News of the Week But trouble is afoot. The large Tosco/Exxon Colony Oil Shale project in Colorado, which struggled hard last year to get a $1.1 billion loan guarantee from the government outside of Synfuels Corp., is in danger of losing that support. Stories of huge cost overruns at the project have led to a number of cries to end government funding because some believe that the costs may have risen beyond what the project is worth. The $3.1 billion price of the project has risen to at least $3.7 billion, and some estimates go up to $5 billion. Synfuels Corp., which is managing the loan guarantee for the government, has called the overruns very serious and has moved to find out just what is happening. Meanwhile, another synthetic fuels project has called it quits. The largest coal gasification project in Wyoming has asked that it no longer be considered for support by Synfuels Corp. and is getting out of the business. WyCoal, sponsored by WyCoal Inc. and Ruhrgas Carbon Conversion, wrote a letter to Synfuels Corp. chairman Edward E. Noble complain-
ing of the combined problems of continuing high interest rates for loans, the lack of government support for synthetic fuels projects, and the falling prices of crude oil. In another arena, Congress has lost its affection for Synfuels Corp. and has been taking pot shots at it for some time. Legislation has been introduced in this session that would have the corporation administer projects on alcohol fuels, biomass conversion, and district heating and cooling projects, all of which had been excluded from its original charter. Most recently, Rep. Hank Brown (R.-Colo.) proposed that Title I of the Energy Security Act be repealed — t h a t is t h e title t h a t created Synfuels Corp. and its demise would mean the same for the corporation. And Rep. Tom Corcoran (R.-Ill.) has proposed that any of the $14.2 billion of Synfuels Corp.'s funds that have not been obligated to a specific project by Sept. 30 of this year be taken away from that office and used to provide assistance to the ailing housing industry. •
Former ACS president Charles Thomas dies Charles Allen Thomas—eminent research chemist, former president of the American Chemical Society, and former president and chairman of Monsanto—died March 29. He was 82. Thomas earned his B.S. degree at Transylvania College, Lexington, Ky., in 1920; an M.S. at Massachusetts Institute of Technology in 1942;
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C&EN April 5, 1982
and a D.Sc. in organic chemistry at Transylvania in 1933. He joined General Motors Research Corp., Dayton, Ohio, in 1923. Thomas discovered that adding ethylene dibromide to gasoline prevented lead oxide buildup on sparkplugs and valves, and thus helped pave the way for high-compression engines. While at GM, Thomas met chemist Carroll A. (Ted) Hochwalt. The two men left GM in 1926 to form their own consulting laboratory. Monsanto acquired Thomas & Hochwalt Laboratories in 1936 and re-erected it as Monsanto's central research facility with Thomas as director of research. Thomas started work in 1938 to move Monsanto into production of styrene and of plastics and synthetic rubbers. During 1943 and 1944, Thomas led a team of scientists that worked out the metallurgy and developed a purification technique for plutonium for the Manhatten Project. Monsanto made Thomas president in 1951. He was elected president of ACS for 1948. He became board chairman at Monsanto in 1960, retiring in 1970. Thomas was a member of the National Academy of Sciences and a founding member of the National Academy of Engineering. •
Dow Chemical to sell oil and gas division Just when archrival Du Pont jumps into oil and gas with both feet by purchasing Conoco, Dow Chemical is pulling back. Dow has agreed in principle to sell its oil and gas division to Apache Corp. and Apache Petroleum Co. in return for a combination of cash and Apache Petroleum "depository units" (stocklike securities). Terms of the agreement call for Dow to receive $200 million in cash and 10 million newly issued Apache Petroleum depository units, which trade much like stock. The value of the deal is about $400 million. Dow also will receive an 80% share of revenue from production on developed properties above a predetermined annual base level. Dow also will get an overriding royalty interest on undeveloped properties, may purchase gas and oil produced from the acquired properties, and may purchase additional uncommitted gas and oil produced by Apache. At the beginning of 1981, Dow's oil and gas division had proven and provable reserves of 271.3 billion cu ft of gas and 8.4 million barrels of oil, according to a report by Ryder Scott, independent oil and gas engineering consultants. The properties also include 1.7 million net acres of undeveloped leasehold in 19 states— primarily in the Gulf Coast, midcontinent, southwestern, and Rocky Mountain regions. Dow president Paul F. Oreffice says, "This transaction is ideal for Dow in that it reduces our financial commitment in the oil and gas area while providing access to production from more oil and gas acreage. At the same time, we will have significant future benefits from revenue sharing and from our ownership of Apache Petroleum depository units." Dow says the 200 employees in the oil and gas division all will be offered employment at Apache. A Dow spokesman says the proceeds from the sale will be used for capital projects and for reducing short-term debt. The company has set a goal of reducing its total debt from 48% of total capitalization (debt plus stockholders' equity) in 1981 to about 40% over the next few years. The sale of the oil and gas division is part of Dow's stated objective of selling about $1 billion in assets within the next two years. Dow retains its oil and gas properties in Canada. •
