INDUSTRY BRIEFS

SPILLS

U.S. CIRCUIT COURT OF APPEALS in Chicago ordered Amoco Corp. to pay about $204 million in damages to the French government and other French parties as a result of the March 1978 Amoco Cadiz supertanker oil spill (OGJ, Mar. 27, 1978, p. 108). A lower court had ordered Amoco to pay $155 million. Amoco also was ordered to pay $30 million to Shell Oil Co., owner of the spilled oil. Amoco may try to recover some money from shipbuilder Astilleros Espanoles SA, also found liable. Amoco is reviewing the order.

GOVERNMENT

ENVIRONMENTAL PROTECTION AGENCY filed a $15.678 million complaint, the largest administrative penalty in its history, against Tennessee Gas Pipeline Co., Houston. EPA alleges the pipeline improperly used and disposed of polychlorinated biphenyls at 26 compressor stations in Alabama, Kentucky, Mississippi, Ohio, and Tennessee. The pipeline is working with EPA and the affected states on a cleanup program.

U.S. INTERNAL REVENUE SERVICE billed Mobil Oil Corp. for $300 million in back taxes as part of its "Aramco advantage" tax case against four major oil companies. Mobil said interest could add $1 billion to the bill, and it plans to challenge IRS in court. IRS maintains the oil companies benefited from low priced Saudi crude they received in 1979-81. A Washington, D.C., federal court is expected to rule soon in a similar case involving Exxon Corp. and Texaco Inc. IRS has not yet billed the fourth company, Chevron Corp.

EXPORTS-IMPORTS

CANADA'S National Energy Board received applications from Enserch Development Corp. LP, Husky Oil Operations Ltd., Kamine Natural Dam Cogen Co. Inc., and Petro-Canada to export a total 49 MMcfd of gas for cogeneration projects in Bellingham and Ferndale, Wash., and St. Lawrence County, N.Y. TransCanada PipeLines Ltd. asked for a license to export 98.35 MMcfd to Great Lakes Gas Transmission LP for use as compressor fuel.

REFINING

Mobil Oil AG is producing 1,000 b/d of methyl tertiary butyl ether at its 100,000 b/d Woerth, Germany, refinery. It is Mobil's first refinery outside the U.S. to produce MTBE. Mobil expects the MTBE unit, together with an isomerization unit it installed 2 years ago at Woerth, to help it meet German environmental standards for gasoline. Mobil holds a 28% interest in Aral AG, which handles most of its gasoline marketing in Germany.

ESSO NEDERLAND BV plans to start construction in 1993 at its 153,200 b/d Rotterdam refinery of a $200 million hydrocracker able to convert 40,000 b/d of high sulfur heavy oil to essentially sulfur free jet fuel, automotive diesel fuel, and petrochemical feedstock. Start-up is expected about mid-1994.

HUNT REFINING CO., Dallas, let contract to Pritchard Corp., Overland Park, Kan., to provide engineering, procurement, and construction for a 12,000 b/d diesel desulfurization unit at its 45,000 b/d Tuscaloosa, Ala., refinery. Construction of the $25 million project is to begin in June, with completion scheduled for July 1993. The project will be partly financed by $20.5 million in bonds issued through the Industrial Board of Tuscaloosa.

LNG

BRUNEI COLD GAS, a joint venture of Brunei's government, Royal Dutch/Shell Group, and Mitsubishi Corp., agreed to extend contract to ship liquefied natural gas to Tokyo Electric Co., Tokyo Gas Co., and Osaka Gas Co. for 20 years. The joint venture has supplied 5.14 million tons/year of LNG to the Japanese utilities since 1972 under a contract that would have expired in March 1993. The new contract, to be signed this fall, allows imports to be increased 10%.

EXPLORATION

MOBIL EXPLORATION NORWAY INC.'S 35/11-4 wildcat on Block 35/11 in the Norwegian North Sea flowed a combined 10,700 b/d of 39-43 gravity oil from three zones. A fourth zone flowed mainly gas. It is the second commercial discovery on the block (OGJ, Dec. 14, 1987, p. 22), awarded in March 1984. Mobil has a 40% interest, Den norske stats oljeselskap AS 50%, and Norsk Hydro 10%.

