INDUSTRY BRIEFS

PETROCHEMICALS

FOUR WORKERS WERE KILLED and three others severely injured when an explosion ripped through a China General Plastics Corp. polyvinyl chloride plant in Miaoli, Central Taiwan, July 13. Cause was still under investigation at presstime, but police said initial evidence suggests gases ignited when sparks fell into a PVC tank workers were repairing.

DRILLING-PRODUCTION

SUDAN'S government initially approved State Petroleum Corp.'s plan to develop oil concessions on a combined total of 60 million acres with an estimated 280 million bbl of proved reserves. The plan calls for Phase 1 production of 40,000 b/d by mid-1995, with test production to begin in January 1994. Ultimate target is 300,000 b/d by 1998-99. State Petroleum and Arakis Energy Corp., Vancouver, B.C., are joint venture partners in a production sharing agreement.

TECO COALBED METHANE INC., a unit of TECO Energy Inc., Tampa, agreed to buy all of Transco Energy Co. unit Magnolia Methane Corp.'s coalbed methane gas properties in Alabama's Black Warrior basin. Sale is for $15.5 million cash plus production payments based on percentages of net gas production. Magnolia owns interests in 500 wells in the basin, 160 of which produce a combined 12-13 MMcfd. The wells are adjacent to TECO leases.

BP EXPLORATION OPERATING CO. LTD. let two 3 year contracts to support a 16 well infill drilling program in North Sea Forties field. Baker Hughes Ltd., London, won a 12 million ($18 million) contract for well construction work. A 22 million ($33 million) well management contract went to CDP, an alliance of Camco Ltd. of Newtown Abbey, Northern Ireland, and Services Dowell Schlumberger SA and Progenetive Services Ltd. of Aberdeen.

OAKRIDGE ENERGY INC., Wichita Falls, Tex., agreed to sell its producing gas leases in Edwards and Sutton counties, Tex., for $21.5 million cash to Cometra Oil & Gas Inc., a unit of American Cometra Inc., Fort Worth. Sale is subject to Oakridge stockholder approval.

AMERICAN EXPLORATION CO., Houston, sold its remaining interests in Alberta to two companies. Production from the acreage is about 8.5 MMcfd of gas net to American. Its Canadian Foothills leases were bought by Equitable Resources Inc., Pittsburgh, for $18 million (U.S.), with American retaining a 4% overriding royalty. It sold other unspecified leases to Canadian Conquest Exploration Inc., Calgary, for about $900,000.

CO-ENERCO RESOURCES LTD., Calgary, increased its 1993 capital budget, exclusive of acquisitions, to $66 million (Canadian) from $50 million. Most of the spending, to occur in late fall, is expected to increase 1994 production and provide drilling opportunities for oil and gas. The added funds will be used to expand the company's drilling program, upgrade facilities, and acquire and evaluate undeveloped acreage.

PETRO-CANADA, Calgary, increased its interest in Terra Nova oil field to 49% from an unspecified level through an exchange of leases with Shell Canada Ltd., also of Calgary. Petro-Canada acquired Shell's 5.3% interest in Terra Nova, along with interests in other minor Grand Banks leases, in exchange for parts of Petro-Canada's interests in six gas fields in the Sable subbasin on the Scotian Shelf, about 250 km east of Halifax, N.S. Terra Nova field is 350 km southeast of St. John's, Newf.

WORLD BANK GROUP'S International Finance Corp. will lend $10 million to Russia's Vasyugan Services Enterprises and invest $1.5 million to finance a plan to increase oil and gas production in western Siberia's Tomsk region. Estimated cost of the project is $37 million. Vasyugan Services is a venture of Canadian Fracmaster Ltd., Calgary, and Russian organizations Tomskneft Production Amalgamation and Vasyugan Production Agency.

NORTH COAST ENERGY INC. (NCE), Cleveland, signed a memorandum of understanding with Pakistan's Oil & Gas Development Corp. (OGDC) for an enhanced recovery project in OGDC's Toot oil field. Toot, discovered in 1988, has produced 11.2 million bbl of an original reserves estimate of 15.8 million bbl. NCE will conduct a study and develop an EOR proposal within 18 months under a joint venture with OGDC. NCE will bear project costs and share incremental production 50-50 with OGDC.

