INDUSTRY BRIEFS

COURTS

DISTRICT COURT of Austin County, Tex., awarded royalty owner Fred Fox, Rockport, Tex., and New Ulm Gas Ltd., Houston, more than $6 million in a suit against Mobil Oil Corp. and Columbia Gas Transmission Corp. The jury found Mobil and Columbia failed to provide Fox and New Ulm information that would have led to discovery of royalty underpayments to Fox and underpayment for gas produced by New Ulm. Mobil plans to appeal. Columbia is undecided.

SPILLS

ECUADOR'S GOVERNMENT fined Petroleos del Ecuador about $26,000 for alleged negligence that led to a faulty pipeline valve spilling 500-3,000 bbl of crude in the Amazon region July 25, Reuters reported. The spill occurred near Sacha oil field, 125 miles east of Quito. One independent study showed the spill contaminated three fourths of the Napo River, with the slick apparently extending 300 km.

TEXAS GENERAL LAND OFFICE released a list of 33 companies certified to clean up oil spills in Texas state water under requirements of the Oil Spill Prevention and Response Act of 1991 (Ospra). To be included, each company had to provide an inventory of spill response facilities and equipment verified by land office staff. Ospra requires Texas oil processing and storage facilities to be certified by Aug. 21.

RUSSIA continues to report a spate of oil spills in which the possibility of sabotage has not been ruled out (OGJ, Aug. 3, p. 32). Moscow newspaper Trud reported authorities are investigating a suspicious hole bored into an oil pipeline at a river crossing in Krasnodar Territory north of the Caucasus Mountains. The resulting oil slick covered an area of 25,000 sq m.

PETROCHEMICALS

QATAR FERTILIZER CO. is accepting bids from Japan's Chiyoda Corp. and Mitsubishi Kasei Corp., France's Technip, Germany's UHDE GmbH, Italy's Snamprogetti SpA, and M.W. Kellogg Co., Houston, for a $400 million expansion of its Umm Said petrochemical complex (OGJ, Nov. 5, 1990, p. 31). The project is to increase ammonia capacity to 1,500 metric tons/day and urea capacity to 2,000 tons/day, OPEC News Agency reported. The complex which uses gas from offshore North field, has two 1,000 ton/day urea plants and two 900 ton/day ammonia plants. The new plants are to go on stream in 1995.

PETROQUIMICA DE VENEZUELA SA (Pequiven) let a turnkey contract to ABB Lummus Crest to engineer and build a $270 million, 150,000 metric ton/year linear polyethylene plant in Venezuela. Pequiven partners are Venezuela's Grupo Zuliano and ABB-Cetico. The project will use DuPont Canada's proprietary Sclairtech technology to produce a broad range of linear resin grades. Commercial operation is expected in first quarter 1 994. Commercial loans and export credits totaling $203 million are secured, and the U.S. Export-import Bank granted political risk coverage.

PEQUIVEN and Japan's Mitsui Petrochemicals Industries Ltd. are scheduled soon to sign an agreement to build a $330 million methanol plant of undisclosed size in Venezuela. Other partners in the venture are to be Eastman Kodak and Mitsui Toatsu Chemicals Inc. The two Mitsui affiliates together will hold 50% interest in the venture, with Pequiven taking 30% and Kodak 20%. The plant, to start up in 1995, will sell all its production to other Petroleos de Venezuela SA units.

PIPELINES

AN EXPLOSION occurred July 28 on the Urengoi-Centre 2 gas pipeline about 7 km from Krasnoturinsk in the Sverdlov region of Russia, Itar-Tass news agency reported. The accident took place in a forest near Maoo Shakhta, but no casualties were reported, Gas flow was stopped and diverted to a reserve line. As of July 29, rescue and emergency repair workers were on site.

BORD GAIS EIREANN let five contracts valued at more than 25 million (Irish) for its proposed 147 mile gas pipeline from Scotland to Ireland (see map, Dec. 30, 1991, p. 38). Wilson Walton International Ltd. will provide sacrificial anodes for corrosion prevention, British Steel onshore line pipe on the Irish and Scottish lines, Wood-Bredero (Ireland) Ltd. onshore coating of pipe, Framatone SA turboexpander compressor units, and O'Neill Ltd. manufacturing quality assurance technical services. Target completion date is October 1993.

