INDUSTRY BRIEFS

Lubes

Neste Oy commissioned an extra-high-viscosity base oil unit at its 160,000 b/d Porvoo, Finland, refinery near Helsinki. The unit has capacity to produce 50,000 metric tons/year of base oils for lubricants manufacture. Previously, all of Finland's lubricants were imported. The plant cost 240 million markka ($44 million).

Refining

Petroleos Mexicanos let contract to Siemens AG, Munich, to implement the Teleperm process control system at Pemex's 235,000 b/d Cadereyta refinery near Monterrey. Siemens claims the project is the first time a single instrumentation and control system will be implemented in a refinery of this size. Siemens also will supply electrical equipment. The contract is valued at 330 million deutschemarks. Teleperm is often used in power plant installations, including all six of Pemex's refinery-associated power plants.

Aden Refinery Co.
let contract to Tarmac Construction Ltd., Wolverhampton, U.K., for rehabilitation of its idle 110,000 b/d refinery at Little Aden, Yemen. The plant was badly damaged in Yemen's civil war of 1994. Oil companies suspended exploration programs and pulled out of Yemen while the fighting ensued (OGJ, May 16, 1994, p. 25). The refinery was the target of air strikes during the war.

Petrochemicals

Mitsubishi Chemical Corp., Tokyo, is no longer an equity partner in a proposed $300 million (Canadian) Shell Chemicals Ltd. ethylene glycol plant at Scotford, Alta. (OGJ, Feb. 24, 1997, p. 40). Mitsubishi was to take a 25% equity interest in the project and market 25% of the output. Shell said its requirements for external cash changed in 1996, when Shell Chemicals was spun off from its parent company as a separate company. Shell Chemicals is continuing to negotiate with Mitsubishi on marketing 25% of the output.

The Westlake Group,
Houston, increased ethylene capacity at its Lake Charles, La., petrochemical complex to 2.3 billion lb/year from 1 billion lb/year. The expansion uses the latest SRT V short residence time technology from ABB Lummus Global, Bloomfield, N.J. Lummus also designed and constructed the new train.

Exploration

Pebercan, Ville Saint-Laurent, Que., will spud its Cantel Profundo 1 well on Cuba's Varadero block by yearend. The site was chosen after interpretation of 72 km of new seismic data, acquired by NRG Services, Calgary, and processed by Robertson Research International Ltd., Llandudno, U.K. Pebercan holds exploration and production rights below 2,000 m, or below identified producing horizons. Cantel Profundo 1 will penetrate two prospects-one superimposed over the other-of fractured carbonates and bottom at 3,200 m. Pebercan is acquiring 670 km of infill seismic on five other Cuban blocks.

A group led by
Germany's Deminex AG will explore the 781 sq mile North Idku block off Egypt in second half 1998. Group members are Deminex 50%, Union Texas Petroleum 30%, and Hungary's MOL 20%. The concession is for 20 years, with a 5-year extension option. About 80% of the block is offshore, west of the Nile delta. The exploration area contains three known gas fields that are excluded from the Deminex-led group.

Petro-Canada Ltd.,
Calgary, reports a natural gas/condensate discovery on Tamadanet prospect on the Tinrhert block, Algeria. The company's discovery well, Hassi Imoulaye-1 (HIM-1), is its third well at Tamadanet and second discovery. The HIM-1 well cut 246 ft of gas/condensate pay in four Siluro-Devonian zones and flowed a combined 55 MMcfd of gas and 4,650 b/d of condensate on three drill stem tests. On a fourth test, flows were 8.8 MMcfd of gas, 490 b/d of condensate, and 1,965 b/d of water.

Total SA
acquired from Amoco Corp. half of its 100% stake in the Punta Pescador exploration permit in eastern Venezuela. The 2,000 sq km onshore/offshore block is in the northern Orinoco River delta. Amoco remains operator of the permit. Amoco started a 2D/3D seismic program last February; results are being interpreted. The partners will drill at least two wildcats, the first in second quarter 1998.

ARCO British Ltd.
and Amerada Hess Ltd. agreed to swap license interests in U.K.'s Atlantic Margin area. ARCO traded a 17% interest in Tranche 52 in the North Rockall trough for a 17% interest in Blocks 214/27a and 206/2 plus 14.8148% of Block 204/30a. ARCO said the trade adjusts its risk profile and exposes it to additional Atlantic Margin opportunities.

