INDUSTRY BRIEFS

Correction

Mobil Producing Nigeria is operator of the field where expatriate offshore workers were held hostage late in December, not Mobil Oil Nigeria Ltd., as reported incorrectly (OGJ, Jan. 13, 1997, p. 27). The vessel involved was a contractor's derrick/lay barge, installing platforms.

Companies

Lomak Petroleum Inc. agreed to acquire certain West Texas, South Texas, and Gulf of Mexico properties from American Cometra Inc. for $400 million. Both are Fort Worth firms. Included are 515 producing wells, 401 proven development projects, a leasehold of about 149,000 acres, 265 miles of gas pipelines, and a 25 MMcfd Midland basin gas plant. Lomak plans to invest $140 million the next 5 years to increase production from the properties.

Mesa Inc., Dallas, agreed to acquire for $270 million all of the capital stock of Greenhill Petroleum Corp., Houston, from Western Mining Corp. (USA), a unit of WMC Ltd., Melbourne. Assets, in the Gulf of Mexico, Permian basin, and inland waters of Louisiana and the Texas Gulf Coast, include 522 producing wells and more than 200 development projects. Mesa identified 45 development and 132 recompletion exploitation opportunities. It plans to spend at least $65 million on about 50 drilling projects in 1997-98.

GPM Gas Corp., a unit of Phillips Gas Co., completed purchase of Amoco Corp.'s Midland Farms, Mojo, and Goldsmith gas gathering assets in the Permian basin of West Texas (OGJ, Aug. 12, 1996, p. 40). The deal includes Amoco's interest in the 26 MMcfd North Cowden processing complex and gathering system in Ector and Andrews counties.

NGL

Novagas Clearinghouse Ltd., Calgary, filed an application with British Columbia's Environmental Assessment Office for approval to build and operate a 350 MMcfd natural gas liquids extraction plant and truck terminal at Taylor, B.C. Estimated cost of the complex is $50 million (Canadian). The 20,000 b/d Taylor 2 plant would extract NGL from locally produced gas for delivery into a new 8-in. NGL pipeline Novagas proposes from Taylor to Boundary Lake at the British Columbia-Alberta border. The plant could be on stream in April 1998.

Mesa purchased for $66 million all of Mapco Inc.'s NGL and condensate reserves totaling almost 11 million bbl in the West Panhandle fields in Texas. Mapco's processing plants are not included. The deal is effective Jan. 1, 1997. Expected 1997 production totals 850,000 bbl. Tulsa-based Mapco will continue to provide pipeline transportation and fractionation services for Mesa's NGL output under a long-term contract. Under a term agreement, Mapco will purchase all of Mesa's NGL production to support its marketing initiatives.

Exploration

Norway's Ministry of Industry and Energy extended by 1 month to Mar. 5 the deadline to apply for new acreage in the Barents Sea off northern Norway. State-owned Den norske stats oljeselskap AS (Statoil) said the extension reflects delays in disclosing the earlier date in a European Union journal, as required in a trade agreement between Norway and EU. The government has offered 45 Barents Sea blocks to companies and intends to award exploration licenses in the spring (OGJ, Oct. 21, 1996, p. 22).

Total Oil Marine plc and Saga Petroleum AS, Oslo, formed an alliance for deepwater exploration and development along the Atlantic margin, which runs from west of Ireland to west of the Shetland Islands off northern Scotland. The companies will apply jointly for acreage and pool their know-how and resources. The companies have mutual interests in the area since Saga bought Santa Fe Exploration (U.K.) Ltd. (OGJ, Dec. 9, 1996, p. 34).

Antrim Resources Inc., a Canadian company, and state-owned Tanzania Petroleum Development Corp. signed a production-sharing agreement calling for Antrim to conduct exploration on the islands of Zanzibar and Pemba in the Indian Ocean and offshore along Tanzania's Indian Ocean coast. Antrim budgeted at least $15 million for a 4-year exploration phase.

Woodside Petroleum Ltd., Melbourne, plans to spud the 2 Keast appraisal in March after its 1 Keast wildcat off Australia's North West coast, about 20 km southwest of Goodwyn field, tested at a constrained rate of 20 MMcfd of gas and 1,000 b/d of condensate.

