INDUSTRY BRIEFS

Correction

Chemical Market Associates Inc. is based in Houston, not Tarrytown, N.Y., as reported (OGJ, Mar. 17, 1997, p. 39).

Cogeneration

Star Enterprise, Houston, will spend $350 million modifying an existing power plant at its Delaware City, Del., refinery to generate power and steam using petroleum coke from the refining process. The plant will use an integrated gasification combined-cycle technology developed by Texaco Inc. Equipment slated to come on stream in 1999 will sharply cut plant emissions of nitrogen oxides and sulfur dioxide. Star Enterprise is a venture of units of Texaco and Saudi Aramco.

Pipelines

Turkey's
state pipeline firm Botas let a $118 million contract to a group of 14 Turkish companies to lay a 188-mile section of a natural gas pipeline linking Iran with Turkey. The two nations last year signed a $23 billion, 23-year gas supply contract calling for a pipeline from Tabriz to Ankara (OGJ, Aug. 19, 1996, Newsletter). Iran will lay a 169-mile pipeline from Tabriz to the Turkish border, while Turkey will start its segment between Erzurum and Dogubeyazit near Iran's border. The full system will have initial capacity of 288 MMcfd at expected completion in 1998, expandable to about 960 MMcfd.

Nautilus Pipeline Co. LLC,
Houston, got approval from the Federal Energy Regulatory Commission for its $121 million pipeline in the central Gulf of Mexico. The 101-mile, 600-MMcfd capacity, 30-in. pipeline will connect with the Manta Ray offshore gathering system at Ship Shoal Block 207 and extend onshore to Exxon Corp.'s Garden City, La., gas plant (OGJ, July 15, 1996, p. 23). Nautilus is owned by units of Shell Oil Co. 50%, Leviathan Gas Pipeline Partners LP 25.67%, and Marathon Oil Co. 24.33%.

Drilling-production

U.S. Coast Guard
said a well blowout was still burning at presstime last week on an oil and gas platform operated by American Exploration Co., Houston, on East Cameron Block 328 in the Gulf of Mexico. The well blew out and caught fire Apr. 1. There were no injuries, and the cause is being investigated. The crew was evacuated immediately. Amex said the fire appeared to be fed by natural gas; only a light oil sheen was on the water, and it was being dispersed by wave action. The company shut in production in all three development wells it has drilled on the block.

Apache Corp.,
Houston, and partners signed a 10-year take-or-pay contract to supply about 200 bcf of natural gas starting in 1999 to an electric power plant at Abidjan, Côte d'Ivoire. The contract establishes commercial viability of Foxtrot gas field in Block C-27 off Côte d'Ivoire, where three wells flowed a combined 115 MMcfd of gas and 1,350 b/d of condensate in the early 1980s. Reserves are estimated at 600 bcf. The take-or-pay commitment rises to 50 MMcfd from 30 MMcfd after 2 years. Apache, operator, holds a 24% interest; partners are state-owned Petroci 40%, Saur Energi 24%, and Electricit? de France 12%.

Iranian Offshore Engineering
& Construction Co.
let contract to National Petroleum Construction Co. of Abu Dhabi for fabrication of a wellhead drilling platform and cellar deck for first-phase development of South Pars gas field. Completion is due in September.

Norske Energy Corp.,
New York, will form a 50-50 venture with Ukhta Neft, a joint stock company in Russia's Komi republic. The agreement covers oil fields east of Ukhta, close to existing pipelines and other infrastructure. The venture covers an initial 70 million bbl of oil reserves and could be expanded to cover as much as 200 million bbl of reserves.

Enron Oil & Gas India Ltd.
on Mar. 31 started up Tapti gas field off India and expects output to reach 150 MMcfd of gas by yearend. Gas Authority of India Ltd. is purchasing the gas. Operator Enron has a 30% working interest in the field, about 60 miles off Hazira, north of Bombay. Other interests are held by state-owned Oil & Natural Gas Commission 40% and Reliance Industries Ltd. 30%. The group also is developing Panna and Mukta fields, east of Bombay High field, all of which produce oil.

Tuskar Resources plc,
Dublin, has acquired a 2.5% working interest in Ukpokiti field off Nigeria from Camac International (Nigeria) Ltd. Tuskar will issue ordinary shares to Camac in payment. The field is being developed by operator Conoco Energy (Nigeria) Ltd., with first oil due in July. Other interests are Conoco 40% and Nigerian firm Express Petroleum & Gas Co. Ltd. 57.5%. Tuskar said field reserves are estimated at 32 million bbl of oil, and peak production is expected to be 20,000 b/d.

