World of oil and gas
EXPLORATION |
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Pacific Rubiales tests successful oil flow onshore Colombia |
Pacific Rubiales Energy has announced successful results from the first production tests in the CPE-6-1X exploration well and the CPE-6-H2 appraisal well, both drilled during December in the CPE-6 Block in the Eastern Llanos basin, onshore Colombia. CPE-6-1X was drilled to a TD of 3,318 ft, MD, in the Hamaca prospect. The well flowed at an average rate of 222 bpd of 10.8°API oil, with a 15% water cut, tested over a five-day period. CPE-6-H2 was drilled to a TD of 3,485 ft, MD. The well is 4 km northeast of CPE-6-1X, and was also drilled in the Hamaca prospect. It flowed at an average rate of 213 bpd of 10.9°API oil, with a 12% water cut, tested over a three-day period. |
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Repsol, RWE Dea spud exploration well in Mauritania |
Repsol and RWE Dea have spudded the first exploration well in license Block Ta10 of Mauritania. The Ouguiya-1 well in the desert of Mauritania is being drilled, using the Saipem 5893 drilling rig. Its primary targets are Precambrian formations. The well is scheduled to be completed within second-quarter 2014. Prior to drilling, 2D seismic data were acquired from 2008 to 2010. These new data were interpreted in combination with re-processed, older 2D seismic data. The block is in the Taoudeni basin of the desert of central Mauritania, roughly 800 km inland from the Atlantic coast. The license area covers 14,450 sq km. |
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USGS estimates substantial gas in Denmark’s Alum shale |
The Alum shale in Denmark contains an estimated mean of 6.9 Tcf of undiscovered, technically recoverable natural gas, according to a new report by the U.S. Geological Survey. This estimate comes from the first-ever USGS assessment of shale gas resources in Denmark. The geological foundation that underpins the assessment was facilitated by data provided by the Geological Survey of Denmark and Greenland (GSDG). USGS released the assessment to the GSDG in a meeting last month. The Alum shale is part of the Baltic basin, and is made up of two assessment units: the onshore and offshore portions. The offshore area was estimated to contain a mean of 4.4 Tcf of gas, and the onshore segment was estimated to contain 2.5 Tcf of gas. |
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| Israel grants exploration license to Zion |
Zion Oil & Gas said that Israel’s Petroleum Commissioner has awarded Megiddo-Jezreel Petroleum Exploration License No. 401 to the company. The license covers an area of approximately 98,842 acres onshore. The tract has a three-year primary term, commencing Dec. 3. The license may be extended further for additional one-year periods, up to a maximum of seven years, as provided by the Israeli Petroleum Law. Under license terms, the company has time-specific deadlines for identifying and submitting a drilling prospect in the area; entering into a contract for the drilling of such prospect; and beginning the drilling or spudding of a well to a minimum proposed TD of approximately 13,125 ft. |
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PRODUCTION |
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| Shell floats hull for world’s largest floating facility |
The 488-m-long hull of Shell’s Prelude floating liquefied natural gas (FLNG) facility has been floated out of the dry dock at the Samsung Heavy Industries (SHI) yard in Geoje, South Korea, where the vessel has been under construction. Once complete, Prelude FLNG will be the largest floating facility ever built. It will unlock new energy resources offshore and produce approximately 3.6 million tonnes of LNG per annum to meet growing demand. Prelude FLNG is the first deployment of Shell’s FLNG technology and will operate in a remote basin 475 km northeast of Broome, Western Australia, for roughly 25 years. |
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| BG Group starts additional production at Itaú in Bolivia |
BG Group has begun commercial gas production from the second phase of the Itaú development in Bolivia. With first production from Itaú Phase II, BG Group has delivered its promise to bring into production new oil and gas projects in Brazil, the UK, Thailand and Bolivia, and to complete large, planned maintenance campaigns on core assets in Kazakhstan and the UK. |
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| First gas announced from North Sea’s Orca field |
Production from the southern North Sea’s Orca gas field has started in Dutch waters. The field is operated by GDF SUEZ E&P Nederland, with RWE Dea as partner. Orca will be developed by drilling three wells in total; the first two development wells were drilled and completed in 2013. The third producer is being drilled, and is expected to be completed in February. The gas is in a Carboniferous reservoir, and the platform, D18a-A, is in the Dutch sector, 500 m from the UK sector. |
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| Gazprom initiates output in Arctic’s Pechora Sea | Gazprom has produced the first commercial quantities of oil from its Arctic drilling platform, Prirazlomnaya, in the remote waters of the Pechora Sea. The Prirazlomnaya platform was the focus of a high-profile Greenpeace protest in September, which led to the arrest and imprisonment of 28 activists and two freelance journalists. The detainees were included in an amnesty passed by the Russian parliament in mid-December. | ||
