INDUSTRY BRIEFS

PETROCHEMICALS

SAUDI BASIC INDUSTRIES CORP. (Sabic) will construct a 350,000 metric ton/year purified terephthalic acid (PTA) plant as part of its lbn Rushd polyester complex at Yanbu, Saudi Arabia. Sabic obtained a license to use Technimont SpA's PTA technology. The PTA plant is to start up in 1997, the polyester complex in 1995.

OILSANDS

SUNCOR INC. let contract to Fluor Daniel for engineering and other services for a wet limestone flue gas scrubber to cut S02 emissions from the steam and electricity generating unit at its Fort McMurray, Alta., oilsands plant. The $133 million project includes a flue gas desulfurization unit and related materials handling facilities. Engineering is under way with completion slated for mid 1996.

SUNCOR acquired an oilsands lease for an undisclosed price from Petro Canada for expansion of its 68,000 b/d Fort McMurray oilsands plant. Lease 97 adjoins Suncor's Fort McMurray oilsands leases and plant. It acquired two other leases in late 1992 with an estimated life of 40 years. Suncor will start developing one of the three leases in 1997 at a cost of about $100 million (Canadian) during 3 years.

REFINING Two workers were killed and five wounded when a fire broke out June 4 in a crude distillation unit at BP France's 174,000 b/d Lavera refinery on the French Riviera.

CONOCO INC. and Pennzoil Products Co. agreed to install a $500 million lube oil hydrocracker that will produce more than 15,000 b/d.of high quality base oils at Conoco's Lake Charles, La., refinery. Separately, Conoco will spend an additional $250 million to boost the refinery's crude distillation and gasoline production capacities. Work is to begin late this year and be complete in 1997.

PERTAMINA'S Exor 1 refinery at Balongan, West Java, is to start trial operations this month with commercial operations to begin in November. The 125,000 b/d refinery will process 100,000 b/d of Duri crude and 25,000 b/d of Minas crude and produce gasoline, auto diesel, industrial diesel, kerosine, fuel oil, LPG, propylene, and sulfur. Half the output will be exported to Japan, half used in Indonesia.

CHEVRON U.S.A. PRODUCTS CO. asked the U.S. Commerce Department for foreign trade zone status for its Philadelphia refinery. That would exempt Chevron from customs duty payments on products made from imported oil and later exported, notably jet fuel sold for international flights.

COGENERATION

SARAS SPA chose Texaco Inc.'s gasification power systems technology for a 500,000 kw, resid fired, combined cycle/gasification cogeneration plant at its Sarroch, Italy, refinery. The project, to be complete in 1998, will gasify 20,000 b/d of high sulfur resid to produce hydrogen and steam for the refinery, electricity for sale to Italy's electric utility ENEL, and sulfur for export.

NATURAL GAS STORAGE

J. MAKOWSKI CO. Phase I services for its gas storage project at Cayuta, N.Y., were oversubscribed in a 2 bcf capacity open season that ended May 31. The Cayuta project received bids totaling 2.1 bcf for services beginning Oct. 1, 1996. The 2 bcf Phase 11 and 1 bcf Phase Ill will commence in October 1997 and October 1998, respectively, with open seasons and negotiations for both to begin this summer.

ALBERTA'S Energy Resources Conservation Board was asked to evaluate earthquake risk in an area north of Calgary where an $80 million (Canadian) natural gas storage facility is planned. The study was requested by the towns of Crossfield and Airdrie near the Amoco Canada Ltd. facility under construction about 20 miles north of Calgary.

TERMINALS

GATX TERMINALS CORP. acquired an 18 tank, 655,000 bbl capacity refined products storage facility at Port Everglades, Fla., from British Petroleum Exploration & Oil Inc. Terms were not disclosed. The facility is capable of marine receipt and delivery, tank truck loading/ unloading, and pipeline injection.

ASSOCIATED PETROLEUM

TERMINALS LTD., Immingham, U.K., let a 2500,000 ($750,000) contract to Baker Hughes Process Systems, Rugby, U.K., for a deballasting facility at South Killingholme jetty on the River Humber. The jetty handles 3,600 vessels/year, carrying a combined 20 million metric tons of oil and LPG for nearby Lindsey and Humber refineries.

