World of Oil and Gas

TGS has commenced a new 15,000-km multiclient 2D seismic survey offshore Namibia. The survey grid covers open acreage and images the main prospective plays due for drilling in 2011/2012. Offshore Namibia is significantly underexplored and has the potential to hold large oil and gas discoveries. The mix of play types in the TGS survey area include basin floor turbidites, slope fans and channels, significant syn-rift structures and plays similar to those offshore Angola. Recent studies have also shown additional strong hydrocarbon indicators in significant structures. The seismic data is being acquired by the M/V Northern Explorer.

Vol. 232 No. 10

WORLD OF OIL AND GAS

NELL LUKOSAVICH, SENIOR EDITOR

EXPLORATION

TGS begins new 2D seismic survey in Namibia

Russian partners to explore Black Sea’s Tuapse block

Rosneft and Sevmorneftegeofizika, Russia’s largest marine seismic contractor, have signed an agreement to conduct seismic exploration of the Tuapse license block in the Black Sea. The work will be conducted using the Vyacheslav Tikhonov research vessel. The assignment is part of the strategic alliance between Rosneft and ExxonMobil. The two parties have agreed to jointly explore and develop deposits in the Arctic and other parts of the Russian shelf, including Tuapse Trough.

Ukraine, Shell sign shale gas exploration deal

Ukraine has awarded its first shale gas exploration contract to supermajor Shell in a deal worth up to $800 million, according to Ukraine’s state gas exploration company Ukrgazvydobuvannya. No official estimate has been made and there is no confirmed figure of how much shale gas might be in the six blocks awarded to Shell near northeastern city of Kharkiv.

CGGVeritas completes WAZ 3D survey in Norwegian Sea

CGGVeritas announced it has completed acquisition of a 3D survey for Chevron Norge AS. The minimum commitment for the program comprised acquisition of a 3D survey over a 2,190-sq-km area west of Bodø in the Norwegian Sea. Due to good progress, the program was extended to 2,805 sq km. In addition, part of the survey was acquired in wide-azimuth (WAZ) mode, making it the first commercial BroadSeis WAZ project.

AleAnna completes seismic shoot in Italy

Italian E&P company AleAnna has completed a 136-sq-km 3D seismic acquisition survey on the Ponte Del Diavolo exploration permit area in Italy. The 258-sq-km Ponte Del Diavolo permit area is located in southeastern Po Valley, and is on trend with a number of large natural gas fields. Reservoir Geophysical is conducting the reprocessing work for the 3D seismic survey.

NATURAL GAS

GE to supply compressors for Shell’s Prelude FLNG

GE Oil & Gas has entered into an agreement with Technip to supply two steam turbine-driven compressors for the Shell Prelude Floating Liquefied Natural Gas (FLNG) project. The facility, which is to be based offshore Australia, will be the largest floating offshore facility in the world. Technip and Samsung Heavy Industries formed a consortium, which Shell has tasked to engineer, procure, construct and install the Prelude FLNG facility. In addition to the supply of the steam turbines and compressors, the scope of GE’s agreement with Technip France includes startup and two years of training, operation and spare parts. Shell’s FLNG facility will be moored at the Prelude gas field, about 200 km off Western Australia’s Kimberly Coast. Offshore fields such as Prelude may hold significant quantities of natural gas, but many are at great distances from land or the nearest pipeline.

Clough Downer awarded $600 million contract for Santos GLNG

Engineering and construction company Clough announced that the Clough Downer Joint Venture (CDJV) has been awarded a $600 million contract by Fluor for construction of pipelines, compression facilities and associated infrastructure relating to the Fairview component of the Santos GLNG project, located in Australia’s Surat basin. The scope of work involves the construction of over 400 km of gas and water transmission pipelines, two compression facilities, and an 800-person camp. The project sources gas from Santos’ gas fields in the Bowen and Surat basins and transports the gas via a 420-km underground pipeline to a two-train LNG plant with a nameplate capacity of 7.8 million tonnes per annum on Curtis Island, Gladstone. GLNG is a joint venture between Santos and Petronas, Total and Kogas.

Czech Republic seeks bidders for shale exploration permits

A number of local and foreign companies have applied for exploration permits in the Czech Republic, including Basgas Energia Czech, a unit of the Australian-based exploration company Basgas and the Czech unit of British company Cuadrilla Morava. The Czech Republic’s Environment Ministry stated that until now there has been no consideration of extracting natural gas from shale, and reserves of this type have not been found (or systematically searched for) or technically and economically evaluated.

