PRODUCTION

Total brings Angola’s Dalia Phase 1A online

Total has started production from Dalia Phase 1A, a new development on its operated, deepwater Block 17, 135 km off the coast of Angola. Dalia Phase 1A will develop additional reserves of 51 MMbbl and will contribute 30,000 bopd to the block’s production. Arnaud Breuillac, president of E&P at Total, said, “The Dalia FPSO came onstream nearly nine years ago, and with the addition of Phase 1A will still produce around 200,000 bopd. It is the latest milestone in the success story of Block 17, Total’s most prolific license with cumulative production reaching 2 Bbbl in May 2015.” The Dalia Phase 1A project involves the drilling of seven infill wells tied back to the Dalia FPSO. Total operates Block 17 with a 40% interest alongside Statoil (23.33%), Esso Exploration Angola Block 17 Ltd. (20%) and BP Exploration Angola Ltd. (16.67%). Sonangol is the concessionaire of the license.

Oil sands production growth to continue: IHS

IHS expects continued oil sands production growth through 2020, albeit lower than what would be expected, had prices remained higher, according to a new production forecast by the Englewood, Colo.-based organization. Oil sands production is forecast to grow 800,000 bpd by 2020, a level that will keep Canada among the largest sources of growth in global oil supply throughout that period. Canada will remain the third-largest source of supply growth in the world, a position it has held since 2005. The updated production forecast from IHS is 280,000 bpd less than a previous outlook prior to the collapse in crude oil prices. Image: Suncor.

Statoil spuds first production well on Gina Krog field

Drilling of the first production well at Gina Krog field started on July 20, just eight days after the Maersk Integrator arrived at the North Sea field, Statoil, the operator, said. The current plan involves drilling 14 wells—10 of which will be production wells, with the remaining four serving as combined gas injection and production wells. “We will now drill and firstly install ten 30-in. conductors. We will then drill the top section of six wells. The plan is that two to three wells will be drilled into the reservoir before the topside arrives from South Korea,” said Statoil Drilling Supervisor Tonny Lemqvist.

Tullow gas exports from Ghana’s Jubilee field halted by glitch

Tullow Oil announced on July 20 that the export of gas from Jubilee field to the Ghana gas plant at Atuabo had been suspended since July 3, due to technical issues with gas compression systems on the Kwame Nkrumah FPSO.  Oil production was constrained to about 65,000 bpd and was under constant review, but there was no effect on the field’s reservoir or resources, Tullow said in a statement. Gas exports are expected to resume by mid-August.

Keystone pipeline delivers one billionth barrel of oil

TransCanada has delivered the one billionth barrel of Canadian and U.S. crude oil on the Keystone Pipeline System, according to a company announcement in July. The Keystone Pipeline System is one of the most extensive crude oil pipeline systems in North America, delivering to refineries at Wood River and Patoka, Illinois; Cushing, Oklahoma; and Port Arthur, Texas. “To put this achievement in perspective, it would take approximately 1.7 million train cars or 3.3 million trucks to transport one billion barrels of crude oil,” said Russ Girling, TransCanada’s president and CEO. TransCanada remains committed to expanding the Keystone system with the addition of Keystone XL, a 1,179-mi pipeline between Hardisty, Alberta, and Steele City, Nebraska, the company said. “Identical to Keystone, Keystone XL will reduce GHG emissions and improve public safety by transporting crude oil via pipeline versus rail,” Girling added.

GOVERNMENT/REGULATORY

IPAA: Iran deal disadvantages America’s oil producers

The ban on exporting U.S. crude oil came under pressure from Independent Petroleum Association of America (IPAA) President Barry Russell after the Obama administration secured an agreement with Iran, which includes provisions that will lift sanctions on Iranian oil sales. “Once oil sanctions on Iran are lifted, today’s deal will soon put America’s oil producers at a competitive disadvantage on the global marketplace,” Russell said in a statement on July 14. “As soon as Iran is permitted to export its surplus oil on the world market, why can’t we allow our own companies to do the same with their American-made surplus of crude oil?” Most unprocessed American crude is prohibited by U.S. law from being sold overseas, but this does not limit the sale of refined petroleum products to foreign buyers. 

BOEM to offer 22 million acres in August lease sale

The Bureau of Ocean Energy Management (BOEM) will offer approximately 21.9 million acres offshore Texas for oil and gas exploration and development in an August lease sale, which will include all available, unleased areas in the Western Gulf of Mexico Planning Area. Western Gulf of Mexico Lease Sale 246, which will be held in New Orleans, La., on Aug. 19, will be the eighth offshore sale under the administration’s Outer Continental Shelf Oil and Gas Leasing Program for 2012-2017. Sale 246 will include approximately 4,083 blocks, from nine to 250 nautical mi offshore, in water depths ranging from 16 ft to more than 10,975 ft.

