World of Oil and Gas
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Ghana find may add 1 billion boe |
Tullow announced July 27 that its Owo-1 deepwater exploration well offshore Ghana intersected a significant light oil column, potentially adding 1 billion boe to the area’s resource estimate. The deviated well encountered a gross vertical reservoir interval of 154 m containing 53 m of net oil pay in two zones of high-quality stacked reservoir sandstones. Samples show that the oil is 33−36°API. |
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Lukoil to develop blocks offshore Romania |
A consortium of Russia’s Lukoil and US independent Vanco International has won a tender for exploration and development of two blocks, Est Rapsodia and Trident, in the Romanian sector of the Black Sea. The companies’ respective stakes in the consortium are 80% and 20%. The blocks rest about 37−60 mi from shore in water depths ranging 300 to 3,300 ft. Lukoil will sign a concession agreement with the country’s oil agency within the next six months. |
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Chevron discovers gas offshore Australia |
Chevron Corp. announced a new discovery in the Carnarvon Basin offshore Western Australia. The Sappho-1 exploration well is located in the WA-392-P permit area about 87 mi northwest of Onslow. The well was drilled to a depth of 15,406 ft and encountered about 246 ft of net gas pay. |
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Encana, CNPC may partner on Canadian gas |
Encana and China National Petroleum Corp. (CNPC) signed a memorandum in June that could lead to a joint venture for the development of natural gas acreage in the Horn River, Greater Sierra and Cutbank Ridge plays of northeastern British Columbia, where Encana has a hefty acreage position. Encana would be the operator of all developments and CNPC would invest capital to earn an interest in the assets. In early July, Encana CEO Randy Eresman told investors that the partnership could extend beyond these three areas. |
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New GOM oil spill system planned by major oil companies |
In an effort to blunt public criticism in the wake of BP’s Macondo well blowout and oil spill, four of the world’s largest oil companies have announced a plan to build and deploy a rapid response system that would capture and contain oil in the event of another underwater well blowout in the deepwater Gulf of Mexico. Chevron, ConocoPhillips, ExxonMobil and Shell announced the joint venture in late July, and have committed a combined $1 billion to fund the initial costs of the system. As part of the new initiative, subsea containment and modular processing equipment will be designed for several scenarios in water depths up to 10,000 ft specific to conditions in the Gulf. The subsea equipment will connect by manifolds, jumpers and risers to capture vessels that will store and offload the oil. According to a statement by the companies, the system will be able to mobilize within 24 hours and will have initial capacity to contain 100,000 bpd. Additional costs for equipment, contracts and new vessels may increase the $1 billion commitment. The companies said they have reviewed the system with Congress and the Obama administration and will conduct briefings with other stakeholders. |
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Ghana rejects Exxon Jubilee buy |
Ghana National Petroleum Corp. (GNPC) said on July 5 it had rejected a formal request by privately held Kosmos Energy to sell its stake in the Jubilee oil field to ExxonMobil. According to Reuters, a confidential petroleum agreement entered into by all partners in Jubilee provides that any company seeking to enter into any deal with an interested third party must give “prior notice” to GNPC and the government of Ghana. Ghana argues Kosmos did not give such notice. Kosmos, backed by private equity companies Warburg Pincus and Blackstone Group, agreed last year to sell its interests in the field to the US supermajor for $4 billion. Ghana at the time declared the sale illegal and said GNPC was interested in the stakes, which amount to a 30.875% interest in the West Cape Three Points Block and an 18% stake in the Deepwater Tano Block in the Gulf of Guinea. Other firms have also shown interest, including China National Offshore Oil Corp. and Korea National Oil Corp. First oil is due in the fourth quarter of 2010 with initial output building to 120,000 bpd. |
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Marathon sees first oil from GOM Droshky development |
