CorrectionThe editorial of Apr. 12 incorrectly referred to "auspices of the United Nations" in a statement about military conflict in Yugoslavia (OGJ, Apr. 12, 1999, p. 21). The reference should have been to the North Atlantic Treaty Organization.
CompaniesChevron U.S.A. Production Co. decided not to form a 50-50 joint venture with ARCO Permian (OGJ, Feb. 15, 1999, Newsletter). The combination would have joined the two companies' production operations in the Permian basin of West Texas and Southeast New Mexico.
TransCanada PipeLines Ltd.,
Calgary, plans to sell its U.S. Gulf Coast natural gas midstream facilities and its U.S. oil marketing and trading units. TransCanada holds ownership interests in six midstream facilities in Louisiana, with processing capacity of up to 2.2 bcfd of natural gas, that produced 90,000 b/d of ethane, isobutane, propane, and natural gasoline in 1998. TransCanada's marketing operations in Houston, Los Angeles, and Charlotte, N.C., marketed 69 million bbl of crude and 85 million bbl of refined products in 1998. Trans- Canada plans to maintain its focus on its Canadian gas/liquids business and Canadian and U.S. northern tier crude oil business.
priced its $4 billion jumbo, multi-tranche offering of senior debt securities. This offering is $1 billion more than a previously announced offering. The offer consists of: $1.35 billion in 5-year notes due 2004 with a coupon of 5.90%, offered to the public at 99.856%; $750 million in 10-year notes due 2009 with a coupon of 6.35%, offered at par; and $1.9 billion in 30-year notes due 2029 with a coupon of 6.95%, also offered at par. Conoco will use proceeds from the offering to pay debt back to DuPont Co., which last year launched an initial public offering of Conoco stock that was the largest in history (OGJ, May 18, 1998, p. 37).
will offer up to $256 million (Canadian) for an interest in Northrock Resources Ltd., Calgary, to increase its exposure to the Canadian natural gas market. Northrock said the offer would provide an injection of cash and allow it to expand its natural gas drilling activity. The company, which operates in Alberta and British Columbia, has production of about 160 MMcfd of gas and 10,500 b/d of oil. Under a two-part plan, Unocal will offer Northrock shareholders $14/share for up to 10 million shares. The offer is contingent on Unocal acquiring at least 6.9 million shares. If the tender is successful, North- rock will issue another 7.6 million shares to Unocal at $16 each. Initially, Unocal would acquire a 46% interest in Northrock under the deal.
Koch Industries Inc.
unit Koch Midstream Services Co., Houston, acquired East Texas natural gas gathering and treating assets from Pioneer Natural Resources U.S.A. Inc. and Pioneer Natural Gas Co. for an undisclosed sum. Included in the transaction is Pioneer's 80 MMcfd Plum Creek treating plant and Plum Creek gathering facilities, which comprise about 25 miles of 12-in. gathering lines and 16-in. residue lines.
Edge Energy Inc.,
Calgary, launched a $40.6 million (Canadian) takeover bid for Volterra Resources Inc., Calgary. The deal would include the assumption of $21 million in net debt. The acquisition would give Edge additional assets in its West Central Alberta and Peace River Arch core areas and new properties in Northeast British Columbia and Southeast Saskatchewan.
in Alberta and Ontario ruled against an ambitious plan by Westlinks Resources Ltd., a small Calgary independent, to acquire interests in up to 40 oil companies. Westlinks wanted to issue up to 1.6 billion shares traded on the Alberta Stock Exchange for stock in much larger firms such as Anderson Exploration Ltd. and Poco Petroleums Ltd. Some of the target companies described the offer as a nuisance, while expressing concern that it could be costly to respond to the proposal. Regulators, concerned that investors would be unable to understand the complexity of the bid, told Westlinks that they would not let the complex offer proceed because it was structurally flawed.
Castle Energy Corp.,
Radnor, Pa., plans to acquire nearly all of AmBrit Energy Corp.'s oil and gas assets for $22 million. The properties include producing and undeveloped lands in Alabama, Louisiana, Mississippi, Montana, New Mexico, Oklahoma, and Texas. The assets are estimated to have proved reserves of 27.5 bcf of gas.
