INDUSTRY BRIEFS

Correction

Royal Dutch/Shell plans to spend $100 million to fix the Year 2000 computer glitch. The company was not correctly identified in this context in the third part of the OGJ Outlook '99 series that ran in the Jan. 4, 1999, issue of OGJ (p. 23, upper right hand column, third line from the top).

Refining

A fire at the Novoufimsky refinery in Russia's Bashkiria republic killed one firefighter and seriously burned four others. The fire was in a diesel dehydration unit, according to local press reports. An investigation into the cause of the blaze is under way.

Williams
let contract to Howe-Baker Engineers Inc., Tyler, Tex., for the engineering, procurement, and construction of a 36,000 b/d, continuous catalyst regeneration Platforming unit for its Memphis refinery. The Platforming process is licensed by UOP LLC, Des Plaines, Ill. Start-up of the unit is slated for second quarter 2000.

Companies

Pennzoil Co., Houston, changed its name to PennzEnergy Co. as part of its merger with Quaker State (OGJ, Apr. 20, 1998, Newsletter).

El Paso Energy Corp.
unit El Paso Energy International Co., Houston, acquired a 25% interest in Enfield Energy Centre Ltd. from Northern States Power unit NRG Energy Inc., Minneapolis. Enfield is building a 396-MW combined-cycle gas turbine power plant at Brimsdown, U.K. (OGJ Feb. 2, 1998, p. 38). Partners in the project include Indeck Energy Services Inc., Buffalo Grove, Ill., and NRG Energy. The £176 million project is expected to be operational by October 1999.

Institut Français du Pétrole
(IFP) acquired reservoir and field-behavior study group Beicip-Franlab from Isis for an undisclosed amount. Beicip-Franlab, which posted sales of 160 million francs in 1998, relies on computer software designed in cooperation with IFP.

TransCanada PipeLines Ltd.,
Calgary, will set up a limited partnership to handle its U.S. pipeline assets. The partnership, to be called TC PipeLines LP, will take over TransCanada's 30% interest in the Northern Border pipeline system (OGJ, Dec. 28, 1998, p. 30). TransCanada will retain a 21.8% interest in TC PipeLines. TransCanada has filed documents with U.S. regulators to sell 15.64 million units in the partnership. They have not yet been priced.

Gaz de France
acquired certain upstream assets in the southern part of the U.K. North Sea from Total. Included in the sale is an 11.5% interest in the Conoco-operated Murdoch gas field and the related interest in the Caister Murdoch system, which transports gas from the fields to the Theddlethorpe terminal, north of Bacton. The sale is in line with an agreement the two companies signed in December 1997, designed to bolster each partner's integration in the natural gas chain (OGJ, Sept. 22, 1997, p. 23).

Basinview Energy Ltd.,
Calgary, will complete a $70 million (Canadian) reverse takeover of privately held Avalanche Energy Ltd., also of Calgary. Basinview will issue stock for the purchase and will assume $10 million in Avalanche debt. Avalanche management will take control of Basinview, which will be merged into Avalanche. Avalanche's major property at Entice, Alta., produces 10.5 MMcfd of natural gas.

Two small Australian
exploration firms-Frontier Petroleum NL and Australian Worldwide Exploration NL (AWE)-agreed to merge. The merger is designed to combine the immediate cash flow of Frontier and the potential longer-term cash flow from AWE's acreage. Frontier shareholders will receive one AWE share for five Frontier shares. Frontier earns about $2.2 million (Australian)/year in royalties from fields in the North Sea and Indonesia. AWE has $12.8 million in cash assets plus interests in the Gippsland basin off southeastern Victoria, including a share in the planned Kipper gas field project.

Pipelines

Shell Oil Co. unit Tejas Natural Gas Liquids LLC and Enterprise Products Partners LP formed a 50-50 joint venture to develop an NGL transportation and distribution system. The firm, called Entell NGL Services LLC, will include Enterprise's entire Louisiana pipeline system. Entell will build a system linking storage at Breaux Bridge, La., to Mont Belvieu, Tex. Enterprise's 80,000 b/d NGL pipeline could be expanded to transport 110,000 b/d.

Exxon Corp.
completed the 13-km, 12-in. subsea Harmony Heritage pipeline off California, linking the Heritage and Harmony platforms (OGJ, Nov. 30, 1998, p. 26). Construction of the line was completed by Coflexip Stena Offshore Inc. employing the new CSO MJ-Lay spread system for the first time (see related article, p. 58).