PRODUCTION

Eni restarts production at Libya’s Abu-Attifel field

Italy’s Eni has restarted production in 15 Libyan wells in Abu-Attifel, located at 300 km south of Benghazi. Present production levels are around 31,900 bopd. In the coming months, other wells will be re-activated in order to reach the required volumes to fill the pipeline connecting the field to the Zuetina terminal. Abu-Attifel field was the first “giant oil field” discovered in Libya by Eni in the 1960’s. Eni has been active in Libya since 1959 and is the largest foreign player in terms of hydrocarbon production.

Statoil, partners allot $1.93 billion for Troll A expansion

Statoil and its partners in the Troll license have decided to invest $1.93 billion in two new compressors on Troll A, which will enable the production of gas from the field all the way until 2063.The two new compressors form the final phase of the planned capacity expansion on Troll A. The two latest compressors, which will come onstream in 2015, will enable Troll A to produce 120 MMcmd up until 2018, ensuring the ability to produce 30 Bcm annually until 2024.

Woodside fires up Okha FPSO

Production has commenced from the Woodside-operated Okha floating production, storage and offloading (FPSO) vessel, 135 km northwest of Karratha in Western Australia. The hook-up, testing and commissioning of the Okha facility has been completed. The Okha is expected to produce around 30,000 bpd when reaching steady-state operations towards the end of October 2011. The first offtake is scheduled for November 2011.

BUSINESS

Apache to acquire ExxonMobil’s Beryl field for $1.75 billion

Apache Corporation has agreed to acquire ExxonMobil’s North Sea assets-—including the Beryl field and related properties—for $1.75 billion. The fields have current net production of about 19,000 bpd of oil and natural gas liquids and 58 MMcfd of natural gas. At year-end 2010, estimated proved reserves totaled 68 MMboe. The transaction, with a planned close at year-end 2011, is expected to increase Apache’s North Sea production by 54% and proved reserves by 44%. Since acquiring Forties field in 2003, Apache has drilled about 100 development wells, invested $3.2 billion, and added an estimated 171 MMboe in new reserves.

Rockhopper to spend $2 billion developing oil offshore Falklands

UK-based Rockhopper Exploration has released a development plan for its Sea Lion Discovery in the North Falkland basin on the basis of a recoverable resource of 350 million bbl using a leased FPSO. The plan includes an estimation of first oil being achieved in early 2016, with maximum production of 120,000 bpd by 2018, and development costs to first oil expected to be about $2 billion. Rockhopper expects to complete its concept engineering studies in the first quarter of 2012 and to commence its front-end engineering design. The FEED is expected to be completed and submitted to the Falkland Islands government in the first quarter of 2013, by which time Rockhopper expects to have awarded the contracts to the FPSO provider and subsea contractor.

Consol, Hess partner in $593 million Utica shale JV

Consol Energy has entered into an agreement with Hess Corporation for the joint exploration and development of Consol ‘s nearly 200,000 Utica shale acres in Ohio for about $593 million.
Consol‘s and Hess’ plan of jointly developing the Utica shale assets calls for Hess to generally operate in the liquids-rich window, which contains approximately 80,000 acres in Belmont, Harrison, Guernsey and Jefferson counties, and Consol to generally operate elsewhere in eastern Ohio, including Portage, Tuscarawas, Mahoning counties in the oil window, as well as in Noble County.

Petrobras, Cameron sign subsea aftermarket service deal

Cameron has renewed an agreement with Petrobras for the supply of aftermarket services and support for their developments offshore Brazil. This agreement is a continuation to the aftermarket services contract previously signed in 2007 and is expected to generate more than $150 million in revenue to Cameron over the next three years. Cameron will manage the agreement from its service center in Macae, which is undergoing an extensive capital expansion program. The facility will support Petrobras operations with inspection, maintenance, repair and remanufacturing, storage and offshore installation services.

REGULATORY AFFAIRS

EU lifts sanctions on Libyan NOC

The European Union announced it was lifting sanctions on Libya’s National Oil Corp. following the fall of Col. Moammar Gadhafi last month, ending a key hurdle to the meaningful return of the country’s oil exports to European consumers. In its official journal, the EU said it was striking NOC, along with state-controlled oil-field and port operator Zueitina Oil Co., from a list of entities European companies were barred to have transactions with. Until now, European companies were generally barred from buying lift crude from Libya with exception of Arabian Gulf Oil Co, or Agoco. Though the end of the sanctions had been expected, its timing is unknown.

