Industry Briefs
Gas gathering
Mitchell Energy & Development Corp., The Woodlands, Tex., acquired four packages of gas gathering and processing assets for about $31 million. The assets will increase the company's natural gas liquids production by more than 3,000 b/d. Mitchell will acquire Tejas Gas's North Texas gas gathering and processing facilities and, through a 50-50 partnership with Conoco Inc., Western Gas Resources' Perkins/Noel gathering system in West Central Texas. The Western transaction is awaiting U.S. federal antitrust clearance. The other two deals involve acquisition from undisclosed parties' of various interests in gathering assets in Oklahoma and East Central Texas.NGL
Suncor Energy Inc. and Novagas Canada Ltd., both of Calgary, signed a deal for a $164 million (Canadian) natural gas extraction project. The project includes: building a Novagas extraction plant at the Suncor oilsands plant in northern Alberta; shipping NGL to the Edmonton area through a 239-mile Suncor pipeline scheduled for completion this year; and installing a new NGL fractionation tower at a Novagas facility at Redwater, Alta. Subject to regulatory approvals, construction will begin this summer with completion in fall 1999. Novagas said the joint project is the first time NGL recovered from oilsands production will be separated and sold.Terminals
ICA and the Soros Group proposed Pakistan's first single-point mooring (SPM) system oil terminal to the Pakistani government. The proposed terminal will be 10-20 km off Pakistan's coast and will require construction of associated tank farms, pipelines, and infrastructure. The SPM terminal will provide facilities for off loading crude oil from large tankers for transportation through subsea pipelines to shore.MOL Rt.,
Hungary's state oil company, let contract to Foster Wheeler Corp. to build a $250 million, 20,000 b/d resid cracking unit at its refinery near Szazhalombatta, Hungary. Work is scheduled to begin early in 1998 and is due to be completed by 2001.
Pipelines
Canada's National Energy Board scheduled a May 4 public hearing for comments on Souris Pipeline Ltd.'s application to construct and operate a 38-mile carbon dioxide transmission pipeline in southeastern Saskatchewan. The hearing location in Saskatchewan will be determined at a later date. Interventions are due by Feb. 26, 1998. The Bismarck, N.D.-based company's 12.75-in. pipeline will extend from the international boundary 16 miles southwest of Estevan to a terminus 2 miles northeast of Goodwater. The pipeline will transport CO2 from the proposed Dakota Gasification Co. Pipeline Project in North Dakota to Weyburn oil field for a CO2 miscible flood project.TransColorado Gas Transmission Co.,
jointly owned by Questar Corp., Salt Lake City, and KN Energy Inc., Lakewood, Colo., agreed to purchase 260 miles of 22-in. and 20 miles of 24-in. line pipe from Stupp Corp., Baton Rouge, La., to complete its natural gas pipeline project in western Colorado. The $200 million project will begin second phase construction in July. The second phase will provide open access transportation for an incremental 300 MMcfd of capacity. TransColorado extends across nine Colorado counties and one New Mexico county, from the northern terminus near Rangely, Colo., to the Blanco Hub near Aztec, N.M.
Units of Duke Energy Corp.,
Houston, and Williams Cos., Tulsa, will form a joint venture to develop the Cross Bay Pipeline project into New York City. The project will expand Transco's Long Beach, N.Y., facilities, ultimately leading to the completion of a new parallel line. Deliveries into the project can be made from connections to the Transco and Tetco systems in New Jersey and will enter the New York Facilities Group grid at the existing Long Beach delivery point and a new service point in the John F. Kennedy International Airport area. Cost of the project has not been determined.
Westcoast Energy Inc.,
Vancouver, B.C., and Coastal Corp., Houston, increased their joint ownership interest to 28.5% in the Alliance natural gas pipeline project. Gulf Canada Resources Ltd., Calgary, sold its 8% interest in Alliance to Westcoast. Westcoast then sold half of that to Coastal. Westcoast now has 14.5% and Coastal 14% in the $3.7 billion (Canadian) project for a pipeline from British Columbia to Chicago. Westcoast and Coastal will manage their Alliance interest through Engage Energy, a jointly owned company. Gulf said it supports Alliance, wants it built, and has committed gas to the line. Alliance is currently being reviewed by the National Energy Board.