Belco Energy LP, a unit of Belco Oil & Gas Corp., New York, and privately held Andover Partners and Andex Partners will jointly explore an area of mutual interest (AMI) in the Green River and Wind River basins of Wyoming. Belco will acquire a 50% undivided interest in about 553,000 gross acres and fund 100% of exploration-related operations during 5 years to $20 million. Above that, costs will be shared equally. Separately, Belco and Snyder Oil Corp., Fort Worth, formed joint exploration-development programs and AMIs covering 63,408 acres in the Otto area of the Bighorn basin and 30,692 acres in the North Riverton area of the Wind River basin.

Costa Rica's government is accepting bids for exploration and development after 14 years of study. The first bid round, covering 15 onshore and 10 offshore blocks, will close June 30. Officials said each stage of development will involve public hearings and strict environmental impact studies.

Petrochemicals

China's Sinopec Luoyang Petrochemical Co. let a $70 million contract to Babcock King-Wilkinson, a unit of Babcock International, to build a 160,000-metric ton/year paraxylene plant at Sinopec's Luoyang complex in Henan province. The plant, which will use UOP technology to manufacture purified terephthalic acid in the production of polyester, is slated for commissioning in 2000. Babcock King-Wilkinson recently completed a similar complex at Urumqi, in China's Xinjiang province.

Lyondell Petrochemical Co., Houston, plans a 440-million lb/year high density polyethylene (HDPE) resin capacity expansion using Nissan technology. A site for a new unit has not been selected. The expansion will give Lyondell 40% more capacity to meet projected demand growth of high-molecular weight film resins, as well as incremental capacity for other processes. The expansion will increase Lyondell's total HDPE capacity to more than 2 billion lb/year after start-up, set by mid-1999. Nissan technology is used at a Lyondell plant in Matagorda County, Tex.

Phillips Petroleum Co. and PTT Petrochemical Co. Ltd. (Pttpc), a Petroleum Authority of Thailand/National Petrochemical Co. Ltd. unit, plan a joint venture to build, own, and operate a 440-million lb/year linear polyethylene plant at Mab Ta Phud in Thailand's Rayong province. The JV, now covered by a memorandum of understanding, is subject to negotiation of definitive agreements and government and company approvals. Construction would begin in third quarter 1998, with production set 1 year later. The complex, Phillips' first Thai petrochemical project, would use its proprietary PF loop-slurry process. Pttpc would supply ethylene to the complex.

Gas processing

Abu Dhabi National Oil Co., Abu Dhabi's state-owned oil company, plans to boost production capacity of its Habshan gas processing complex to 3 bcfd by 1999 from 2 bcfd currently. Construction of a new plant would involve three independent trains to process gas and include a network of 1,000 km of pipeline to supply gas to key installations.

Drilling-production

Lagoven SA, a unit of Petroleos de Venezuela SA, let a service contract to Williams Cos. unit Williams International Co., Tulsa, and Production Operators Corp., Houston, covering what the companies say is the largest natural gas injection project to be outsourced in Venezuela. Project involves design, construction, and operation for 20 years of a complex to provide gas compression, transmission, and injection involving El Furrial reservoir in northeastern Venezuela. The complex will handle more than 600 MMcfd of gas and require 112,000 hp of compression. Investment is pegged at $195 million.

U.S. Minerals Management Service scheduled two meetings to receive comment on its proposed rulemaking regarding valuation of royalties on crude produced on federal lands (OGJ, Jan. 27, 1997, p. 36). Meetings are set at its offices Feb. 25 in Houston and Mar. 4 in Lakewood, Colo.

Tengizchevroil, operator of Kazakhstan's Tengiz oil field, let a 5-year contract to Parker Drilling Co., Tulsa, to expand operations in Kazakhstan. The agreement creates a broad alliance between Parker and Tengizchevroil, a joint venture of Kazakhstan, Chevron Overseas Petroleum Inc., and Mobil Corp. Parker will operate and maintain Tengizchevroil rigs, as well as perform other services. Also, Parker will provide local and expatriate drilling crews, maintenance personnel, and training.

Taurus Exploration Inc., a unit of Energen Corp., Birmingham, Ala., plans to acquire 225 bcf equivalent (bcfe) of San Juan basin oil and gas reserves in a $77.7 million purchase from Burlington Resources Inc., Houston. A March closing is planned. The deal has a Jan. 1, 1997, effective date. About 80% of total proved reserves are developed and producing. Taurus plans to spend an additional $18.5 million to fully develop reserves.

