INDUSTRY BRIEFS

LNG

Ras Laffan LNG Co. (Rasgas) plans to debotttleneck the LNG plant it is building at Ras Laffan, Qatar. The two-train, 5 million metric ton/year plant will be expanded by 1.4 million tons/year in two phases. The plant's first train will start up in March 1999, and shipments of LNG to Korea Gas Corp. will begin as early as July 1999. The first train is 90% complete, while the second, slated for start-up in mid-2000, is 50% complete.

Petrochemicals

PetroFina SA, and Mitsui Chemicals Inc. agreed to continue joint research and development efforts in metallocene-based propylene polymers, extending a previous agreement between the companies. The R&D efforts will include metallocene syndiotactic products, isotactic products, and metallocene catalysts. The companies intend to produce new metallocene isotactic polypropylenes and complete commercialization of syndiotactic polypropylene.

Montell Polyolefins Co. NV,
Showa Denko KK, and Nippon Petrochemicals Co. Ltd. plan to form a polypropylene joint venture in Japan. The target date for launching the new company is May 1, 1999. The venture follows a number of alliances between the partners over the last 3 years in Japan and Thailand.

Exploration

Total acquired a 28% stake and operatorship in two deepwater exploration blocks off Gabon along the maritime border with Congo. Other partners are Unocal Corp. 25%, Kerr-McGee Corp. 14%, Houston's Vanco Energy Co. 22%, and R.B. Falcon 11%. The first block, Astrid, covers 6,000 sq km and the second, Anton, 6,600 sq km. Both are in 1,000-3,000 m of water, 80 km off Gabon in the northern part of the lower Congo oil basin. A 3D seismic campaign is scheduled in 1999.

Pakistan's Ministry of Petroleum
awarded Hardy Exploration & Production Ltd. and Pakistan's Government Holdings a contract for exploration of Mamro Block 2768-2. During the 3-year license, the parties must acquire 100 line-km of 2D seismic, drill one exploration well, and spend at least $1.7 million. The license is renewable for three, 1-year increments. The 193 sq km block is in Sindh province, Sukkur district, near Miano, Kadanwari, and Sawan gas fields.

Colombia's
state-owned Empresa Colombiana de Petroleos granted approval to Millenium Energy Inc. and Mera Petroleums Inc., both of Calgary, for an initial exploration program in the Guajira Peninsula at the northeast tip of Colombia. In the first 2 years, the companies will spend $2.1 million on exploration and production in the gas-prone, 320,000-acre area.

Canadian Occidental Petroleum Ltd.,
Calgary, acquired four additional exploration blocks covering 12 million acres in a frontier area of northeastern Yemen. This purchase bolsters CanOxy's holdings in the area to more than 20 million acres, when combined with interests it acquired in two other blocks (OGJ, Apr. 20, 1998, p. 45).

Refining

Air Products & Chemicals Inc., Lehigh Valley, Pa., will build a 100 MMcfd, high-purity hydrogen plant at Carson, Calif., to serve nearby refineries owned by Equilon Enterpirses LLC-the joint venture of Texaco Refining & Marketing Inc. and Shell Oil Products Co.-ARCO Products Co., and other companies. Start-up of the plant is scheduled for early 2000.

Drilling-production

Saga Petroleum AS instructed Noble Drilling Corp., Aberdeen, to shut down drilling operations on Noble Al White rig, currently engaged in development drilling in Varg field off Norway. Saga said the decision was made following an inspection of the rig and complaints by trade unions about safety and working environment concerns. The company said it will look into the contractor's observance of regulations and contractual requirements and its own follow-up of contractors. Noble said the allegations are being taken very seriously, irrespective of the issues being factual or not.

China's Daqing oil complex
will meet its oil production quota of 1.1 million b/d, despite the summer floods that inundated over 1,500 wells in the country's northeast region, said Daqing city Mayor Yang Xin (OGJ, Sept. 7, 1998, p. 32). The floods along the Nenjiang and Songhua rivers submerged numerous oil fields in Daqing, Jilin, and Liaohe provinces. Only 2% of daily production was affected, even in the most severely hit areas.

