INDUSTRY BRIEFS

Exploration

PanCanadian Petroleum Ltd., Calgary, Clyde Expro plc, London, and Yukong Ltd., Seoul, signed an exploration and production agreement with National Oil Corp. of Libya covering a $17 million, 5 year exploration program in a 5,000 sq km area of Libya's Sirte basin near the Mediterranean export terminal at Ras Lanuf. The work program calls for at least three wells and 1,000 km of seismic surveys, with the first wildcat to spud in 1997 or 1998. Interests are PanCanadian 75%, Clyde 15%, and Yukong 10%.

Unocal Vietnam Exploration Ltd. signed a production sharing contract with Petrovietnam for exploration of gas prone Block B off Southwest Viet Nam. The block covers more than 1.3 million acres in the northern Malay basin in 180-215 feet of water 300 miles west-southwest of Vung Tau. Under a 3 year work program, seismic surveys are expected to take 9 months to complete and analyze. The first wildcat is to spud in 1997. Interests are operator Unocal 45%, Repsol SA 30%, and Mitsui Oil Exploration Co. Ltd. 25%. Petrovietnam has an option to acquire a 15% interest in the block.

Reformulated fuels

Petrochemicals

Taiwan's Tuntex Groupwill spend as much as $7 billion to increase output of petrochemical products in Taiwan and Thailand. Tuntex expects the Thai government to approve within 30 days a license to build an 800,000 metric ton/year paraxylene plant in Thailand that is slated for completion by yearend 1998. Tuntex also plans an 800,000 ton/year paraxylene plant in Taiwan that is to go on stream in 1999. Plans also call for Tuntex to increase output of polyester fiber to 500,000 tons/year from 110,000 tons/year in Thailand and to 645,000 tons/year from 385,000 tons/year in Taiwan, both during 1997-99.

Taiwan's state owned Chinese Petroleum Corp. (CPC) notified Taiwan's Securities & Exchange Commission it intends to sell 55.9 million shares of the recently privatized China Petrochemical Development Corp. (CPDC). Under Taiwan's existing securities rules, CPC must sell the shares within 1 month and 3 days. CPC holds 258.7 million shares, or 26.9%, of CPDC's total outstanding shares. CPDC holds an interest in an ethylene plant at Daqing, China, as well as petrochemical complexes at Kaohsiung and Miaoli, Taiwan.

Oxiteno Nordeste SA, Sao Paulo, received $30 million in financing for expansion of its ethylene oxide/ethylene glycol plant. EO capacity will increase to 235,000 metric tons/year from 130,000 tons/year and EG capacity to 224,000 tons/year from 142,000 tons/year. Products will be used in polyester fiber and polyethylene terephthalate production.

Saudi Yanbu Petrochemical Co. let contract to Fluor Daniel for basic engineering and procurement services for the first phase of a $2 billion expansion of the Yanpet petrochemical complex at Yanbu, Saudi Arabia (OGJ, May 20, p. 39). Contract value to Fluor Daniel for Phase 1 is less than $50 million. Engineering is under way at Fluor Daniel's Houston office.

Environment

Duratherm Inc., Houston, started up a $3 million expansion and upgrade of its thermal desorption recycling plant. The plant converts hydrocarbon contaminated refinery and petrochemical wastes to nonhazardous materials.

Catalysts

Catalytica Combustion Systems Inc., Mountain View, Calif., received a patent for its new ultralow NOx combustion catalyst. The catalyst, developed by Catalytica and Japan's Tanaka Kikinzoku Kogyo KK, is used in Xonon flameless combustion systems. It will enable catalytic combustion turbines to process a wider variety of liquid and gaseous fuels.

Lubricants

Rohm & Haas Co., Philadelphia, formed a 50-50 venture with Huls Group company Rohm GmbH, Darmstadt, Germany. The new Rohm & Haas Primene business will supply petroleum additives, including viscosity index improvers, pour point depressants, and synthetic fluids, for use in transmission, hydraulic, and crankcase fluids. The company's sales will be about $225 million/year.