EXPLORATION

HS RESOURCES INC. (HSR), San Francisco, signed a letter of intent with Union Pacific Resources Co. (UPRC) covering UPRC's acreage in 21 townships in the southern Denver Julesberg basin. HSR will acquire rights to explore and develop four blocks totaling about 120,000 acres plus an option for a fifth block covering 47,000 acres in four townships. HSR will commit about $9.25 million in 2 years, with options for 3 subsequent years, and expects to drill at least 50 wells in the basin this year.

GULFSTREAM RESOURCES CANADA LTD., Calgary, acquired an additional 35% interest in the Qatar concession it holds jointly with Wintershall AG and Deilmann Erdol Erdgas (DEE). It exercised first refusal rights after Wintershall sought to cede the share to British Gas Exploration & Production Ltd. Concession interests now are Gulfstream 68.85%, DEE 16.15%, and Wintershall 15%.

PIPELINES

BASIC PETROLEUM INTERNATIONAL LTD., Paris, will lay a 120 km, $13.75 million crude oil pipeline in Guatemala from its Xan oil field to its 4,000 b/d La Libertad asphalt refinery. It let contract to Mexico's Lineas de Produccion SA de CV to lay the line, which when operational in mid 1995 is expected to save Basic more than $2/bbl in transportation costs and help it boost field output, currently constrained by trucking capacity limits.

COLONIAL PIPELINE CO. will request a hearing on a proposed U.S. Transportation Department order requiring it to run smart pigs through several products pipelines in North Carolina, Virginia, and Maryland. The Office of Pipeline Safety proposed the action because of a rupture last year in northern Virginia. Colonial said all the lines had been pigged within 5 years or would be this year.

TRANSCONTINENTAL

GAS PIPE LINE CORP. (TGPL) accepted a final Federal Energy Regulatory Commission certificate authorizing its 1994 southeast expansion project (SE94), the first of several expansions of TGPL's U.S. Southeast main line that will provide a total 200 MMcfd of firm transportation capacity by 1996 97 winter heating season. SE94 will add 35 MMcfd of firm capacity, to be in service for the 1994 95 season, from TGPL's Mobile Bay lateral interconnect near Butler, Ala., to points upstream of TGPL compressor station 165 near Chatham, Va. Pipelaying is to begin this summer.

EXPORTS-IMPORTS

GAZ DE FRANCE signed an agreement for more than 20 years with Norway's Den norsk stats oljeselskap AS, Norsk Hydro AS, and Saga Petroleum to buy Norwegian gas beginning in 1996, building to 140 bcf/year. That's in addition to 180 bcf/year under Troll field gas sales that began in 1993 and gas purchased from Ekofisk, Heimdal, and Gullfaks area fields. France's Norwegian gas take will jump to 455 bcf in 2000 from 210 bcf in 1993.

DRILLING PRODUCTION

AGIP RECHERCHES CONGO signed three agreements involving Congo exploration/development. It will develop Kitina field, a 1991 discovery with reserves of more than 100 million bbl. And it is converting its Marine VI and Marine VII exploration permits to production sharing contracts in a bid by the government to spur offshore exploration (OGJ, Apr. 3, 1989, p. 25). In Kitina and Marine VII, interests are operator Agip 35.75%, state owned Hydrocongo 35%, and Chevron Corp. 29.25% and in Marine VI operator Agip 65% and Hydrocongo 35%.

PARKER & PARSLEY PETROLEUM CO., Midland, Tex., agreed to purchase PG&E Resources Co.'s interests in about 1,850 producing oil and gas wells in West Texas, the Midcontinent, and Rocky Mountains with associated development rights and certain related facilities for $122 million. The deal is to close Aug. 1.

PHILLIPS PETROLEUM INTERNATIONAL CORP. ASIA let contract to Parker Drilling International Ltd. for precommissioning and purchasing services for its Xijiang 24 3 field production platform in the South China Sea off China. Under a separate contract through project manager Halliburton Energy Services, Parker will provide drilling services. Phillips' partner in the field is Pecten Orient Co.

TATHAM OFFSHORE INC., Houston, 2 Ship Shoal 331 A step out confirmed Genuine Risk oil and gas field in the Gulf of Mexico. The well cut about 270 ft of oil and gas pay in five Pleistocene and Pliocene zones. Tatham installed a refurbished four pile, 12 slot drilling production platform on Ship Shoal 331 and expects to start production in late June.

