INDUSTRY BRIEFS
Correction
Pennzoil Co. shareholders backing Union Pacific Resources Group Inc.'s takeover bid totaled 61.5% on an outstanding-shares basis, or 57% on a fully diluted basis, while the cash portion of the offer totaled $84/share for 50.1% of Pennzoil's stock at presstime July 23. It was incorrectly reported that 84% of Pennzoil shareholders backed UPR's offer of $84/share for Pennzoil's stock (OGJ, July 28, 1997, p. 42).Terminals
Petrozuata, a strategic alliance of Petroleos de Venezuela SA unit Maraven SA and Conoco Inc. to produce, upgrade, and market 120,000 b/d of extra-heavy crude from the Zuata area of Venezuela's Orinoco oil belt (OGJ, July 7, 1997, Newsletter), let a contract valued at $190 million to Convenco, a venture of Koch Industries Inc., Wichita; Weeks Marine, Houston; and Germany's DSD-CGI to develop a marine terminal at Jose for exporting 102,000 b/d of synthetic crude upgraded from the extra-heavy crude.Drilling-production
International Petroleum Corp., Vancouver, B.C., began Phase I production from Bunga Kekwa field on Block PM-3 off Malaysia in the Gulf of Thailand. Output is expected to reach 18,000 b/d of 36? gravity oil by late August when all three wells are completed; appraisal drilling also is planned for August to confirm a new gas field, Bunga Seroja, that may contain 1 tcf of gas. Under Phase II, output is to ramp up to 40,000 b/d of oil and 250 MMcfd of gas. Award of main fabrication contracts for Phase II is slated for January 1998.Angola's
Ministry of Petroleum and state-owned oil firm Sonangol approved plans by Ranger Oil Ltd., Calgary, to develop Kiame oil find in 465 ft of water on Block 4. Development will cost $27 million using a leased production, storage, and offloading ship. Kiame reserves are estimated at 8 million bbl of oil. First oil is expected in second quarter 1998, with production expected to reach 7,000 b/d.
Canadian Occidental Petroleum Ltd.
(CanOxy), Calgary, hiked its estimate of proven reserves in Yemen's Masila block fields to 176 million bbl from about 100 million bbl at yearend 1996. Reserves are expected to keep increasing at Masila, now in production for 4 years. CanOxy's overall production continues to rise with the recent $1.7 billion (Canadian) acquisition of Wascana Energy Inc., Calgary (OGJ, Apr. 21, 1997, p. 34). Its output averages more than 200,000 b/d of oil and 448 MMcfd of gas. CanOxy's second quarter output averaged 61,500 b/d of oil and 290 MMcfd of gas.
Aminex plc,
Dublin, plans to develop oil fields in Tatarstan and expand other operations in Russia. Aminex plans to fund the effort with a share offering on the London and Dublin exchanges that it hopes will raise as much as $18.1 million. Aminex is seeking a 35% stake in Idelloil, a joint venture with Tatarstan's state oil companies, which intends to develop 15 oil finds with a combined 300 million bbl of reserves.
Pipelines
Amber Energy Inc., Calgary, plans to file with Canada's National Energy Board to build a 100,000-b/d heavy oil pipeline from Pelican Lake field in northeastern Alberta to new storage facilities at Wabasca and Mitsue, Alta. The line is slated for completion in 1998.Exports-imports
Koch Oil Ltd. and Suncor Energy Inc. signed a contract for Suncor to supply crude to Koch's 230,000-b/d Pine Bend, Minn., refinery. Suncor will ship 30,000 b/d of light sour crude to Pine Bend starting in 1999, when Suncor completes an expansion of its 105,000 b/d capacity oilsands plant at Fort McMurray, Alta. (OGJ, June 30, 1997, Newsletter).Exploration
PanCanadian Petroleum Ltd., Calgary, reported a flow rate of 7,667 b/d of 49? gravity oil and 4.02 MMcfd of gas from its 1 Tenacious ST1 sidetrack off Western Australia on exploration permit AC/P17 in the Timor Sea. The well cut an oil column of 39.5 m in Tithonian (upper Jurassic) sandstone at 2,897.5 m measured depth. Flow was limited by the 31/2 in. tubing used for the test. The well is in 153 m of water 13 km northwest of Jabiru oil field. Interests are PanCanadian, operator Cultus Timor Sea Ltd., Cosmo Ashmore Ltd., and Gulf (Aust.) Resources NL 25% each.Tornado Resources Ltd.,
Calgary, signed two production-sharing agreements with National Oil Corp. of Kenya to explore for oil and gas in Kenya's Lamu basin near the Tanzanian border and in the Mandera Basin near the Ethiopian border. The agreements have a 3-year term and call for 275 km of seismic and two exploratory wells, with a minimum $7 million investment. Tornado will begin seismic work this fall and plans to start drilling in mid-1998. The deal marks the first exploration contract signed in Kenya in 10 years and the first exploration to occur there since Amoco Kenya Petroleum Co. and Shell Exploration BV decided not to renew exploration contracts in 1992.