LNG

Oman awarded first rights to a combine of Japan's Chiyoda Corp. and Foster Wheeler Corp., Clinton, N.J., to negotiate a $2 billion contract to build a liquefied natural gas complex in Oman. Oman LNG, a group made up of Oman's state petroleum company and foreign partners led by Royal Dutch/Shell Group, is developing the $2.25 billion LNG export project (OGJ, Apr. 15, Newsletter).

U.S. Federal Energy Regulatory Commission approved construction and operation of an LNG terminal that will support an electrical power plant in Puerto Rico. EcoElectria LP, a partnership of Enron Development Corp. and Kenetech Energy Systems Inc. affiliates, plans to build the $600 million project at Guayanilla Bay, 9 miles west of Ponce. Regasified LNG will be burned in a 461,000 kw cogeneration plant, with power sold to the Puerto Rico Electric Power Authority. FERC said 98% of the power generated in Puerto Rico is fueled by oil. Steam from the project will provide thermal energy to a proposed desalination plant.

Massachusetts firms Cabot LNG Corp. and Colonial Gas Co. agreed to form a venture to boost the market share of LNG in the U.S. Northeast. The two companies will jointly own Transgas Inc. and a new entity that will offer LNG trucking, storage, and related services in the region. Cabot will acquire 50% of Transgas, Colonial's LNG trucking company. The new entity will lease Colonial's 1 bcf LNG storage tank and related facilities for 20 years.

Pipelines

Canada's National Energy Board (NEB) will open hearings July 22 on a proposed $263.6 million (Canadian) 1997 expansion program by TransCanada PipeLines Ltd., Calgary. The pipeline looping and compressor unit upgrades in Sas- katchewan, Manitoba, and Ontario is to add 126.3 MMcfd capacity to TransCanada's system to Canadian and export markets. Completion is planned for Nov. 1, 1997.

NEB approved environmental aspects of the proposed Express Pipeline Ltd. crude oil line from Alberta to Wyoming. The $580 million (Canadian) project is a joint venture of TransCanada PipeLines Ltd. and Alberta Energy Ltd., both of Calgary. The federal cabinet may approve or reject the environmental plan, and NEB still must rule on project tolls and whether the project is in the public interest. Express hopes to obtain approvals in time to begin construction in August and crude shipments early in 1997. The 170,000 b/d pipeline would extend from Hardisty, Alta., to Casper, Wyo.

Oilsands

Alberta and Canada's oilsands industry have extended for 5 years funding for a joint heavy oil research project. The core research program run by the Alberta Research Council will receive $10 million (Canadian) from government and $5 million from industry. The program researches recovery technology for heavy oil and bitumen.

Drilling-production

Cliffs Drilling Co., Houston, closed purchase of 10 jack ups operated by the Southwestern Offshore Corp. unit of Viking Supply Ships AS and its affiliates and Production Partner Inc. Consideration is $103.8 million cash, 1.2 million shares of Cliffs stock, and $4.3 million in debt guarantees related to refurbishment of a jack up hired to work off Trinidad. Cliffs also purchased the Ocean Magallanes jack up from a unit of Diamond Offshore Drilling for $4.5 million cash. The rig will work under an 8 month contract for state owned Maraven SA in Venezuela's Lake Maracaibo.

Wiser Oil Co.,

Dallas, plans to drill about 100 infill wells in Maljamar oil field in Lea and Eddy counties, N.M., and expand the field's waterflood. By halving spacing to 20 acres, the infill and waterflood programs are expected to boost Maljamar production to about 4,000 b/d by yearend and a 5,700 b/d plateau in 1998 from the current 2,000 b/d. Total project cost is about $85 million.

Newfoundland

is developing a generic royalty regime for offshore oil projects. Premier Brian Tobin said a new policy is to be in place within weeks to replace the existing system of negotiating terms project by project. Tobin said the new regime will be competitive with other royalty rates around the world but will not include local employment requirements that are part of the Hibernia offshore project accord.

