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INTEC RESTRUCTURES AND PROMOTES FROM WITHIN
In order to manage its growth and prepare for an organized and orderly transition into the 21st century, INTEC Engineering, Inc has promoted Bill Beran, Kerry Kirkland and Uri Nooteboom to the position of Vice President, and Sam Foster, Phil German and Nestor Goytia to the position of Executive Engineer. They, along with Joe Key (previously promoted to Executive Engineer), Vural Dolen, General Manager of INTEC SEA, George Lagers, Managing Director of INTEC BV, and the four Principals will constitute the INTEC Executive Management Committee (EMC) with responsibility for worldwide operations.

While INTEC is not adverse to bringing new talent on board, in fact it recognizes this as a necessity for sustained growth, we are extremely pleased that all the inaugural members of the EMC are tried and proven quantities, promoted from our own ranks!

SUBSEA PIPELINING IS ALIVE AND WELL AT INTEC!

In recent years, the INTEC name has been recognized in association with quite a number of developments involving deepwater subsea production, offshore terminals and floating production systems. The leading article this quarter shows that offshore pipelines are still very much a major part of the services we perform for our clients. The following is a synopsis of our current subsea pipeline projects:

Large Diameter, Long Distance Pipelines

INTEC has achieved a unique distinction amongst pipeline engineering companies by being currently associated with nearly 1500 miles of large diameter, long distance subsea pipelines, including the world's longest pipeline. The projects, in the order of their respective lengths, are as follows:

Confidential Client (SE Asia) - 38" OD x approx 530 miles long

Shell Malampaya - 24" OD x approx 400 miles long

Total Moattama Yadana - 36" OD x 225 miles long

Petronas MLNG Tiga - 38" OD x 90 miles long
- 34" OD x 80 miles long (2 nos)
- 24" OD x 65 miles long


INTEC has been awarded a contract for the preliminary engineering of a 530 mile pipeline in the general area of the South China Sea.

The engineering will encompass design, installation and precommissioning aspects, with a major target being reduction of costs using innovative design and installation concepts. This project will place INTEC at the forefront of the Southeast Asian pipeline market, and will ensure a successful beginning to our operations in the next century.

Shell International Exploration and Petroleum Company (SIEP) of The Hague, The Netherlands, has commissioned INTEC Engineering, Inc of Houston to provide Management services during the Geophysical and Geotechnical surveys for the Malampaya Pipeline. The contract, finalized recently, requires the services of two Pipeline Engineers on board the survey vessels, and a Senior Manager to coordinate and supervise the work. The surveys are expected to begin in December 1996, and be completed by June 1997. INTEC will also provide the necessary drafting support to prepare 125 alignment sheets, along the 400 mile route.

INTEC has already carried out several studies on Malampaya, including the selection of the pipeline route, review of seismic and mass gravity flow hazards, pipeline spanning and landfall site selection.

Details of the Yadana project and MLNG Tiga were included in our previous issue.

map of pipeline in S.China Sea

Steel Catenary Risers (SCRs)

INTEC has recently completed three SCR design projects in the Gulf of Mexico, consisting of the detailed design and construction supervision of SCRs for the Mobil Green Canyon 60 project, preliminary engineering for the Amoco Marlin export SCRs in Viosca Knoll 915, and the preliminary engineering for the Enserch Allegheny SCRs in Green Canyon 254.

In keeping with the advances made in analysis techniques, INTEC has added the commercially available software program 'SHEAR7' to its software library. This places INTEC in a very strong position to bid for and attract further work in this field. INTEC will be presenting a paper on 'SCR Applications in the Gulf of Mexico' at the 7th International Offshore and Polar Engineering Conference (ISOPE-97) to be held in May 1997, in Honolulu.

In addition to the above projects, INTEC carried out an investigation on material selection and specification for the Petrobras Campos Basin SCR.

Arctic Projects

In line with a primary corporate strategy of continuing involvement in frontier technology, INTEC is carrying out work on two pipeline projects in the Arctic. Our pioneering capabilities have led to an alliance with BP and other specialized engineering companies and installation contractors for the purpose of developing the NorthStar field in Alaska, which will include the first Arctic offshore pipeline.

In another area of the Arctic, The Northern Gateway Group, through the Timan-Pechora Company, commissioned INTEC to perform a feasibility study for a crude oil transportation system bringing oil produced in Western Siberia and the Timan Pechora region to an export terminal on the coast of the Pechora Sea or Southern Barents Sea. Production from Western Siberia would flow through a pipeline originating in Krasnoleninskiy, and terminating in Uktha in the Komi Republic.

INTEC's involvement in the Arctic began in 1984 shortly after the formation of the company. In the past 12 years, INTEC has had the privilege of assisting many of the companies involved in the development of arctic pipeline projects and, as a result, has amassed a wealth of technical and commercial data which can be utilized for the benefit of the industry. INTEC has developed a Russian

Arctic Cost Estimating Program as part of a Joint Industry Project with Shell, Exxon, Amoco and Saga Petroleum, and which has been recently updated to include 1996 Russian costs.