MOBIL EXPLORATION & PRODUCING U.S. Block 75-1 wildcat off Alabama, about 1/2 mile north of Dauphin Island, flowed 20.5 MMcfd of gas through a 30/64 in. choke with 4,000 psi flowing tubing pressure from Jurassic Norphlet. The wildcat, drilled to 21,863 ft, is west of Mobil's Mary Ann Norphlet gas field in Lower Mobile Bay. Mobil holds an 87% interest in the well, Amoco the remainder.

APACHE CORP., Denver, 1 Matagorda Island Block 683 wildcat off Texas flowed 5.5 MMcfd of gas through a 20/64 in. choke with 2,101 psi flowing tubing pressure from Miocene Rob L at 6,297-6,304 ft and 7.3 MMcfd through a 23/64 in. choke with 2,091 psi flowing tubing pressure from Rob L at 6,002-021 ft. Apache expects to begin production late this year and plans at least two development wells on adjacent Block 703.

EGYPTIAN GENERAL PETROLEUM CORP. will offer 13 areas in Egypt's Western Desert and Gulf of Suez for licensing. Companies have until the end of April to bid on the offshore acreage and the end of May to apply for the desert tracts. EGPC introduced a seismic option on the unexplored 62,987 sq km North Mesaha permit in the desert on the border with Sudan.

COMPANIES

NORTH CANADIAN OILS LTD., Calgary, cut 43 of its 485 staff positions as part of a restructuring. About 60% of NCO's leases, representing 25% of its reserves, 18% of production, and 14% of cash flow, will be transferred to a new division that will either sell them or try to manage them more efficiently, NCO's exploration group has been reorganized to focus on reserve additions, and NCO plans a reserves acquisition program.

NORTHERN ILLINOIS GAS received approval from the Illinois Commerce Commission to provide gas to Commonwealth Edison Co.'s Collins generating station near Morris, Ill., under a 10 year contract. Northern said if gas prices remain competitive with fuel oil, the Collins plant may use more than 10 bcf/year of gas. ComEd is modifying three of five units at the station to burn gas and fuel oil and is to begin using gas by mid-1993.

DRILLING-PRODUCTION

ARCO OIL & GAS CO. converted 40 oil well pumps in Ojai field, Orange County, Calif., from natural gas fuel to electricity. The $58 million project reduces ARCO's gas use by 140 Mcfd and required laying about 3 miles of power lines. ARCO received an award from Southern California Edison Co. for its effort, which reduces its air emissions by about 21 tons/year.

PETROLEO BRASILEIRO SA let contracts for two semisubmersible rigs to Wilrig SA for drilling and subsea completions in the Campos basin off Brazil in water to 3,445 ft. The Treasure Legend rig is under a 2 year contract to start working in April in Albacora field, Treasure Prospect has a 3 year contract to start working in May in Marlim field. Combined value of the contacts is about $113 million. A joint venture of Wilrig and Odebrecht Perfuracoes Ltd. will operate the rigs.

RUSSIAN REPUBLIC ordered $8.4 million in oil field equipment from Lufkin Industries Inc., Lufkin, Tex. Lufkin's 1991 orders from the republic totaled $50.2 million. Lufkin shipped $43.7 million of products to the republic during 1991, and the balance will be shipped during first half 1992. Lufkin said it has received payment for most of the shipments.

PHILLIPS PETROLEUM CO. is drilling ahead at 1 East Breaks 167 in the Gulf of Mexico. Site is about 100 miles southeast of Galveston, Tex., and 1/2 mile east of its 1 East Breaks 166 wildcat, which flowed 15.7 MMcfd of gas through a 48/64 in. choke from 68 ft of pay. Phillips holds 79.4% interest in both blocks, Taiwan's Opicoil the remainder.

BOW VALLEY INDUSTRIES LTD., Calgary, will take a writedown of about $270 million (Canadian) on assets, mainly in Canada, due largely to year to year reduced prices for oil and gas. The writedown, as of last Dec. 31, will amount to about 17% of the book value of the company's total assets and cause a net loss for 1991. Worldwide reductions in reserves due to an engineering redetermination will amount to 9.8 million bbl of oil and 118 bcf of gas.

AMERADA HESS CORP. began delineation drilling for its 1 Garden Banks Block 260 discovery off Louisiana, which flowed 3,986 b/d of oil and 9.5 MMcfd of gas through a 24/64 in. choke from one zone and 2,510 b/d of oil and 15 MMcfd of gas through a 22/64 in. choke from a second zone. Delineation drilling will continue through yearend on the block in about 1,675 ft of water 120 miles southwest of Morgan City, La. Amerada and Oryx Energy Co. each hold a 50% interest in the block.