Marathon Oil Corp. announced that its Droshky development in the deepwater Gulf of Mexico has begun production on time and under budget. Marathon owns a 100% working interest in Droshky, previously called Troika Deep, which is expected to produce about 50,000 net boepd at its peak. This output will consist of about 45,000 bpd of liquid hydrocarbons and 30 MMcfd of natural gas. Located in about 3,000 ft of water in Green Canyon Block 244, about 160 mi southwest of New Orleans, Droshky is a major subsea project consisting of four development wells tied back to the third-party Bullwinkle platform with dual, 18-mi flowlines. At a final development cost of less than $900 million, the initial stage of development is expected to produce 35 million of the estimated 60 million-boe net resource. At year-end 2009, Droshky had booked proved reserves of about 26 million boe. |
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Total acquires Chevron’s stake in Nigerian license |
Total signed an agreement to acquire Chevron’s 45.9% interest in Block 1 in the Joint Development Zone (JDZ) in Nigeria. Total will operate the block in partnership with Addax Petroleum, Dangote Energy Equity Resources and South Africa-based Sasol. The JDZ is governed by a treaty signed by Nigeria and Sao Tomé and Principe in 2001 for a period of 45 years. The license extends over an area of close to 270 sq mi in water depths ranging from 5,250 to 5,900 ft. Within this license, a discovery was made in 2006 with the Obo-1 well. The proximity of Total-operated licenses and facilities in Nigeria will enable cost reductions in developing the license’s resources. |
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| House amendment would ban BP drilling permits | A key provision of a spill response and energy bill introduced in the US House of Representatives on July 27 would bar new offshore oil and gas drilling permits to BP “or any other company with a significant history of violating worker safety or environmental law,” according to a press release from Rep. George Miller (D-Calif), the amendment’s author. The Miller amendment would bar a company from drilling on the Outer Continental Shelf (OCS) if its record indicated five times the industry average for willful or repeat worker safety violations at its oil and gas facilities, if more than 10 fatalities occurred at any of its facilities, or if it incurred fines of $10 million or more under the Clean Air Act or the Clean Water Act within the preceding seven years. The parallel bill in the Senate contains no such provision. “It is a privilege to be able to drill for the valuable resources that belong to the American people,” Miller said in a statement. “And the American people have a right to insist that only the companies of the highest caliber and with the best records be permitted to drill off our shores.” BP responded July 28 with a letter to House Speaker Nancy Pelosi and Minority Leader John Boehner, saying the proposed legislation proposed amendment would have a “drastic impact,” triggering job losses and threatening US energy security. | ||||
| Integra and WesternGeco form land seismic JV | WesternGeco, the seismic business segment of Schlumberger, is partnering with Former Soviet Union-based service company Integra to provide land seismic acquisition, interpretation and data processing in the FSU. The two firms will form a joint venture company, IG Seismic Services Limited, offering services in Russia, Kazakhstan, Uzbekistan and Turkmenistan and their respective transition zone waters. WesternGeco will be a minority shareholder, with a 25% stake through the contribution of its land and transition zone seismic and data processing business in the four countries together with cash and access to certain proprietary technology and data processing software. Day-to-day management of the venture will be performed by Integra, while key strategic and investment decisions will be made by the board of the joint venture with input from WesternGeco. The venture will operate a combined capacity of more than 40 seismic crews and nearly 900 CPUs of computer processing power. | ||||
| Poland to join in US shale gas research program | Poland has signed up to join a US research project aimed at improving gas extraction from shale, boosting the country’s position as an emerging force in unconventional energy. The scheme, called the US Shale Gas Initiative, aims to encourage collaboration from nations involved in shale gas exploration. It will use experience gained in the US to assess Poland’s shale gas potential and promote development of those resources. The total resource in Poland’s shale formations is still unknown. But ConocoPhillips, ExxonMobil, Chevron and Poland’s state-owned PGNiG are among developers that have already been issued licenses to explore for shale gas in the country. A host of other smaller firms have also begun drilling. | ||||
