INDUSTRY BRIEFS

TERMINALS

CAMBODIA'S government and France's Total signed a preliminary accord to form a joint venture between Cie. Kampuchea des Carburants (CKC) and Total Cambodia. CKC will contribute two refined products terminals at Phnom Penh and Sihanoukville, Cambodia, and Total will cover cost of revamping the terminals. The venture will receive, store, and load its refined products and possibly later handle third party products as well.

PETROCHEMICALS

RUSSIA started forming a petrochemical holding company in Bashkir republic. Subscription for stock in the Novo Ufimsk refinery is complete. The plant is the first of four member enterprises of the Bashneftekhimzavody corporation to be transformed into Bashkir Petrochemical Co.

ROYAL DUTCH/SHELL GROUP 70% and Mitsubishi Petrochemical Corp. 30% will form the Seraya Chemicals Singapore Pte. joint venture in Singapore and build a 51 billion yen ($459 million) petrochemical plant on Seraya Island. The plant will produce 310,000 metric tons/year of styrene monomer and 140,000 tons/year of propylene oxide. Work is to start in March, with trial production to begin in second quarter 1997.

EXPLORATION

PHILLIPS PETROLEUM INTERNATIONAL CORP. ASIA and 50 50 partner ARCO China Inc. agreed with China National Offshore Oil Corp. to explore East China Sea Blocks 26/05 and 25/05. The geophysical agreements are for 2 years and call for reprocessing and acquiring seismic data. The blocks lie 120 miles southeast of Shanghai.

ARCO agreed with a group of 14 Philippine companies to start geological and seismic surveys on a 3 million acre area of the Sulu Sea 500 miles south of Manila. Work is to begin in March.

AUSTRIA'S OMV found a major gas field in Sindh province, Pakistan. Estimate of the resource is 1.47 tcf. Development is expected to cost $350 million, with start up projected for 1997. Pakistan's state petroleum company Oil & Gas Development (OGDC) will take a 52% interest in the development, while operator OMV will take a 17.7% interest and contribute $60 million to development.

PAKISTAN granted an exploration license to a joint venture of Hunt Exploration & Mining Co., Netherlands, 95%, and OGDC 5% for exploration in Thana Block 2367.1 covering 6,157 sq km in Thatta and Tharparker districts and on the Indus River delta in Sindh province. The venture plans to spend at least $4 million to acquire 300 line km of seismic data and drill one wildcat during the license's initial 3 year term.

PARTNERS Kerr McGee Corp. 35% and Cairn Energy plc and Monument Oil & Gas plc unit Secab Ltd. each 32.5% plan to drill one wildcat well this year in the South Con Son basin off Viet Nam. The Block 22 well will be drilled in 170 ft of water.

DRILLING PRODUCTION

VAALCO ENERGY INC., Houston, reports the Sedco Forex 703 semisubmersible rig arrived in West Linapacan A field off Palawan Island, Philippines, and will start diagnostic work on wells. It will help determine the source of water intrusion, which caused field production to decline to 4,500 b/d of oil from a peak of 15,000 b/d in 1992.

HAMILTON OIL CO. LTD., London, let a $53 million contract to Brown & Root Energy Services, London, for design and procurement work on its Quadrant 110 Liverpool Bay oil and gas field development project in the Irish Sea. Four fields are to be developed using a combination of platforms and subsea tiebacks, with gas exports to a power generating station (OGJ, Nov. 1, 1993, p. 34). First oil is expected in late 1995.

RUSSIA authorized joint stock society Varyeganneftegaz to develop the northern Novosibirsk region's 179 million bbl Verkh Tarsky oil reservoir. Work includes drilling 100 wells in the next 2 2 years and laying a 200 km crude pipeline.

RUSSIA'S Tyumen region oil production declined to 128.5 million bbl during January vs. 129 million bbl the prior month. The decrease stems from several well shut ins triggered by overstocked refiners, who said their customers had no funds to purchase products. One producer, Surgutneftegaz, said it idled as much as 219,000 bbl of production during January.

RUSSIA'S Sakhalin Island production association Sakhalinmorneftegaz and McDermott International Inc., New Orleans, formed a joint venture to develop ice resistant offshore drilling units to be built in the U.S. by McDermott.