READING & BATES CORP. (R & B), Houston, agreed to sell its 86.24% interest in Arcade Shipping AS to Leif Hoegh & Co., AS, Oslo, for about $27.3 million, buy Arcade Shipping's 46.23% interest in Arcade Drilling AS for about $42 million, and buy certain marketable securities from Arcade Shipping for about $2.6 million. In addition, Arcade Shipping will repay R&B a loan of about $12.9 million.

YPF SOC. ANONIMA renegotiated with Amoco Corp. a production sharing contract (PSC) for Cerro Dragon/Anticlinal Grande field in Chubut province, Argentina. When YPF was Argentina's state oil company, the PSC, which extends to 2013, called for the company to pay Amoco's taxes and royalties on field production. After YPF was privatized last year, it sought to avoid the PSC's tax burden by transferring Cerro Dragon/Anticlinal Grande and two smaller adjacent concessions to Amoco. YPF will pay Amoco's taxes and royalties and receive 24% of Cerro Dragon production through 1994.

TANKERS

DAMAGED IRANIAN TANKER TOCHAL was to be towed into South Africa's sheltered False Bay last week to minimize risk of further damage to the 300,000 dwt vessel, damaged in a recent storm 70 miles off Capetown. Plans are to assess damage and transfer the 1.97 million bbl crude cargo to another vessel before towing to shelter.

SPILLS

A 1 IN. DIAMETER HOLE in the hull of Maritime Overseas Corp's Eastern Lion tanker caused a 200 bbl crude oil spill in Alaska's Valdez Harbor May 21 (OGJ, May 30, p. 40), U.S. Coast Guard said. The rest of Eastern Lion's 830,000 bbl cargo was transferred to the ARCO Fairbanks tanker, and the empty Liberian flag tanker left Valdez for repairs in Singapore. About 19 bbl of crude escaped booms and contaminated a fish hatchery and nearby beaches.

GOVERNMENT

WASHINGTON STATE proposed a $13.5 million plan to fund transportation/conservation projects in settling a 17 year old class action lawsuit alleging price fixing by major oil companies. Although a federal judge in the mid-1980s dismissed the case, the antitrust suit, filed in 1977 by Washington and other western states, dragged on through appeals before being settled recently.

COMPANIES

PENNZOIL CANADA INC. received Canadian government approval of its tender offer, valued at $310 million, for all Co enerco Resources Ltd. common stock (OGJ, May 9, p. 25). Pennzoil expects to be able to accept June 14 all Co-enerco common shares and debentures tendered, at presstime 92% and 97%, respectively.

NATIONAL ENERGY GROUP INC. (NEG), Dallas, closed a $25 million credit facility with Tenneco/EnCap Gas Fund, with initial funding of $6 million, to develop Goldsmith Adobe Unit (GAU) in Ector County, Tex., and for acquisitions. NEG expects to spend about $20 million the next 4 years on development and other work in GAU. Its current budget calls for drilling 22 wells and waterflood enhancement.

MCDERMOTT INTERNATIONAL INC., New Orleans, and Offshore Pipelines Inc., Houston, are combining their worldwide marine construction businesses into a new jointly owned Panamanian company, J. Ray McDermott SA. McDermott will contribute substantially all its marine construction assets and businesses, and OPI will merge into the new company.

HELIUM

ALGERIA'S first helium plant will go on stream this month at Bethioua. The $30 million Helios joint venture project is to produce 16 million cu m/year of liquid helium for export and 33,000 metric tons/year of liquid and gaseous nitrogen. Helios is owned by Sonatrach 51%, France's Air Liquide, and Air Products & Chemicals Inc., Allentown, Pa.

COURTS

A SEPT. 12 TRIAL DATE is set in Maryland for litigation involving Columbia Gas Transmission Corp. (CGT) and its unsecured creditors' committee. Creditors challenge validity of a $1.7 billion debt CGT owes parent Columbia Gas System Inc. (CGS), payment of dividends and interest to the parent, and transfer of natural resource properties to affiliate Columbia Natural Resources. CGS and CGT have been operating under Chapter 11 bankruptcy since mid 1991.