DISRUPTION in pipeline deliveries of fuel and lubricants recently halted vehicular transportation in Kemerovo, a large Russian industrial center in western Siberia. The Moscow press reported a major cause of the problem was interception of product deliveries destined for Kemerovo by cities and plants farther up the pipeline in Novosibirsk and Tomsk provinces. Kemerovo authorities threatened legal action against neighboring provinces if the seizures are not stopped quickly.

U.S. BANKRUPTCY COURT for the District of Delaware extended to Nov. 25 the period in which Columbia Gas System Inc. and Columbia Gas Transmission Corp. have exclusive right to file Chapter 11 reorganization plans. The previous exclusivity period expired July 31 (OGJ, July 20, p. 29). The two companies have been in bankruptcy since July 31, 1991.

QUESTAR PIPELINE CO., Salt Lake City, is holding an open season July 25-Aug. 23 for shippers who want to transport gas through its proposed system serving western Colorado and Southeast Utah. The pipeline would transport gas to connections with Kern River Pipeline, Northwest Pipeline, Colorado Interstate Gas, Trailblazer, Williams Natural Gas, and Mountain Fuel Supply.

PT WIGO, an Indonesian contractor acting on Pertamina's behalf, let a $6 million contract to Sembawang Maritime Ltd.'s offshore division for design, installation, and project management of a 12 km, 20 in. subsea refined products pipeline off Belawan, Sumatra. Work is scheduled for completion in November. The pipeline, 20 km from Medan, will link onshore storage tanks with a catenary buoy mooring system that takes kerosine, motor diesel, and gasoline from tankers moored offshore.

DRILLING-PRODUCTION

HARRIET JOINT VENTURE, led by Hadson Energy Ltd., commenced sales of Offshore Western Australia gas July 28 under a December 1990 agreement with the State Energy Commission of Western Australia (Secwa). Participants will supply 123 bcf to Secwa for as long as 10 years under an initial contract, with first deliveries at 26 MMcfd. The project gathers gas from Rosette and Harriet fields. In the next 2 months, gas from Sinbad and Campbell fields will be connected. Secwa will use the gas to fuel the Kwinana or Pinjar power stations.

MEXICO'S Petroleos Mexicanos completed the final stage of its $60 million Abkatun-Pol-Chuc secondary recovery project, including construction of 10 platforms in Campeche Bay. The project, which allows as much as 1.5 million b/d of water to be injected into 24 wells, is expected to maintain production at its current rate of 500,000 b/d. Notimex Mexican News Service reported the project includes a 25 km network of 18-30 in. subsea injection pipelines, as well as 12 km of 6-12 in. gas pipeline.

LAGOVEN SA expects to boost oil recovery from Bachaquero field in Lake Maracaibo by about 255 million bbl through an infill drilling program. Wells in the area are usually 300 m apart, and Lagoven plans spacing of 150 m. The field has produced more than 361 million bbl of crude since 1950.

FOREST OIL CORP., Denver, completed the acquisition of Transco Exploration & Production Co., Houston, for $45 million (OGJ, July 20, p. 38).

MORRISON PETROLEUMS LTD., Calgary, agreed to buy all of Unocal Canada Ltd.'s oil and gas leases, undeveloped acreage, production facilities, and seismic database in the Milligan and Peejay areas of Northeast British Columbia for $25 million (Canadian). Net production from the leases is more than 1,000 b/d of 40' gravity oil and condensate and 3.8 MMcfd of gas. The deal is to close Sept. 30.

MORRISON also agreed to purchase interests in certain oil and gas leases, undeveloped acreage, and a seismic database in Central Alberta from Union Pacific Resources Inc., Calgary, for $50 million (Canadian). Net production is more than 1,500 b/d of light oil, 17 MMcfd of gas, and about 500 b/d of natural gas liquids. Closing of the trade, to be effective June 1 , is expected in September.

UNION TEXAS PAKISTAN INC. expects to start production this year of about 4,000 b/d of sweet crude from an oil discovery at Bhatti, near Badin, Sindh province, Pakistan, boosting its oil productive capacity in Pakistan to 27,000 b/d. In addition, UTP found gas fields at Nari and Bukhari, bringing its total Badin gas productive capacity to 210 MMcfd. UTP also operates the Badin 11 concession surrounding the original Badin concession, where it is conducting seismic surveys near Mirpurkhas on behalf of itself, Occidental Petroleum Pakistan, and Oil & Gas Development Corp. (OGJ, Feb. 17, p. 31).