Refining

Papua New Guinea's first refinery moved closer to fruition with project participants signing a memorandum of understanding last week. The $250 million refinery at Motukea would have capacity of about 40,000 b/d and start up by mid-1997 (Apr. 18, 1994, p. 22). Partners are Australia's PNG Oil Refineries Ltd. and Barclay Mowlem Construction Ltd. and Japan's Chiyoda and Sumitomo Corp. Sumitomo is arranging financing. Construction start awaits approval of an environmental management plan.

Navajo Refining Co., Artesia, N.M., chose UOP technology for a revamp of the 18,500 b/d fluid catalytic cracking unit at its 60,000 b/d Artesia refinery. The upgrade will incorporate an Optimix feed distribution system and Vortex separation system riser termination device. Replacement of pressure balanced U-bend catalyst standpipes with straight standpipes and slide valves will improve unit temperature control. The revamp will take place during Navajo's fall turnaround.

Chevron U.S.A. Products Co. completed the revamp of a 70,000 b/d fluid catalytic cracking unit at its 230,000 b/d Richmond, Calif., refinery. The $300 million project, performed by Jacobs Engineering Group Inc., Pasadena, Calif., included a 40,000 hp power recovery turbine.

Techint International Construction Corp., Argentina, let contract to ABB Lummus Heat Transfer, Bloomfield, N.J., on behalf of Petroleo Brasileiro SA (Petrobras). The contract is for a medium capacity hydrogen reformer furnace and three process heaters. The hydrogen it produces will be used in a 31,500 b/d hydrotreater under construction at Petrobras' Cubatao refinery outside Sao Paulo. Start-up is scheduled for April 1997.

Companies

Mobil Corp. as of May 23 had acquired more than 75% of common shares held by takeover target Ampolex Ltd., Sydney. The takeover is being blocked by five institutional shareholders holding 65% of preference shares that are refusing Mobil's $1.8 billion (Australian) bid on the grounds they won't get a premium they contend their class of shares warrants.

El Paso Energy Corp. subsidiary El Paso Energy completed a $6/share cash tender offer for all of the outstanding common stock of Cornerstone Natural Gas Inc., Dallas. Including assumption of $17 million in debt, the deal is worth about $115 million. Cornerstone has gas pipeline and processing operations in Texas and Louisiana that include purchasing, gathering, treating, transportation, and marketing of gas and recovery and marketing of natural gas liquids.

Parsons Latin America formed an alliance with Grupo Mexicano de Desarrollo SA and Cia. Brasileira de Projectos e Obras de Mexico SA (CBPO) to pursue oil, gas, refinery, and petrochemical construction projects in Mexico. Parsons Latin America is a regional unit of Parsons Corp., Pasadena, Calif., and CBPO is the Mexican subsidiary of Brazil's Odebrecht SA.

Gas storage

Northwest Natural Gas, Portland, Ore., plans to spend about $120 million during 5 years to develop more natural gas storage capacity in the Mist field area of Northwest Oregon.

Gas marketing

PanEnergy Corp., Houston, and Mobil Corp. affiliates agreed to create a major gas marketing company and for PanEnergy to acquire certain Mobil interests in gas gathering, processing, and intrastate pipelines in Texas, Oklahoma, Louisiana, and Utah for about $300 million. The gas and power marketing operations of PanEnergy Services and Mobil Natural Gas Inc. will be joined and operated as PanEnergy Trading & Market Services LLC. Mobil currently markets 3.6 bcfd of gas production, PanEnergy more than 4 bcfd. All of Mobil's U.S. and Canadian gas production is to be marketed by the new company for at least 10 years.

Tankers

Neptune Orient Lines, Singapore, will take delivery in July-August of two 99,300 dwt crude oil tankers that are to be provided to Bayway Refining Co., a unit of Tosco Corp., Stamford, Conn., under a 12 year charter. The two newbuildings, christened last week at Samsung Heavy Industries' shipyard in South Korea, boost Neptune's shipping fleet to 68 vessels.

Copyright 1996 Oil & Gas Journal. All Rights Reserved.