Industry Briefs
Gas storage
MCN Energy Group Inc., Detroit, is developing the Washington 10 natural gas storage project to convert a nearly depleted gas reservoir near Detroit to a 42 bcf capacity storage field. The complex will deliver an average 400 MMcfd of gas, more during peak periods. Acquisition of storage and mineral rights is under way. Construction is slated to begin late this year, with initial injection planned in spring 1999. The complex will be fully operational by the 1999-2000 winter heating season.ANR Storage Co.,
Detroit, a unit of Coastal Corp., is holding an open season through Sept. 15 to gauge interest in firm storage at its proposed underground storage field in Monroe County, Miss. The Aberdeen gas storage project will convert a depleted gas field in the western Black Warrior basin into a 6-bcf capacity complex. It will have access to markets in the U.S. Southeast, Mid-Atlantic, and Northeast and connect with Gulf Coast gas supplies. Maximum daily withdrawal capacity will be 100 MMcfd; maximum injection capacity will be 40 MMcfd.
Gas processing
Conoco Inc. plans to triple isobutane output at its Wingate fractionator in northwestern New Mexico. Construction, aimed at upgrading and simplifying operations, as well as reducing maintenance costs and improving efficiencies, will increase isobutane capacity to 6,000 b/d. The new butamer unit is slated to come on stream in second quarter 1998. Project engineering and procurement are under way. Field construction is expected to begin in 2-3 months.Pipelines
Colorado Interstate Gas Co. (CIG) and Wyoming Interstate Co. Ltd. (WIC), units of Coastal Corp., have completed Wyoming system expansions on both pipelines. WIC's capacity is now 693 MMcfd of gas, a 40% increase, achieved via about 28,700 hp of added compression. WIC is the central segment of the Trailblazer Pipeline System, extending from southwestern Wyoming to central Nebraska. Also, CIG's Wind River lateral, in north-central Wyoming, has been expanded by 68 MMcfd to 263 MMcfd total capacity. Expansion involved construction of a 10,000 hp-plus compressor station at Muddy Gap, north of Rawlins, Wyo.Drilling-production
Kazakhstan re-registered the Karakuduk-Munay Inc. 50-50 joint venture with Chaparral Resources Inc., Houston, as required by law after registration expired. The JV includes newly established Kazakhstan National Petroleum Co., or Kazak Oil, as a new partner. Chaparral is proceeding with plans to begin production from Karakuduk field by yearend (OGJ, Apr. 28, 1997, p. 44).Amoco Corp.
extended its contract with Transocean Offshore Inc., Houston, for two deepwater rigs to 10 rig-years. The $502 million contract extends an original 6 rig-year deal signed last year, giving Amoco an extra 5-year commitment each on Transocean's Amirante semisubmersible, capable of drilling in 3,500 ft of water, and Discoverer Enterprise, a new dual-activity drillship that will be capable of drilling in 10,000 ft of water.
Stone Energy Corp.,
Lafayette, La., closed the $36.6 million purchase of 66.7-83.3% working interests in Vermilion Area Block 255 field in the Gulf of Mexico from Aviara Energy Corp. and Total Minatome Corp., both of Houston, and Forest Oil Corp., Denver. The field, now operated by Stone, has eight platforms and 48 wells on Blocks 255, 256, 267, and 268, about 75 miles off Louisiana in 130-175 ft of water. Ten wells are producing a total of about 1,500 b/d of oil and condensate and 18 MMcfd of gas. Exploitation plans include four new wells and three workovers in 1998. CNG Producing Co., New Orleans, owns the remaining interests.
Apache Corp.,
Houston, increased Miocene production from Apache-operated High Island Area East Addition Block 195 to 66 MMcfd from 22 MMcfd by drilling two additional wells, including a discovery in another Miocene sand. Apache plans to spud an offset in the third quarter. Output from four wells is being moved via satellite structure and flowline on nearby Block 176 to an existing Apache production platform, also on Block 176. It owns a 40.7% working interest in Block 195. Other interests are Exxon Co. U.S.A. 33.3%, Edisto Exploration & Production Co. 23.5%, and Ridgewood Energy Equity Income 2.5%.
