Industry Briefs

Correction

Syntroleum Corp. was inadvertently omitted as group leader of a project to develop a $240 million gas-to-liquids plant in Sweetwater County, Wyo. (OGJ, Mar. 2, 1998, p. 60). Enron Capital & Trade Resources Corp. and SLH Corp. are participants in the project. Syntroleum will operate and hold a majority stake in the 8,000 b/d gas-to-liquids plant.

Power

Ingleside Cogeneration LP let a turnkey contract to Duke Energy Corp. and Fluor Daniel Corp. for design and construction of a 440 MW natural gas-fired cogeneration power plant near Ingleside, Tex. Igleside Cogeneration is a joint venture of Occidental Petroleum Corp. unit OxyChem and Conoco Inc. unit Conoco Global Power Inc. Total installed cost of the project is $210 million. The value of the contract was not disclosed. The plant will sell as much as 235 MW of electric power and 1.1 million lb/hr of process steam to OxyChem.

Gas distribution

U.K. gas regulator Office of Gas Supply (Ofgas) now reckons it can open the last of Britain's residential gas market to competition 1 month earlier than planned. Clare Spottiswoode, director general of Ofgas, said 3.1 million homes in Greater London and Surrey will join the competitive market on May 23. So far, only 4.5 million out of a total 19 million households in Britain have a choice of gas supplier, but Ofgas claims 1 million of these have already opted to change their supplier.

Refining

Nigeria National Petroleum Corp. began maintenance of the Port Harcourt refinery fluid catalytic cracking unit last month. The unit was scheduled for maintenance to boost capacity after the Kaduna refinery was shut down. Although the government budgeted for the refinery's maintenance last year, funding was not made available, according to an NNPC official.

Sinclair Oil Corp.
let a turnkey contract to the Foxboro Co., Foxboro, Mass., for a refinery automation system at its 54,000 b/d refinery at Sinclair, Wyo. The system will consist of an I/A Series controller, intelligent instruments integration, configuration engineering, project management, and desktop information technology tools. Advanced process control will be implemented in conjunction with alliance partner Aspen Technology Inc., which is providing its latest dynamic matrix control product.

Shell Oil Products Co.
signed a $1.2 million, multi-year non-cancelable license agreement with Simulation Sciences Inc., Brea, Calif. The deal covers software license and maintenance fees. Under terms of the agreement, Shell will license SimSci's PRO/II software for process design and operational analysis, Hextran for heat transfer simulation and pinch-analysis, Pipephase for fluid flow simulation, and Datacon for data reconciliation and gross error detection.

Pipelines

Shell Deepwater Development Systems Inc. let contract to Ceanic Inc., formerly American Oilfield Divers Inc., to design, build, test, and operate a deepwater pipeline burial system for the Ursa and Angus project pipelines in the Gulf of Mexico. Ceanic said the tracked, remotely operated vehicle (ROV) initially will be used to bury up to 105/8-in. diameter pipelines 1 m below the seabed. The tracked burial work will be performed by a newbuild Ceanic Triton XL ROV system, operated from one of its fleet of dynamically positioned offshore work vessels.

Canada's National Energy Board
will hold hearings May 25 on an application by Alberta Energy Co., Calgary, to build and operate a 71-mile natural gas pipeline in southern Alberta. The $26.2 million (Canadian) line would run from Suffield, Alta., to near Burstall, Sask., where it will connect with the TransCanada PipeLines Ltd. mainline. The 200 MMcfd line is slated for completion Nov. 1.

Sable Offshore Energy Inc.
let a $45 million contract to Shaw & Shaw Ltd., Halifax, N.S., for anti-corrosion and concrete weight coating of subsea interfield flow lines and a main gathering line. The 12-in. and 18-in. interfield flow lines will link the Venture and North Triumph gas fields with a central facility at Thebaud in the gas development project near Sable Island off Nova Scotia. A 26-in. gathering line will transport gas to an onshore processing facility at Goldboro, N.S. A coating plant will be established at Sheet Harbor, N.S.

Gas marketing

Apache Corp. signed a letter of intent to supply 700 bcf of natural gas over 15 years beginning in July 2000 to An Feng Kingstream Steel Ltd. in Western Australia. Gas volumes supplied under the take-or-pay agreement will total 125 MMcfd. The gas will be supplied from one or more of Apache's Carnarvon basin blocks. Apache-operated East Spar, Harriet, Campbell, Sinbad, and Rosette fields now supply more than 100 MMcfd to Western Australia customers. Future developments will include the Wonnich gas field and the recently discovered Reindeer gas field.