PetrochemicalsBorealis Compounds GmbH, a unit of Borealis AS, Copenhagen, plans to close its 32,000 metric ton/year compounding facility at Norderstedt, Germany, north of Hamburg. Production from the plant will be shifted to Borealis's other compounding units in Austria, Belgium, Finland, France, and Italy. The company cited low utilization and lack of competitiveness as the reasons behind the closure of the unit, which employed 40 people.
RefiningShell Oil Co. and Petroleos Mexicanos gave final approval Apr. 13 to a joint project that will increase capacity of Shell's Deer Park, Tex., refinery. The project, to be completed by second quarter 2001, involves construction of a new sulfur plant, expansion of an existing coker, and improvements to the crude distillation and catalytic hydrocracking units. That will enable the refinery to handle 340,000 b/d of oil vs. its original 280,000 b/d, with heavy Maya crude then accounting for 220,000 b/d of the feedstock.
let a $300 million, 21/2-year contract to Siemens Power Generation Group, Schaumburg, Ill., to upgrade and extend the process control system at Pemex's Madero oil refinery. Work will include the installation of a Teleperm XP instrumentation and control system and other controls to increase the efficiency of the plant's electric power and steam generation subsystems. The contract is part of a $1.2 billion plant upgrade project to be completed by a 3-company consortium made up of Siemens, South Korea's Sunkyong Engineering & Construction, and Mexico's Grupo Tribasa.
Tulsa, intends to acquire an additional 33% stake in Lithuania's state-owned Mazeikiu Nafta refinery and related marine terminal. Williams last year agreed to acquire 33% of the plant for $150 million. During first quarter 1999, the refinery processed 1.164 million metric tons of oil and other raw materials, a drop of 30% from first quarter 1998. Mazeikiu Nafta was forced to shut down for almost 3 weeks after it ran out of Russian crude at the end of January 1999. In March, the plant started working at full capacity again. The refinery had planned to process more than 7 million tons of oil this year, but a shortage of crude in Russia and a cut in Lithuanian refined products exports may hinder these plans.
Shell Eastern Petroleum Ltd.
let contract to Kvaerner AS, Oslo, for engineering, procurement, and construction of a pipeline/cable bundle at its Singapore oil refinery complex. The bundle is part of a $100 million expansion of the refinery and will link Shell's new condensate splitter unit on the island of Pulau Bukom to a number of downstream customers nearby. The 4.5-km bundle, which will incorporate eight pipe- lines and two fiber optic cables, will initially deliver naphtha to Petrochemical Corp. of Singapore's plant on Jurong Island. Project completion is expected by May 2000.
Drilling-productionPhillips Petroleum Co. Norway shut down the Ekofisk complex Apr. 19, in the Norwegian North Sea, to repair a leak in the gas cooling unit on Platform 2/4J. Phillips, Ekofisk operator, expects the shutdown to last no more than 2 weeks. Production at Ekofisk averages 310,000 b/d of oil, 12,000 b/d of NGL, and 400 MMcfd of gas.
U.S. Minerals Management Service
extended to May 6 the comment period for proposed regulations regarding marginal oil and gas properties on federal public lands (OGJ, Mar. 29, 1999, p. 14).
Saga Petroleum AS,
Oslo, submitted to Norway's Ministry of Petroleum and Energy a plan for the development of Borg discovery on Norwegian North Sea Block 34/7. The find, previously known as H-Central, lies 1 km west of Saga's Tordis field, a subsea satellite of Gullfaks C platform. Saga plans to develop Borg initially with one subsea well tied back to the Tordis manifold. This well was tested under a 6-month production program. Borg output is expected initially to be 15,000 b/d; Saga is considering tie-in of further wells to raise production to 30,000 b/d in 2001. Borg has estimated reserves of 75 million bbl of oil. The single-well development is estimated to cost $105 million.
India's Oil & Natural Gas Corp.
(ONGC) filed an insurance claim for $70 million for damages caused by a wild well fire raging on its B 121-D offshore gas platform in the Bombay High area off India (OGJ, Mar. 29, 1999, p. 31). At presstime, ONGC and wild well specialist Cudd Pressure Control Inc., Houston, were still battling to control the well, which blew out Mar. 12. A Cudd team demobilized a jack up rig at the site and disconnected it from the platform. The fire eventually collapsed the platform after spreading to two more wells. Two more jack ups have been mobilized to the area to drill relief wells in an attempt to kill the wild well.