Anadarko Petroleum Corp.,
Houston, and partners cut 46 ft of net oil pay in the 1 Hassi Berkine South East wildcat on Block 404 in Algeria. Drilled to 10,856 ft TD, the well flowed on test at a rate of 17,092 b/d of 47.6? gravity oil and 37.5 MMcfd of gas. The well is 4.5 miles southeast of the March 1995 discovery well for HBNS field, which is under development with first output planned for early in 1998 (OGJ, Jan. 20, 1997, p. 81). Operator Anadarko holds a 50% interest prior to participation at the exploitation phase by Algeria's state oil company Sonatrach. Partners are Lasmo Oil (Algeria) Ltd. and Maersk Olie Algeriet AS, each with 25%.
Conoco Inc.,
Houston, applied to the U.S. Bureau of Land Management to drill four shallow wildcats in Utah's Grand Staircase-Escalante National Monument, where the state is suing the federal government over the area's national monument designation (OGJ, July 7, 1997, p. 29). The 3,300-ft tests to upper Cretaceous Mancos B will be on the Smoky Mountain Federal Exploratory Unit in Kane County, 20-25 miles southeast of Upper Valley oil field and 10 miles southwest of Conoco's 2 Reese Canyon-State, spudded early in July toward a 14,500-ft objective (see map, OGJ, Mar. 24, 1997, p. 69).
Greece's government
signed leases with Enterprise Oil plc, London, and partners to explore two onshore blocks covering 2,000 sq miles at Ionnina and northwest Peloponnesos in western Greece. Operator and 40% stakeholder Enterprise said the area is geologically similar to already-explored Italian blocks and offers good potential. Other partners are Hungary's MOL 20%, Union Texas Petroleum Holdings Inc. 28%, and Greece's Public Petroleum Corp. 12%. The firms must spend $37 million during 6 years, drilling one well per block.
ARCO Ireland Offshore Inc.,
Anadarko Ireland Co., and BG Exploration & Production Ltd. formed an alliance to assess the hydrocarbon potential of recently awarded acreage off western Ireland. The companies have equal interests in nine tracts awarded in the recent Rockall Trough licensing round (OGJ, June 16, 1997, p. 32). ARCO operates two of the blocks, and BG operates four full blocks and two partial blocks.
Gulf Canada Resources plc
unit Clyde Expro plc acquired a farmout of a Romanian exploration venture operated by MMS Petroleum plc, London. Clyde will earn a 70% interest in a production-sharing agreement between MMS and state firm Petrom RA covering Block VI in the eastern Carpathian mountains. Clyde will pay as much as $4 million towards exploration and appraisal work on the block.
Orbit Oil & Gas Ltd.,
Calgary, reported award of an association contract covering the Payara block in central Colombia's Llanos basin. Orbit will have a 25% interest in the contract with the remainder held by operator Casa Ingleza Ltda., Barranquilla, Colombia, and Diaz Resources Ltd., Calgary. The contract requires processing a minimum 310 line-miles of seismic, shooting 62 line-miles of new 2D seismic, and drilling two wildcats in the first 2 years on the 187,000-acre area. Final contract and regulatory approvals are pending.
Companies
Monument Oil & Gas plc, London, swapped its assets in Argentina for U.K. North Sea assets owned by Mobil North Sea Ltd. Mobil will receive Monument's entire Argentine portfolio, including a 19.9% interest in Sierra Chata gas field and 30% in Block CNQ7 exploration license. In return, Monument will take 19.5% of Block 210/24 Hudson field; 100% of Block 21/28a and 32.5% of Blocks 21/27a and b, which contain Fyne discovery; 40% of Block 16/18; and 20% of Blocks 13/16a and 13/21a, west of Captain field.Ramco Energy plc,
Aberdeen, bid $87 million for JKX Oil & Gas plc, Guildford, U.K. Ramco focuses on projects in the former Soviet Union and eastern Europe. JKX, which agreed to discuss the proposal with Ramco, has an exploration and production portfolio in Georgia and Ukraine.