ARCO BRITISH LTD. chartered the Petrojarl 1 production vessel from Golar Nor Offshore AS, Trondheim, Norway. The ship will be used to develop Blenheim oil field in U.K. North Sea Block 16/21b. Blenheim holds reserves estimated at 23 million bbl. The field is due to start up early in 1995 and produce for 3 4 years.

COMPANIES

ROWAN COS. INC.'S new LeTourneau Inc. unit, Longview, Tex., completed its $52.1 million purchase of the net assets of General Cable Corp. unit Marathon LeTourneau Co.

HARKEN ENERGY CORP., Dallas, intends to sell its idle drilling rigs and related equipment and spend the proceeds mainly on exploration in Bahrain and Colombia. It plans a writedown of those assets as of last Dec. 31, resulting in a $3.1 million charge against fourth quarter 1993 earnings.

TAIWAN'S China Petrochemical Development Corp. (CPDC) will eliminate 250 jobs by March, part of the company's continuing privatization program. The layoffs will result in a charge of $7.55 million. The company laid off 236 employees, almost 11% of its workforce, in 1993. CPDC, 81% government owned at present, will sell another 35% of its stock to private investors in 1994. State owned Chinese Petroleum Corp., also planning to go private, will lay off 450 employees during the next 3 months.

AMOCO CORP'S refining, marketing, and transportation unit Amoco Oil Co. is reorganizing and plans to reduce its U.S. marketing group staff 610% and cut costs as much as 18%. The group employs 6,000 persons. Changes are expected to be complete in several months.

PHILLIPS PETROLEUM CO. is restructuring downstream operations into two divisions. Phillips 66 Co. will include refining, marketing, and transportation. Phillips Chemical Co. will consist of natural gas liquids, chemicals, and plastics. Changes will become effective Apr. 1.

USX CORP., Pittsburgh, settled litigation between its Delhi Gas Pipeline Corp. unit and Southwestern Electric Power Co., a unit of Central & South West Corp., involving a 15 year gas purchase contract due to expire in April 1995. Southwestern paid Delhi contract price for supplies through this past January. Delhi will receive a 4 year contract to supply gas at market sensitive prices to Southwestern's Wilkes and Lone Star power plants in East Texas. Delhi signed a 4 year transportation agreement to serve Central & South West's Laredo, Tex., plant.

REFINING

PARSONS OVERSEAS CO., Pasadena, Calif., started engineering, procurement, and advisory services for a diesel hydrotreater at Yukong Ltd.'s 529,000 b/cd Ulsan, South Korea, refinery. The unit will help remove sulfur components from processed diesel. Work is scheduled for completion in July 1995.

KUWAIT NATIONAL PETROLEUM CO. let contract to Stone & Webster Engineering Corp., Houston, for project management support and consulting services for upgrade projects at two Kuwaiti refineries. At the 288,000 b/cd Mina Al Ahmadi plant, the FCCU will be expanded, and methyl tertiary butyl ether, alkylation, and acid gas removal units will be added. The steam system at the 211,000 b/cd Mina Al Abdullah plant will be enhanced.

TURKIYE PETROL RAFINERILERI AS let a $30 million contract to H.I. Sofresid Chimie Petrole, Paris, to build an isomerization unit at its 113,000 b/cd Kirikkale refinery at Anatolie, 80 km west of Ankara, Turkey. The 1,000 metric ton/day unit will produce unleaded gasoline. Commercial operation is scheduled to begin in fall 1996.

A JOINT VENTURE of Shell Oil Co. and Pemex Refining generated $400 million in private bonds to partially finance a $1 billion upgrade of the 215,900 b/cd Deer Park, Tex., refinery the venture has operated since July 1993. The upgrade will enable the refinery to process greater volumes of Mayan heavy crude from Pemex and export unleaded gasoline to Mexico. It involves construction of a coker, hydrotreater, and sulfur recovery plant, with work to be complete by July 1995.

PERMNEFT production association, Perm, Russia, ordered a modular, 4,000 b/d crude processing unit from Ventech Engineers Inc., Pasadena, Tex. The computerized unit will produce stabilized naphtha, kerosine, diesel, and atmospheric residuum. The unit will be delivered this summer and is expected to be in operation before winter 1995.

