Exploration
Texaco Exploration & Production Inc.'s 42-4 Lake Barre wildcat, drilled to 19,196 ft TVD, tapped a new pool in a fault segment identified by 3D seismic on the south flank of a massive salt dome in Lake Barre field about 75 miles southwest of New Orleans. The well, with 100 ft of net pay, is producing 1.3 MMcfd of gas and 1,300 b/d of oil through a 17/64 in. choke with 1,375 psi flowing tubing pressure. With the discovery, Lake Barre Miocene production has jumped to 39 MMcfd of gas and 6,300 b/d of oil, highest since 1981. Planned offsets will explore the new fault segment's deeper potential.
British Gas plc found gas on its Muturi concession in Northwest Irian Jaya. The 1 Mogoi Deep wildcat, the first well drilled on the block, flowed a combined 40 MMcfd of gas on test through a 1 in. choke. The company plans a seismic survey of Malingping Block off Southwest Java beginning in October.
South Africa's Energy Africa Ltd. and Petro-Inett Corp. are equal partners in a new production sharing agreement with Angola's state firm Sonangol for exploration and development on Block 7 off Angola. Block 7 covers 4,700 sq km of the Kwanza basin, about 70 miles south of Luanda. Energy Africa, block operator, also has interests in Blocks 1 and 2 off Angola.
Refining
Kuwait Petroleum Co. (KPC) purchased a 50% stake in Agip SpA's Milazzo refinery and 330 gasoline stations in Italy. Acquisition of the 300,000 b/d refinery doubles KPC's refining capacity in Europe. The stations sell about 500 million l./year of gasoline, equal to 75% of the market.
Diamond Shamrock Inc., San Antonio, selected M.W. Kellogg Technology Co.'s ROSE process to upgrade its Three Rivers, Tex., refinery. The Kellogg unit will provide technology license and basic engineering. Project will almost double the plant's solvent extraction capacity to 15,000 b/d and provide added feedstock for the complex's downstream conversion units. Project will use Kellogg's proprietary Rosemax separator internals technology. License award is the first since Kellogg acquired the ROSE process in 1995.
BOC Gases, Murray Hill, N.J., commercialized its next generation SURE burners for sulfur recovery. The new oxygen-based burner can increase Claus units' throughput by 50-100%. Burner uses oxygen-enriched combustion air to produce more effective burn and greater temperature control profile inside thermal reactors. New burner is designed for inclusion in the SURE Double Combustion process, enabling refiners to more than double sulfur capacity. New technology increases processing capacity for sour-water stripping gas.
Pipelines
TransCanada PipeLines Ltd., Calgary, drew requests during an open season for more than 2 bcfd of additional capacity in 1998 on its main gas pipeline from western Canada to eastern Canada and the U.S. About 80% of the requested new capacity would be for U.S. markets. Trans- Canada does not expect the entire requested capacity to be built and projects 1998 additions of about 500 MMcfd. Deadline for bids is Oct. 31. TransCanada is spending about $668 million (Canadian) this year to add 250 MMcfd capacity and $900 million in 1997 to add 288 MMcfd to its mainline system.
NGL
Gulf Canada Resources Ltd., Calgary, received approval from the Alberta Energy and Utilities Board to process a sidestream of as much as 210 MMcfd of gas from NOVA Gas Transmission Ltd.'s system to recover natural gas liquids, including propane, butane, and pentanes-plus, at its Strachan processing plant near Rocky Mountain Horse, Alta. Gulf said the project will improve economics and assure continued operation of the plant, which has been operating at only about 40% of its 275 MMcfd capacity.
PanCanadian Petroleum Ltd., Calgary, and partners started up their $72 million Empress, Alta., NGL extraction plant. Interests are operator PanCanadian and Alberta Energy Co. 40% each and Renaissance Energy Ltd. and Anderson Exploration Ltd. 10% each. Plant capacity is 800 MMscfd, producing about 8,000 b/d of NGL for transport to fractionation in Ontario and Michigan via Kerrobert and Interprovincial/Lakehead pipelines.
Petrochemicals
Methanex Corp., Vancouver, B.C., will spend $300 million to build its third methanol plant in Chile. Construction will begin in December when the company's second plant is due for completion. The third plant will have capacity of 975,000 metric tons/year. It will increase Methanex's total production in Chile to about 3 million tons/year.