BHP Petroleum Pty. Ltd.
will be unit operator of Bayu-Undan gas condensate discovery on Blocks 91-12 and 91-13 in the Timor Sea Zone of Cooperation Area between Indonesia and Australia. The find has estimated reserves of more than 5 tcf of gas extending over the two blocks operated, respectively, by BHP and Phillips Petroleum Co. The field initially will be developed as a gas-recycling project, which will produce condensate and liquefied petroleum gas on a floating processing, storage, and offloading facility built from a modified tanker. The partners intend to start production from Bayu-Undan in 2001, initially exporting condensate and LPG. Later gas output is expected to be sent to a liquefied natural gas export plant to be based either on BHP's proprietary offshore technology or Phillips' optimized cascade process in an onshore plant (OGJ, July 15, 1996, p. 23).

Exploration

Petroleum Authority of Thailand
(PTT) found more gas and oil in the Thai-Malay Joint Development Area (JDA) in the Gulf of Thailand. A wildcat about 180 miles east of the Thai province of Songkhla flowed on test 48 MMcfd of gas, 585 b/d of crude oil, and 1,451 b/d of condensate. Tests on a nearby well in January flowed 35 MMcfd of gas. PTT's exploration arm, Pttep International Ltd., is jointly exploring JDA Blocks B-17 and C-19 with Malaysia's state-owned Petronas Cariga* Sdn. Bhd. (OGJ, Jan. 27, 1997, p. 26).

Esso Production Malaysia Inc.
and Petronas Cariga* formed an 80-20 venture to spend $22.9 million to explore Offshore Malaysia Blocks H and SB302 under production-sharing contracts signed in March. The venture plans to process more than 10,000 km of seismic data the next 2 years and drill six exploratory wells starting in 1998. As part of a new incentive program, the exploration phase for deepwater Block H was extended to 7 years from the usual 5, and the production phase was extended to 25 years from 20.

Vastar Resources Inc.,
Houston, disclosed two adjacent discoveries about 25 miles off Louisiana on Ship Shoal blocks 126 and 105. No. 1 Ship Shoal 126 wildcat, drilled to 17,000 ft TD, logged about 126 ft of net pay in three zones; Vastar also drilled a successful delineation well on the block, No. 2 Ship Shoal 126. Both are 100% owned by Vastar. The No. 4 Ship Shoal 105 wildcat, drilled to about 16,000 ft TD, logged more than 100 ft of net pay in at least five zones. Plans include additional drilling, with production to start up around yearend 1997 or early 1998. Vastar holds a 42% working interest in the Ship Shoal Block 105 wells.

Tankers

U.S. Coast Guard
issued a temporary rule setting minimum performance standards for devices in single-hulled oil tankers that monitor pressure and tank levels. The devices would reduce the size and effects of an oil spill by alerting tanker operators that a level or pressure change has occurred in a cargo tank.

Spills

Oil Spill Response Ltd.
(OSRL), Southampton, U.K., and Clean Caribbean Cooperative, Fort Lauderdale, Fla., have signed a memorandum of understanding to link their oil spill response capabilities. Both organizations are oil industry-funded, and the aim of the link is to enhance global response to spills. OSRL said the arrangement enables more equipment and capability to be brought to bear on a spill and better utilizes existing stockpiles and technical know-how.

Argentina's
government ordered YPF SA to shut in 112 oil wells as a result of spills on Feb. 14 and Mar. 6 that polluted the Colorado River in two southern provinces. The government also is inspecting facilities of Perez Companc and Petrolera San Jorge. YPF says it spilled about 157 bbl.

Companies

Talisman Energy Inc.
and a unit of Canadian Occidental Petroleum Ltd. (CanOxy), both of Calgary, remain locked in a takeover battle with a price tag of at least $1.7 billion (Canadian) for Wascana Energy Inc., Regina, Sask. CanOxy mailed a formal offer of $20.50/share, which remains open until Apr. 14. Wascana's board recommended accepting CanOxy's offer. Talisman Energy Inc. extended its bid of $18.50/share to Apr. 11 from Mar. 24. Talisman said it is keeping options open.