Chevron U.K. Ltd.
will boost fluids-handling capacity at its U.K. North Sea Alba platform to 390,000 b/d from 240,000 b/d by installing three new modules weighing a total of 1,700 metric tons. A water injection well will be connected by a new 6-km pipeline to the platform. Chevron recently upgraded Alba topsides to hike output capacity to 100,000 b/d from 75,000 b/d.
Elf Exploration U.K. plc
let a $79.5 million contract to Kvaerner Oil & Gas Ltd., London, to design and build topsides for Elgin and Franklin wellhead platforms. The finds are being developed in conjunction with Shell U.K. Exploration & Production's Shearwater find. First gas is due in 2000 (OGJ, Apr. 21, 1997, p. 29). Elgin's platform will be bridge-linked to a processing/utilities/quarters platform. Franklin's will be unmanned and set 5.5 km away. Decks will each weigh 2,000 metric tons. Construction will begin at Kvaerner's Port Clarence yard, Middlesbrough, U.K. Installation is planned in second quarter 1999.
Western Australia's
government extended its domestic gas contract with North West Shelf project partners by 15 years but reduced the volume it's willing to buy. Value of the contract is as much as $1 billion (Australian). It will begin in 2005, when the current contract expires. Government-owned AlintaGas will buy up to 74.4 MMcfd until 2020. The existing take-or-pay contract calls for purchases of up to 88.4 MMcfd until 2005. The new contract accounts for about 30% of AlintaGas's expected demand during the pact period.
Exploration
Apache and Western Atlas International Inc.'s Western Geophysical division, both of Houston, formed a technology alliance to design, conduct, and process seismic surveys on Apache's acreage worldwide. Apache says the deal gives it access to new technology and geoscience expertise available before only to major oil companies through in-house operations. The first project will be a complete analysis of acquisition and processing parameters in Egypt's western desert, where Apache has interests in 28 million acres and 13 rigs running (OGJ, July 14, 1997, p. 19).Petrochemicals
DSM NV, Netherlands, will spend $496 million to become Europe's largest polyolefins producer, with total capacity of 2.5 million metric tons/year by 2001. DSM will acquire polyolefins operations from Germany's Vestolen GmbH, including 150,000 tons/year of high density polyethylene capacity and 200,000 tons/year of polypropylene capacity. DSM also will build a 300,000-ton/year gas-phase, low density polyethylene plant and a 250,000-ton/year polypropylene plant at Gelsenkirchen, Germany. Debottlenecking and other upgrading are also planned at its Geleen complex.Malaysia's
state-owned oil company Petronas and BP Chemicals plan a joint venture to build a 500,000-metric ton/year acetic acid plant at Kertih, Malaysia. The $150 million plant will be operational by yearend 1999 and will use BP's Cativa technology. A letter of intent was signed in February, followed by a feasibility study (OGJ, Mar. 10, 1997, p. 38). BP will hold a 70% interest in the JV, Petronas the remainder. Kvaerner John Brown will be project contractor.
Germany's BASF
plans a $700 million acrylic acid/esters and oxo-alcohols project at Gebeng, on peninsular Malaysia's eastern coast. BASF has a 60% interest in the plant. Remaining interest is held by Malaysia's Petronas. Annual capacities of the acrylic acid plant will be 160,000 metric tons of crude acrylic acid, 100,000 tons of butyl acrylate, 60,000 tons of 2-ethyl hexyl acrylate, and 20,000 tons of glacial acrylic acid. It's expected to be on stream in 2000. Annual capacities of the oxo-alcohols complex will be 800,000 tons of ethyl hexanol, 40,000 tons of phthalic anhydride, and 100,000 tons of plasticizers. That plant is expected to be on stream in 2001.
Energy marketing
British Gas Trading Ltd. is supplying electricity under its first power contract serving U.K. industrial and commercial markets to Hydrocarbon Resources Ltd. Both firms are units of Centrica plc, which was formed as a result of British Gas plc's break-up earlier this year (OGJ, Mar. 10, 1997, p. 26). Hydrocarbon Resources operates North and South Morecambe gas fields in the U.K. Irish Sea. Under the contract, British Gas will provide electricity to three onshore sites.Westcoast Energy Inc.,
Vancouver, B.C., created a new business, Union Energy, an affiliate of Westcoast units Union Gas Ltd. and Centra Gas Inc., both of Toronto. The new business will focus on the rapidly deregulating retail energy services sector, initially in key markets in Canada and ultimately throughout North America.