Westlake Polymers Corp., Houston, let contract to Brown & Root Petroleum & Chemicals, Houston, for engineering, procurement, and construction of a grassroots polyethylene unit at Westlake's petrochemical complex at Sulfur, Calcasieu Parish, La. The plant, slated for completion early in 1998, will produce a combined 500 million lb/year of linear low-density polyethylene and high-density polyethylene.
Mobil Chemical Co. let contract to Bechtel Corp., Houston, to expand capacity at Mobil's Beaumont, Tex., olefins and aromatics plant (OGJ, Nov. 20, 1995, p. 40). Bechtel will provide project and construction management and bulk materials procurement for production of an additional 600 million lb/year of ethylene, slated to come on stream in 1998. Bechtel is working under another contract with Mobil to add a 275,000 ton/year paraxylene unit at the Beaumont plant.
Energy Biosystems Corp. (EBC), Woodlands, Tex., is refocusing its biocatalytic desulfurization (BDS) process to develop a commercial system for the production of deeply desulfurized diesel fuels needed to meet the European Union's (EU) anticipated diesel sulfur level of 350 ppm by 2000. EBC refocused its efforts at the request of alliance partner Total Raffinage Distribution SA. Previously, EBC was working on reducing sulfur in diesel from a range of about 500-2,000 ppm; the new range will be 300-600 ppm. The BDS process uses bacteria to remove sulfur from crude oil and refined products.
ARCO Chemical Co., Newton Square, Pa., started engineering on a 250 million lb/year butanediol (BDO) plant to be built at Rotterdam. The BDO plant is slated for start-up in 2001 and will adjoin a propylene oxide/styrene monomer plant ARCO is building. ARCO also plans to develop capacity for a variety of BDO derivatives and debottleneck its BDO unit at Channelview, Tex., to 120 million lb/year in late 1997.
Coastal Corp. will install a 660 ton/day anhydrous ammonia plant at Freeport, Tex. Coastal purchased the plant from Dakota Gasification Co. in April and moved it to Texas from the original site at Plaquemine, La. Coastal let contract to Air Liquide America Corp. to supply nitrogen and hydrogen feedstocks for the ammonia plant. As part of the project, Air Liquide will build a 45 MMscfd hydrogen purification plant at Freeport.
FINA Inc. finalized plans for expanding its high-density polyethylene plant near Bayport, Tex., to 850 million lb/year from 420 million lb/year, selecting Phillips Petroleum Co.'s HDPE process for the new unit. Construction is slated for completion in mid-1998.
Shell International Chemicals Ltd. paid $465 million for the chemical business of Shell Canada Ltd., a company owned 78% by Royal Dutch/Shell Group and 22% by public shareholders. The sale, to be completed by yearend, includes a 450,000 metric ton/year styrene plant at Fort Sas- katchewan, Alta., and a 91,000 ton/year isopropyl alcohol plant at Sarnia, Ont.
Lubes
Mobil Oil Corp. spent $48.5 million to expand capacity to 6,000 b/d from 4,000 b/d at its lube oil blending plant at its Notre-Dame-de-Gravenchon refinery in Normandy, France. The plant is Mobil's largest and the most modern in Europe, where Mobil holds a 10% market share. Following the proposed merger of European downstream operations with British Petroleum Co. plc, Mobil and BP will hold a combined 18% share of Europe's lube oil market.
Drilling-production
Vaalco Energy India Inc. let contract to Nortrans Engineering Group Pty. Ltd. to buy and operate a floating storage and offloading ship (FSO) and mooring system to develop PY-3 oil field off India. A 70,000 dwt tanker will be converted into an FSO in Singapore, with offshore installation slated for April 1997. As much as 20,000 b/d of oil will be produced by Tahara production semisubmersible, operated by Hitech Drilling Services India. The FSO has been chartered for 7 years.
Saga Petroleum AS increased its reserves figure for Snorre field off Norway, based on improved understanding of the reservoir and enhanced recovery techniques. The operator now estimates total reserves in Snorre at 1.315 billion bbl, up 16% from the previous estimate and 71% from the estimate on which the development decision was based in 1988. Snorre was developed with a concrete tension leg platform. The operator expects to disclose plans for further development work in and around Snorre next year.
