INDUSTRY BRIEFS

Gas processing

A Total-led consortium will build a plant to extract liquids from natural gas produced from Canadon Alfa and Ara fields off Tierra del Fuego, Argentina. The $70 million plant, slated to start up in 1999, will have capacity to produce 250,000 metric tons/year of LPG and 60,000 tons/year of natural gasoline. LPG will be exported through a pipeline owned by Chilean state firm Empresa Nacional del Petroleo (ENAP) to a separation plant at Cabo Negro, Chile. The natural gasoline will be blended with crude from the Total-operated Hidra field off Argentina.

Abu Dhabi National Oil Co.
(Adnoc) let a $1.3 billion contract to France's Technip and U.S.-based Bechtel Corp. for a gas gathering and processing system in Abu Dhabi. The project will double the capacity of Adnoc's existing system to 20 billion cu m/year. The contract includes gas processing units, condensate production facilities, and sulfur recovery units. The system will process 1 bcfd from Thammama C and D gas fields at Habshan. The project is scheduled for completion in 2001.

Petrochemicals

Adnoc and Borealis AS, Copenhagen, signed a final agreement to establish a joint venture to produce and market polyethylene. The venture will build a 600,000 metric ton/year ethane cracker and two 225,000 ton/year polyethylene plants at Ruwais, Abu Dhabi. The polyethylene plants will use Borealis' Borstar technology to produce high-density and low-density linear polyethylene. The new venture will be owned 60% by Adnoc and 40% by Borealis. A separate marketing joint venture will be set up in Singapore.

Hoechst AG,
Frankfurt, is selling Trevira, its worldwide polyester business, to a combine of KOSA Ltd.-a unit of Koch Industries Inc., Wichita-and Grupo Xtra, Mexico City. The combine claims the new company will be one of the world's largest polyester producers. Regional headquarters will remain in Charlotte, N.C.; Toluca, Mexico; and Frankfurt. The group is negotiating for the purchase of Hoechst's Canadian polyester business from Celanese Canada, of which Hoechst owns 56%. Hoechst will retain its current polyester holdings in South Africa.

Saudi European Petrochemical Co.
(Ibn Zahr) signed a letter of intent to build a second polypropylene plant at Al-Jubail, Saudi Arabia. The 320,000 metric ton/year unit is due on stream in second quarter 2000. The firm is currently debottlenecking its existing 320,000 ton/year Al-Jubail plant. Ibn Zahr is composed of Saudi Basic Industries Corp. 70%, Finland's Neste Oy 10%, Italy's Ecofuel 10%, and Arab Petroleum Investment Corp. 10%. The new plant will use Union Carbide Corp.'s Unipol technology; propylene feedstock will come from a nearby Sabic subsidiary.

Refining

Phillips Petroleum Co will retrofit the HF alkylation unit at its Woods Cross, Utah, refinery to incorporate the reduced volatility alkylation process, developed by Phillips and Mobil Corp. The technology cuts airborne HF emissions by 60-90% in the event of an accidental release.

Lubes

Petrofina SA entered India's lubricant market through its subsidiary Fina India Petroleum Pvt. Ltd. Fina India will market the entire range of Fina products, including automotive and industrial oils, greases, marine oils, specialty products, and biodegradable lubricants. The company also has partnered with Lucas Indian Service Ltd., a leading auto accessory manufacturer and distributor based in Chennai, Madras, to ensure availability of its lubricants throughout the country.

Drilling-production

BP Exploration Operating Co. Ltd. completed installation of topsides for Eastern Trough Area Project (ETAP) platforms in the U.K. North Sea. The $2.6 billion ETAP development involves seven fields with combined reserves of 400 million bbl of oil and 1.1 tcf of gas (OGJ, Jan. 22, 1996, p. 21). A two-platform central processing facility was placed in Marnock field and a normally unmanned platform was placed in Mungo field. The other fields-Machar, Monan, Heron, Skua, and Egret-will produce through subsea manifolds tied back to the central processing unit. First production is expected in the summer.

Union Texas Venezuela Ltd.
a unit of Union Texas Petroleum Holdings Inc., reported that its Alturitas-52 development well on the Desarrollo Zulia Occidental (DZO) unit in western Venezuela increased production from the unit by 15%, to 26,540 b/d of oil. Union Texas holds a 100% interest in the operating service contract (OSC) for DZO. On test, the well flowed 3,810 b/d of 21° gravity oil on an electric submersible pump from Marcelina formation at 10,852-11,092 ft. Union Texas plans seven more development wells and one horizontal reentry well on the DZO unit this year.