Petrochemicals

Malaysian state firm Petronas plans to take a 26% stake in Indian Oil Corp.'s (IOC) proposed 40.56 billion rupee petrochemical project. The plant, to be built near IOC's Panipat refinery, will have capacity to produce 350,000 metric tons/ year of paraxylene and 525,000 tons/year of purified terephthalic acid (PTA). Naphtha feed will be supplied by IOC's Panipat and Mathura refineries. The plant will enable IOC to compete with Reliance Industries Ltd., India's only PTA producer. IOC and Petronas signed a memorandum of understanding that will be converted to a joint venture pact once India approves the project.

Exploration

Shell Todd Oil Services and partners Cultus Petroleum NL, Sydney, and Shell (Petroleum Mining) Co. Ltd. completed drilling a 650-m sidetrack of the Maari 1 exploration well off Taranaki, New Zealand (OGJ, Dec. 14, 1998, p. 33). On test, the well flowed at a rate of 4,400 b/d of 37° gravity oil and 1.3 MMcfd of gas from Miocene Moki through a 181/64-in. choke with 280 psi flowing pressure. Through a 44/64-in. choke, the well flowed at a rate of 2,900 b/d of oil and 0.9 MMcfd of gas.

Repsol SA
found oil close to El-Sharara field on Libya's Block NC-115, in the Murzuq basin about 800 km south of Tripoli. The M-1 new-pool wildcat flowed 2,500 b/d of 43° gravity oil on test. The well's output could reach 8,000 b/d using standard pumping techniques, said license partner OMV Oil Production Libya GmbH. The partners plan to bring the find on stream within 3 months and estimate its reserves at 100-200 million bbl of oil. Appraisal drilling is slated for this year, and another new-pool wildcat will be drilled nearby. Interests in the license are operator Repsol 40%, OMV 30%, and Total 30%.

Exports-imports

India's demand for imported petroleum products in fiscal year 1998-99 (April-March) is projected to fall to 141 million bbl vs. a start-of-year estimate of 170 million bbl, said the country's petroleum ministry. Diesel shows the largest drop, falling to 83 million bbl from about 120 million bbl. The fall in diesel imports is due to an expected demand decline of 24 million bbl, combined with increased domestic production of 14 million bbl. Oil imports are expected to reach 287 million bbl for the period vs. an earlier estimate of 270 million bbl. The rise is due to reduced domestic production and increased refinery runs.

Enron Capital & Trade Resources Corp.
filed a 10-year natural gas export application with Canada's National Energy Board. Enron plans to export 20 MMcfd of gas from St. Clair, Ont., to its markets in the U.S. The gas would be purchased from PanCanadian Petroleum Ltd.'s production in Alberta.

Gas processing

Air Products & Chemicals Inc., Lehigh Valley, Pa., plans to build, own, and operate a synthesis gas separation and purification unit at Baytown, Tex. The plant will process gas from an adjacent gasification unit Exxon Corp. is building at its Baytown refinery. The plant will be connected to Air Products' Gulf Coast industrial gas pipeline. Air Products also will build, own, and operate an air separation plant at Baytown to supply oxygen to Exxon under a long-term contract. The overall project is expected to be brought on stream in stages during late 1999 and early 2000.

Drilling-production

Total Indonesia let a $82 million (Australian) contract to Clough Engineering Ltd.'s Indonesian unit PT Petrosea Tbk for the engineering, procurement, construction, and installation of offshore platforms and pipelines for Total's Tunu gas and condensate field development project. Work is to include installation of three 20-in. and one 36-in. trunk lines, construction of a new Tunu manifold and radio tower platforms, and construction of a 300-metric ton scrapper trap platform. The contract, which comprises the seventh phase of Total's Tunu project, is expected to be completed by third quarter 2000.

Kerr-McGee Oil & Gas Corp.,
Oklahoma City, started production at Ewing Bank 910 and West Cameron 638 fields in the Gulf of Mexico (OGJ, Oct. 13, 1997, p. 42). Production from Ewing Bank 910 is expected to peak at 16,000 b/d of oil and 23 MMcfd of gas in mid-1999. Production from West Cameron 638 is expected to reach 20 MMcfd. Kerr-McGee holds a 40% interest and operatorship of both developments. Petrobras America Inc. holds the remaining interest in Ewing Bank 910. Partners in West Cameron 638 are Petrobras 33.33% and Burlington Resources Oil & Gas Co. 26.67%.