LNG
Petronet India Ltd., a group of four Indian state-owned oil companies, invited commercial bids for the supply of liquefied natural gas from seven companies. Petronet asked Malaysia's Petronas, Shell International, Total SA, Australia's Woodside Petroleum Pty. Ltd., Chevron Corp., Indonesia's Pertamina, and Ras Laffan LNG Co. Ltd./Mobil Natural Gas Inc. to submit their commercial LNG supply bids last month.Drilling-production
Santa Fe International Corp., Dallas, committed $75 million to expand its land rig fleet in Venezuela following the receipt of a letter of intent to provide two rigs and the signing of a contract to provide an additional two rigs. Under the terms of the contract, Santa Fe will provide two 2,000 hp land rigs to begin operations in June 1998. The contracts cover one rig for 2 years and the other for 1 year, each at a day rate of $21,000. The letter of intent is for two 3,000 hp land rigs to begin operations in July and November 1998, each for an initial term of 2 years at a day rate of $27,500.Amerada Hess Corp.
and partners' 5 Garden Banks (GB) 215 appraisal well on the Conger block in the Gulf of Mexico flex trend hit 300 ft of net hydrocarbon-bearing sands 11/2 miles from the 4 GB 215 discovery well, reported partner Oryx Energy Co. Development options include subsea tieback to a host facility or a separate, stand-alone facility. The 5 GB 215 well, drilled in 1,500 ft of water, is being temporarily suspended. The 4 GB 215 encountered about 300 ft of net pay in May 1997. Conger discovery partners are operator Amerada and Shell Offshore Inc. 37.5% each and Oryx 25%.
Petronas Cariga* Vietnam Sdn Bhd.,
a subsidiary of the Malaysian state oil company, signed a 3-year contract with Nortrans Offshore Vietnam Ltd. for the M/t Knock Davie, a 140,000 dwt vessel for conversion to a floating production storage and offloading vessel capable of processing 30,000 b/d of condensate. The FPSO will process oil from Petronas's Ruby gas/condensate field off Viet Nam. The contract starts in November with two 1-year extension options.
Ensco International Inc.
let a $130 million contract to Keppel Fels Shipyard to build a new international class harsh-environment jack up. The rig, an enhanced Kfels Mod V, has a delivery date of January 2000. Financing of the rig's construction will be from Ensco general corporate funds, including proceeds from the company's recent $300 million public debt offering. Ensco has an option with Keppel Fels to build an identical jack up for the same price.
A consortium of companies
will drill the Hebron D-94 appraisal well this summer in Hebron oil field on the Grand Banks off Newfoundland. The group consists of Mobil Oil Canada Ltd., Chevron Canada Resources Ltd., Petro-Canada, and Norsk Hydro AS. The Hebron-Ben Nevis complex was discovered in 1981 by Mobil and is 19 miles south of Hibernia oil field. The delineation well will be drilled to 7,218 ft TD. It is 1.9 miles northeast of the Hebron I-13 discovery well. The group let a 1-year drilling contract, to begin in July with options to extend for 5 years, to the Canadian unit of Global Marine Inc. for Glomar's Vinlander semisubmersible.
U.S. Federal Energy Regulatory Commission
declined to reconsider an order requiring Kansas gas producers to refund $500 million to pipelines (OGJ, Sept. 22, 1997, p. 33). FERC said the producers charged rates that illegally included the state's local property tax.
Amoco Production Co.
and Spirit Energy 76, Unocal Corp.'s U.S. exploration and production business unit headquartered in Sugar Land, Tex., formed a joint venture to explore and develop 22,000 acres located in the Cotton Valley reef trend of East Texas. The area of interest lies south of Bear Grass field in Leon County and is contiguous to recent Cotton Valley discoveries. Amoco shot 110 sq miles of 3D seismic over the area, and identified multiple reef prospects and leads. Operator Amoco 62.5% and Spirit Energy 37.5% plan to drill at least four wells in 1998, two of which are currently drilling.
Esso Exploration Inc.,
an affiliate of Exxon Corp., let a 3-year contract to Marine Drilling Co. Inc., Houston, for its Marine 700 drilling rig, which will generate revenues of about $207 million. The company said final construction of the Marine 700, a deepwater semisubmersible, will be at HAM Shipyard at Pascagoula, Miss. The unit will be initially equipped to work in water depths up to 5,000 ft, upgradeable to 7,500 ft. Marine 700 will be available to Exxon affiliates for work outside the North Sea. The contract starts in first quarter 1999.
