U.S. BRIEFS

PETROCHEMICALS

QUANTUM CHEMICAL CORP., New York, started up the first world scale, grassroots ethylene plant built in the U.S. since 1983. The Deer Park, Tex., plant is fed by liquefied petroleum gas and is producing ethylene at 70% of its capacity of 1.5 billion lb/year. M.W. Kellogg Co. handled engineering, procurement, and construction on the 32 month job.

REFINING

UNOCAL CORP has until May 17 to respond to Environmental Protection Agency allegations it mismanaged toxic waste at its 108,000 b/d Los Angeles refinery. EPA proposes to fine Unocal $689,700. The EPA complaint is the first regional enforcement action under federal hazardous wastes handling rules that took final form last year (OGJ, Mar. 5, 1990, p. 33). EPA alleged Unocal mismanaged a 22 million gal wastewater storage pond containing benzene and other hazardous materials and improperly labeled hazardous waste drums.

HONDO OIL & GAS GO., Roswell, N.M., hired BT Securities Corp. to study possible sale of its Fletcher Oil & Refining Co. unit. Fletcher operates a 32,000 b/d high conversion refinery in Long Beach.

DRILLING-PRODUCTION

SAMEDAN OIL CORP., Ardmore, Okla., paid $8.1 million to Forest Oil Corp. for interests in four Offshore Louisiana leases. In the deal, Samedan acquired a 50% working interest in West Delta Blocks 19 and 20, with one completed well that flowed 7.4 MMcfd of gas and 109 b/d of condensate, and a 5% overriding royalty interest in the unitized part of Ship Shoal Blocks 291 and 300, where there is one well completed and another drilling. Proved reserves covered by the deal thus far are estimated at 8 bcf of gas and 284,000 bbl of condensate.

CLINTON GAS SYSTEMS INC., Columbus, Ohio, through its Clinton Oil Co. unit agreed to buy 435 producing oil and gas wells in Ohio from CNG Producing Co., New Orleans, for $7.5 million. Certain interests are subject to retained contracts, and final terms may be 300 wells for $6 million.

EBCO U.S.A. INC., Oklahoma City, will auction 400 producing leases owned by 34 companies in 12 states May 8 at Southland Center Hotel, Dallas.

BUREAU OF LAND MANAGEMENT is considering changes to rules governing minimum site security for operators verifying sales volumes on federal and Indian leases. The changes would set minimum requirements for an operator to inspect and verify sales volumes if lease automatic custody transfer meters are not used.

PLAINS RESOURCES INC., Houston, sold Midcontinent properties for $23 million, not Plains Petroleum Resources Inc., as reported incorrectly (OGJ, Apr. 22, p. 46).

GOVERNMENT

TEXAS GOV. ANN RICHARDS proposed legislation to provide incentives for Texas electrical power plants to burn more Texas gas. The proposal would change state regulatory procedures and allow utilities to recover costs associated with storing alternative fuels and maintaining long term contracts.

COMPANIES

TOTAL PETROLEUM (NORTH AMERICA) LTD., Denver, plans to spin off its Canadian oil and gas operations as a separate public company. The plan will be effective upon shareholder and Canadian government approval, expected about June 1. Total Canada Oil & Gas Ltd. will get the Canadian operations and assume about $34 million of bank debt.

A HOUSTON federal district court judge ruled partly in favor of Chevron U.S.A. in a lawsuit brought by former Gulf Oil Corp. employees over Chevron's use of surplus funds in Gulf pension plans after the 1984 merger of the two companies. The judge ruled the two companies' main pension plans were merged properly and said Chevron could ultimately recover more than $500 million from the main plan. He also ordered Chevron to pay about $180 million to about 19,000 participants in supplemental Gulf pension plans. Chevron plans to appeal the latter ruling.

GRACE ENERGY CORP., Dallas, plans 1991 capital and equipment spending, excluding acquisitions, of $78 million vs. $82 million in 1990. Grace earmarked $28 million for its Grace Petroleum Corp. exploration and production unit, down from a previously announced budget of $37 million. Exploration will account for $5 million of the current budget.

SANTA FE MINERALS INC., Dallas, will close its Tulsa office by September. Six employees were offered transfers and 41 laid off. The office is mainly responsible for Oklahoma operations. The company, a unit of Kuwait Petroleum Corp. subsidiary Santa Fe International Corp., plans to focus on the Gulf of Mexico.

EXPLORATION

TEX/CON OIL & GAS CO., Houston, 1 Brooke flowed 4.1 MMcfd of gas, 129 b/d of condensate, and 150 b/d of water through a 14/64 in. choke with 4,819 psi flowing tubing pressure from Lower Eocene Wilcox at 10,900 ft in DeWitt County, Tex. The company has a 79% working interest in the prospect and plans to drill two offsets this year. The Wilcox has produced more than 75 bcf from South Cook field 2 miles west and more than 80 bcf from Gunpoint field 2 miles south.

PIPELINES

MITCHELL ENERGY & DEVELOPMENT CORP., The Woodlands, Tex., bought 22 gas gathering systems from TexLine Gas Co., Corpus Christi, Tex., for an undisclosed sum. The systems involve 234 miles of 2-12 in. pipeline in 14 South Texas counties. Current throughput is about 60-65 MMcfd of gas. Some of the systems gather gas from the southern Austin chalk trend. The systems will be added to Mitchell's Southwestern Pipeline Inc. unit.

PANHANDLE EASTERN PIPELINE CO. Houston, filed a proposed settlement with the Federal Energy Regulatory Commission to resolve its Order 94 costs. Panhandle wants to allocate recovery of about $81 million in production related costs according to contract demand levels of 1985. Panhandle also filed a proposed global settlement with FERC covering a number of disputes between the company and its major sales customers.

TENNESSEE GAS PIPELINE CO. let contract to Universal Ensco Inc., Houston, to acquire rights-of-way and provide pipeline survey and engineering services for a crossover to connect Tennessee's 100 Line near Jonesboro, La., with its 500 Line near Heidelberg, Miss. The 223 mile, 30 in. spur is to start up by mid-1993.

Copyright 1991 Oil & Gas Journal. All Rights Reserved.