Gulf Canada Resources Ltd.,
Calgary, reports a significant natural gas discovery 15 miles southeast of its 1996 Bungkap gas discovery in southern East Kalimantan, Indonesia. On test, the discovery well flowed 23.4 MMcfd. The well is near Gulf Canada's Corridor gas development project. Two appraisal wells and a seismic program are planned in 1998.

Talisman Energy Inc.,
Calgary, and ARCO traded some North Sea properties in a deal that rationalizes holdings for both companies. Talisman will give ARCO interests in four North Sea blocks and undisclosed cash. ARCO will give interests in five blocks: four in the Blenheim/Bladon area of the central North Sea and one in Scotland's Moray Firth. Talisman will become Blenheim field operator. ARCO increases its interest in Waveney field development.

SOCO International plc,
London, was awarded a 30% interest in Block 16-1 off Viet Nam, where state firm Petrovietnam is operator and 50% interest holder. Block 16-1 is next to Bach Ho field. Water depth is 50 m. The Vietnamese/Soviet joint venture Vietsovpetro drilled Ba Vi No. 1 wildcat on the block in 1989. The well discovered oil in Miocene sandstone.

Pipelines

Eastern Natural Gas (Offshore) Ltd., a subsidiary of U.K. electricity generator Eastern Electric plc, bought a 30% interest in the Esmond Transportation System for £4 million ($6.4 million) from BHP Petroleum Great Britain plc. The pipeline is part of the Eagles gas pipeline system, which exports gas from a number of fields in the southern North Sea to Bacton terminal at Norfolk, U.K. Eastern is building a business as an independent gas supplier and sees the pipeline purchase as a way of securing tariffs and capacity rights.

TransCanada PipeLines Ltd.
says general corrosion was the likely cause of a Dec. 2 natural gas pipeline explosion and rupture near Cabri, Sask. (OGJ, Dec. 8, 1997, p. 26). Federal investigators completed field work Dec. 4. Repair crews began to replace about 130 ft of 36-in. pipe on the company's Line 3. The line is expected to be in full operation by the end of December. Firm service deliveries are being maintained, and no one was injured in the blast.

Companies

U.S. Federal Trade Commission completed its antitrust review of the Marathon Oil Co./Ashland Inc. refining and marketing joint venture and will permit the transaction to proceed (OGJ, May 26, 1997, p. 27).

Giant Industries Inc.,
Scottsdale, Ariz., agreed to acquire the assets of Ever-Ready Oil Co. The transaction brings Giant 27 retail service stations/convenience stores, 10 cardlock fueling operations, and lubricant sales of about 1 million gal/year.

NOVA Corp.,
Calgary, is selling Pan-Alberta Gas Ltd., its natural gas marketing unit. Pan-Alberta markets 1.6 bcfd in Canada and the U.S. and is the largest Canadian gas marketer in the U.S.

Drilling-production

Employees on the Hibernia drilling platform were evacuated Nov. 30 after a detector indicated a natural gas leak from oil stored under the platform in a utility shaft. The workers were airlifted by helicopter to a nearby rig and returned to the Hibernia platform Dec. 1. Ninety-three of 273 employees were evacuated before the alarm was canceled. The platform had been producing oil for only a few weeks at the time of the incident (OGJ, Nov. 24, 1997, p. 42).

Amerada Hess Ltd.
let a $338 million contract to Kvaerner Oil & Gas Ltd., London, to design and build a production, storage, and offloading ship for development of U.K. North Sea Bittern and Guillemot West fields. The hull will be built in South Korea, and topsides will be added at Kvaerner's Port Clarence yard at Teesside, U.K. The fields, which overlap into a number of central North Sea blocks, are being developed by a joint team from Amerada, Shell U.K. Exploration & Production, and Texaco North Sea U.K. Co. (OGJ, Nov. 17, 1997, p. 31).

Shell U.K. Exploration & Production
began oil production from U.K. North Sea Merlin field only 10 months after discovery. Merlin was developed as a single-well subsea satellite of Dunlin field for £23 million. Production is averaging 14,500 b/d of oil. Merlin has reserves of 21 million bbl of oil, about 5 million bbl of which will be produced using the first well. Shell expects to drill a second well for water injection or further production. Merlin oil is combined with Dunlin output for export to Cormorant A platform and onwards via the Brent system pipeline to Sullom Voe terminal. Merlin's associated gas is used as fuel on Dunlin platform.

