Industry Briefs

Alternate fuels

Scotland's Dundee Energy Recycling Ltd.-a joint venture of London's BICC plc, Oslo's Kvaerner AS, and Dundee City Council-raised £42 million ($68 million) to build a waste-to-energy plant at Baldovie, Dundee. The plant will be the U.K.'s first waste-to-energy project. It will burn 120,000 metric tons/year of waste to generate as much as 8.3 MW of electric power for delivery to the national grid. The venture let a £35.1 million ($56 million) turnkey contract to a 60-40 BICC/Kvaerner alliance for design and construction.

Terminals

Shell Petroleum Development Co. is spending $433 million to refurbish and upgrade its 35-year-old Bonny terminal in Rivers state, Nigeria. The terminal was commissioned in 1962. Shell has rehabilitated 13 of the terminal's 23 tanks, including rebuilding one that was struck by lightning and gutted by a fire about 4 years ago. Program completion is slated for 2001.

Exploration

Norwegian state firm Statoil and Russian gas giant Gazprom agreed to collaborate on exploration of Medynskayamore field just off Russia's northern coast in the Pechora Sea. Statoil will pay 25% of exploration costs and Gazprom the rest in a drilling program to target reservoirs deeper than current finds. The Murmanskaya jack up rig has begun drilling the first joint well in 10 m of water. Statoil and Gazprom have a similar agreement for exploration of Varandeymore find along the coast to the southwest, where 3D seismic data were acquired during the summer.

Genoil Inc.,
Calgary, and partners will drill another exploratory well off Cuba in the next 12 months under an agreement with Comerci l Cupet SA, the Cuban state oil company. Genoil said the test will be a follow-up to the Ana Maria No. 1 well drilled last summer, which flared gas and had live oil shows but was not commercial. The company also has agreements for seismic and exploratory drilling on onshore Cuban Blocks 19 and 20.

Premier Oil plc,
London, disclosed a gas discovery in Block A off Indonesia in the Natuna Sea. Gajah Puteri-2 well flowed a combined restricted total 35 MMcfd of gas and 1,406 b/d of condensate from three pay zones on test. The well has been suspended as a potential producer. Premier has tentatively estimated reserves for the find at 200-400 bcf of gas. The company intends to market the find as part of a proposed sale of gas from the western Natuna Sea to Singapore. Premier has chartered Harvey H. Ward to drill four wells on the block. The second, Pelikan-1, will be spudded shortly.

Amadeus Petroleum NL,
Perth, began exploratory drilling in the Savory basin, in the Pilbara region of Western Australia. The company plans to drill three shallow wildcats, each to a depth of 1,100 m, on its 16,000 sq km permit area, EP380. Located between Canning and Officer basins, Savory's prospectivity was enhanced late last year when oil was found along the southern margins of the basin. The Geological Survey of Western Australia will assist Amadeus in evaluating its drilling results.

Benton Oil & Gas Co.,
Carpinteria, Calif., agreed to acquire a farm- out from Shell Exploration (China) Ltd., Beijing, in Shell's Liaohe area in northeastern China. Benton will have 50% participation in the project, which will be operated by Shell. Shell's contract with China National Petroleum Corp. is for deep exploration and development rights on Qingshui block, a 563 sq km area in the Liaohe River delta. The contract area is surrounded by large, shallow discoveries holding more than 4 billion bbl of oil in place. A database has been developed on the area, including 600 sq km of 3D seismic and results from 24 deep wells.

Fugro-Geoteam AS,
Oslo, completed acquisition and processing of a 3,500 line-km 2D seismic survey in the southern Norwegian North Sea. The survey, carried out in association with Statoil, covered the eastern flank of the Central Graben and nearby fields, mainly in Quadrants 16, 17, 7, 8, and 2. Geoteam said this nonexclusive survey was intended to evaluate possible exploration fairways for long-distance migration of hydrocarbons generated in the Central Graben.

Black Sea Energy Inc.,
Calgary, completed registration of Radonezh Petroleum, its third Russian joint venture. Radonezh will hold exploration and development permits for a 1.3 million acre block adjacent the company's Tura project, near Tyumen, southern Siberia. Four productive zones have been tested, with each flowing as much as 500 b/d. Russian firm Tyumennedra is a 50% partner in the venture.