Tosco Corp.,
Stamford, Conn., completed its $1.4 billion acquisition of Unocal Corp.'s refining and marketing assets (OGJ, Nov. 25, 1996, p. 32). Recently formed Tosco Marketing Co., formerly Circle K Co., will be based in Phoenix. As a result of Unocal, Circle K, and BP Oil Co. acquisitions, Tosco is the U.S.'s largest operator of company-controlled convenience stores, with 5,200 outlets, as well as the nation's largest independent refiner, with capacity of 950,000 b/d.

Hurricane Hydrocarbons Ltd.,
Calgary, closed in escrow a $110 million Canadian private placement of special unit purchase warrants. The financing will enable Hurricane to complete its $120 million (U.S.) purchase of privatized Kazakhstan firm Yuzhneftegaz. Hurricane said the balance of funds after payments will be added to working capital to increase production and accelerate development of established reserves in central Kazakhstan. Yuzhneftegaz is currently producing more than 40,000 b/d and has estimated proven and probable reserves of 340 million bbl.

Powergen plc,
London, bought the 50% interest held by partner Conoco (U.K.) Ltd. in U.K. gas supplier Kinetica Ltd. for $29 million. The deal recognizes diverging strategic interests of the partners and reduces Kinetica's exposure to long term take-or-pay contracts, signed at a time when U.K. spot gas prices were significantly higher than today's. Conoco said the move does not represent a withdrawal from the U.K. gas supply industry. Instead, the company is likely to sell gas under its own name.

Germany's
Ruhrgas AG, Essen, and PreussenElektra AG, Hanover, jointly acquired a 16.25% stake in Latvian gas supply company Latvijas Gaze, Riga. The purchase price was $25 million. Russian gas supplier Gazprom, which provides Latvijas Gaze's gas, also is taking a 16.25% stake in the firm. The Latvian government intends to retain about 60% of the company's shares, while the remainder is owned by private investors.

Refining

Conoco (U.K.) Ltd.
is preparing for a major maintenance turnaround at its U.K. Humber refinery that will start early in May and last for 5 weeks. During the $32 million overhaul, about 40 pieces of equipment will be replaced either partly or completely. These will mainly be heat exchangers and pressure vessels, but the biggest job will be to replace an 18-ft tall, 18-ft diameter amine tank. Six main contractors will manage the maintenance for different areas of the refinery, with the help of 40 specialized subcontractors.

UOP,
Des Plaines, Ill., began operation of the first Par-Isom light naphtha isomerization process unit at Flying J Inc.'s refinery at North Salt Lake, Utah. The process uses a new UOP catalyst to provide higher octane than conventional zeolitic isomerization catalysts, without the contaminant sensitivity of chloride-promoted catalysts. Based on a composition developed by Cosmo Oil Co. Ltd. and Mitsubishi Heavy Industries Ltd., both of Tokyo, the new catalyst incorporates a metal oxide formulation as much as 150° F. more active than current zeolitic catalysts. The increased activity translates into a 2-3 octane number improvement for once-through zeolitic isomerization unit flow schemes.

Marketing

Hungary's
partly state-owned petroleum company MOL bought Amoco Corp.'s Romanian gasoline retail business. The acquisition includes 12 service stations, three now being built. Eight of the sites are in Bucharest. MOL already has four stations up and running in Romania and aims to have 100 in eastern Europe within 5 years. Amoco still is negotiating the sale of retail outlets in Poland and Bulgaria in keeping with a decision to focus on the upstream sector in the region.

Petrochemicals

Dubai Gas Co.
began operation of a $250 million, 500,000 metric ton/year methyl tertiary butyl ether (MTBE) plant at Jebel Ali, Dubai, making the U.A.E. the second Persian Gulf state, after Saudi Arabia, to have an MTBE industry. Saudi Arabia now produces about 2 million tons/year of MTBE. Output is expected to climb to 2.7 million tons/year after a new plant starts up this month, making Saudi Arabia the world's second largest MTBE producer after the U.S. Dubai currently receives gas supplies from Sharjah but plans to buy gas from Abu Dhabi to feed the new MTBE plant.

India's
Reliance Industries brought on stream a 2.2 million metric ton/year naphtha cracker unit at its petrochemical plant at Hazira in the western Indian state of Gujarat. The naphtha-fed cracker will produce 750,000 tons/year of ethylene and 365,000 tons/year of propylene. Reliance said the addition of the naphtha cracker created India's first world-scale ethylene complex and reduces the nation's dependence on imported ethylene and propylene. The Hazira plant now will account for about 55% of India's ethylene production and reduce import costs by about $500 million/year.