BOEMRE completes first post-Macondo spill drill

The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) announced it has completed the first unannounced spill drill to test the new requirements of subsea containment capabilities for deepwater wells. Led by BOEMRE, the table-top drill was a joint exercise with the US Coast Guard, the State of Louisiana, and Petrobras America, Inc.
The drill tested Petrobras America, Inc, with a scenario that was premised on a hypothetical blowout experienced by one of its deepwater subsea wells. The table-top exercise specifically tested Petrobras’ ability to assess a subsea well control situation and mobilize the proper subsea containment/intervention equipment in a timely manner. The preliminary results of the drill were positive; a final evaluation will follow when analysis of all documentation is completed. The selection of an operator to participate is based on such factors as the number of oil-producing facilities, the volume of oil production and proximity to sensitive areas. Considering the operator’s current activities, a location is chosen and a spill scenario is developed.

DISCOVERIES

Two new discoveries in Norwegian North Sea blocks

Statoil and partners have made an oil discovery in the Aldous Major North prospect, which is estimated to contain 110-260 MMboe. Samples from the prospect well 16/2-9S, in the Norwegian sector of the North Sea, found a column of oil of up to 26 ft in formations dating from the Upper Jurassic period. The partnership, consisting of Statoil (40% interest), Petoro (30%), Det norske (20%) and Lundin (10%), will consider further exploratory drilling on Aldous Major North in order to clarify the structure’s potential.
Due east of North Aldus, Lundin Petroleum has confirmed that the Avaldsnes appraisal well 16/2-7A, found an excellent quality oil-bearing Upper Jurassic sandstone reservoir. The sidetrack well encountered a gross reservoir column of about 82 ft of which 56 ft net was above the oil-water contact. The operator conducted a coring and logging program, confirming that the reservoir has similar characteristics to the Avaldsnes discovery and appraisal wells.
It is estimated that the Aldous Major North propsect, when, combined with the Aldous Major South and Avaldsnes discoveries, may hold between 500 million and 1.2 billion boe.

Seventh oil field pushes Russian field potential north

PetroNeft Resources, the owner and operator of Licences 61 and 67, Tomsk Oblast, Russian Federation, announced the discovery of a seventh oil field in Licence 61 at North Varyakhskaya field. The well, North Varyakhskaya No. 1, encountered 2.2 m of net oil pay confirmed in J1-1 interval with 36°API quality oil. This preliminary test indicates that the reservoir will need fracture stimulation for economic development, as is usual in the area.
As development drilling at the Lineynoye block continues to push field boundary significantly further north, several wells have encountered materially thicker pay beyond the originally expected northern field boundary and have pushed the observed field oil-water contact at least 5 m deeper. The field is located along the Lineynoye to Arbuzovskoye pipeline which is planned for construction in the first quarter of 2012.

Deepwater appraisal well off Ghana successful

Tullow Oil announced that the Enyenra-3A appraisal well, in the deepwater Tano licence offshore Ghana, has successfully encountered oil in high quality sandstone reservoirs. Pressure data indicates that the Enyenra-3A well has confirmed an up-dip extension of the Enyenra oil field. Located 6.5 km north of the Owo-1 discovery well and 14 km north of Enyenra-2A, the well was drilled to test the up-dip extent of the Enyenra oil field. Results of drilling, wireline logs, samples of reservoir fluids and pressure data show that Enyenra-3A has intersected 17 m of 35°API net oil. On completion of drilling operations, prior to flow testing the Enyenra field in late 2011, pressure gauges will be deployed in Enyenra-2A and Enyenra-3A to determine reservoir connectivity.

New oilfield discovery onshore Australia

Cooper Energy announced a new oilfield discovery in its Germein-1 well that will be tied into the PEL 92 block production system. Germein-1, located onshore South Australia, encountered a 2.5-m net oil column in the Namur sandstone formation. The recoverable volumes will be estimated at a later time. Beach Energy, operator holds a 75% interest and Cooper Energy holds the remaining 25%.

New hydrocarbon discovery in Gulf of Thailand

After restoring production at its Songkhla A mobile offshore unit following an upgrade, Coastal Energy announced that the Bua Ban North A-06 well, located in the Gulf of Thailand, encountered 63 ft of net pay in the Miocene with average porosity of 28%. The reservoir quality seen in the A-06 is superior to that in the A-01 well, which encountered 32 ft of net pay with 26% porosity. Songkhla field, the largest of four Tertiary basins in an 8,500-sq-km block holds an estimated 38 million bbl of recoverable reserves. Production testing of Bua Ban North A-06 is expected to begin in late October.

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