Futures
International Petroleum Exchange (IPE), London, reached a new peak on July 31 for trading natural gas futures when 960 lots of contracts representing almost 3 trillion BTU changed hands. The previous peak was 575 lots traded Feb. 19. The latest peak represented 40% of total U.K. daily gas output.Safety
U.S. Department of Transportation's Research and Special Programs Administration (RSPA) decided federal rules are not needed to regulate design and operation of underground storage sites for hazardous materials. It advised operators to follow industry standards. The National Transportation Safety Board had urged RSPA to review adequacy of its rules after a 1992 storage cavern explosion near Brenham, Tex.CNG
Petroleum Authority of Thailand (PTT) and the Bangkok Mass Transit Authority (BMTA) are reviving plans to operate more compressed natural gas-powered buses in Bangkok to ease air pollution. BMTA has operated 84 CNG-powered buses for about 3 years. Earlier plans to add more CNG buses stalled due to the high cost and the agency's debt. Along with more buses, PTT wants to build additional CNG refueling stations on the outskirts of Bangkok.Tankers
Saudi Arabia's National Shipping Co. secured financing of $427 million from Chase Manhattan Bank to finance purchase of eight very large crude carriers (VLCCs) and three container vessels. The deal calls for $300 million to cover purchase of the five VLCCs.Terminals
TransAmerican Refining Corp., Houston, signed a letter of intent with GATX Terminals Corp. to acquire 5.5 million bbl of crude oil and product storage capacity, docks along the Mississippi River, and associated support infrastructure from GATX's complex at Norco, La. Assets being acquired are bounded by TransAmerican's 200,000- b/d refinery, now being upgraded. The refinery, scheduled for completion in 1998, will process heavy and sour crudes into light products.Companies
The merger of Parker & Parsley Petroleum Co., Midland, Tex., and Mesa Inc., Dallas, was approved Aug. 7 by shareholders of both companies (OGJ, Apr. 14, 1997, p. 26), creating the third-largest independent oil and gas exploration and production company in the U.S., the companies said. Pioneer Natural Resources Co., Irving, Tex., will have more than 3.7 tcf of gas-equivalent reserves, broken out 52% gas and 48% crude oil and liquids.Shell Continental Cos.,
Houston, formerly known as Shell Western E&P Inc., formed Shell CO2 as its business unit for managing and marketing CO2 supplies and applied technology. The new unit will be based in Houston and maintain its current presence in the Midland/Odessa, Tex., area. Shell expects to complete an expansion of its McElmo Dome CO2 source field in Colorado this fall, which will increase production capacity from McElmo Dome to more than 1 bcfd.
Texas Utilities Co.'s
planned acquisition of Enserch Corp., Dallas, closed Aug. 5 after the U.S. Securities and Exchange Commission approved the merger under the Public Utility Holding Company Act of 1935 (OGJ, June 23, 1997, p. 28). Terms call for each share of Enserch common stock to be exchangeable for 0.225 shares of Texas Utilities' common stock. Immediately preceding the merger, Enserch distributed about 1.5 common shares of Enserch Exploration Inc. for each share of Enserch common.
Specified Fuels & Chemicals LLC,
Houston, a company controlled by retired Lyondell Petrochemical Co. CEO Bob G. Gower, closed the $20 million purchase of the research and reference fuels and chemical custom manufacturing business of Howell Corp., Houston. Consummation completes Howell's divestiture of all non-exploration and production activities, permitting Howell to focus on its producing property assets.
Hurricane Hydrocarbons Ltd.
and Canadian Occidental Petroleum Ltd. (CanOxy), both of Calgary, traded some assets in Kazakhstan. Hurricane acquired CanOxy shares of Turan Petroleum Cyprus Ltd., and CanOxy acquired Hurricane shares of Cyprus-based CanadianOxy Hurricane Ltd.
Power
Hungary's national oil company MOL signed a 20-year agreement to sell 17 bcf/year of gas to a 389-MW power-generating complex on Csepel Island, near Budapest, starting in 2000. The plant is 100%-owned by Britain's PowerGen plc.Copyright 1997 Oil & Gas Journal. All Rights Reserved.