KCS ENERGY INC., Houston, completed its acquisition of varying working interests in 80 producing oil and gas wells in the Texas Gulf Coast region from a group headed by Neil Hanson. Most of the wells are operated by Hanson Minerals Co., Houston. The acquisition adds an estimated 8.7 bcf of gas and 400,000 bbl of oil and condensate to KCS Energy's reserves. The purchase was for cash and KCS Energy common stock.

COMPANIES

KELT GROUP agreed to acquire Ste. Nationale Elf Aquitaine's Colombian subsidiary. Terms aren't disclosed, and the agreement is subject to regulatory approvals. Elf, which began exploration in Colombia in 1971, holds six blocks totaling 1,700 sq km in the Llanos basin. Discovered fields include Trinidad, La Gloria, La Gloria Norte, Tocaria, Cano Garza Los Toros, Sardina, Guasar, and La Flora. Production started in 1983, and development is in final stages. A trans-Andean pipeline transports crude from the fields to link at Vasconia with the Central Colombian trunk line to the Covenas export terminal. Production in 1992 averaged about 30,800 b/d, with about 10,000 b/d net to Elf.

FMC CORP., Chicago, completed its acquisition of Sofec Inc., Houston, an engineering/construction company. Sofec designs, fabricates, and installs offshore tanker mooring systems for export-import terminals and for floating storage and production facilities for offshore oil and gas. Sofec will operate as a subsidiary of FMC's energy and transportation equipment group, Houston. Sale terms aren't disclosed.

CHERNOGORNEFTE, an employee owned oil production enterprise in Russia, received its first funds July 11 in a $40 million oil field equipment credit. Money disbursed from U.S. currency capitalized TokoBank and marketing agent Moscow Naptha will be used to buy equipment and services to restore production for more than 300 idle wells in western Siberia's Samotlor field. The lending deal is the first major private sector financing of a Russian employee owned production unit by a private Russian institution. Chernogornefte expects to produce more than 51 million bbl of oil during 1993. Financing was handled by Sovlink-American Corp., New York.

PARKER & PARSLEY PETROLEUM CO. unit Parker & Parsley Acquisition Co., Midland, Tex., completed its tender offer for the last two of 35 Prudential-Bache Energy LPs (OGJ, July 12, p. 36). Its tender offer of $8.4 million is for Prudential-Bache Pension and International Investor LPs PI-1 and PI-2. Payment is to be made soon.

SETPOINT INC., Houston, acquired Ipcos BV, a supplier of advanced process control technology in Europe. Renamed Setpoint Ipcos BV, the Eindhoven, Netherlands, company specializes in high performance multivariable identification and control technologies.

HUNGARIAN state holding company AV Rt named M.M. Lazard Freres VC of France privatization adviser to state owned MOL Oil & Gas Co. The French firm is to set the date, conditions, and sales method for a minority stake in MOL. Hungary will retain majority ownership.

GAS STORAGE

YOUNG GAS STORAGE CO. LTD. LP asked the U.S. Federal Energy Regulatory Commission for a permit to build and operate a natural gas storage field in Morgan County, Colo. Young storage field will have 5.3 bcf capacity and a delivery rate of 200 MMcfd for Colorado markets. Storage is scheduled to be available Mar. 1, 1995. General partners are two affiliates of Coastal Corp. unit Colorado Interstate Gas Co. Colorado Springs, Colo., is a limited partner. Colorado Springs and Public Service Co. of Colorado signed letters of intent for all the storage field's capacity. However, a 30 day open season will be conducted to determine other interest for firm storage service.

PIPELINES

TRANSCANADA PIPELINES LTD., Calgary, filed its 1994 toll application with the NEB, requesting marginally lower tolls to be effective Jan. 1. The application seeks a 4.9% increase, or $1.608 billion (Canadian), in revenue requirements for 1994, compared with $1.534 billion in 1993. System throughput is forecast to increase, and the application requests an eastern zone toll of 82.56cts (Canadian)/Mcf, down from 82.7cts/Mcf in 1993. The application also seeks a rate of return on common equity of 12.75% on a common equity ratio of 30%.