BASIN INDUSTRIES INC., Gulfport, Miss., agreed with Resource Investment Organization Ltd. , Jackson, Miss., to earn a 75% working interest in Pelahatchie field, Rankin County, Miss., by spending about $6 million to work over five wells and drill two more by mid-1993. Basin estimates its 50% revenue interest in the field has proved undeveloped reserves of 14 million bbl of oil, 57 bcf of gas, and 670,000 tons of sulfur.

PLUSPETROL SA, Buenos Aires, increased oil production in the 8,154 acre El Porvenir area of Argentina to 1,572 b/d from 440 b/d since it took over operations in October 1990. Pluspetrol has spent $20 million on the project and expects to spend a total of $42 million, including rehabilitating 100 old wells and drilling 40 wells during the next 3 years. Pluspetrol estimates future production at about 9 million bbl. Production to date is about 35.5 million bbl.

REPSOL EXPLORACION SA of Spain will purchase BP Exploration's producing assets in Egypt's Gulf of Suez for $125 million (OGJ, Dec. 16, 1991, p.29). BP will retain its 25% stake in the El Qara gas project currently under development.

CHAUVCO RESOURCES LTD., Calgary, agreed to buy a 23.3% interest in oil and gas tracts in Argentina's Austral basin from state owned Yacimientos Petroliferos Fiscales SA for $47.8 million. Bridas Sapic, a private Argentine firm, will pay $143.5 million for a 70% working interest in the deal with YPF. Assets in the Tierra del Fuego region include five parcels producing 6,500 b/d of crude, 53 MMcfd of gas, and 1,700 b/d of liquefied petroleum gas.

PETROCHEMICALS

LINDE AG'S process engineering and contracting division licensed Aspen Technology Inc.'s Advent, an advanced process synthesis and optimization tool for applying pinch technology. During testing by Linde, Advent was improved and adopted to fulfill special requirements of olefin plant design. Linde is the first European engineering and contracting company to license Advent.

TRANSPORTATION

KPL ENTERPRISES INC., Topeka, Kan., and Triumph Natural Gas Inc., Dallas, agreed to form Triark Gathering Co., a joint venture to construct two gas gathering, compression, and treatment facilities in Oklahoma's Arkoma basin. The 45-50 mile, 25 MMcfd Dog Creek system will be in Latimer and LeFlore counties, while the 80-85 mile, 75 MMcfd Panther Mountain system will be in Latimer, Pittsburg, and Haskell counties. Cost is estimated at $10 million.

LOUISIANA OFFSHORE OIL PORT asked the U.S. Coast Guard to expand the safety zone around its tanker offloading facility in the Gulf of Mexico. LOOP said Conoco Inc. intends to drill on Grand Isle Block 59 near the facility. The Coast Guard is asking for comments on the request.

WESTERN GAS SUPPLY CO., Denver, completed the final phase of its Lateral 4A-22 project, installing a compressor station that will handle as much as 25 MMcfd of coalbed methane and conventional gas from Colorado's San Juan basin to El Paso Natural Gas Co. and Northwest Pipeline Co. WestGas designed the station to handle production from Texaco Inc.'s coal seam wells.

CITIZENS GAS SUPPLY CORP., Boston, and National Fuel Resources Inc., Buffalo, N.Y., formed Citizens National Gas Co. to buy, gather, transport, store, and sell gas, while increasing its holdings in gas gathering systems and underground storage. The companies received approval from the Securities and Exchange Commission late last December.

CHINESE PETROLEUM CORP. is installing a fourth single point mooring buoy at Kaohsiung, Taiwan. Contractor is Intec Engineering Inc., Houston. The system, in 26 m of water, will include two 34 in., 6 km pipelines to move diesel fuel and naphtha to the Tainpu refinery in southern Taiwan. Installation is to be complete by midyear.

LABOR

OIL, CHEMICAL, AND ATOMIC WORKERS will conduct its 1992 national oil bargaining conference Sept. 28-30 at the Radisson Hotel in Denver. OCAW's U.S. oil industry contracts expire Jan. 31, 1993.

MARKETING

WSGP PARTNERS, Los Angeles, and a limited partnership formed by Unocal Corp. truckstop operators are negotiating purchase of Unocal's U.S. auto and truckstop network. Including more than 140 Unocal 76 retail stations.