| Petrobras: Franco field oil estimated at 3 billion bbl | Petrobras has estimated the commercial reserves of its Franco field offshore prospect at more than 3 billion bbl. The largest section of the commercially-viable play, Franco, holds an estimated 3.06 billion boe, while Carioca holds 459 million boe and Sul de Tupi holds 128 million. The company will continue to focus a large portion of its $237-billion, five-year business plan to pre-salt developments like these. Carioca is part of a group of fields referred to as the “Big Five” discoveries and is owned by Petrobras, in partnership with BG Group and Repsol Sinopec Brasil. Franco and Sul de Tupi are in a grouping of six fields that the company is developing, after acquiring rights to produce 5 billion bbl from the government in 2010. | ||
DISCOVERIES |
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| Petrobras discovers oil in the deepwater Potiguar basin |
Petrobras has discovered an oil accumulation on concession BM-POT-17, the first in the Potiguar basin’s deep waters. The discovery was struck by well 1-BRSA-1205-RNS (1-RNS-158), informally known as Pitu, at a water depth of 1,731 m, about 55 km off the coast of Rio Grande do Norte state. The well is being drilled at a depth of 4,197 m, and drilling will proceed to 5,028 m. Petrobras operates the concession with an 80% stake, while Petrogal Brasil holds the remaining 20%. Due to the farm-out agreement, in progress, and after obtaining the approval of Brazil’s ANP, BP Energy do Brazil will join the consortium, and interests will be revised to: Petrobras (40%), BP (40%) and Petrogal (20%). |
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| BP hits deepwater Paleogene oil discovery in the Gulf of Mexico |
BP has made a significant oil discovery at its Gila prospect, which it co-owns with ConocoPhillips, in the deepwater Gulf of Mexico. This is BP’s third discovery in the GOM’s emerging Paleogene trend; the company announced previously two other Paleogene discoveries—Kaskida in 2006 and Tiber in 2009. The Gila discovery was found by an exploration well on Keathley Canyon Block 93 in approximately 4,900 ft of water. The well was drilled to a TD of 29,221 ft. BP owns a majority interest in the Gila discovery, drilled by the West Capricorn rig. |
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| Rosneft finds four hydrocarbon reservoirs in eastern Siberia |
Four new hydrocarbon deposits were discovered on Rosneft’s license blocks in eastern Siberia, and reserves for one of the reservoirs have been converted from the C2 to C1 category. The increase in C1 recoverable oil and condensate reserves was over 10 million t, with gas reserves of 12 Bcm. Three new deposits were discovered in the Irkutsk region, in the Mogdinskiy license area at Savostyanov field, following the drilling of the Mogdinskaya-10 exploration well. Testing of the reservoirs resulted in gas and condensate flows, with production rates of up to 425,000 cu m/d, and oil flows of 90 cu m/d. Testing of a new exploration well at North-Danilovskoe field resulted in commercial oil flows at a production rate of more than 165 cu m/d. Gas and condensate flows were measured at 50,000 cu m/d from the Preobrazhenskiy horizon. |
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Noble Energy discovers oil in deepwater GOM, more gas offshore Israel |
Noble Energy has announced discoveries at the Dantzler exploration well, in the deepwater Gulf of Mexico, and at the Tamar Southwest exploration well, offshore Israel. At Dantzler, the well encountered over 120 net ft of primarily crude oil pay in two high-quality Miocene reservoirs. The discovery well, in Mississippi Canyon 782, was drilled to a TD of 19,234 ft in 6,580 ft of water. Discovered gross resources at Dantzler are now estimated at 55 to 95 MMboe. The Tamar SW well encountered 355 ft of net natural gas pay within the targeted Miocene intervals. Tamar SW was drilled to a TD of 17,420 ft in 5,405 ft of water. The field is 8 mi southwest of Tamar. Evaluation of drilling data and wireline logs has confirmed the field’s range of gross resources to be 640 to 770 Bcf of natural gas. | ||
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GOVERNMENT/REGULATORY |
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| Mexico ends 75-year oil monopoly | Mexico’s Congress has ended nearly eight decades of Pemex control over the country’s sizable oil reserves with the approval of its most notable economic reform since NAFTA. The bill changes Mexico’s charter to allow outside companies to develop some of the world’s largest unexplored crude reserves. Operators will be offered production-sharing contracts under the new legislation. (For more details, see p. 154.) | ||
| UK to offer blocks for shale drilling in 2014 | The UK will open an area the size of Wales for shale drilling in 2014, effectively doubling the available exploration space. An onshore oil and gas exploration licensing round will feature up to 150 blocks, covering about 20,000 sq km. The UK’s Bowland basin is estimated to hold 1,329 Tcf of gas in a “central case” scenario, according to the British Geological Survey. Several companies have purchased stakes in, or expressed interest in, onshore acreage, so far. | ||