Pakistan
awarded two exploration licenses in the Sanghar and Thar Parkar districts of Sindh province. One was granted to a joint venture of Union Texas Pakistan Inc., Edison Gas, and government state entities for the 3,030 sq km Umer Kot block. The second was awarded to UT Pakistan and state entities for the 3,892 sq km Kinsar block. UT Pakistan is operator for both licenses. The groups will put up about $10 million for an exploration program to include shooting a 250 line-km seismic data, performing aerogravity and aeromagnetic surveys, and drilling two exploratory wells during the initial 3-year term.

Amoco (U.K.) Exploration Co.
disclosed test results for a discovery well drilled on Appleton Beta prospect on U.K. North Sea Block 30/11b. The 30/11b-4 well flowed 6,329 b/d of oil and 13.4 MMcfd of gas on test, but Amoco would say only that the discovery is "significant." The new find is near Amoco's Halley find. The company plans further appraisal of Appleton this year and feels the find might prove to be a hub for a number of oil and gas finds in the area.

Refining

Reliance Industries Ltd.'s consulting engineer, Bechtel SA France, let a supply contract to GHH Borsig Turbomaschinen GmbH, Oberhausen, Germany, for compression and turbine equipment for a 450,000 b/d refinery Reliance is building at Jamnagar, India (OGJ, July 14, 1997, p. 32). GHH Borsig will supply two machine trains for the fluid catalytic cracking (FCC) unit, including an FCC gas expander, axial compressor, steam turbine, and motor/generator; four 32-MW steam turbines; and nine process-gas turbocompressors. Linde AG, another Reliance contractor, ordered from GHH Borsig a multishaft fuel gas compressor.

Valero Refining Co.
let contract to BOC Gases, Murray Hill, N.J., to build a 200 ton/day oxygen/nitrogen generator and supply SURE sulfur recovery technology for Valero's Corpus Christi refinery. Valero will use the oxygen in its heavy oil cracker, sulfur recovery units, and bio-slurry reactor. The SURE process will increase sulfur unit capacity and efficiency. The oxygen plant-using BOC's ICO technology-will come on stream next April.

Cogeneration

NRG (Morris) Cogen LLC, a subsidiary of NRG Energy Inc., Minneapolis, is building a 117-MW cogeneration plant at the Morris, Ill., petrochemical complex of Millennium Petrochemicals Inc., Cincinnati. NRG will own and operate the plant, which will meet all of Millennium's electric power and steam needs. The plant will use natural gas and some process gas as fuel. The unit is expected to start up in fall 1998.

Petrochemicals

Haldia Petrochemicals Ltd., Calcutta, licensed Montell Polyolefins BV's Spherilene technology for a new polyethylene unit to be built at Haldia's West Bengal plant. Haldia will use the "swing" gas-phase technology to boost capacity at the plant to 225,000 metric tons/year from 120,000 tons/year. Haldia already uses the Spherilene process at the site. The Tecnimont engineering unit of Montedison SpA was awarded the construction contract for the unit, which is due on stream in mid-1999. Haldia is also building a 190,000 ton/year polypropylene plant at the site, based on Montell's Spheripol technology.

The joint venture of
Houston's Lyondell Petrochemical Co. 57% and Millennium Petrochemicals 43% will be named Equistar Chemicals (OGJ, Aug. 4, 1997, Newsletter). Equistar will own 13 U.S. plants that produce mainly olefins and polymers.

Storage

The American Petroleum Institute will offer the first of a series of training seminars on its petroleum storage tank standards Dec. 2-4 in Los Angeles. Other seminars will be held next year in: Houston, Feb. 3-5; Wilmington, Del., May 19-21; Chicago, Aug. 18-20; and Oakland, Calif., Dec. 1-3.

Drilling-production

Ecuador's state firm Petroleos del Ecuador had to shut in production from eight oil fields after protesters overran the first pumping station on the national cross-country oil pipeline. Press reports say the peaceful occupation of the station has reduced Ecuador's daily oil output by 15%. Ecuador's production currently averages about 370,000 b/d.

Norway's
Statoil says first oil from Norne field has been delayed from the Oct. 1 target because of technical problems and last month's helicopter crash, in which 12 offshore workers were killed (OGJ, Sept. 15, 1997, p. 34). Statoil said the crash halted daily commuting to the field, reducing staff on Norne by 40% and delaying completion work. Now Norne is expected on stream in mid-November. Two of four pre-drilled wells have been completed, one of which is expected to yield 36,000 b/d of oil in full production.