SUNSHINE INTERSTATE PIPELINE PARTNERS is holding an open season until Aug. 10 for its proposed 330 MMcfd, 600 mile pipeline. The line will ship gas to Florida's electrical power generation plants, utilities, and commercial and industrial customers upon targeted first phase completion in late 1995. Service is available from receipt points in Mississippi and Alabama with redelivery at any point between Pascagoula, Miss., and the link with SunShine Pipeline Co.'s intrastate system in Okaloosa County, Fla.

REFINING

HONAM OIL REFINERY LTD., Seoul, let contract to Setpoint for implementation of advanced process control (APC) on the No. 1 crude distillation unit at its Yocheon, South Korea, refinery. Setpoint has completed APC projects on crude units Nos. 2 and 3 at the refinery. Honam will complete functional design, while Setpoint will provide detailed design and consulting services.

TERMINALS

COLUMBIA GAS SYSTEM INC., Wilmington, De]., will proceed with new peaking, terminating, and transportation services at its mothballed LNG receiving terminal at Cove Point, Md., on the Chesapeake Bay. Adequate bids from prospective customers during a second open season prompted the decision. The company targets early 1995 for the new services and hopes this month to file the required amendments to its application currently before FERC.

ALTERNATE FUELS

COSTA RICA started commercial operation of the third and final plant in its Arenal hydroelectric complex. The $66 million Sandillal facility, located on the Santa Rosa River in Guanacaste province, was financed by InterAmerican Development Bank and has installed capacity of 32,000 kw. It joins the 157,000 kw Arenal plant and the 174,000 kw Corobisi plant.

EXPLORATION

DUPONT E&P NIGERIA LTD. and Nigerian National Petroleum Corp. signed a production sharing contract for Oil Prospecting License 220 in the Southeast Niger Delta deepwater area. The block covers 2,421 sq km in 150-1,100 m of water. Contract terms call for DuPont to commit $54 million to a work program during the first 6 years of the license. A detailed seismic program is to begin later this year.

NIGERIA awarded five exploration licenses to Shell Petroleum Development Co. (SPDC) covering deepwater Blocks 212 and 219 and three onshore blocks in the Benue basin. The offshore acreage lies in water depths ranging from 200 m to more than 1,500 m. SPDC created a new company, Shell Nigeria Exploration & Production Co. Ltd., to conduct exploration and production operations on the offshore blocks, where it plans extensive 3D seismic surveys.

ENERGY DEVELOPMENT CORP., Houston, 1 OCS-G-10878 off Louisiana in the Gulf of Mexico cut four potential pay zones. The lowest zone in the 16,436 ft well flowed 2.25 MMcfd of gas and 1,171 b/d of oil through an 8/64 in. choke with 7,700 psi flowing tubing pressure from 30 ft of perforations. The discovery lies 7 miles offshore on West Delta Block 57. EDC is 100% owner of the well.

COURTS

A U.S. FEDERAL GRAND JURY in Hauppauge, N.Y., indicted eight men on charges of tax evasion and conspiring to evade $85 million in federal gasoline excise taxes. The indictment alleged that between the start of 1983 and mid-1988 the defendants conspired to evade tax owed on 946 million gal of gasoline. The tax was owed by New York Fuel Terminal Corp., which did business in Brooklyn and New Jersey. The Justice Department said the case is the largest federal excise tax evasion case ever brought. It estimates as much as $1 billion/year in gasoline excise taxes is evaded.

EXPORTS-IMPORTS

RUSSIAN oil exports by joint venture companies are returning to normal this month following Transneft crude oil pipeline company's temporary suspension of crude movement by most Russian JVs. In June, under some government agencies' rulings, Transneft suspended export shipments by most Russian JVs. The JVs threatened to sue the agencies for damages and appeal to the governments of the JVs' foreign partners for support. Transneft's July pipeline operation schedule reportedly contains all 28 JVs that have submitted export applications.

CNG

AMERICAN GAS ASSOCIATION reported 701 compressed natural gas vehicle refueling stations are in operation and 29 are planned in the U.S. It said they are being added at the rate of four/week. AGA publishes a directory of the stations in 44 states and the District of Columbia. Gas utilities operate most of them, and nearly 400 are available for public use.