U.S. BRIEFS

ENVIRONMENT

CONOCO INC. will begin what it says is industry's first lube oil recycling program in which used oil will be accepted from all commercial buyers and distributors in amounts equal to new lube oil sold to those firms. Conoco hopes to have trucks that carry new oil to buyers and distributors return with used oil, which will be tested for contaminants before being taken to a recycling site.

ACQUISITIONS

SONAT INC. and North Carolina Natural Gas Corp., Fayetteville, N.C., signed a $125 million merger agreement. Sonat will exchange 7/10 of a share of a new preferred stock, convertible to Sonat common stock at $50.25/share, for each share of NCNG stock. The merger, part of Sonat's plan to extend its interstate gas pipeline system into North Carolina, provides for NCNG to operate under present management as a division of Sonat. It is subject to government and NCNG shareholder approvals.

REFINING

CHEVRON CORP. purchased for $12.7 million a Honeywell Ltd. distributed digital control system to convert its 55,000 b/d Ewa Beach, Hawaii, refinery from analogue panel mounted pneumatic controls to digital. Chevron also will combine the plant's present five control rooms into one control center. It expects to have the system installed by second quarter 1992.

TEXACO REFINING & MARKETING INC.'S Anacortes, Wash., refinery spilled about 1,100 bbl of Alaskan North Slope crude at March Point when a booster pump blew out during unloading of a tanker, causing the oil to spew from a 20 in., 23,000 bbl/hr pipeline. The Coast Guard said about 3,100 gal of crude entered Fidalgo Bay. Crews from Texaco and the Clean Sound Cooperative, composed of refineries in the Puget Sound area, were mobilized to the spill site, about 80 miles north of Seattle.

COMPANIES

NOBLE AFFILIATES INC. unit Samedan Oil Corp. will receive $8 million cash plus attorney's fees and other costs from an undisclosed buyer of Outer Continental Shelf gas off Louisana to settle a gas purchase contract dispute.

ALTERNATE FUELS

CALIFORNIA ENERGY CO., San Francisco, signed a joint venture agreement with Kiewit Energy Co., Omaha, to jointly' develop geothermal leases in Nevada and Utah that California Energy recently acquired from Chevron Corp. As part of the pact, Kiewit will buy 4 million newly issued California Energy shares at $7.25/share with an option to buy as many as 6 million more at $10.50/share.

COGENERATION

CABOT ENERGY CORP. LTD., Port Hawkesbury, N.S., and its affiliate, Struthers Corp., Pittsburgh, plan to build a metallurgical coke and power generation plant in Point Tupper, N.S., on the former Atomic Energy of Canada Ltd. site. The project will produce 4,000 metric tons/day of coke with 150,000 kw cogeneration capacity. It will be operated by an international group directed by Cabot and Struthers.

ENSERCH CORP. arranged financing from First National Bank of Chicago for its $87 million, 62,000 kw gas fired congeneration project in Buffalo. Enserch will serve as general partner of the limited partnership, with Continental Energy Services Inc. and Ensat Cogeneration Co. as limited partners, and Lone Star Energy Co. will operate it. Ebasco Constructors Inc. designed the plant, and expects to begin construction in early March with late 1992 startup.

MARKETING

UNOCAL CORP. will retain First Boston Corp. to evaluate strategic and financial options for its U.S. Southeast marketing and distribution assets and its U.S. Auto/TruckStop network as part of a continuing restructuring. Under consideration is a long term supply commitment. Assets under study include 50 company-owned retail outlets, contracts with more than 200 marketers representing more than 4,200 other branded outlets, 25 product terminals, a lube oil blending/packaging plant, and about 150 Auto/TruckStop outlets.

TRANSPORTATION

WESTGAS INTERSTATE INC., Denver, asked the Federal Energy Regulatory Commission for a permit to operate a gas pipeline from near Pierce, Colo., to east of Cheyenne, Wyo. It also seeks blanket clearance to provide open access service and to build and operate related facilities. WestGas bought the 4 and 8 in. oil and products line from Conoco Pipe Line Co. Inc. in 1990 and converted it to gas service (OGJ, Jan. 7, p. 32).

MOSS BLUFF GAS STORAGE SYSTEMS, Houston, began offering special off peak discount rates for interruptible storage and interchange services at its Moss Bluff gas storage facility in Liberty County, Tex. (OGJ, Dec. 31, 1990, p. 35). The monthly storage fee will be discounted to 9.5/MMBTU from 24/MMBTU based on the average daily balance of inventory. Also, the 68/MMBTU maximum deliverability capacity fee and l/MMBTU maximum injection and withdrawal charges will be waived. It will assess a fuel charge of 1.5% on all volumes injected.

HUNT REFINING CO., Dallas, purchased all storage facilities and assets of Mobile Bulk Terminal Co., Mobile, Ala., from Ergon Inc., Jackson, Miss., for an undisclosed price. Hunt unit Alabama Bulk Terminal will own and operate the Mobile terminal.

COLUMBIA GAS TRANSMISSION CORP., Charleston, W.Va., began delivering 20 MMcfd of gas to Piedmont Natural Gas Co., Charlotte, N.C., under a contract to eventually move 60 MMcfd to Piedmont's Carolina division. It is Columbia's first firm sales to a distributor serving South Carolina and the second to one serving North Carolina.

CALIFORNIA PUBLIC UTILITIES COMMISSION issued final rules allowing gas utility core customers who aggregate loads to obtain transportation-only services on utility pipeline systems. The rules cover a 3 year pilot program for small core customers applying on a first come, first serve basis during a May 15-July 1 open season for service beginning Aug. 1.

QUESTAR PIPELINE CO., Salt Lake City, applied for a Federal Energy Regulatory Commission permit to provide open access gas storage, starting May 15, at its Clay Basin storage field in Northeast Utah. Questar plans to hold an open season Mar. 1631 to accept requests for self-implementing firm and interruptible service. It will market about one third of Clay Basin's 30 bcf/year injection capacity to new customers if FERC grants permit. Questar also asked for interim clearance to begin the service in case FERC has not acted by May 15.

Copyright 1991 Oil & Gas Journal. All Rights Reserved.