Thai Romo Ltd.
and its partners on Block B8/32 in the Gulf of Thailand finalized a $400 million development plan for Benchamas field. Three wellhead platforms-two 12-slot and one 16-slot-will be installed near Wells 1, 3, and 12. All three will be able to accommodate either a jack up or platform rig. Thai Romo, a unit of Rutherford-Moran Oil Corp., Houston, also plans to lay spur pipelines. Benchamas oil will be produced via a floating storage and offloading system. Associated gas will be shipped via an existing gas pipeline and sold to Petroleum Authority of Thailand under a take-or-pay contract.

ARCO British Ltd.
awarded a frame contract to Stolt Comex Seaway M.S. Ltd., Aberdeen, for work on field developments in the southern U.K. North Sea. The contract covers ARCO's subsea installation requirements for 3 years plus two 1-year options. The contractor expects to earn $20 million under the contract in 1998 by installing, trenching, and commissioning 30 km of pipeline, along with pipeline crossings, umbilicals, and spool pieces.

Hardy Oil & Gas plc,
London, bought a 10% interest in East Spar gas condensate field off Northwest Australia for $62.5 million from operator Apache Corp., Houston. The deal brings Hardy 1,400 b/d net oil production and 9.5 million boe of net reserves.

Norway's
Saga Petroleum AS extended a maintenance and engineering services contract with Aker AS, Oslo, for Snorre field tension leg platform. The contract will now run until 2000 and is expected to be worth 200 million kroner ($28 million). The original contract was let in 1992 and was extended in 1994 to include expansion work during development of Vigdis subsea satellite field.

Cliffs Drilling Co.,
Houston, will convert one of its mobile offshore production units to a 200-ft mat cantilever jack up drilling rig. Cliffs signed a 1-year contract for the rig with Enron Oil & Gas Venezuela Ltd. and INE Paria, an affiliate of Inelectra SA. Renamed Cliffs Drilling 202, the rig is scheduled to begin exploratory drilling in the Gulf of Paria off Venezuela in mid-1998.

Atwood Oceanics Australia Pty. Ltd.,
O'Conner, Australia, let contract to Keppel Fels Ltd., Singapore, to convert Vicksburg rig from from a slot-type rig to an extended-reach cantilever rig. The contract, worth more than $20 million, included design, construction, and installation of a cantilever, drill floor, and substructure.

NGL

Norway's Statoil let two contracts totaling 1 billion kroner to Raytheon Engineers & Constructors BV, Netherlands, to build a natural gas liquids processing plant and expand condensate processing facilities at Statoil's Mongstad refinery. Work is due to begin early next year and to be completed Oct. 1, 1999. The Statoil-led Vestprosess group plans to develop a pipeline to carry raw NGL and condensate from Sture and Kollsnes terminals to Mongstad. The group comprises operator Statoil 58%, Saga Petroleum AS 17%, Mobil Development Norway AS 10%, Norske Shell AS 8%, Total Norge AS 5%, and Norske Conoco AS 2%.

LNG

Tamil Nadu Industrial Development Corp. Ltd. (Tidco) short-listed five groups for a liquefied natural gas project at Ennore, India. The groups are led by Mitsubishi Corp., Shell Gas BV, Petronas, Siemens Power Ventures GmbH, and National Power International Ltd. The Tamil Nadu state electricity board asked Tidco to choose the developer by June 1998. The project includes developing, building, operating, and maintaining an LNG terminal, storage and regasification facilities, and a 1,500-2,000-MW power plant. Start-up is expected by 2003.

India
let contract to Qatar's RasGas for supply of 2.5 million metric tons/year of LNG beginning in 2001. Supplies will later be doubled. RasGas is a joint venture of Qatar General Petroleum Corp. 66.5%, Mobil Corp. 26.5%, Itochu Corp. 4%, and Nissho Iwai 3%. LNG will be supplied via the $1 billion Ras Laffan LNG terminal north of Doha.

Gas distribution

Repsol México SA de CV received a definitive permit to distribute natural gas in Mexico's Nuevo Laredo, Tamaulipas, geographic zone. The permit involves Repsol's acquisition of Pemex Gas y Petroquimica B sica's distribution assets, valued at about $1.85 million and consisting of about 12 miles of pipelines. Repsol had been granted a provisional permit to distribute gas in the region in December 1995. The permit includes a 5-year exclusivity agreement.