INDUSTRY BRIEFS

PETROCHEMICALS

A GROUP led by Valero Energy Corp., San Antonio, signed two 15 year contracts with Petroleos Mexicanos related to the $350 million, 13,000 b/d methyl tertiary butyl ether (MTBE) plant the group plans to build for Pemex (OGJ, Sept. 14, 1992, p. 30). Productos Ecologicos SA de CV, a venture of Valero and three Mexican firms, signed contracts with Pemex units for purchase of the plant's 13,000 b/d of normal butane feedstock and sale of MTBE. Start-up is scheduled for second half 1995.

LNG

INDONESIA'S STATE OWNED PERTAMINA plans to spend $580 million for a seventh train at its Bontang liquefied natural gas complex in East Kalimantan. Pertamina reportedly let contract for construction of the plant to Indonesia's PT Inti Karya Persada Teknik, currently building the six train at Bontang. Pertamina wants to assure Japanese LNG buyers of its willingness to extend a contract to supply 2.3 million tons/year of LNG, which expires in 1999, without waiting to determine feasibility of the proposed Natuna LNG project.

GAS STORAGE

STEUBEN GAS STORAGE CO., a joint venture of Arlington Storage Corp., Boston, and units of ANR Storage Co., Detroit, will conduct an open season this month to offer storage services at the proposed Thomas Corners storage complex in Steuben County, N.Y. Upon approval from the Federal Energy Regulatory Commission, Thomas Corners field is to begin storing gas in spring 1995. The $28 million site is to have 5 bcf and 2.7 bcf of working and base gas capacity, respectively, and a 50 MMcfd peak withdrawal rate. Gas receipts and withdrawals are to pass through a Steuben pipeline link with the system of CNG Transmission Co. near Woodhull, N.Y.

PIPELINES

DELHI GAS PIPELINE CORP., Dallas, a USX-Delhi Group company, acquired Lockridge gas gathering system, including 65 miles of 4-24 in. pipeline and related compression in Pecos, Reeves, and Ward counties, West Texas, from Natural Gas Pipeline Co. of America, Lombard, Ill. In a related deal, the companies agreed to connect Delhi's pipeline system in West Texas with NGPL's system, giving Delhi access to gas markets in the U.S. Midwest.

NOVA CORP. OF ALBERTA, Calgary, agreed with Altamont Gas Transmission Co. to work with Altamont to build and own the Canadian segment of a gas pipeline to Opal, Wyo., providing a link to markets in the U.S. West, Midwest, and Mexico. NOVA or an affiliate is to make all regulatory filings and pursue approvals for the project's Canadian portion. NOVA also will cooperate with and support Altamont in future Canadian and U.S. regulatory filings and in determining the project's best construction means.

COMPANIES

STE. NATIONALE ELF AQUITAINE sold Elf Asphalt, St. Louis, to Koch Materials Inc., a unit of Koch Industries Inc., Wichita, as part of its efforts to dispose of nonstrategic assets. Elf Asphalt, which sells asphalt and asphalt emulsions for airport/highway construction and repairs and specialty applications, has 4.5% of the U.S. asphalt market and reported sales of $169 million in 1992.

CAIRN ENERGY PLC, Edinburgh, Scotland, bid to take over fellow independent Teredo Petroleum plc, London. Cairn said the takeover would increase its production to 5.900 b/d of oil equivalent from 4,800 b/d.

A LONDON COURT ruled British Petroleum Co. plc was defrauded by two information brokers who sold inside information to contractors bidding for North Sea development contracts during 1988-90. Josef Szrajber and Paulo Sorelli were sentenced Apr. 26 to 3 years in prison.

SPILLS

NOSAC FOREST, a Norwegian cargo vessel, spilled about 71 bbl of bunker fuel into Blair Waterway at Tacoma, Wash., last month during barge loading operations. More than 8,000 ft of shoreline was soiled, and about 2,000 ft at last report had been cleaned using a high volume, low pressure, water flushing technique.

DRILLING-PRODUCTION

NABORS INDUSTRIES INC. unit Nabors Loffland Drilling Co., Houston, agreed to buy the land rigs and certain other assets of W.R. Grace & Co. unit Grace Drilling Go., Dallas, for about $32 million, Grace Drilling operates 167 U.S. based land rigs, 27 of them diesel electric units. Nabors operates 102 land rigs-40 in the U.S., including 34 diesel electric. Closing is expected during second quarter.