British Petroleum Co. plc
agreed to sell its upstream interests in Papua New Guinea to local firm Oil Search Ltd. for $400 million. Oil Search will gain interests in four onshore license areas, including net production of 13,000 b/d from Kutubu and Moran oil fields, and 15 MMcfd of gas production from Hides gas field. BP's share of oil reserves in the areas is 35 million bbl. Its share of gas reserves, largely undeveloped, is about 3 tcf. Oil Search will take: a 45% stake in License PPL138; 45% of PDL1; 95% of the Hides gas project; 19.375% of PDL2, in which BP's share of production is 11,000 b/d; and 19.375% in PL2, which contains the Kutubu oil export pipeline.

Santos Ltd
reported first oil from Southeast Gobe field in Papua New Guinea, about 80 km southeast of Kutubu oil field. Flow is expected to reach 10,000 b/d this month and a maximum rate of 25,000 b/d in July. The field is being developed by Chevron Niugini Pty. Ltd. under a unitization agreement in conjunction with nearby Gobe field, which came on stream in early March. Southeast Gobe straddles two licenses: PDL3 and PDL4. The field has proved and probable reserves of 62.4 million bbl.

Oceaneering International Inc.,
Houston, completed a major offshore heavy lift program aboard the floating production, storage, and offloading (FPSO) vessel Zafiro Producer. The heavy lifts were performed while the FPSO was operating off Equatorial Guinea as part of Phase 2 development of Zafiro field for Mobil Equatorial Guinea Inc. Oceaneering managed fabrication and offshore installation of 10 modules with a total weight of 3,000 tons. The installation lifts were completed during the last week of February. Five main lifts, with weights of 300-830 tons, set modules for seawater treatment, water injection, turbine generation, and turbine fuel gas compression, plus living quarters.

Petroleos Mexicanos
let a day rate contract to Stolt Comex Seaway SA, Aberdeen, and Protexa SA, Monterrey, Mexico, for inspection, repair, and maintenance of facilities in the Bay of Campeche. Work has begun and is scheduled for completion in December 1999. Stolt will provide the Seaway Hawk construction barge and marine crew; Protexa will supply diving and inspection crews.

Pipelines

A group led by Santos Ltd. commissioned a gas pipeline from the Cooper basin fields to Mount Isa, in northwestern Queensland. The gas is being sold to MIM Holdings under a 15-year, 14.25 bcf/year contract. MIM will use the gas to generate electricity at the Mica Creek power station. Santos and partners will spend $200 million (Australian) to upgrade the Ballera gas plant and perform field development work in the area. The group is composed of: Santos 60.0625%, Dolhi Petroleum (Esso) 23.2%, Boral Energy Resources 16.5%, and Oil Co. of Australia 0.2375%.

Broken Hill Petroleum Pty. Ltd
sold its Karratha-to-Port Hedland natural gas pipeline in Northwest Western Australia to Epic Energy for $129 million (Australian). The sale of the 215-km line includes a 24-km extension to be constructed by Epic from the North West Shelf joint venture facilities on Burrup Peninsula to the main pipeline inlet.

Norsk Hydro AS
let a $45 million pipeline contract to DSND Subsea AS, Grimstad, Norway for engineering, procurement, fabrication, and installation of three pipelines related to development of Oseberg South field. A 12-km, 12-in. oil line will be laid from the Oseberg South platform to Oseberg field center. Two 14-km, 8-in. pipelines will be laid from a subsea installation to the Oseberg South platform. Installation of pipelines is slated for spring and summer of 1999 and 2000. First oil from Oseberg South is expected in 2000.

Gasoducto Cuenca
Noroeste Ltda. Argentina
let contract to a group of Bonatti SpA, Comercial del Plata Construcciones SA, and Iecsa SA for construction of the 414-km western portion of the GasAtamaca pipeline from Argentina to Chile (OGJ, Jan. 5, 1998, p. 29). The pipeline will transport natural gas across the Andes to power plants and industrial users in Mejillones, Chile. Construction started in March and will be completed in February 1999. Commercial operation is set for first quarter 1999.

Companies

KN Energy Inc., Lakewood, Colo., will purchase interests in four independent power plants from Denver-based Thermo Cos. KN will have interests in plants with combined generating capacity of 380 MW, or about 10% of the state's capacity. The plants are at Fort Lupton and Greeley, Colo. KN Energy also will acquire Thermo management companies involved in developing electricity generation projects. The deal includes access to 130 bcf of natural gas reserves. KN will make an initial payment of $35 million in KN common stock; the remainder of the purchase price will be paid in common stock and cash in 1999 and 2000.