Mobil Equatorial Guinea Inc., a unit of Mobil Corp., let a contract valued in excess of $115 million to Oceaneering International Inc., Houston, for modifications to Zafiro Producer, a floating production, storage, and offloading (FPSO) vessel, as part of phase two Zafiro field development off Equatorial Guinea. The FPSO will remain in operation during modifications, to be performed during two seasons by Oceaneering's Production Systems' division.

Statoil chartered Borgland Dolphin semisubmersible drilling rig from Dolphin DOC AS, Tananger, Norway, under an 8-year charter valued at $340 million. The rig, stacked for 2 years, will be upgraded for spring 1998 start-up. The charter will enable Statoil to meet its rig needs for current development and well completion plans (OGJ, Dec. 2, 1996, p. 25).

Pipelines

A 26-in. gas pipeline operated by Northwest Pipeline Corp., Salt Lake City, exploded and caught fire Feb. 9 near Kalama, Wash., the second explosion in 2 days on the pipeline. A similar explosion and fire Feb. 8 occurred near Bellingham, 70 miles north of Seattle. No injuries were reported. Service was restored by presstime. Officials blamed stresses from land movement.

Canada's National Energy Board told TransCanada PipeLines Ltd. to reduce operating pressure on a section of Line 100-1 pipeline between Falcon Lake, Man., and Ignace, Ont., until pipeline safety can be verified. The order, to 90% of the line's maximum operating pressure, will be in force until May 31, 1997, or until such time as line integrity can be confirmed by hydrostatic testing and internal electronic inspection. The area includes a section near Stewart Lake where a line break last year caused a pipeline explosion (OGJ, Dec. 23, 1996, p. 38). Officials blamed general corrosion for the break.

Portland Natural Gas Transmission System (Pngts), Portland, Me., and Maritimes & Northeast Pipeline LLC, Boston, applied to the Federal Energy Regulatory Commission to construct about 100 miles of 30-in. jointly owned pipeline and facilities between Dracut, Mass., and Westbrook, Me., between an interconnection with Tennessee Gas Pipeline and an interconnection with the upstream portions of the proposed 290-mile Pngts system and the 729-mile Maritimes & Northeast system. The companies said the joint filing for one large-diameter pipeline segment eliminates having to install separate lines. An Aug. 31 final order was requested.

Iroquois Pipeline Operating Co., Shelton, Conn., is conducting an open season for about 200 MMcfd of potential long-haul, firm transportation capacity for delivery into the New York City area by November 1999 on the Iroquois Gas Transmission System. Proposals are invited for incremental firm transportation service for other existing or proposed interconnects along the 375-mile pipeline. Bids with minimum 10-year terms are due by Mar. 4. The line now has multiyear firm contracts to move about 875 MMcfd.

Norsk Hydro AS let a $26 million contract to DSND Subsea AS, Grimstad, Norway, to lay a 25-km, 12-in. oil pipeline between Oseberg East field and Oseberg field center in the Norwegian North Sea (OGJ, Jan. 6, 1997, p. 25). Contract covers engineering, procurement, construction, and installation. Work will be done in spring and summer 1998. Production is scheduled in October 1998.

Refining

Citgo Petroleum Corp., Tulsa, planned to put half the capacity of its 62,000 b/d coker back on stream by end of last week following a Feb. 7 fire at its 320,000 b/d Lake Charles, La., refinery. Remaining coker capacity is due to be back on stream by Feb. 21.

Sharjah Refining Co. is advancing plans for Sharjah's first oil refinery. The complex, being built in the Hamriya free zone for about $109 million, will have an initial 35,000 b/d capacity. It will be upgraded to 60,000 b/d in mid-1998. Commissioning is set in October.

Isab Energy, formed by Erg Petroli, a unit of Italy's Erg SpA, and Edison Mission Energy, is constructing a new integrated gasification combined-cycle (IGCC) plant at Priolo, Sicily. The IGCC power station, located at the Priolo refinery, is scheduled to go on stream in 1999 and generate 4 million MW/year, equivalent to 2% of total Italian electricity supply. Isab Energy's investment is pegged at $1.33 billion. The company is owned 51% by Erg Petroli and 49% by Edison Mission Energy.