Drilling-production

Amerada Hess Ltd. and partners tested the 20/4b-6 well in the U.K. North Sea. The well flowed 41.5 MMcfd of gas and 2,055 b/d of oil. Operator Amerada 40% said the test confirms that a discovery made by Shell Expro, the operating joint venture of Shell U.K. Ltd. and Esso Exploration & Production Ltd., extends into the Amerada group's acreage. The two groups are sharing data from the two wells and from 14/29a-4, a Shell Expro well to the east of its 14/29a-3 discovery. Amerada's partners are Lasmo North Sea plc 17.5%, Talisman Energy (UK) Ltd. and Statoil UK Exploration Ltd. 15% each, and Noble Affiliates Inc. unit Brabant Petroleum Ltd. 12.5%.

Husky Oil Operations Ltd.,
Calgary, will begin delineation drilling in September at its White Rose E-09 discovery on the Grand Banks off Newfoundland. Operator Husky Oil 43.8% said the well is near Hibernia and Terra Nova fields in the Jeanne D'Arc basin. The company will also begin exploration on its Cape Race exploration license by yearend 2000.

BHP Petroleum Pty. Ltd.
returned Griffin Venture production ship to Griffon oil field off Northwest Australia following an engine room explosion and fire on Nov. 19, 1997. BHP said a 3-month investigation revealed the blast was caused by an unprecedented form of microscopic corrosion, which produced cracking in the high-pressure disk in one of five turbines. The vessel will be brought back into production this month.

BP Exploration Operating Co. Ltd.
decommissioned Donan field on U.K. North Sea Block 15/20 and brought subsea equipment to shore for recycling or reuse. Donan yielded 15.3 million bbl of oil during April 1992-December 1997. It was developed with two subsea producers tied back to Seillean production, storage, and offloading ship. Reading & Bates (U.K.) Ltd., Aberdeen, bought Seillean from BP in August 1996 and is currently seeking a new charter. Coflexip Stena Offshore Ltd., Aberdeen, plugged the two producers, cut their casing to below the seabed, and recovered wellheads using its Seawell construction ship.

BHP Petroleum Inc.
signed a letter of intent with Global Marine Inc. to build and lease a $300 million deepwater drilling rig.The contract will generate $186 million in revenues during 30 months for Global. The ultra-deepwater Glomar 456 class dynamically-positioned drillship will be delivered in fourth quarter 1999. After the contract period, BHP will have two 1-year options on the rig. The drillship is rated for 9,000 ft water depths in the Gulf of Mexico. Funds for construction will come from internal sources and existing lines of credit, Global said.

Petroleos Mexicanos
chartered Safe Lancia accommodation semisubmersible from the Cotemar/Prosafe AS alliance, Stavanger. The flotel was hired under a 2-year bareboat charter for 200 million kroner ($28 million). Prosafe said Pemex will use Safe Lancia during development of Cantarell field in the Bay of Campeche.

Companies

Oneok Inc., Tulsa, agreed to buy Occidental Petroleum Corp.'s natural gas properties in Oklahoma and Kansas, excluding Hugoton field, for $135 million. The sale includes properties with net production of 30 MMcfd of gas and 400 b/d of oil and a gas sweetening plant in Oklahoma. About two thirds of the wells and production are in Oklahoma. The sale is part of Occidental's divestment of nonstrategic assets to partially fund its acquisition of Elk Hills field from the U.S. government and to repurchase as many as 40 million shares of its common stock.

Devon Energy Corp.,
Oklahoma City, made a tender offer for Burlington Resources Coal Seam Gas Royalty Trust. Devon's offer is $8.75/share in cash. The offer will be conducted by a newly formed subsidiary, Devon Acquisition Corp. If all of the trust's units are tendered, the transaction will be valued at $78 million. Devon anticipates using its cash on hand and committed credit lines to fund the transaction. The offer expires Mar. 13 unless extended.

Phillips Petroleum Co. (U.K.) Ltd.
let a $25 million contract to Stolt Comex Seaway M.S. Ltd., Aberdeen, for work in the subsea development of Renee and Rubie fields in the central U.K. North Sea. The two fields will be tied back to a production semisubmersible in Ivanhoe/Rob Roy fields 21 km away (OGJ, Feb. 16, 1998, p. 28). The contractor will perform design, detailed engineering, and installation of 96 km of rigid pipelines and 28 km of well control umbilicals. Installation is expected to begin in April and be completed by November.