Santa Fe Energy Resources Inc.,
Houston, said Mudi field on Tuban Block in Java is producing 3,000 b/d and could reach 20,000 b/d by the end of the first quarter. The joint operating partners are Pertamina 50% and Santa Fe Resources, Total, Risjad Salim Resources Petroleum (Tuban) Ltd., and Enserch Far East Ltd. 12.5% each. Meanwhile, the Mudi 9, a delineation well on the northern side of the Mudi structure, flowed 1,700 b/d through a 28/64-in. choke with flowing tubing pressure of 367 psi. Additional wells in the field, as well as exploration wells on two adjacent structures, are planned this year.
Sable Offshore Energy Project
let a $167 million contract to Fabco/CKT Joint Venture, Dartmouth, N.S., to build accommodation modules for the Thebaud and Venture production platforms, slated for installation in the Sable Island gas fields off Nova Scotia. The contract covers final design, engineering, procurement, fabrication, testing, and commissioning of the modules. The platforms will be designed to handle more than 3 tcf of natural gas.
Safety
U.K. Health and Safety Executive (HSE), London, published a report, Safety and the Year 2000, on the occurrence of safety issues due to computer problems when dates change from 1999 to 2000 (OGJ, Mar. 11, 1996, p. 39). David Eves, HSE deputy director general said, "The risk of safety-related control systems failing at or around the century date change needs to be taken very seriously. The practical, solution-based approach described in this report will provide businesses with an effective, structured way of readying themselves for the millennium, using a risk-based strategy."Refining
The Ukrainian State Property Fund will offer 40% of the stock in oil refinery Lisichansky Naftobererobny Zavod before Apr. 30 and will sell another 5% before July 30. The government will keep a 26% stake in the 320,000 b/d eastern Ukraine refinery.Ampol Refineries (NSW) Pty. Ltd.
let a $7.8 million contract to Kvaerner AS, Oslo, for engineering and procurement for a revamp of the No. 1 crude distillation unit at its Kurnell refinery in Sydney. Work will include modifications to the atmospheric crude and vacuum pre-heat trains, atmospheric and vacuum columns, and naphtha stabilizer. New equipment will be installed during a short turnaround early in 1999.
Nissho Iwai Corp. and JGC Corp.,
both of Japan, plan to build a 33 billion yen refinery in Galychyna, Ukraine, to make high-octane unleaded gasoline. The plant, scheduled to come on stream in 2002, would be Ukraine's first refinery capable of producing unleaded gasoline.
Exploration
Gulf Indonesia Resources Ltd. and partners made another natural gas discovery in the South Jambi B Production Sharing Contract (PSC) area of South Sumatra. Testing of the 1 Bungin exploratory well in the southern part of the PSC yielded a combined flow rate of 34 MMcfd of gas from three zones at 2,925-40 m, 2,555-76 m, and 2,181-88 m. Operator Gulf Indonesia 45% said the well is 14 km west of the 1 Rayun natural gas discovery found in December and 13 km north of the 1996 Bungkal discovery. Other partners in the block are Total 30% and Pertamina 25%.Gulf Canada Resources Ltd.'s
1 Tasour exploration well on Block 32 in Yemen's Sayun basin flowed at a rate of 3,250 b/d of 29° gravity oil on a submersible pump from an 11 m interval, with a maximum pump capacity rate of 4,877 b/d. Drilled to 8,500 ft TD, the discovery is 10 km north of the Masila fields that produce more than 180,000 b/d. Pending government approval, interests in the block's production-sharing agreement are: operator Gulf Canada 32.26%, Norsk Hydro Yemen AB 31%; Ansan Wikfs Hadramaut Ltd., a private Yemeni company, 16%; Dutch company Oranje-Nassau Yemen BV 12.74%; and Canada's TransGlobe Energy Corp. 8%.
Companies
Petroleos de Venezuela SA (Pdvsa) let a 3-year, $165 million contract to GeoQuest to manage Pdvsa's exploration and production integrated applications and data environment. Technical data from Pdvsa's E&P divisions will be consolidated in a corporate database. GeoQuest, a unit of Schlumberger Ltd., will deliver specialized services to Pdvsa's E&P division. Geoquest said that by integrating technology and specialized services, Pdvsa takes a step toward its goal of increasing production capacity to more than 6 million b/d by 2006.Power
Westcoast Energy Inc. and Columbia Energy Group, Reston, Va., agreed to form a 50-50 joint venture to develop three natural gas-fired electricity generating plants in northeastern North America. The plants will have total generating capacity of 1,000 MW.Copyright 1997 Oil & Gas Journal. All Rights Reserved.