Northwest Natural Gas Co.
(NWNG), Portland, Ore., and NI Energy Services Inc. (NESI), Merrillville, Ind., combined their Canadian oil and gas exploration and production subsidiaries-respectively, Canor Energy Ltd. and Southlake Energy. The combine began operating Mar. 31, 1998, under the Canor name. The deal involved the purchase of Southlake stock with Canor shares. The new Canor is owned 66% by NWNG and 34% by NESI. It has production of 4,000 boed and gas reserves of about 120 bcf.

Exploration

Algerian state firm Sonatrach and partners Neste Oy and Asamera Algeria Ltd., a unit of Gulf Canada Resources Ltd., disclosed a strike on Block 212 in Algeria's Berkine basin. The In Amedjene North-1 wildcat flowed a combined 6,659 b/d of condensate and 42.7 MMcfd of gas from two pay zones through a 1/2-in. choke. Neste reported the well cut 41.5 m of net pay in the Triassic and 19 m of net pay in Carboniferous sandstone. The well was suspended as a potential producer.

Santa Fe Energy Resources China Ltd.,
a unit of Houston-based Santa Fe Energy Resources, said its exploratory well PY4-2-1 on Block 15/34 in the South China Sea's Pearl River Mouth basin cut 300-400 ft of oil-bearing sand in more than 25 zones at 4,800-8,500 ft. The well was drilled to 9,843 ft TD. Tests of three sands at 7,071-7,238 ft flowed 3,100 b/d of 21.5° gravity oil through a 32/64-in. choke with flowing tubing pressure of 275 psi. A second sand at 6,234-6,280 ft yielded 3,300 b/d of 26° gravity oil through a 40/64-in. choke with flowing tubing pressure of 140 psi. The production-sharing contract on the block is owned equally by operator Santa Fe and SCS Resources Ltd., a unit of Western Atlas International Inc. China National Offshore Oil Co. has an option to take a working interest of as much as 51% in the block.

Schlumberger Ltd. unit
Geco-Prakla, Houston, completed a 13,300-km 2D seismic survey of ultradeepwater blocks off Gabon. Geco-Prakla acquired the survey for Petrolin UK under special decree from Gabon's ministry of mines, energy, and petroleum. The survey took 129 days to complete. Gabon granted an extension of its ultradeepwater licensing round to allow oil companies more time to assess all the blocks on offer. An information meeting will be held in London later this month.

Monument Oil & Gas plc
London, and Mobil Corp. signed a production-sharing agreement (PSA) with Turkmenneft, the state oil firm of Turkmenistan, for the unlicensed, onshore Absheron sill area. Under the PSA, Monument and Mobil will explore, develop, and produce oil and gas in a 4,500 sq km area of western Turkmenistan, south of their Nebit Dag license area (OGJ, Apr. 20, 1998, p. 37). Interests in the new PSA are: operator Mobil 52.4%, Monument 27.6%, and Turkmenneft 20%. The agreement includes development of oil reserves discovered below the extensively developed Kotor Tepe and Barsa Gelmes fields and exploration and appraisal below and outside all existing fields.

PTT Exploration & Production plc
is acquiring a 30% stake in a petroleum exploration license off Viet Nam. PTT International Ltd. will join with Fina Exploration Minh Hai BV, a subsidiary of Belgium's Petrofina, to explore for hydrocarbons in offshore Blocks 46, 50, and 51. Petrofina is operator and holds a 70% stake. The three blocks, about 130 km off the southwest coast of Viet Nam, cover a total area of 6,700 sq km. Fina has acquired 2D and 3D seismic data over the area and drilled eight exploratory wells, six of which are oil and gas discoveries. Under the production-sharing contract, state firm PetroVietnam has an option to acquire an interest of up to 15% upon field development.

Chevron Canada Resources Ltd.,
Calgary, and partners report a major natural gas discovery in the Musreau area of west-central Alberta, 53 miles south of Grande Prairie. The well is producing at a restricted rate of 20 MMcfd due to plant capacity limitations but has a delivery capacity of more than 40 MMcfd, says Chevron Canada. The well was drilled to 15,216 ft and was completed in May 1997 but has been under tight-hole status. It is in the top 5% of producing wells in Alberta, says Chevron. The company issued few details on the test, but said two more wells have been drilled in the area and are being evaluated. A 77 sq mile seismic program has been completed and is being processed. Interests in the project are: Chevron 48%, Gulf Canada Resources Ltd. 32%, Berkley Petroleum Corp. 12%, and Newport Petroleum 8%.

Copyright 1998 Oil & Gas Journal. All Rights Reserved.