ARAN ENERGY PLC paid Chevron U.K. Ltd. $24.4 million for a 14.38% interest in Dunlin oil field on Block 211/16 in the U.K. North Sea. The agreement entitles Aran to 26.05% of production until Dunlin output attributable to Aran amounts to 14.38% of cumulative field production, At that time Aran's entitlement will revert to 14.38%. Aran also is entitled to 26.05% of tariff receipts from transport of production from Osprey field on Block 211/17. Aran will pay 14.38% of capital costs through payback, while its share of operating costs will match entitlements.

CYPRUS GAS CORP., Denver, agreed to pay $3.8 million to Giant Industries Inc., Scottsdale, Ariz., for a working interest in certain coal seam gas reserves and related gathering systems in the San Juan basin of New Mexico, including about 14% of Giant's proved gas reserves. Cyprus also agreed to participate in future development of other Giant proved, undeveloped coal seam leases. The deal is to close by the end of this month.

GAS PROCESSING

SHELL U.K. EXPLORATION & PRODUCTION is commissioning a third natural gas liquids fractionation module at its Mossmorran, Fife, plant that will increase capacity for NGL fractionation to 4.9 million tons/year from 3.6 million tons/year. Costain Oil, Gas & Process Ltd., London, provided engineering, procurement, and construction of the 2100 million module.

UNOCAL CORP. and partners reached a long term agreement with Airco Gases, Murray Hill, N.J., to supply Airco 140 MMcf/year of liquid helium. Value of the contract is more than $7 million/year or more than $40 million during its life. Helium will be supplied by Unocal's natural gas processing plant near Moab, Utah, from gas produced in Lisbon field. Unocal holds a 59% interest in the project and will operate it on behalf of six other working interest partners. Helium deliveries will begin this year.

TANKERS

U.S. COAST GUARD issued a final rule requiring large tankers operating in Alaska's Prince William Sound to use advanced systems to provide the Coast Guard better data on their positions. The rule requires automated dependent surveillance using a differential global positioning system. The regulation is to be effective Aug. 1 7.

COGENERATION

CHINESE PETROLEUM CORP. by yearend 1993 expects to be Taiwan's biggest producer of cogenerated power with capacity of more than 300,000 kw. CPC, which operates Taiwan's two refineries among other petroleum operations, is near completion of a 4 year investment program to make it self-sufficient in electrical power. Currently, Formosa Plastics Group, Taiwan's biggest petrochemical manufacturer, is the nation's leading cogenerator with capacity of more than 240,000 kw.

EXPLORATION

CAIRN ENERGY PLC 1 Ngatoro wildcat on License PPL 38706 in New Zealand flowed 500 b/d of 38' gravity oil with associated gas during cleanup test. The well was drilled in 1984 but not tested, and success of the 2 Ngatoro caused renewed interest in the area (OGJ, Feb. 1 0, p. 47). The 2 Ngatoro averaged 350 b/d on a long term production test. The 3 Ngatoro appraisal well is planned, and development plans are at an advanced stage.

REFINING

RUSSIAN purchases of foreign manufactured refinery and petrochemical equipment may increase soon. President Boris Yeltsin told officials of western Siberia's 360,000 b/d Omsk refinery and petrochemical complex he had sought government approval of the plant's request to remove barriers that prevent it from using its own hard currency to buy replacement oil processing equipment abroad. The Omsk refinery also needs foreign equipment to place new capacity on stream next year. The Omsk plant supplies fuel and lubricants to a large area between the Ural Mountains and Russia's Far East.

SHELL INTERNATIONALE PETROLEUM MIJ. BV let contract to Badger BY to assist with preparation of project specifications for a 145,000 b/sd grassroots refinery planned at Map Ta Phud, Rayong province, Thailand (OGJ, Aug. 26, 1991, p. 17). Shell is preparing specifications for Rayong Refinery Co., a joint venture of Shell and Petroleum Authority of Thailand. The refinery, to be on stream by 1996, will have crude and vacuum distillation, visbreaking, platforming, hydrotreating, hydrocracking, hydrodesulfurization, and hydrogen manufacturing capabilities.