CAPITAL: Madrid

MONETARY UNIT: Peseta

REFINING CAPACITY: 1,315,500 b/cd

OIL PRODUCTION: 10,900 b/d

OIL RESERVES: 14 million bbl

GAS RESERVES: 60 bcf

The Spanish government passed a hydrocarbons reform law in September 1998 which liberalized marketing in the country.

The legislation removed government-established limits on gasoline pump prices, lifted restrictions on LPG retailing, and dropped roadblocks to opening competing product marketing networks.

The law set a 15-year timetable for the decontrol of natural gas markets. About 45% of Spanish consumers were already able to negotiate their own gas supply deals.

The law established a National Energy Commission to oversee the operations of the deregulated markets.

Upstream

Repsol SA started up production and processing facilities for the Poseidon gas fields in the Gulf of Cadiz, about 30 km off Huelva.

Repsol was operator and sole concession holder for the project: two gas fields in Tertiary sandstone at about 1,500 m in waters 75-150 m deep. Reserves were estimated at 1.7 billion cu m.

Production of more than 1 million cu m/day of gas and liquids was moved 65 km to land in a dual-phase, Y-shaped pipeline system.

After landfall at Mazagin, the line extended to an onshore processing plant rated at 1.5 million cu m/day. After liquids recovery and fractionation, the treated gas was shipped through a 5 km pipeline to the state gas distribution network operated by Enagas.

Repsol said other gas fields near Poseidon might be developed and tied into the Poseidon infrastructure, with Poseidon North field as a gas storage site.

Repsol had a 140,000 cu m/day gas discovery in southern Spain`s Guadalquivir Valley, the Santa Clara-1, about 5 km northeast of Carmona.

Processing activities

Iberdrola and Repsol planned a gasification plant to fuel their proposed Integrated Gas Combined Cycle (IGCC) power station in the northern Basque province.

The $1 billion plant would be built next to the companies` Petronor refinery near Bilbao. Completion was expected in 2002-2003.

The plant was to convert gasoline residues into gas to fire the 900-MW power station. The project was part of the Basque regional government`s plan to achieve near self-sufficiency in energy by 2005, meeting 82% of its electricity needs, compared to 20% in 1998.

AES Corp. planned to build an 800-MW gas-fired, combined-cycle power plant and seawater desalination facility in Cartagena.

The plant`s electricity would be sold to nearby industrial plants. The surplus would be sold across the Spanish power grid.

The desalination side of the project would produce about 6 million cu m/year of potable water for industrial and other uses. The $425 million project was due completion by early 2002.

Repsol was building a 350 km, 22-in. oil pipline from Cartagena to the 140,000 b/d Puertollano refinery. Completion of the $182 million line was due in early 2000.

When the line was completed, Repsol planned to decommission a 520,000 cu m storage facility at Malaga and the crude line from Malaga to Puertollano.

Repsol also was building a $9.8 million expansion of crude offloading facilities at Cartagena, which would triple capacity and also serve the 100,000 b/d Cartagena refinery.

Sogama, a Spanish waste handling company, let a $45 million contract to Kvaerner plc, London, for two circulating fluidized-bed boilers to be installed in a new waste-to-energy plant near La Coruna.

The boilers would have combined capacity to generate 50 MW of electric power from waste. The plant was due completion in mid-2000.

Enron International Co. planned to build a 1,200-MW gas fired, combined-cycle plant at Arcos de la Frontera, northeast of Cadiz. Construction on the $560 million project was due to begin in late 1999 and be completed by 2002.