Selling off U.S. Strategic Petroleum Reserve is shortsighted: Sen. Murkowski

A proposal to sell off 101 MMbbl of oil from the nation’s emergency energy stockpiles, to partially pay for the Senate highway bill, has been lambasted by U.S. Sen. Lisa Murkowski (R - Alaska). Murkowski said the effort to raise $9 billion through a sale of Strategic Petroleum Reserve (SPR) oil, to help pay for a three-year extension of the highway trust fund, is a bad deal for the country. “The Strategic Petroleum Reserve is a vital national security asset that must be maintained in case of serious future supply disruptions,” Murkowski said. “While I recognize that a long-term highway bill is a priority, a shortsighted sale that undermines our emergency preparedness could have real and lasting impacts on our security.”

DISCOVERIES

Exxon’s Guyana find could hold 700 MMbbl

Exxon Mobil’s discovery offshore Guyana could hold as much as 700 MMbbl of oil. The Liza-1 well, encountered in excess of 295 ft of high-quality oil-bearing sandstone reservoirs. “A find of this magnitude for a country like ours, which sits on the lower end of the scale of countries in this hemisphere, this could be transformational,” Raphael Trotman, Guyana’s minister of governance, said during an interview, Bloomberg reported. “From my sense, from speaking
to experts outside of Exxon, it has to be something in excess of 700 MMbbl.” 

Statoil finds gas, condensate in North Sea’s Julius prospect

Statoil and Total E&P Norge, partners in license PL146/PL333, have made a gas and condensate discovery in the Julius prospect, in the King Lear area of the North Sea. Discovery well 2/4-23S, drilled by the Maersk Gallant jackup, proved gas and condensate in the Ula formation. Statoil, the operator, estimates the volumes in Julius to be between 15 MMbbl and 75 MMbbl of recoverable oil equivalent. The well also aimed to appraise the 2012 King Lear gas and condensate discovery. It is expected that the King Lear volumes will stay within 70 MMbbl to 200 MMbbl of recoverable oil equivalent. Image: Maersk Drilling.

Eni reports a 15-Bcm gas discovery in Egypt’s Nile Delta

Eni has reported a gas find in the Nooros exploration prospect, in the Abu Madi West license of the Nile Delta, 120 km northeast of Alexandria, Egypt. Preliminary estimates of the discovery amount to a potential of 15 Bcm of gas-in-place with upside, plus associated condensates. The discovery was made in the Nidoco NW2 Dir NFW well, which reached a TD of 3,600 m and encountered a 60-m gas-bearing sandstone interval of Messianian age with excellent petrophysical properties, further of other gas layers in the overlying Pliocene section. The discovery will be put into production in two months’ time through a tie-in to the existing Abu Madi gas treatment plant, Eni said.

EXPLORATION 

BSEE bars Shell from drilling in oil-bearing zones offshore Alaska

The U.S. Bureau of Safety and Environmental Enforcement (BSEE) has granted Shell conditional approval for two Applications for Permits to Drill (APD) to conduct limited exploratory drilling activities in the Chukchi Sea, offshore Alaska. The APDs limit Shell to drilling only the top sections of wells and prohibit Shell from drilling into oil-bearing zones. Shell is not permitted to drill into oil-bearing zones because, to do so, BSEE requires that a capping stack be on-hand and deployable within 24 hr. Shell’s capping stack is staged on the vessel M/V Fennica, which was enroute to Portland, Ore., for repairs. If, and when, the vessel can be deployed in the Chukchi Sea, and Shell is able to satisfy the capping stack requirement, the company may submit an Application for Permit to Modify the APDs and request to have this restriction reconsidered. Under the limited permits, Shell may proceed with drilling the top sections of two wells at the Burger prospect. Shell is prohibited from conducting simultaneous drilling activity at these wells; the company must plug and abandon the top section of the first well before proceeding with any drilling activity at the second well site. BSEE safety inspectors will be stationed on the Noble Discoverer and Transocean’s Polar Pioneer.

Polarcus starts 3D survey offshore The Gambia

Polarcus has started a new 3D broadband multi-client project across the Mauritania-Senegal-Guinea-Bissau basin (MSGB), offshore northwest Africa. The project, which is supported by industry funding, will cover a 1,500-km² area offshore The Gambia, and is expected to run for 50 days. Final data products will be available in first-quarter 2016. The prefunding has been secured in response to heightened industry interest in the Cretaceous slope fan and shelf-edge reef plays along the entire MSGB margin.