OMV (Pakistan) Exploration GmbH,
a unit of Vienna-based OMV AG, claimed an appraisal drilling success on the Southwest Miano concession in Pakistan's Sindh province. While the Sawan-2 well was not tested, OMV said it encountered a 90 m gas column with more than 60 m of net pay and confirmed additional gas reserves. The Sawan-1 well flowed 58 MMcfd of high- quality gas early in 1998. OMV is looking to drill two more appraisal wells in Sawan this year with a view to early development during 2000 and full field development by 2002.

Amoco Angola BV
let contract to Diamond Offshore Drilling Inc., Houston, to lease the fourth-generation semisubmersible Ocean Alliance to drill in deep water off Angola. The award is for a 120-day, two-well drilling program, with the option to extend for two more one-well programs.

Statoil AS
let a 1.3 billion kroner ($180 million) contract to Aker Maritime AS, Oslo, to upgrade Gullfaks C platform in the Norwegian North Sea. Two gas processing modules will be installed on the platform to handle output from the Gullfaks satellites subsea developments. The upgrade will double the gas handling capacity of Gullfaks C. The two 1,000-metric ton gas processing modules will be built at the Aker McNulty yard in Newcastle, U.K., with project management and engineering work taking place at Aker's Aberdeen and Stavanger offices.

U.K. Department of Trade and Industry
announced that Amoco (U.K.) Ltd. brought the U.K.'s 200th offshore field into production in December with the start-up of Brown field on southern North Sea Block 49/30. Brown was discovered in October 1998 with an extended-reach well drilled by Amoco from Davy platform. The well was subsequently tied back as a producer and marked the U.K.'s record time for taking a find from discovery to production. Initial production was 38 MMcfd of gas and production is expected to continue until 2002.

Enterprise Oil plc
found oil with its fifth development well drilled in Pierce field off the U.K. Pierce field is comprised of North and South Pierce. Well 23/22a-A3z, the first development well to be drilled in North Pierce, was drilled to 15,000 TD and increases the vertical height of the oil column on the western portion of North Pierce to 1,500 ft from 800 ft. The well is expected to increase proven and probable reserves by about 20 million bbl of oil. Partners in the venture are operator Enterprise 42.7922%, Enterprise Oil Exploration Ltd. 31.2%, Agip (U.K.) Ltd. 3.7284%, MOC Exploration (U.K.) Ltd. 3.7544%, Ranger Oil (U.K.) Ltd. 15.6%, and Petrobras North Sea Ltd. 2.925%.

Shell Petroleum Development

Co. of Nigeria Ltd. let a $30 million contract to Willbros Group Inc., Tulsa, for engineering, procurement, construction, and installation of four concrete barge-mounted compressor facilities for a gas utilization project in Nigeria. The additional facilities will transport low-pressure flare gas from certain Nembe Creek crude oil flow stations and compress it for injection into a system of new high-pressure gas pipelines. The project is slated to begin in first quarter 1999 and to be completed in third quarter 2000.

Cogeneration

Gregory Power Partners, a joint partnership of units of LG&E Energy Corp. and Columbia Energy Group, secured financing from ING Barings for a 550 MW-equivalent natural gas-fired cogeneration plant. The plant, to be built near Gregory, Tex., at Reynolds Metals Co.'s Sherwin alumina plant, will generate 400 MW of power and about 1.5 million lb/hr of steam. Reynolds plans to purchase 55 MW of electricity and up to 1.5 million lb/hr of steam from the partnership. Dynegy Inc. unit Electric Clearinghouse Inc. will also purchase power from the group.

Gas gathering

Sid Richardson Gasoline Co., Fort Worth, acquired the Walton and Santa Rosa gas gathering systems from KN Energy Inc. units American Gathering LP and American Processing LP for an undisclosed amount. The systems comprise 600 miles of gathering line and over 30 MMcfd of processing and treating capacity. Both gathering systems are in Winkler, Ward, Crane, and Pecos counties, Tex.

Gas supply

Mobil Oil Qatar Inc. and Qatar General Petroleum Corp. signed a heads of agreement to develop their enhanced gas utilization project (OGJ, Apr. 27, 1998, p. 33). Mobil will act as contractor for the project. More than 1 bcfd of gas produced from Qatar's North field will be delivered to power, petrochemical, and industrial customers, primarily at Ras Laffan. First gas is planned to be sold in 2002.