Conoco Indonesia Inc.
extended its contract for another year with Oceaneering International Inc., Houston, for the bareboat charter of the 12,450 dwt San Jacinto floating production, storage, and offloading vessel. Conoco will use the vessel for servicing wells on Block B in the Natuna Sea off Indonesia through October 1999. San Jacinto's present production capacity is 11,000 b/d of oil.

Ocelot Energy Inc.,
Calgary, will acquire Snow Leopard Resources Inc.'s 50% interest and operatorship in the Stepnoi Leopard KTT oil, gas, and condensate development project in Kazakhstan. The Kazakhstan State Oil Co. holds the other 50%. Ocelot will spend $1.5 million by yearend and drill one well in 1999. The field, in northwest Kazakhstan, holds 100 million boe of proven undeveloped hydrocarbons, says Ocelot. Development drilling and initial production of oil and condensate are planned in 1999. Snow Leopard will retain a 50% net income interest until $3 million is recovered, then take a 4% gross override.

Shell U.K. Exploration & Production
let a multi-million pound contract to Maersk Contractors AS, Copenhagen, for removal of drill cuttings from its U.K. central and northern North Sea operations for recycling in Aberdeen. The contract is for an initial period of 3 years and is expected to involve treatment of more than 3,500 metric tons/year of cuttings. Shell said the plant is expected to be operational beginning in 1999. It is expected to be built in the Aberdeen Harbor area, although the exact location has not been determined. The operator processes cuttings from its southern North Sea operations in a similar plant in Lowestoft, U.K.

Esso Exploration & Production Norway AS
let contract to Smit Maritime Contractors BV, Rotterdam, for installation of its Balder field floating production unit in 127 m of water on Block 25/10 off Norway. In spring 1999, Smit will install a temporary mooring system inshore to test the ship and its mooring systems. It will then be moved to the field for hook-up to a pre-laid mooring system comprising 10 chains, each 1,220 m long and secured by a 17 metric ton anchor. Varg has reserves of 170 million bbl of oil and is due on stream in third quarter 1999.

Companies

Parker Drilling Co., Tulsa, acquired Superior Energy Services Inc., Harvey, La., for $168 million. Under terms of the deal, Parker will assume debt of $25 million and exchange 0.9 share of common stock for each Superior share. Parker also will issue 26 million new shares to current Superior shareholders. After closing the deal, expected early in 1999, there will be 103 million shares outstanding. Superior reportedly will retain its name and maintain its headquarters in Louisiana.

TransMontaigne Inc.,
Denver, purchased Louis Dreyfus Corp. unit Louis Dreyfus Energy Corp. for $161 million, including $100 million in cash and 4.5 million shares of the company's common stock, as well as working capital. The acquisition boosts TransMontaigne's total assets to over $800 million. Louis Dreyfus Energy will join the TransMontaigne Logistical Services Group, which includes TransMontaigne Product Services Inc. and TransMontaigne Transportation Services Inc. Starting Jan. 1, 1999, the product and transportation services units will be relocated to Atlanta from Fayetteville, Ark.

CMS Energy Corp.,
Dearborn, Mich., will purchase Heritage Gas Services LLC, Tulsa, for an undisclosed amount. Heritage, with about $23 million in revenue in 1997, owns and operates seven natural gas gathering systems and one 45 MMcfd gas processing plant. The gathering systems comprise 2,000 miles of pipelines. CMS recently purchased Continental Natural Gas, Tulsa, gaining 2,000 miles of gas gathering lines, 550 MMcfd of gas processing capacity, and 1.4 million gal/day of liquids production. It made another large pipeline acquisition form Duke Energy Co. this week (see story, p. 37).

Black Sea Energy Ltd.,
and Sunwing Energy Ltd., both from Calgary, announced plans to merge. The new company will change its name and retain its head office in Calgary. Black Sea has exploration interests in South America, Russia, and the U.S., and oil-producing properties in Siberia. Privately-owned Sunwing was awarded the first onshore production sharing agreement with China National Petroleum Co. at Daqing in northeast China. Black Sea has agreed in principle to pay Sunwing up to $2 million to fund pre-merger operating costs and transaction expenses.

Hungary's MOL
and VegyUpszer, Budapest, want to sell their 24% and 25% respective stakes in the Kazakh joint venture Emba VegyOil. VegyOil produced only 120 b/d of oil in western Kazakhstan in 1997, despite more optimistic forecasts. VegyOil's third interest holder, Kazakhoil 51%, has turned down requests from the two Hungarian firms to be bought out, and other purchasers are nowhere in sight.