TOMSK, RUSSIA, invited tenders for construction of a refinery to supply its petrochemical operation with products and eventually satisfy the region's demand for fuels and lubricants. Current gasoline demand in the region is about 150,000 b/d.

UZBEKISTAN'S state petroleum concern Uzbekneftegas let contract to France's Technip for front end engineering for construction of a 100,000 b/d refinery at Boukhara. Work is to be complete within 6 8 months.

A SPECIAL RUSSIAN commission said - 300 C. air temperature caused a pipeline gasket failure and resulting fire at the 360,760 b/cd Rayzan refinery. The fire was extinguished 3 hr after it started Feb. 11. No one was injured.

TAIWAN'S INVESTMENT COMMISSION proposed relaxing restrictions on foreign investment in the country's refining and petroleum products marketing. Under new rules, foreign investors would be allowed to own as much as 30% of refining/marketing assets.

SHOWA YOKKAICHI SEKIYU CO. LTD. licensed UOP's Merox process to treat LPG and gasoline produced by a new resid catalytic cracking unit at Showa's 220,300 b/cd Yokkaichi, Japan, refinery. The LPG streams will be treated using the extraction application of the mercaptan sulfur removal process. The light/heart cut and heavy gasoline streams will be sweetened using the Minalk version of Merox.

PIPELINES

A SUDDEN air temperature drop ruptured the 28 in. Druzhba 1 crude oil pipeline Feb. 9, spilling more than 2,000 bbl near Malinovka in the Tambov region of Central Russia, 260 miles south of Moscow. Valves were closed to isolate flow. The leak created a 17 acre oil lake. Oil recovery work was slowed by 280 C. air temperature.

A 100,000 B/D, 256 mile, $220 million, 16 in. crude pipeline linking western Argentina with Chile's port of Talcahuano started up Feb. 15. One fourth of the crude goes to the 89.570 b/cd Talcahuano refinery. The rest is sold by Argentina's Yacimientos Petroliferos Fiscales to Pacific Rim customers. Crude comes from YPF's oil fields in Puesto Hernandez in western Neuquen province.

A FOOTHILLS PIPE LINES LTD. 42 in. gas pipeline ruptured and caught fire Feb. 15 about 35 miles north of Maple Creek, Sask. Valves on either side of the break closed automatically to isolate flow. Deliveries to Northern Border Pipeline Co.'s system, beginning in Montana, are curtailed until repairs are completed. Cause of the break is unknown.

OCELOT TANZANIA LTD., TransCanada PipeLines Ltd., and the government of Tanzania will lay a 200 km pipeline to Dar es Salaam to move natural gas from Songo Songo Island off Tanzania. Gas will fuel a 200,000 kw electrical power plant to be built at Dar es Salaam. Pipelaying and plant construction will cost a combined $200 million.

BRAZIL'S Petrobras extended for 2 years its charter of Coflexip SA's Flexservice 1 pipelay vessel. Petrobras recently chartered for 5 years starting in 1995 Coflexip Brazil's Sunrise ultradeepwater pipelaying vessel. Sunrise, which will be able to work in 2,000 m water depth, is under construction.

FOUR CORNERS PIPELINE CO. Line 1, ruptured in eight places during the Jan. 17 Northridge, Calif., earthquake, was repaired but is not expected to restart for 68 weeks. The breaks spilled 4,120 bbl of oil, mostly into the Santa Clara River. Full cleanup is expected to take another few weeks. Line 1 usually carries as much as 50,000 b/d of San Joaquin Valley (SJV) crude to Los Angeles refineries. Four Corners' parallel Line 63 is moving SJV and Offshore California crude on a prorata basis while Line 1 is out of commission.

LNG

THE OMANI government signed a decree formalizing the project company that plans to develop a 5 million metric ton/year liquefied natural gas export plant to exploit Oman's 20 tcf offshore gas reserves. A Shell International Petroleum Co. spokesman said start up by 2000 is thought feasible. London's Financial Times placed the cost of the project at $6 billion. Shareholders are the government of Oman 51%, Shell 34%, Total SA 6%, Omani company Partex 2%, Mitsubishi Corp. 3%, Mitsui Oil Exploration Co. Ltd. 3%, and Itochu Corp. 1%.