alberta's Energy Resources Conservation Board said the well is in a sparsely populated area and did not pose any threat to people. The well had been shut in for 16 years and was back on production only 2 days when it blew out.

TROPHY RESOURCES LTD.,

Calgary, bought a one-third interest in Long Riders Rig Corp. from Williston Wildcatters Corp. for $2.9 million. Long Riders is drilling 25 horizontal wells in Carlyle Manor Spearfish field in Southeast Saskatchewan. It also owns varying interests in other Saskatchewan leases and operates two rigs capable of drilling horizontal holes and one vertical hole rig.

COMPANIES

CHINA

formed China National United Oil Corp. (Sinoil) to focus on the international market and to form joint ventures with foreign companies in trading and manufacturing equipment for oil exploration and development. Sinoil has the ability to invest in foreign countries and to import and export oil and products. It is China's first state owned company to combine industry and trade.

COASTAL CORP.

plans to add to its natural gas group a gas services company expected to handle more than 1.2 tcf/year of gas and 226 million gal/year of natural gas liquids. Coastal Gas Services Co. will combine the parent's gas gathering and processing operations into a single unit and acquire gathering and processing assets. A project development division will supervise activities not related to Coastal interstate pipeline units, including construction of pipelines and storage facilities, sales and management services for power ventures, and gas reserves acquisitions.

WEATHERFORD INTERNATIONAL,

Houston, agreed to pay W.R. Grace & Co., Boca Raton, Fla., $97.5 million and assume certain liabilities to acquire Homco International Inc., Bellaire, Tex. Homco offers oil field services from more than 70 sites in North America, Europe, and Southeast Asia. The deal is to close by late March or early April, subject to antitrust clearance, corporate regulatory approvals, and certain other conditions.

ENRON POWER SERVICES INC.,

Houston, signed a 9 year contract to supply Texas Utilities Fuel Co., Dallas, as much as 60 MMcfd of gas. The contract was effective Jan. 1 . Total deliveries over the term of the agreement are estimated at 105 bcf.

GOVERNMENT

UTAH PUBLIC SERVICE COMMISSION

(PSC) allowed Mountain Fuel Supply Co., Salt Lake CO, to include in its rate base the cost of gas purchased during an 18 month period in 1991-92 under a portfolio of short and long term contracts. PSC denied an $80 million refund sought last year by the Utah Committee of Consumer Services (CCS). CCS challenged Mountain Fuel's rate applications on grounds that the company should have bought lower priced gas through 30 day, best effort spot market contracts.

REFINING

SOUTH CHINA'S

Hainan province received approval to build a 120,000 b/d refinery, the largest in the province. Construction is to start this year. It is expected to yield about $1.2 billion/year in sales, equal to the 1992 industrial production of the entire province.

PETROLEOS MEXICANOS

placed on stream two sulfur extraction units at its 330,000 b/d Salina Cruz refinery, Oaxaca state, on the southern coast of Mexico. The units will produce a combined 40 tons/day of sulfur.

SNC-LAVALIN INC.,

Calgary, and Unocal Process Technology & Licensing, Brea, Calif., agreed to jointly license and market the U-CAN residcracking process, which produces naphtha, diesel, and gas oils from refinery residual oil, heavy oils, or bitumen, with conversion levels as high as 95%. The process combines features of the Canmet hydrocracking process and Unocal's Unionfining process.

TRANSPORTATION

SEMINOLE PIPELINE CO.,

Tulsa, reached a settlement reportedly worth more than $1 00 million with plaintiffs in a case stemming from last year's explosion at Seminole's liquefied petroleum gas storage site near Brenham, Tex. (OGJ, July 13, 1992, p. 30). Lawsuits against Coastline Gas Pipeline and parent United Texas Transmission Co., Houston, were settled at the same time, with Seminole agreeing to pay the total settlement.

ASSOCIATED BRITISH

PORTS HOLDINGS PLC

plans an L18 million ($28 million) expansion of the Immingham oil terminal at Humberside, U.K. A new jetty will provide a third berth able to handle tankers as large as 80,000 dwt. The terminal ships products from the Conoco (U.K.) Ltd. Humber refinery at South Killingholme and the Lindsey refinery, owned jointly by Total Oil Marine plc and Fina plc.

FLORIDA GAS TRANSMISSION CO.

(FGT), Houston, plans to buy about 760 miles of steel pipe from five manufacturers for its Phase III expansion project (OGJ, Jan. 18, p. 29). By signing letters of intent with the manufacturers, FGT reserves mill space for fabrication later this year. Purchase of the pipe hinges on FGT's receipt of final approval from the Federal Energy Regulatory Commission to construct the project. The expansion is to be in service by yearend 1994.

ARCH PETROLEUM INC.,

Fort Worth, acquired a 50% interest in Onyx Gathering Co. LC, a company formed to own and operate pipelines in Nueces, Hidalgo, and San Patricio counties, South Texas. Arch agreed to lend Onyx $2.9 million to finance purchase of two pipelines and pipeline construction. Onyx agreed to connect three electrical power plants to various sources of natural gas by laying 13 miles of 8-12 in. pipeline. It will supply part of the baseload fuel for the plants.

NUEVO ENERGY

purchased 80% of the stock of Bright Star Gathering Inc. from Lasmo Inc. for $6.32 million. The deal gives Nuevo a 72% interest in the 150 mile gas gathering system serving the Alabama Ferry field area of Leon County, Tex. A Nuevo unit holds an 18% interest and Continental Natural Gas Co., Tulsa, the remaining 10%. The system, laid in 1985, gathers about 13 MMcfd of casinghead gas from 152 wells.

FUTURES

INTERNATIONAL PETROLEUM EXCHANGE'S

Jan. 27 price of Brent crude for March delivery was incorrectly reported as $17.03/bbl (OGJ, Feb. 1, Newsletter). The correct price is $18.03/bbl.

PETROCHEMICALS

HAN YANG CHEMICAL CORP.

started up a 350,000 ton/year ethylene plant at Yeochun, Korea. The plant is the first in the world to use the Advanced Recovery System (ARS) developed by Stone & Webster Inc. and Mobil Chemical Co. ARS technology uses a dephlegmator to reduce recovery section energy consumption by about 10% compared with conventional plants.