Amerada Hess Ltd.
plans to halt production from U.K. North Sea Durward and Dauntless fields at the end of April, at which time the fields will have yielded 11 million bbl of oil. The fields were brought on stream in August 1997 with the Glas Dowr floating production, storage, and offloading (FPSO) ship. At the end of 1997, Amerada downgraded its estimate of reserves from 43 million bbl, citing reservoir complexity (OGJ, Jan. 5, 1998, p. 32). Now Amerada and shipowner Bluewater Marine BV, Essen, Belgium, are negotiating with other operators to take over the Glas Dowr.
Talisman Energy (U.K.) Ltd.
started up oil production from Ross field in the U.K. North Sea on Apr. 20. The field was developed with the Bleo Holm FPSO, owned and operated by Bluewater Marine. Ross has estimated reserves of 60 million bbl of oil and 20-30 bcf of gas and is expected to produce at a peak of 40,000 boed. Production is expected to be built up over 4-6 weeks as water injection begins and the gas export system is commissioned. Talisman is currently drilling a fourth development well in the field. Ross field interest holders are operator Talisman 51.99%, Lasmo plc 16.33%, Kerr-McGee Petroleum (U.K.) Ltd. 14.49%, Intrepid Energy North Sea Ltd. 13%, and Nippon Oil Exploration & Production (MF) Ltd. 4.19%.
of the In Salah gas project in southwest Algeria were reduced to $2 billion from the original $3.6 billion, reported Paris-based Arab Oil & Gas Review. The project's equal partners are BP Amoco plc and Algerian national oil firm Sonatrach. The project, slated for completion in 2003, will produce 318-388 bcf/year of gas.
PowerElwood Energy LLC, a joint venture of units of Peoples Energy Corp. and Dominion Energy Inc., entered into multi-year agreements to supply Commonwealth Edison Co. and Engage Energy U.S. LP with 300 MW of power each from its 600 MW-natural gas-fired power plant, presently under construction 60 miles southwest of Chicago. The plant is expected to be on line by this summer. Elwood has received regulatory approval to increase the plant's capacity to 3,100 MW, making it one of the state's largest merchant plants.
ExplorationOccidental Petroleum Corp. began appraisal and exploration efforts on Block 44 in northern Oman; the block is one of the five that Oxy and joint venture partners BP Amoco and Finland's Fortum Oy are developing for gas (see map and story, OGJ, Nov. 9, 1998, p. 44). The program's first phase is scheduled for completion by early 2000.
Premier & Shell Pakistan BV
acquired an exploration license for the Dadhar block, which covers 6,248 sq km of Pakistan's Baluchistan province. Premier/Shell's Premier Exploration Pakistan Ltd. unit will be operator and 95% interest holder of the license, with the Pakistani government holding 5%. The venture plans to acquire geological and seismic data over the next 2 years, and could drill at least one well in the third year of the license. Premier/Shell has working interest in 10 blocks in Pakistan, which include seven gas discoveries.
Elf Petroland BV
disclosed a gas discovery on Block K5a off the Netherlands. Elf said the K5-11 well was drilled to 4,140 m TD and flowed 26.5 MMcfd from the Rotliegendes sandstone play. The operator said it is studying the most cost-efficient development scheme for the find. Elf is operator of producing fields on Blocks K4b and K5a, which were developed with a central processing platform and five wellhead platforms linked by export pipeline to Den Helder terminal in the Netherlands.
PipelinesBuccaneer Gas Pipeline Co. LLC, a unit of Williams, received 1.3 bcfd in long-term, aggregate nominations, under a recent open season, for newly created firm transportation capacity on the Buccaneer natural gas pipeline (OGJ, Mar. 15, 1999, p. 30). Williams plans to file on the project with the Federal Energy Regulatory Commission during third quarter 1999.
SpillsIndia's Oil & Natural Gas Corp. (ONGC) is to set up two major oil spill response centers at Mumbai and Kakinada, along coastal Andhra Pradesh state. The centers were the suggestion of the International Maritime Organization in May 1993, when a major oil spill occurred at ONGC's Bombay High offshore facilities. The centers, which will be managed by an outside agency, are scheduled for completion by mid-2000.
CatalystsHyundai Heavy Industires Ltd., Seoul, began construction of a $41 million refining catalysts plant south of Kuwait City. The 5,000 metric ton/year plant is slated for completion by August 2000. The plant is jointly owned by the Kuwait Catalyst Production Co. and other Japanese companies.
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