PAKISTAN produced 550.7 bcf of gas in fiscal 199192, according to its petroleum ministry. Baluchistan produced 340.8 bcf of the total volume from Sui, Pirkoh, and Loti gas fields. During the period, 42 wells were drilled in the Pirkoh plains region at an average $1.3 million/well and 11 in the Pirkoh valley area at an average $2 million/well. One was dry and three were plugged because of mechanical problems.

ONEOK EXPLORATION CO., Tulsa, paid about $17.5 million to Shore Oil Co. and Paramount Exploration 1990 limited partnership, both of Houston, for about 14% working interest and production payment rights in North Frisco City field, Monroe County, Ala. Oneok's net revenue interest because of production payments amounts to about 12.5%. North Frisco City field, discovered in March 1991 on a prospect generated by Paramount Petroleum Co. Inc., Houston, produces about 7,000 b/d of oil from six wells.

SHELL CANADA LTD. tested its fourth gas discovery at Burnt River in Northeast British Columbia. The well flowed sour gas at rates as high as 40 MMcfd. Shell said the Monkman Pass play, where the Burnt River concession lies, is estimated to contain 6-7 tcf. Shell has a majority interest in nearly 17% of the acreage.

NORTH SEA OPERATORS helped sponsor a study by AMEC Engineering Ltd., London, of prospects for normally unmanned gas compression platforms in the southern North Sea. Costs of installing a platform to boost pressure to 1,500 psi from 500 psi on a medium size gas field will be established. Operational data from sponsors Shell U.K. Ltd., ARCO British Ltd., and Statoil (U.K.) Ltd. will help calculate life cycle costs for comparison with manned platform costs.

ENSCO DRILLING CO.'S Ensco IX cantilevered drilling barge is on its way to Lake Maracaibo, Venezuela, to work under a 5 year contract with Lagoven, a unit of Petroleos de Venezuela SA. Christened early in April at Texas Drydock Inc. and Brown Center in Orange, Tex., the rig can drill to 15,000 ft in 125 ft of water. Ensco Drilling is a unit of Energy Service Co. Inc., Dallas.

U.S. DEPARTMENT OF ENERGY'S 322X-35R horizontal well in California's Elk Hills field flowed 1,224 b/d of oil, 61 b/d of water, and 557 Mcfd of gas through a 30/64 in. choke from 1,455 ft of net pay at 8,055 9,630 ft. Drilled to a measured depth of 9,752 ft, the well cut a 1,958 ft horizontal section. True vertical depth is 7,355 ft. The well is the seventh successful completion in the field's 4 year horizontal program and the first of three horizontal wells planned for 1993. The first six boosted production 5,000 b/d.

TEXACO LTD. signed a joint planning agreement with BP Exploration Operating Co. Ltd. for the Erskine prospect in U.K. North Sea Block 23/26b. Erskine is a high pressure reservoir with an estimated 80 million bbl of condensate and 400 bcf of sour gas. Production start-up is scheduled for 1998. Operator Texaco holds a 60% interest in the block, BP 40%.

DIAMOND M-ODECO DRILLING INC., Houston. changed its name to Diamond Offshore effective Apr. 29. It is a wholly owned subsidiary of Loews Corp.

REFINING

BP OIL U.K. LTD. let a 966 million ($105 million) contract to AMEC Engineering for front end engineering design of a hydrofiner at its Grangemouth, U.K., refinery. The unit will be used to make low sulfur diesel starting in 1996.

PACIFIC REFINING CO. plans to suspend crude oil processing at its 52,250 b/cd Hercules, Calif., refinery this summer. It cited poor economic conditions and large investments that would be required to produce new fuels required by federal and state laws. Its product distribution terminals, blending, rack marketing, and international operations will continue.

U.K. INVESTMENT in refineries rose to 507 million ($810 million) in 1992, a 20% increase from 1991, according to Marketing Strategies for Industry, Chester, U.K. Gas supply sector spending on process plants in 1992 fell 9% to 107 million ($170 million), but the consultant said outlook for 1993-97 is better.

KUWAIT NATIONAL PETROLEUM CO. (KNPC) postponed recommissioning of its 200,000 b/d Shuaiba refinery, damaged in the 1991 Persian Gulf war. Middle East Economic Survey said work is to begin in September, rather than June as planned, because of late arrival of equipment, KNPC's Mina Abdullah and Mina al-Ahmadi refineries process a combined 412,000 b/d at present, compared with 570,000 b/d before the war, MEES said.