| Colombia seeks investments of $2.6 billion via bidding round | Colombia is seeking more than $2.6 billion in investments through an oil and gas auction in 2014, according to the country’s Mining and Energy Ministry. With bidding open to both domestic and foreign companies, the government will offer offshore exploration blocks; conventional and unconventional blocks; blocks with coalbed methane and existing fields, as well as undeveloped fields. | ||
ACQUISITIONS |
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| BASF and Gazprom sign asset swap agreement | BASF and Gazprom signed the final agreement to swap assets of equivalent value. The transaction is expected to be completed by mid-2014. Through the agreement, two additional blocks of the Achimov formation of the Urengoi natural gas and condensate field in western Siberia will be developed jointly. Wintershall receives 25%, plus one share, of blocks IV and V in the Achimov formation. Blocks IV and V are reported to have total hydrocarbon resources of 274 Bcm of natural gas and 74 MMmt of condensate. Production start-up is planned for 2016. In return, Wintershall will completely transfer its jointly-operated natural gas trading and storage business to its long-term partner, Gazprom. Gazprom will also receive a 50% share in the activities of Wintershall Noordzee. | ||
| New Zealand Oil & Gas acquires Indonesian interest | New Zealand Oil & Gas has picked up a new interest in a production-sharing contract (PSC) in onshore South Sumatra, Indonesia. The Indonesian regulator has announced that a consortium, including New Zealand Oil & Gas, has won a permit to explore the Palmerah Baru Block, covering approximately 1,000 sq km. Under the contract, the JV will be committed to an initial three-year exploration work program, and one exploration well. New Zealand Oil & Gas will have a 36% stake in the PSC. Its partners are Bukit Energy Palmerah Baru (54%, operator) and PT SNP Indonesia (10%). | ||
| Hess completes sale of Natuna asset in Indonesia | Hess Corporation has completed the previously announced sale of its Natuna A asset, off the coast of Indonesia, to PT Pertamina and PTT Exploration and Production Company Limited, for a total after-tax consideration of $650 million. The asset produced an average of 5,500 boed, net, to Hess in the first three quarters of 2013. | ||
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| Total to pay InterOil up to $3.6 billion in PNG LNG deal |
Total has purchased a stake in InterOil’s Papua New Guinea assets, estimated to be worth as much as $3.6 billion, as part of a longer-term plan to construct an LNG project in the country. Through the agreement, Total will receive roughly 61% of a license covering Elk and Antelope gas fields, with the right to invest in further exploration blocks. With energy demand rising across Asia, InterOil has searched for a partner to help fund a natural gas project in Papua New Guinea since 2009. |
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BUSINESS |
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| BP signs accord to develop $16-billion Oman gas project |
BP and the government of the Sultanate of Oman have signed additional agreements pertaining to the development of Khazzan field, with BP as operator. The full-field development will involve a drilling program of roughly 300 wells, over 15 years, to deliver plateau production of 1 Bcfgd and 25,000 bcpd. This volume is equivalent to around a third of Oman’s total, daily, domestic gas supply. Total investment in the development is around $16 billion, which includes the investment made, to date, in the resource appraisal and early well test program. |
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| Statoil plans 12 wells in campaign offshore Tanzania |
After discovering up to 3 Tcf of gas in a fifth well offshore Tanzania, Statoil has said it will devote more resources there, with up to 12 wells planned through 2015. Findings at the Mronge-1 well in Block 2, with Exxon Mobil as partner, bring total in-place gas volumes to roughly 20 Tcf. Statoil and BG Group have plans to build the country’s first LNG plant, aiming to tap growing demand for exports to Asia. |
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| BHP looks to invest in Trinidad & Tobago through simplification |
In addition to its main production regions in the U.S. and Australia, BHP Billiton is said to be considering Trinidad and Tobago for potential activity. The company has plans to drill its first well there in 2016, according to Tim Cutt, president of BHP’s petroleum and potash unit. In an effort to simplify its portfolio, the company is considering a sell-off of shale assets in Texas. |
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| Marathon Oil looks to shrink asset base, plans expansion |
Marathon Oil is said to be seeking a buyer for its North Sea oil fields, in an effort to shrink its asset base, as the company plans expansion of its onshore North American production. The proposed sales will add to nearly $3.5 billion in asset sales already conducted over the last three years, Marathon said. The company will shed British and Norwegian sites that accounted for 25% of crude oil sales volumes in third-quarter 2013, not including Libyan output totals. Marathon will continue to focus on North American shale oil and gas plays. |
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