Coalbed methane
BHP Petroleum Pty. Ltd. started a $2 million feasibility study of development of an ammonium nitrate plant in Central Queensland fed by 2 bcf of coalbed methane. Ammonium nitrate is mixed with diesel fuel for use as an explosive for open cast mining. BHP wants to supply the gas from large reserves of methane on its coal leases in the area.Exploration
Cambodia plans in the next 2-3 months to offer onshore acreage to international bidders. The government mapped 10 blocks in Central and southern Cambodia but has not decided how many it will offer. Colossal Natural Resources Exploitation, a Canadian company, met government officials to discuss prospects in the Tonle Sap (Great Lake) area of Central Cambodia. In March the government approved Japan National Oil Co.'s plans for a seismic survey of the Tonle Sap and Mekong basins, expected to begin at midyear.Geoteam AS, Oslo, completed a speculative seismic and gravity survey over the northern sector of disputed territory between the U.K. and the Faroe Islands. The new data extend Geo- team's 1995 North Shetland basin survey. Processed data will be available in July. The survey was carried out by the Geolog Dm. Nalivkin research vessel, which since has been mobilized to the Rockall Trough area off western Ireland for a speculative survey of U.K. and Irish frontier acreage.
Enterprise Oil plc, London, spudded a wildcat on Block 27/5 in the Slyne Trough area off western Ireland, using the Petrolia semisubmersible rig. The well is part of a work program under a license awarded in 1993. The rig is expected to stay on location for about 40 days, after which it will move north to Quadrant 18 to drill a well on a license issued in 1994.
Petrochemicals
Mitsui Petrochemical Industries Ltd. and Sumitomo Chemical Co. started talks for construction of a 200,000 metric ton/year joint venture polyethylene (PE) plant in Japan's Chiba prefecture. Expected to cost $95 million, the plant is slated to start up in 1998 and produce PE resin using the metallocene process.Borealis AS assumed control of Cia. Nacional de Petroquimica (CNP) from Portugal's government. The deal brings Borealis a cracker at Sines with capacity to produce 330,000 metric tons/year of ethylene and 150,000 tons/year of propylene. The purchase of CNP will replace a long term lease dating from 1989 under which Borealis operated the cracker. The plant provides feedstock to Borealis' polyolefins complex at Sines.
Arcadian Corp., Memphis, let contract to M.W. Kellogg Co., Houston, to build a 2,040 ton/day ammonia plant at its Point Lisas, Trinidad, complex. The project, scheduled for completion early in 1998, will feature a Kellogg process that uses a noniron catalyst with activity as much as 20 times that of traditional iron catalysts. The aim is to produce ammonia at the lowest possible capital investment, operating cost, and energy consumption.
Government
Kazakhstan is trying to revive its privatization program by inviting bids for a refinery and the Aktyubinskneft and Yuzhneftegaz producing associations. Canadian Occidental Petroleum Ltd., Chevron Corp., Exxon Corp., and Rotterdam trader Vitol BV are among bidders for 85-90% stakes in the enterprises. Aktyubinskneft's Zhanazhol oil field is the asset most likely in demand. Exxon reportedly is negotiating for a separate venture to operate a large part of the field.Alberta hired three agents under 5 year contracts to market the province's $1 billion (Canadian)/year crude oil royalty share, eliminating a government agency that now handles sales. Gulf Canada Resources Ltd., PanCanadian Petroleum Ltd., and small producers' cooperative Canpet Energy Group Inc. will handle sales and receive 5/bbl. Gulf will market 78,000 b/d of mostly sweet light crude, PanCanadian 38,000 b/d of light sour crude and heavy oil, and Canpet 10,000 b/d of mostly heavy and light sour crudes.
Drilling-production
BP Exploration Operating Co. Ltd. let an $18.75 million contract for hookup and commissioning of the world's biggest newbuild floating production storage and offloading (FPSO) unit to a venture of Brown & Root Ltd., London, and AOC International Ltd., Aberdeen. The unit is to be installed in Schiehallion field in U.K.'s West of Shetland area (OGJ, Apr. 15, p. 30). The project covers the vessel's 10,000 metric ton topsides process and utility systems.Precision Drilling Corp. agreed to a $220 million (Canadian) takeover of EnServ Corp. Merger of the two Calgary firms would create Canada's largest oil field service company. Precision is mainly a drilling company, while EnServ specializes in rental and well service operations.
Saga Petroleum AS received approval from Norway's Ministry of Industry & Energy for 6 months of test production from the H Central reservoir, near East Tordis field, currently under development in the North Sea. Saga plans to produce 3.1 million bbl of oil from H Central through a subsea template to be installed this summer in East Tordis in Block 34/7. Saga hopes to determine the extent of oil bearing sands and communication within H Central in order to estimate reserves. The test could begin this fall but may be delayed to 1997 if priority is given to a production well in East Tordis.
Petrobras America Inc. signed a cooperative agreement with Westinghouse's electromechanical division and its partner, Germany's Leistritz, for first phase development of a subsea multiphase pump system that will serve as a full scale, 2 year subsea pilot. After the system is tested, Petrobras will install the unit in a subsea well as part of its multibillion dollar development of supergiant Marlim field in the Campos basin off Brazil. The system will be able to pump multiphase flows from a water depth of 1,000 m at a total rate of 75,000 b/d at about 900 psig.