MARKETING

UNOCAL CORP.'S Union Oil Co. of California unit completed sale of its U.S. auto/truckstop system to National Auto/Truckstops for $180 million. The sale includes 140 branded outlets on interstate highways. National Auto/Truckstops is a new company formed by Unocal's independent auto/truckstop operators and institutional investors led by Clipper Group LP, New York. It will continue to focus exclusively on the full service auto/truckstop business and operate under the Unocal 76 trademark.

GAS PROCESSING

TRIDENT NGL INC., The Woodlands, Tex., completed its purchase of Occidental Petroleum Corp.'s interest in Trident for $121.5 million. Purchase funds were raised through the sale of newly issued equity and subordinated notes (OGJ, Mar. 15, p. 34).

ABU DHABI CO. FOR ONSHORE OIL OPERATIONS let a $28 million contract to Baker/MO Services Inc., a unit of Michael Baker Co., Pittsburgh, to design, build, and operate two oil and gas processing plants in Abu Dhabi. The work will serve as a pilot to determine need for further processing plants in Northeast Abu Dhabi. Design work is to begin immediately, with start-up scheduled for early 1994. Thereafter, Baker/MO will provide services under a 3 year operations/maintenance contract.

EXPLORATION

TEXACO EXPLORATION MYANMAR INC.'S 1 East Yetagun discovery well flowed a combined 63 MMcfd and 1,922 b/d of 53.5 gravity condensate from three zones at 6,600-7,000 ft in 333 ft of water on Block M-1 3 off Myanmar. The well, Texaco's third off Myanmar, is about 2 miles southeast of its 1 Yetagun gas discovery (see map, OGJ, Oct. 26, 1992, p. 31). Texaco's second well off Myanmar, 1 Zagawa, was a noncommercial discovery. Interests in Block M-13 and adjoining Blocks M-12 and M-14 are operator Texaco 50%, Premier Petroleum Myanmar Ltd. 30%, and Nippon Oil (Myanmar) Exploration Ltd. 20%.

URENGOILTRACE, a 50-50 venture of Yamalo Ltd., Bermuda, and Urengoyneftegaz Geologia, received an exploration and production license for Yaro-Yakinsk field in western Siberia. Details aren't disclosed. Urengoiltrace's Western Hemisphere partners consolidated their interests in Yamalo, which was formed to help finance Urengoiltrace operations. Yamalo partners include Tracer Petroleum Corp., Vancouver, B.C., and Dundee Bancorp Inc., Toronto, each with 40% interest.

INDIA'S GOVERNMENT approved a contract to explore for oil and gas under its fourth bidding round to a group of Pan Energy Resources, Coplex Resources Inc., Pan Pacific Petroleum NL, and Trans Asia Consultants Pte. Ltd. for Block GK-ON-902 in the Gujarat Kutch onshore basin. It is the fifth block awarded in the fourth round.

LITHUANIA reported discovery of an oil field near the Baltic Sea coast. That brings to 16 the number of fields found near the city of Gargzhdai, of which more than half are commercial. The pay zone is at about 2,000 m, and officials say development will be costly, with drilling time typically 3 months/well. Geologists peg Lithuania's potential oil resource at 365 million bbl, of which only 20% has been discovered.

EXPORTS-IMPORTS

INDIA'S GOVERNMENT approved Indian Oil Corp.'s (IOC) proposed $65 million liquefied petroleum gas import terminal at Kandla, Gujarat. It will allow IOC to import 600,000 metric tons/year of LPG vs. the current 200,000 tons/year through import sites at Bombay and Visakhapatnam. The project is to be complete in 42 months.

IOC signed a contract with Bahrain National Oil Co. to import 19,200 b/d of diesel fuel, an increase of 3,200 b/d from the previous fiscal year, and 44,000 b/d of kerosine in fiscal 1993 94.

COGENERATION

EASTERN GROUP INC., Alexandria, Va., and subsidiaries agreed to develop and supply fuel to the proposed $100 million Hagerstown Light gas fired cogeneration plant in Hagerstown, Md. One Eastern Group subsidiary, Eastern Energy Systems, is to develop and operate the Hagerstown Light plant, while another, Appalachian Gas Sales, is to supply gas under long term contract. Although the size of the complete plant is not settled, an 80,000 kw power unit is believed feasible.

Copyright 1993 Oil & Gas Journal. All Rights Reserved.