Limit State Design (LSD)

In recent years, a Limit State Design approach to pipeline design has gained favor in the industry and has also been embraced by several national design codes. The LSD approach essentially produces a thinner wall design than traditional methods. INTEC is currently working on LSD studies for DeepStar, a joint industry study group consisting of major oil companies and suppliers focused on deepwater GOM subsea developments, and for Mobil Technology Company (MEPTEC). The Limit States currently under investigation are burst, collapse and fracture. In addition, the Limit State principles will also be utilized on a confidential project being carried out for Enron.

High Integrity Pipeline Protection System (HIPPS)

INTEC has recently been working on two projects, for Chevron and Texaco, on the feasibility of HIPPS for deepwater applications. The studies have so far indicated potential cost savings due to thinner pipe wall, and that additional work will be required for the development of the necessary subsea hardware.

Subsea Pig Launchers

Deepwater subsea production systems with long offsets drive the need for a reliable subsea pig launching system. Previous designs have not gained acceptance in the industry due to cost, complexity and reliability issues. INTEC, for nearly a year, has spent significant effort on developing system concepts for Chevron and Amoco, respectively, with the Amoco work now proceeding through preliminary engineering. This work is of truly pioneering status, and we believe a breakthrough in technology is imminent. INTEC is confident that this will lead to increased acceptance of the concept by the industry.

Other Projects

INTEC is currently carrying out Phase 2 of the Zafiro Development Project for Mobil Equatorial Guinea (see Quarterly Journal for Spring 1996). The current phase involves the installation of 4 miles of flexible and 20 miles of steel pipelines in water depths up to 580 meters. Mobil Technology Company also commissioned INTEC to carry out preliminary design of the pipelines for the Mobil Producing Nigeria Unlimited (MPNU) 1997 Wellhead Platforms Project.

Exxon Production and Research (EPR) has commissioned INTEC for the second phase engineering of the Mobile Bay pipeline project.

Chevron Petroleum Technology Company (CPTC) has commissioned INTEC to carry out the Chrysaor to Gorgon pipeline installation and pigging study. The fields, located in 1200 meters and 200 meters, are separated by a deep canyon system, requiring extensive survey data for pipeline routing.


START-UP OF LPG PLANT IN PARAGUAY
To satisfy their domestic requirements for liquefied petroleum gas (LPG), Petropar, the National Oil Company of Paraguay awarded a contract to COTAP (a Consortium including Chicago Bridge and Benito Roggio & Hijos of Argentina) to design, construct, and commission an LPG storage facility. This facility is designed to receive and store propane/butane mixture produced by the refinery and to offload barges specially designed to carry LPG in bulk from producers in Argentina. The LPG is stored in four pressurized spherical tanks each having a diameter of 15 meters and a theoretical capacity of 2000 cubic meters of liquefied product.

Paraguay LPG PlantAssociated facilities include multiple pumps, compressors, and four loading islands to load the product to tanker trucks that distribute the liquefied gas to local users.

As Roggio & Hijos did not have staff with start-up experience, they contacted Nestor Goytia (INTEC Director of Latin American Operations) to inquire if INTEC could supply a start-up team. Nestor duly negotiated a contract which provided for INTEC Engineers to perform a design safety review prior to agreeing to be responsible for the start-up.

The INTEC team of Dave Phillips (Project Manager and Electrical Engineer), Bryan Hartman (Instrument Engineer) and Scott Wolverton (Process Consultant, River City Engineering) was fully responsible for all operations and safety, and was ably supported by Petropar operators who had utilized INTEC's procedures to rehearse operations prior to INTEC's arrival. Thirty one truck loads of product were offloaded before the supply of trucks ceased due to a general strike in Argentina. However, by this time, INTEC had discharged its responsibilities by verifying that all systems were operational and performing according to design specifications. INTEC fully documented all phases of their work and edited Roggio's Draft Operating Manual to render it more user friendly, referencing actual start-up experience.

Ten to twelve hour days, seven days a week, working with extremely hazardous material was stressful, but didn't prevent the team sampling the local music and brew, on at least one occasion!


When Jim Gillespie, Bert Schultz, Dave McKeehan and myself started INTEC in early 1984, our vision was to create a company which would be a leader in the technology of our chosen fields, would grow and be financially successful, and which would share this success with its staff. It was part of the agreement with Valmet, our corporate shareholder and financial backer of those days, to set aside a certain portion of INTEC shares for key employees.

The bumps along the first stretch of our course, in particular the 1986 oil industry crisis and the withdrawal of our corporate shareholder, forced us to focus on survival rather than largesse: there just wasn't a whole lot to share. By 1989, however, things started to look up, and we were able to institute a 401-K plan with a significant company contribution, followed the next year by a profit sharing plan (when finally there were profits worth sharing).

