Chexpress - June 19, 2012

North America

Coal Mine

Universal Bioenergy Inc. has begun selling commercial coal from the Whitesburg Friday Branch Mine in Whitesburg, Kentucky. The company forecasts the sales of coal should generate an estimated average of $52.8 million in revenues and an estimated $5 to $8 million in earnings annually. The mine is in full operation six days/week for the mining of coal.

LNG Exports

ConocoPhillips has resumed shipments of liquefied natural gas from its Alaska plant, an aged facility that was previously targeted for closure. ConocoPhillips expects to deliver four or five cargoes of Alaska LNG this year, all of them to Japan. The Kenai Peninsula plant is the only LNG export facility in the U.S.

Asset Sales

Chesapeake Energy Corp. plans to sell its midstream assets in three separate transactions for total expected cash proceeds of more than $4 billion. The divestitures will also enable Chesapeake to reduce previously budgeted capital expenditures by approximately $3 billion over the next three years. The company has agreed to sell its limited partner units and its general partner interests in Chesapeake Midstream Partners, L.P. to Global Infrastructure Partners for cash proceeds of $2 billion. It also entered into a letter agreement with CHKM related to the potential sale of certain Mid-Continent gathering and processing assets to CHKM and a separate letter agreement with GIP for the sale of the company’s interests in its subsidiary, Chesapeake Midstream Development, L.P. to GIP. Chesapeake expects total cash proceeds of more than $2 billion from these two transactions.

Fines

Great Lakes Chemical Corp. has been hit with more than $100,000 in fines by the U.S. Department of Labor’s Occupational Safety and Health Administration for 18 serious violations the federal agency alleges exposed employees at an El Dorado, Arkansas facility to unexpected releases of bromine. Inspectors found a number of violations including improperly installed valves, relief devices and expansion chambers, incorrect liner used to prevent the release of bromine, the control room’s proximity to highly hazardous chemical storage and process areas, and equipment inspection failures. A number of the violations occurred in the bromine unit.

Soot Pollution Standards

The Environmental Protection Agency is proposing new air quality standards to lower the amount of soot that can be released into the air. The proposal is in response to a lawsuit from 11 states (California, New York, Connecticut, Delaware, Maryland, Massachusetts, New Mexico, Oregon, Rhode Island, Vermont and Washington). The states and the American Lung Association say current standards jeopardize public health. The new rule would set the maximum allowable standard for soot at range of 12 to 13 micrograms per cubic meter of air. The current annual standard is 15 micrograms per cubic meter.

 

World

Refinery

Pakistan State Oil’s two-year old plan to enter the refining business has finally made some headway as Khyber-Pakhtunkhwa has agreed to allot 400 acres of land to set up a refinery. The proposed refinery will produce 40,000 barrels/day

LNG Technology

GE Oil and Gas has secured a $150 million deal to supply liquefied natural gas (LNG) technology to Petroliam Nasional Bhd (Petronas). The Petronas LNG Train 9 project will add 3.6 million tons/year to the existing 25.7 million tons/year production capacity at the company’s LNG complex in Bintulu, Sarawak. As part of the contract, GE is providing a fully integrated solution for Train 9, including GE Oil and Gas turbo-compression equipment and variable speed drive systems from GE’s Power Conversion business. The scope of GE’s supply included a low- and medium-pressure mixed refrigerant package and a propane and high pressure mixed refrigerant package, each driven by a frame 7EA gas turbine, with 13MW induction motor running at 3,600 rpm and VSI technology variable speed drive systems.

Explosion

An explosion at a state-owned steel plant in Andhra Pradesh, India has killed at least 11 people. At least 16 other workers suffered serious burns in the blast and a massive fire that broke out in the plant in Visakhapatnam. The explosion occurred when workers were checking a newly installed oxygen unit in the steel melting unit of the Vizag Steel plant. The explosion was so powerful that cars parked outside the unit were flung in the air.