Power

CMS Energy finalized an agreement with Abu Dhabi for the construction and operation of a $700 million, 710-MW gas-fired power plant and desalination complex along the Persian Gulf coast. Operator CMS will own 40% of the new plant, Al Taweelah A2. Abu Dhabi Water & Electricity Authority will own 60% of the complex and purchase electricity under a 20-year contract. The first gas turbine is scheduled for start-up by May 2000, with full operation slated for August 2001.

InterGen,
Boston, and Istanbul-based construction firm Enka finalized an agreement with Turkish Electricity Generation & Transmission Corp., Petroleum Pipeline Transportation Corp., and the Turkish treasury for the construction of three combined-cycle, gas-fired power plants in Turkey (OGJ, June 22, 1998, p. 39). These new power plants will be the first to be built under the country's new build, own, and operate program.

Cogeneration

Enron Corp. unit Enron Capital & Trade Resources, Houston, reached an agreement to purchase Cogen Technologies' interest in three gas-fired power plants for $1.1 billion and assumption of about $350 million in non-recourse debt. The plants, at Bayonne, Camden, and Linden, N.J., have an combined capacity of 1,037 MW. The electric power is delivered to utility and industrial customers in New Jersey and New York City. The companies expect to finalize the acquisition in early 1999.

Spills

Canuswest, a new international spill response agreement that will allow Canadian and U.S. agencies to respond more quickly to cross-border oil spills and other environmental hazards, has taken effect. Participating are Environment Canada, U.S. Environmental Protection Agency, British Columbia, Idaho, Washington, and Montana.

Terminals

Chevron Nigeria Ltd., began a two-part project to expand its Escravos tank farm and terminal at Warri, Nigeria. The project will add 150,000 b/d of dehydration capacity and 50,000 b/d of water treatment capacity. New equipment will include booster pumps, charge pumps, custody-transfer equipment, and an improved control system. New components should be completed in first quarter 1999. The terminal is being expanded to handle added production of as much as 600,000 b/d from new fields, including Opolo, Gbokoda, Dibi, and Ewan.

Pipelines

Soc. Gasoducto del Pacifico let a $47 million contract to Dragados Internacional de Pipelines SA for the construction of Spread 3 of a gas pipeline connecting gas fields at Loma de la Lata, Argentina, to Concepcion, Chile. The 163-km, 20-in. pipeline will be the second to cross the Andes between the two countries. The Chilean venture of Gasoducto del Pacifico is comprised of Canada's Nova Gas Transmission 30%, El Paso Energy Corp. 21.8%, Chile's Gasco 20%, Chilean state firm Empresa Nacional del Petroleo 18.2%, and Argentina's YPF SA 10%.

Indonesia's PGN
plans to invest $389 million to build a 300-mile pipeline to deliver 400 MMcfd of Indonesian gas to Singapore (OGJ, Sept. 28, 1998, p. 44). The project, built under a 20-year supply contract and slated for start-up in 2001, is part of a $1 billion plan to expand PGN's existing system. Japan's Asian Development bank and the European Investment bank are financing the project. PGN also plans to build a $330 million, 230-mile pipeline from South Sumatra to West Java, slated for start-up in 2001. A third pipeline, a $102 million, 174-mile leg in West Java, is expected to be in service by 2000.

Reliance Petroleum Ltd.,
New Delhi, submitted a plan to India to build a 3,000-km refined products pipeline. The pipeline will carry mainly gasoline, diesel, kerosine, naphtha, and LPG from its refinery at Jamnagar, Gujarat state, to Hyderabad, Andhra Pradesh state. The project is to be constructed in two phases. Pending approval, the first 550-km section will be laid from Jamnagar to Indore via Ahmedabad. Construction of this leg is expected to cost 12.94 billion rupees and take 36 months.

Tankers

Greece's Peninsula Star Holdings Ltd. let a $600 million contract to South Korea's Daewoo Heavy Industries Co. for the construction of eight crude oil supertankers. The Greek shipping company intends to pay cash for the tankers, with a guarantee from Export-Import Bank of Korea. The ships are due to be built by 2002.