CGG awarded airborne gravity gradiometer survey in Tanzania

CGG has been awarded a contract by the Tanzanian Petroleum Development Corporation (TPDC) to acquire high-resolution, gravity gradiometry and aeromagnetic data over two onshore areas along the South-Eastern Tanzanian Coastal basin and the eastern arm of the East African Rift. Acquisition over a total area of 30,000 km² will commence in mid-August and is scheduled to last up to two months. Using the low-noise Gravity Gradiometry, FALCON, CGG will deliver high-resolution data and interpretation to help evaluate the hydrocarbon potential of these basins ahead of future licensing rounds. “We know that there have been significant discoveries in the Kenyan and Ugandan parts of the Rift Valley, and there may well be undiscovered oil or gas reserves on Tanzania’s side,” said Dr. Mataragio, TPDC’s managing director. 

MERGERS/ACQUISITIONS

LINN Energy sells Permian acreage for $281 million

LINN Energy has signed a definitive agreement to sell its remaining position in Howard County, Texas, in the Permian basin, for a contract price of $281 million. The properties sold include approximately 6,400 net acres prospective for horizontal Wolfcamp drilling and approximately 2,000 boed of current production from 133 gross wells. The transaction is expected to close in third-quarter 2015, with an effective date of May 1, 2015. Image: LINN Energy.

Noble Energy closes acquisition of Rosetta Resources

The stockholders of Rosetta Resources have overwhelmingly approved the merger of Rosetta into a subsidiary of Noble Energy. Rosetta will become a wholly owned subsidiary of Noble Energy. Dave Stover, Noble’s chairman, president and CEO, said, “The addition of Rosetta’s Eagle Ford shale and Permian positions expands our onshore business with high-quality acreage in two premier unconventional basins, increasing our development inventory and further diversifying our portfolio.”

Wellsite Rental Services to merge with Viking Oil Tools

Wellsite Rental Services and Viking Oil Tools have agreed to merge, to form Wellsite Fishing and Rental Services. Both companies are majority-owned by NGP Energy Technology Partners. 

Enterprise sells Gulf of Mexico business to Genesis Energy for $1.5 billion

Enterprise Products Partners has completed the sale of its offshore Gulf of Mexico pipelines and services business, to Genesis Energy for approximately $1.5 billion. Enterprise’s offshore assets include its ownership interest in nine crude oil pipeline systems, nine natural gas pipeline systems, and its ownership interest in six offshore hub platforms. “We plan to redeploy proceeds from this sale into attractive growth opportunities that would extend and expand our integrated midstream system and should generate higher risk-adjusted returns on capital, such as acquisitions and organic projects in the Eagle Ford and Permian shale plays,” said Michael A. Creel, CEO for Enterprise’s general partner.

BUSINESS

Lundin installs topside modules for Edvard Grieg

Lundin Norway has completed installation of the topside modules on Edvard Grieg field, offshore Norway. The Edvard Grieg topside installation consisted of lifting four modules onto the pre-installed jacket—the main deck frame; the utility and living quarters module; the processing module; and the flare boom, with a total weight of 22,000 tonnes. The final offshore hook-up and commissioning of these modules has now begun, with production expected to commence in fourth-quarter 2015. 

Wood Group awarded FEED contract for Browse FLNG project

Wood Group has secured a contract to carry out front-end engineering and design for Woodside’s proposed Browse Floating Liquefied Natural Gas (FLNG) development, offshore Western Australia. Wood Group Kenny (WGK) will perform all design engineering for the insulated production flowline system required for the asset’s offshore gas-condensate fields—Brecknock, Calliance and Torosa. The 12-month contract, which is valued at $6 million, will be delivered from WGK’s Perth office.

Schlumberger receives Center for Offshore Safety SEMS certification

Schlumberger has achieved SEMS certification to Center for Offshore Safety Program expectations and 30 CFR 250 Subpart S requirements. Schlumberger is the first service/supply contractor to achieve this voluntarily.

Technip wins Trans Adriatic Pipeline contract

Trans Adriatic Pipeline (TAP) has awarded Technip a project management consultancy (PMC) services contract, for a project designed to transport gas from Shah Deniz field to the European market. The project scope includes an approximately 870-km-long pipeline, which will start from the tie-in with the Trans-Anatolian Gas Pipeline portion of the Southern Gas Corridor project, at the Greece/Turkey border. The pipeline will then go through Greece and Albania, to eventually cross the Adriatic Sea and end in Puglia, Italy. It is designed to transport 10 Bcm per year, with a potential future expansion to 20 Bcm per year. The PMC contract awarded to Technip will cover the onshore portion of the pipeline from Greece to Albania and in Italy.