In the last three years, INTEC has quadrupled in size to 160 staff in three regional offices covering worldwide operations with an annual turnover of about $20 million, and we expect sustained growth for the foreseeable future. This growth, we believe, cannot be successfully accomplished with the present management structure and, with this in mind, six senior managers have been promoted to executive positions as reported elsewhere in this issue. Together with the top managers of INTEC's Kuala Lumpur and Delft offices, and the four principals, they form a newly established Executive Management Team which we believe will be essential to successfully direct the further growth and to carry INTEC towards a leadership position as an internationally-operating, high-quality service company in the energy business during the coming years.

To complete our original vision of staff participation, a stock option plan will be implemented shortly which will allow our key staff to share in the increased value created by this further growth, financial success, and engineering excellence.

Let's go for it!

W. J. Timmermans
President

CONGRATULATIONS

The following employees were recently promoted to new positions. We appreciate their hard work and congratulate them on their success:

Jerry Barron - Senior Project Controls-Contracts Supervisor
Tom Choate - Supervising Engineering Specialist
Bill Clark - Senior Project Engineer
Jay Hilty - Senior Engineer
Chris Keevill - Senior Project Engineer
Jeff King - Senior Technical Specialist
Diego Lamacchia - Senior Engineer
Gordon Marshall - Project Engineer
Sharon Rich - Senior Engineer
Gloria Rivera - Project Secretary
Ron Tucker - Senior Engineer
Mike Vine - Senior Engineer
Yi Xu - Project Engineer


INTEC Welcomes the following New Employees to the Houston Office....

Jerry CollinsRon Ledbetter
Guy MackenzieGurminder Manku
Paul MillerJames Owens
Jason StevesKe Yu


IN-HOUSE LECTURES
There were four Brown Bag Lunches this fall with speakers Connie Green, Dee Stewart, Mike Vine and Kim Dyson. The subjects included Project Organization, Pegasus, Russian Arctic Pipeline Cost Estimating Program, and Introduction to STRUCAD.

Charlie Burton organized two Subsea Group Luncheons this fall.

Upcoming lectures for December will include Introduction to CPS, Structural Reliability, Pegasus E-Mail (second session), and Project Organization (second session).

NEW AWARDS THIS PAST QUARTER INCLUDE:
For Sipetrol, Replacement Superintendent for Oscar Byington on DB-21

For Westcoast Energy, Quintana Minerals LPG Plant - Proposal Assistance

Bid Evaluation (Option 1) for Malaysia Refinery Company

Vessel Inspector and Tanker Acquisition Bid Evaluation for IPC

PM-3 Phase 1 Field Development Cost of Tanker and Analysis of Spread Mooring

EPMI Tapis E Development - Provision of Detailed Design of Pipelines and Risers

EPMI Tapis E Development - Hot Tie-ins Pipeline Detailed Design

EPMI Tapis E Development - Bid Evaluation Assistance

For Protek Engineers/Petronas Carigali, PCSB - Conceptual Engineering Services for MLNG 3 Pipelines and Onshore Facilities

For Protek Engineers, Pulau Indah Bunkering Project - Surge Analysis of Pipelines

For Sarku Engineering Services Sdn Bhd, Cabot SPB Terminal Preliminary Engineering

For Shell Offshore Inc., URSA Subsea System Engineering - Well Performance Characteristics

For Shell Offshore Inc., EUROPA Subsea System Conceptual Design

For Shell Offshore Inc., EMC System Selection Project Team Support

For Shell Offshore Inc., Macaroni System Design

For Texaco Inc., Fuji Follow-up Work

For Exxon Production Research Company (EPRCO), Natuna Pipeline Support - Arun Option

For Exxon Company USA, Preliminary Engineering - Diana Project

For Texaco Inc., Mosquito-hawk Conceptual Design Effort

For Texaco Inc., Gorgon Subsea Development Study

For Texaco Group Inc., West Africa Deepwater Development - Economic Feasibility Study

For ESSO Exploration and Production Chad, Inc., Provision of FSO Consulting Services

For Marathon Oil Company, Oyster EB917 - Satellite Well Development - Preliminary System Design

For Marathon Oil Company, Preliminary Engineering - Arnold Prospect

For Turnkey Offshore Production Systems (TOPS), Engineering Support for Turnkey Field Development-Boomvang East Breaks Block 688

For Reading & Bates Development Co., Conceptual Engineering for Testing, Pigging and Topsides Requirements - Boomvang

For PMB Bechtel, Western Australia Subsea Cost Estimates - Create Viewgraph Image

For Exxon Production Company, Subsea Technology Catalog Modeling - Engineering Support

For ENRON, Pipeship Engineering Support

For Reading & Bates Development Co., Boomvang Video/Animation

For Mobil Technology Co. (MEPTEC), 1996 MPNU Standard Wellhead Platforms Study

For Chevron Petroleum Technology Co., Deepwater Large Diameter Technology Study