Talisman Energy Inc.,
Calgary, and Texaco Inc. swapped some assets in the U.K. North Sea. Talisman obtained rights in the Moray Firth area near its Ross Field holdings, about 50 miles northeast of Aberdeen, near a 1996 discovery by Rigel Energy Corp., Calgary. Talisman also acquired property near another of its core areas west of Buchan field in the central North Sea. In exchange, Texaco received assets that were part of Talisman's acquisition of the U.K.'s Goal Petroleum Plc. (OGJ, Dec. 25, 1995, p. 32), as well as an undisclosed sum of cash.
Shell International Gas Ltd.
signed an agreement with Bechtel Enterprises Inc. to negotiate acquisition of 50% of Bechtel's International Generating Co. (Intergen) unit. Intergen develops, finances, owns, and operates electric power plants and related fuel, transportation, and transmission facilities. Intergen is developing four projects, with combined capacity of 2,145 MW, in the U.K., Philippines, Mexico, and Colombia. It has secured contracts for seven more plants worldwide and is negotiating for 20 more.
LPG
Indian Oil Corp. (IOC) and Malaysia's Petronas signed a memorandum of understanding to form a joint venture and invest $56 million building a liquefied petroleum gas (LPG) terminal at Haldia, in West Bengal, India, for import of both packed and bulk LPG to be supplied in and around Calcutta. The venture also plans to tap markets for packed LPG in the states of Orissa, Assam, West Bengal, and Bihar and set up a Malaysian export office, probably in Kuala Lumpur. IOC also is exploring plans for an LPG terminal in southern India via its earlier Indo-Mobil joint venture with Mobil Corp.Petrochemicals
Shell Chemical Co. told vendors and customers last week that the OP-III olefins plant at its Deer Park, Tex., complex will be out of commission until April 1998, because of damage to the 1.9 billion lb/year steam cracker from an explosion June 22 (OGJ, June 30, 1997, Newsletter). Shell returned to butadiene production June 20 using another unit but continues to allocate ethylene and chemical-grade propylene from stocks and production from other sites, reported industry analyst Bonner & Moore, Houston.Grand Pacific Petrochemical Corp.,
Taipei, shut down the company's acrylonitrile-butadiene-styrene (ABS) pellet production after a July 27 explosion at the Kaohsiung, Taiwan, plant. The explosion in an ABS powder storage tank and a fire that took 11/2 hr to bring under control destroyed equipment valued at about $1.2 million. Prior to the accident, the facility's output of ABS pellets had stood at about 200 metric tons/day.
Refining
Petrovietnam, the state oil company of Viet Nam, plans to go ahead on its own with its proposed $1.75 billion, 130,000-b/d Dung Quat refinery. The decision followed 3 years of negotiation with France's Total and other foreign companies (OGJ, July 28, 1997, Newsletter). Total pulled out of the project in 1995, declaring the site to be too far from oil supplies and markets to be viable (OGJ, Sept. 18, 1995, Newsletter).Enoc Condensate Processing Ltd.
let a $135 million contract to Italy's Technipetrol for design and construction of a 60,000-b/d refinery at Jebel Ali Free Zone in Dubai, slated for completion in 1999. The refinery will use UOP processes and include four Merox units to process condensate from the Persian Gulf region. Planned output is 17,000 b/d of kerosine, 11,511 b/d of diesel, 5,000 b/d of LPG, and 33,000 b/d of naphtha for the local market. The contract covers basic and detailed engineering, procurement, construction, commissioning support, and start-up.
Mapco Inc.,
Tulsa, will invest $70 million in its 18,000-b/d North Pole refinery at Fairbanks, Alas., to hike products output by 17,000 b/d, including 14,000 b/d of jet fuel. In the last year, local demand for jet fuel rose 10%, continuing a trend where demand outstrips supply in Alaska, Mapco said. Work involves building a third crude unit, slated for completion in fourth quarter 1998.
Qatar General Petroleum Corp.
plans to spend $550 million expanding capacity at its Mesaied refinery to 137,000 b/d. The project involves adding a 27,000-b/d condensate train, including a unit for fractionation of condensate from Dukhan field. The decision was spurred by increasing local demand for light products. A timetable was not disclosed for the project, which also will include upgrading the refinery from hydroskimming operations to conversion-oriented operations.
Gas distribution
A group of Gaz de France, Israel's American Israeli Gas Corp. Ltd., and NorAm Energy Corp., Houston, will bid on an expected tender to build and operate a natural gas transportation and distribution network in Israel. A number of companies have shown interest in developing a gas grid in Israel (OGJ, June 23, 1997, p. 21).Copyright 1997 Oil & Gas Journal. All Rights Reserved.