Kuwait and Saudi Arabia
plan to increase oil production in the Neutral Zone to 420,000 b/d by 2005 from the current 274,000 b/d. The increase will come from both new and existing oil fields. Kuwait National Petroleum Co. and Texaco Saudi Inc., Riyadh, agreed to form a combine to drill new wells, repair oil installations, and build gathering centers in the area.

Tatarstan
heavy oil production is the goal of Ideloil, a newly registered joint venture. Partners are: Tatnefteprom Joint Stock Co. 40%, Tatneft and Tatneftekhiminvestholding 10% each, Russia's Zarubezhneft 5%, and Britain's Aminex plc 35%. Initial production will be about 2.5 million metric tons/year. Six existing joint companies produced 1 million tons in Tatarstan in first-half 1997-an amount equal to all of 1996 production.

Norsk Hydro Produksjon AS
let a 530 million kroner ($73 million) contract to Procon Drilling Services AS, Bergen, for development drilling in Oseberg East, South, and C satellite fields. The 5-year contract has five 1-year options and includes potential for development work in Fram and Grane discoveries and Heimdal field.

The U.S. Bureau of Land Management
issued a rule to streamline its requirements and allow Indian tribes to conduct BLM oil and gas inspection and enforcement (I&E) activities on tribal lands. BLM will reimburse 29 tribes, mostly in the U.S. West, 100%-up from 50%-for I&E costs.

Exports-imports

Ukraine's State oil and gas committee said Ukraine will remain the biggest consumer of Russian gas next year but will seek to reduce its dependence in the future. Russia has agreed to supply Ukraine more than 45 billion cu m of gas in 1998-the same as this year. Ukraine also plans to buy 15 billion cu m from Turkmenistan and several billion cubic meters from Uzbekistan.

Centrica plc,
the U.K. gas supply company formed when British Gas plc split, has secured a new contract for delivery of gas through the U.K.-Belgium Interconnector gas export pipeline. The contract calls for delivery of 700 million cu m/year of gas over 8 years beginning when the Interconnector is brought into operation in October 1998. The contract is with the Entrade gas trading joint venture of two Dutch regional utilities that are planning to merge in early 1998: Provinciale Noordbrabantse Energie-Mij. BV and Mij. voor Elektricitiet en Gas Limburg.

Companies

BG plc entered negotiations for sale of its Pipeline Integrity International (PII) division to management buyout specialist Mercury Asset Management plc, London. PII is a pipeline inspection business with assets of about £40 million ($64 million) and operations at four U.K. locations and in Houston.

Pacalta Resources Ltd.,
Calgary, sold its Canadian properties to Cascade Oil and Gas Inc., Calgary. Pacalta will concentrate on operations in Ecuador's Oriente basin, where it now produces 13,700 b/d. The acquisition of Pacalta's Alberta properties will increase Cascade's production to 1,650 boed from 500 boed and increase its land bank to 118,000 acres. Cascade manages the Canadian operations of its major shareholder, Abraxas Petroleum Inc., San Antonio.

BG plc
acquired a further 16% interest in India's Gujarat Gas Co. Ltd., after buying a 44.31% stake (OGJ, July 14, 1997, p. 33). BG wants to supply pipeline gas to the Gujarat region through Gujarat Gas and to Mumbai (formerly Bombay) through its Mahanager Gas venture with Gas Authority of India Ltd. BG plans to build a gas-fired power plant in Gujarat state and is looking to build a terminal to import 2.5-5 million metric tons/year of liquefied natural gas to Gujarat.

Pipelines

TransCanada PipeLines Ltd., Calgary, will file with the U.S. Federal Energy Regulatory Commission within a month for approval of its Viking Voyageur natural gas pipeline project. The company will file a similar application with Canada's National Energy Board for the TransVoyageur line, the Canadian segment of the project. The proposed line would extend from Alberta to the Chicago area (OGJ, Aug. 25, 1997, p. 29).

Taxes

Russia's Duma will consider the new tax code in a second reading in mid-October, according to Mikhail Aleksei, head of the committee for natural resources. A commission including Duma members and oil company representatives are working to make the new code stimulate investment in Russia's fuel and energy sector.

Copyright 1997 Oil & Gas Journal. All Rights Reserved.