U.K. Department of Energy approved development of West Brae field on Block 16/7a in the U.K. North Sea by Marathon Oil U.K. Ltd. and partners. Plan involves subsea development requiring one water injection well and three horizontal wells tied back to Marathon's Brae A platform, about 5 miles away. Production start is planned for late 1997 with a rate of 25,000 b/d expected in 1998. Estimated field reserves are 30 million bbl of oil.
United Meridian Corp., Houston, is placing its A-3 Lion dual-oil completion delineation well on production in Block CI-11 off Cote d'Ivoire. Estimated initial production is 4,000 b/d. When tie-ins are completed, Lion field oil production will total about 19,000 b/d. On test, the well flowed at a rate of 42 MMcfd of gas and 11,960 b/d of oil from three zones, including two previously untapped, shallower sands. Operator UMC holds a 25% working interest in the block.
ARCO British Ltd. let a 2-year contract worth $2 million/year to Schlumberger Wireline & Testing, Aberdeen, for logging and completion services in its North Sea operations.
American Exploration Co. (AEC), Houston, plans a multi-well development program before yearend on East Cameron Block 328 in the Gulf of Mexico. Last month, AEC acquired from an undisclosed seller a 100% working interest in the block and a 45% working interest in High Island Block 116. Purchase price, net of interests that AEC will sell to a third party, is $39 million. Acquisition adds 39 bcf gas equivalent of net proved reserves. Current net production totals about 17.3 MMcfd of gas and 700 b/d of liquids.
Cross Timbers Oil Co., Fort Worth, identified 10 locations that will be drilled the next 12 months in the northern Val Verde area of the Permian basin of West Texas on producing properties it is acquiring for $27.5 million from various New York Life Insurance Co. and AEC limited partnerships. Deal is to close about Dec. 1. Properties are primarily operated interests in Henderson, Ozona, and Davidson Ranch fields in Crockett County. Estimated proved reserves total 33 bcf of natural gas and 300,000 bbl of oil. Net average Pennsylvanian age production totals 8 MMcfd of gas and 73 b/d of oil.
Pertamina, Indonesia's state-owned oil company, extended until 2023 the production-sharing contract covering the Corridor Block. Interests are operator Gulf Canada Resources Ltd. unit Asamera (Overseas) Ltd. 54%, Talisman Energy Inc. unit Talisman (Corridor) Ltd. 36%, and Pertamina 10%. As a result of the extension, Gulf will book about a net 85 million bbl of oil equivalent (BOE ) of proved reserves, and Talisman will book about a net 55 million BOE of proved reserves associated with the Corridor Block Gas Project, scheduled for mid-1998 start-up (OGJ, Aug. 12, p. 21).
Companies
Snyder Oil Corp., Fort Worth, granted Cairn Energy plc, Edinburgh, an option to acquire about a 19.9% interest in Command Petroleum Ltd. in a deal that could lead to the eventual merger of Command into Cairn. A Snyder unit holds 32.6%, or about 105 million shares, in Command that is valued at about $95 million. Absent a higher bid, Snyder will accept Cairn's offer for all its shares, as soon as the offer becomes unconditional.
Oilsands
Gulf Canada said if it commercializes its Surmount oilsands pilot, total production of 100,000 b/d by 2006 is possible. Surmount, 60 km southeast of Fort McMurray, Alta., could support a number of 20,000 b/d plants. Gulf holds about 135,000 acres and has drilled 10 vertical wells in 1996 to delineate the project area's resources. Pilot involves testing of steam assisted gravity drainage (SAGD) technology. Four SAGD wells are possible in November. Steam injection could begin in April 1997. Surmount resource estimates are 10 billion bbl original oil in place and 2 billion bbl recoverable.
Power
Ocean State Power (OCP), Burrillville, R.I., let a 7-year contract to TransCanada Power Corp., a unit of TransCanada, involving management and administration of OCP's 500,000-kw, combined-cycle, gas-fired electric generation plant at Burrillville. TransCanada, through a wholly owned unit, owns 40% of OCP.
Environment
U.S. Environmental Protection Agency will not revise the existing national ambient air quality standards for nitrogen oxide. EPA said the current standard, 0.053 ppm measured on an annual average, is adequate to protect public health and the environment.
Copyright 1996 Oil & Gas Journal. All Rights Reserved.