| Eni starts oil from Arcadia Field in Egypt’s Western Desert | Oil production began July 28 at Arcadia Field in the Western Desert of Egypt, only 45 days after its discovery. Operator Eni announced that the Arcadia 1X well, located in the Meleiha concession, had been put into production from the Alam El Bueib Formation. Additional gas potential has been also proven by testing the well in the deeper Katatba Formation. Eni has owned a 56% participating interest in the Meleiha concession since 1987, with the remainder owned by Lukoil (24%) and Mitsui (20%). To fully develop the new discovery, four more wells will be drilled in 2010 and 2011, to produce up to about 3,000 boepd. The drilling of the Arcadia 1X well is part of Eni’s strategy to re-focus exploration activities in Egypt by targeting deeper layers in the Western Desert. To this end, a new 3D seismic survey over the Melehia concession has begun, targeting deep Lower Cretaceous and Jurassic formations. Eni is the country’s leading producer with 230,000 boepd in 2009. In the Western Desert, Eni produces more than 37,000 boepd. | ||||
| Statoil switches on power from mainland to Gjøa platform | The Gjøa facility in the North Sea on July 11 became Norway’s first floating platform to run on electric power from the mainland. The 40 MW of electricity comes from Statoil’s Mongstad facility, north of Bergen, using a 100-km 90,000-V AC power cable. Operator Statoil says it will avoid 210,000 tonnes of carbon dioxide emissions per year by providing power from shore. The alternative would have been a traditional solution using gas turbines to drive electric generators. Statoil has been the operator for Gjøa in the development phase. In the fourth quarter of 2010, GDF Suez will take over the production phase as its first operatorship for a field on the Norwegian Continental Shelf. | ||||
| OGX concludes drilling Niterói well in Santos Basin | Brazilian oil and gas company OGX has concluded the drilling of its OGX-12 well in the BM-S-57 Block, in the shallow waters of the Santos Basin offshore Brazil. OGX, which holds a 100% working interest in the block, said the well reached a total depth of 16,650 ft, and encountered carbonate reservoirs in the Albian section with good permability and porosity, although with an ineffective geological seal. In addition, two thin intervals of carbonate reservoirs with indications of hydrocarbons were found, confirming an active petrolific system. The OGX-12 well, also known as Niterói, is situated about 60 mi off the coast at a water depth of about 490 ft. | ||||
| Tullow discovers 130-ft oil interval in Uganda’s Ngiri Field | Tullow Oil’s Ngiri-2 appraisal well, located in the Butiaba region of Uganda Block 1, has discovered over 130 ft of net oil-bearing reservoir in two zones within a 430-ft gross oil bearing interval. The well was drilled 1 mi north of the Ngiri-1 discovery well to a total depth of 2,930 ft. Successful logging and sampling operations have confirmed the presence of moveable oil in two zones. The lower zone encountered an oil-water contact, while pressure data acquired within the upper zone indicates the possibility of a deeper contact than expected. Reservoir quality is excellent, similar to Kasamene Field in Block 2, where a production rate of 3,500 bopd was achieved during testing in 2009. Tullow operates its 100% interests in three licences, Blocks 1, 2 and 3A, in Uganda’s Lake Albert Rift Basin. | ||||
| Crews scramble to contain Michigan pipeline spill | More than a million gallons of oil may have spilled from a pipeline into Michigan’s Kalamazoo River in the last week in July, according to US officials, after a leak from a 30-in. pipeline carrying oil from Indiana to Ontario. The pipeline’s owner, Enbridge Energy Partners, said it shut in the pipeline on July 27, and response crews have been working to contain the oil. “The Kalamazoo River is a fast-moving river, and EPA’s focus right now is on preventing oil from the Enbridge spill from affecting sensitive shorelines and, ultimately, keeping the oil out of Lake Michigan,” the Environmental Protection Agency said in a statement. The pipeline remained closed as officials examined the piece of the pipeline where the leak occurred. Federal regulators issued an order July 28 saying the company could not reopen the pipeline without approval. | ||||
| BW Offshore awarded $875M FPSO contract in Indonesia | BW Offshore has signed a contract with the consortium developing the Kangean area offshore Indonesia for a gas FPSO to operate at Terang, Sirasun and Batur Fields. PT Energi Mega Persada (50%), Mitsubishi (25%) and Japan Petroleum Exploration (25%) comprise the Kangean consortium. BW Offshore’s scope includes the delivery of the FPSO, risers, umbilicals and mooring system, and responsibility for the installation and operation of the unit. The FPSO will have a capacity of 340 MMcfd of gas compression and conditioning, and the gas will be exported to the East Java Gas Pipeline. The charter contract is for a fixed period of 10 years, plus additional options of up to four years. The total contract value is about $875 million. First gas is planned for early 2012. | ||||
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