Petrochemicals

Saudi Arabia's Eastern Petrochemical Co., a joint venture of Saudi Basic Industries Corp. and Japan's Mitsubishi Corp., let contract to Chiyoda Corp. for design, procurement, construction, and pre-commissioning of a world-scale ethylene glycol plant at Al-Jubail. The new plant will be the site's third and is slated for mechanical completion in August 2000. It will increase ethylene glycol production capacity at the site to 1.3 million metric tons/year.

Hungary's
MOL Rt. and TVK Rt., respectively, the state petroleum and petrochemicals firms, signed a letter of intent to cooperate in using their propylene output. The companies will study the feasibility of forming a 50/50 manufacturing and trading joint venture. The JV is envisioned to build a 140,000 metric ton/year polypropylene plant at TVK's Tiszanjvaros complex. The plant is expected to cost 23 billion florints ($110 million) and to be operational by yearend 1999.

Shell Italia SpA
sold its 50% interest in Camattini SpA, Parma, Italy, to Altana AG, Bad Homburg, Germany, for an undisclosed sum. Camattini is a formulator of thermosetting resins-mainly epoxies and polyurethanes-for use in electrical components, tooling, and prototyping. The move is part of Royal Dutch/ Shell's shake-up of its worldwide petrochemicals portfolio.

Exploration

Rutherford-Moran Oil Corp.'s Benchamas No. 19 new-pool wildcat in the Gulf of Thailand's Benchamas field cut 238 ft of net oil and gas pay at 9,234 ft TVD in a large graben system. The well is in the north-central portion of Block B8/32. The company also said Benchamas No. 18, a delineation well downdip of Benchamas Nos. 14 and 1 wells, reached 9,225 ft TD and cut 84 ft of net hydrocarbon-bearing sands. Benchamas No. 20, also a delineation well and a downdip of Benchamas Nos. 3 and 10 wells, cut 71 ft of net hydrocarbon-bearing sands at 9,234 ft TD.

BP Exploration Operating Co.
and its Petroleum Prospecting License 138 joint venture partners reported the step-out Moran 4x well in the southern Highlands of Papua New Guinea flowed on test at a combined rate of 4,433 b/d of 40° gravity oil from two intervals. The well lies 3.4 km northwest of Moran 1x well, drilled by Chevron Niugini Ltd. The partnership comprises Esso Highlands 47.5%, operator BP 45%, and Oil Search Ltd. 7.5%.

Bow Valley Energy Ltd.,
Calgary, was awarded blocks SY59, SY69, and SY79 in the Wessex basin, Dorset County, England, near Wytch Farm, Europe's largest onshore field. Operator Bow Valley 45%, with partners Sterling Resources Ltd. 45% and Egdon Resources (U.K.) Ltd. 10%, plan seismic by yearend and drilling in 1999.

Petrolera Argentina San Jorge's
Peruvian unit was awarded a 100% interest in a 2.5 million acre block in Peru's Maranon basin. The contract requires San Jorge to reprocess 1,500 km of existing seismic, acquire 300 km of additional 2D seismic, and drill five exploration wells.

Apache Corp.
agreed to become Salt Lake City-based FX Energy Inc.'s 50% partner in a 1.5 million acre concession in the western Carpathian region of southern Poland (see map, OGJ, May 5, 1997, p. 132). Apache will fund three exploration wells and acquire 350 km of 2D seismic during the first 3 years. FX and Apache are also partners in the Lublin concession in southeastern Poland, where Apache has acquired 1,200 km of 2D seismic and plans to begin drilling two wells before this summer. Polish Oil & Gas Co. has an option to participate in exploration of the Lublin concession.

Elf Aquitaine
was awarded a deepwater block southwest of Bioko Island, Equatorial Guinea. Water depths on the block are 1,000-2,700 m (OGJ, May 12, 1997, p. 19).

Gas processing

Novagas Canada Ltd. (NCL) agreed to purchase a 43.3% working interest in the Younger natural gas liquids extraction plant at Taylor, B.C., from Taylor Gas Liquids Fund and PanCanadian Petroleum Ltd. for $30 million. NCL also will pay an equivalent share to expand the plant's processing capability to 750 MMcfd from 400 MMcfd. NCL will halt plans to build a $50 million, 350 MMcfd natural gas liquids extraction plant at Taylor. NCL, PanCanadian, and Solex Gas Liquids Ltd. will become members of the Younger plant's operating committee. The plant's expansion project will make it the largest liquids extraction facility in British Columbia, claimed NCL.

Copyright 1998 Oil & Gas Journal. All Rights Reserved.