Texaco Ltd. let contract to AMEC Process & Energy Ltd., London, for operating services in North Sea Captain field, currently under development. The contract will cover all supervision, personnel, operations, and maintenance services for Captain's FPSO and wellhead platform. Captain, with estimated reserves of 300 million bbl of oil, is to start production late this year (OGJ, Oct. 24, 1994, p. 37).
Phillips Petroleum Co. Norway let a $69 million contract to AMEC and Kvaerner AS, Oslo, to hook up a new platform in Ekofisk field off Norway. Hookup of the 2/4J platform is to begin in August 1997, with oil production slated to start a year later. The 2/4J platform will be the largest in Ekofisk, with topsides weighing more than 23,000 metric tons. It is a process and transportation platform being installed as part of Ekofisk redevelopment (OGJ, Aug. 15, 1994, p. 52).
U.K. Department of Trade & Industry approved a plan by Midland & Scottish Energy Ltd., Aberdeen, to decommission Emerald field on U.K. North Sea Block 2/10a, which ceased production this year. The abandonment plan involves return of the Emerald Producer production semisubmersible to Invergordon for refurbishment to be marketed for redeployment. The field's Ailsa Craig storage tanker also will be marketed. Emerald's wells were shut in and subsea equipment removed last February.
Agip SpA conducted an initial test on its 2 Cerro Falcone appraisal well in Italy's southern Apennines, reported license partner Enterprise Oil. The well penetrated a hydrocarbon bearing formation at 2,500 ft. Two intervals were tested, yielding a combined flow of 3,500 b/d of 30 and 40 gravity oil, with rates constrained by gas flaring restrictions. Further testing is planned, but Enterprise said this well shows the Cerro Falcone discovery is commercial.
Texas Sens. Phil Gramm and Kay Bailey Hutchison filed a bill in Congress to exempt U.S. oil producers that do not directly transport crude from registration and fee requirements of the Hazardous Materials Transportation Act. Texas Independent Producers & Royalty Owners Association said many producers needlessly are required to pay the $300/year fee. Last year the Transportation Department unsuccessfully proposed to raise the $300/year fee to as much as $5,050.
Terminals
Norway's Den norske stats oljeselskap AS leased a site at the port of Riga, Latvia, where it will begin construction this summer of a products import terminal. The site at first will have five tanks holding a total 157,500 bbl of unleaded gasoline and diesel fuel to supply Statoil's growing retail network in Estonia, Latvia, and Lithuania. Statoil plans to spend $92 million in the region the next 3 years on the terminal and its retail chain as it expands its retail network in Europe (OGJ, Oct. 18, 1993, p. 31).Pipelines
Maritimes & Northeast Pipeline LLC reported "exceptional response" to its open season for prospective shippers in Phase 2 of its Canadian-U.S. gas pipeline project. The company received requests for more than 1.2 bcfd of transportation and supply services in filings by local gas distribution companies, power generators, industrial firms, and third-party marketers during the open season that ended Apr. 17. Nominations far exceeded the initial offering of 400 MMcfd to be available in Phase 2 facilities destined to start up as early as 1999 (OGJ, Mar. 25, p. 33).A preliminary investigation found an Apr. 15 explosion in a TransCanada PipeLines Ltd. gas pipeline near Winnipeg was caused by faulty welding and not stress corrosion cracking (OGJ, Apr. 29, p. 31). Canadian pipelines and gas marketers face possible costs of as much as $2.34 billion (Canadian) for new facilities resulting from an inquiry by Canada's National Energy Board into causes and possible solutions for stress corrosion cracking. Such cracking is blamed for 11 ruptures and nine leaks on Canadian pipeline systems since 1977.
Safety
U.K. Health & Safety Executive (HSE) published a guide to roles and responsibilities of government departments and agencies that may become involved in emergencies involving the offshore oil and gas industry. The handbook reflects changes in U.K. offshore legislation arising from the public inquiry into the 1988 Piper Alpha platform blast. HSE also issued a consultative document setting out proposals for revised guidance on choosing standby vessels to attend offshore installations. The proposals recommend as a key criterion for choice of a standby vessel its ability to respond to emergencies. Comments are required by May 24.Storage
American Petroleum Institute developed a training program for underground storage tank (UST) contractors and other UST professionals. The program, focused on installation and removal of USTs, is based on API recommended standards, which the Environmental Protection Agency has accepted as complying with its rules.Refining
U.S. Commerce Department's Foreign Trade Zones (FTZ) Board received applications from three refiners asking for FTZ designations. Texaco Inc. filed on behalf of its 95,700 b/d El Dorado, Kan., refinery, Shell Oil Co. for its 268,000 b/d Wood River, Ill., refinery, and Basis Petroleum Inc., formerly Phibro Refining Inc., for its 117,630 b/d Texas City, Tex., refinery.Companies
Crestar Energy Inc. wants to acquire Petrostar Petroleums Ltd. in an exchange of stock valued at $85 million (Canadian). The deal includes about $35 million of Petrostar debt. Both are Calgary companies. Petrostar produces about 4,200 b/d of oil equivalent, two thirds as gas. Parkland Industries Ltd., Red Deer, Alta., agreed to trade its 39% interest in Petrostar. Crestar offered Parkland one of its shares, trading at about $24, for each 14.8 Petrostar shares.Mobil Oil Canada Ltd. is negotiating a deal with undisclosed financial institutions to spin off about $300 million (Canadian) in noncore Alberta oil and gas properties into a royalty trust.
