Wednesday, August 7, 2013

Petroceltic to Farm Out More of Isarene

North Africa and Mediterranean-focused Petroceltic International reported Friday that it is close farming out a further 18.375-percent interest in its Isarene Permit, onshore Algeria. The Isarene Pemit contains the Ain Tsila gas and condensate field.

Petroceltic said the farm-out process is "substantially complete", but is still subject to partner and regulatory approvals that could take several months. The firm also said that it would be seeking to complete the farm-out prior to it transferring its shares to the official lists of the UK Listing Authority and the Irish Stock Exchange in order to make the farm-out process smoother.

Petroceltic Chief Executive Brian O'Cathain commented in a statement:

"The second Ain Tsila farm-out is a major commercial milestone for Petroceltic. The company's decision to give it priority over the listing at this time is a prudent measure to help ensure the farm-out moves forward smoothly in the months ahead. We are still fully committed to the listing."

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Energy Department Approves Freeport Natural-Gas Export Permit

WASHINGTON - The Obama administration on Friday cleared the way for broader natural gas exports by approving a $10 billion facility in Texas, a milestone in the U.S. transition into a major supplier of energy for world markets.

The decision shows how the boom in U.S. natural-gas production has caused a 180-degree shift in a key area of energy trade.

Five years ago, many companies built natural-gas import terminals, anticipating greater U.S. demand for imported fuel. Now a group of private investors that includes ConocoPhillips (COP) plans to turn one of those terminals--in Quintana Island, Texas--into an export facility to ship natural gas to Japan and other nations. The project, known as Freeport LNG, is expected to require more than $10 billion in investment, according to the owners.

In giving Freeport the green light, the Department of Energy signaled that it found the prospective benefits from exporting energy outweighed concerns about possible downsides for the U.S. economy.

Proponents of greater exports, including the oil and gas industry, say that exporting inexpensive natural gas from the U.S. will help the U.S. trade balance, help advance the adoption of clean-burning fuels around the world and shore up energy-poor U.S. allies.

Opponents counter that exports may cause domestic prices to rise, hurting consumers and some industries such as chemicals that have benefited from cheap natural gas.

Dow Chemical Co., which has vocally opposed unrestricted gas exports, said it supported the DOE's decision because it reflected a careful approach to export approvals rather than the blanket approvals some proponents have called for.

"Dow will adopt a wait-and-see approach regarding further approvals," the company said. It maintained that using natural gas for domestic manufacturing creates "far more" value "than exporting it as a fuel."

The American Petroleum Institute urged the Energy Department to approve the remaining applications without delay "so that the U.S can achieve its full energy and economic potential."

The Department of Energy said it had given preliminary authorization to the Freeport project to export up to 1.4 billion cubic feet per day of liquefied natural gas. The approval is needed for exports to countries with which the U.S. doesn't have a free-trade agreement, a category that includes major trading partners in Europe and Asia. The project still requires final approval from the Federal Energy Regulatory Commission.

The Freeport terminal is the second export facility approved by the Obama administration. Cheniere Energy Inc.'s (LNG) Sabine Pass facility in Louisiana won approval in May 2011 to export LNG to the countries without free-trade agreements.

The first approval got relatively little notice, but the issue gained prominence as export applications piled up and leading companies on both sides of the issue began to clash over the merits of exports. The Department of Energy spent much of 2012 waiting for a report it commissioned on the issue, which was released in December 2012 and concluded that exports would benefit the U.S. economy overall.

Friday's decision is an important harbinger for the remaining 19 applications to export gas to non-FTA countries. That's because according to law, gas exports are presumed to be in the public interest unless shown otherwise.

Freeport LNG has signed preliminary 20-year contracts to sell much of the export facility's capacity to Chubu Electric Power Co., Osaka Gas Co. and BP Energy Co., and the company says it expects to announce a deal for the rest of the capacity this summer. Chubu Electric and Osaka Gas, both major Japanese utilities, have a partial stake in the portion of the facility that is feeding the Japanese demand.

The combination of hydraulic fracturing and horizontal drilling has unleashed a natural-gas bonanza that made the U.S. the world's largest natural-gas producer.

The Freeport permit approval opens up the dam for other pending applications, but the pace of upcoming decisions is still unknown, said Randy Bhatia, an analyst at Capital One Southcoast.

"This is an encouraging step," Mr. Bhatia said. "But you need more than one to get a better idea of what pace we can expect them to process the remainder of that queue."

The Energy Department will next consider the application of a slightly larger export facility in Lake Charles, La. While there are nearly a score of outstanding applications, analysts expect that only a handful will be built, due to the high cost of gas liquefication facilities.

Moody's Investor Service has said that projects building from existing facilities, including Cove Point LNG in Maryland and Cameron LNG in Louisiana, are best placed to secure approval and financing from the private sector.

Further complicating the picture for U.S. exports are uncertainties over future global demand for LNG. Australia and Qatar, among other countries, have expanded their own gas exports in recent years and are well-placed to supply potential customers in Asia and Europe. Due to the cost of liquefying and transporting gas, U.S. exports may not be cost-competitive if domestic prices rise in coming years.

The DOE said it conducted an "extensive, careful review" which considered "the economic, energy security, and environmental impacts," and found that the project was "not inconsistent with the public interest."

The department said that in considering future export applications, it will consider market conditions, including projections about natural-gas prices, supply and demand. All remaining permit applications will be considered on a case-by-case basis, the department said, keeping in mind the cumulative amount of authorized gas exports.

Ben Lefebvre and Tennille Tracy contributed to this article.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Transocean Inks New Contracts, Extensions; Sees More Downtime

Drilling contractor Transocean Ltd. reported late Wednesday several new contracts and contract extensions valued at approximately $662 million.

The company also increased its expected downtime estimate for this year by 117 days, Transocean reported in its fleet summary update. However, 75 percent of this downtime is related to preparations for a new ultra-deepwater award at a leading-edge day rate, according to a May 16 analysts note for Barclays Research.

This downtime includes 89 days due to shipyard acceleration into 2013 from 2014 and contract preparation for the Deepwater Millennium (UDW drillship), which has been awarded a two-year contract through February 2016 by an unnamed operator for work offshore Australia. The rig currently is drilling the Kiboko-1 well for Anadarko Petroleum Corp. offshore Kenya, according to Rigzone's RigLogix database.

Deepwater Millennium will work at a day rate of $605,000, higher than its previous day rate of $545,000. The new award represents a $442 million estimated contract backlog, Transocean said in its rig fleet summary.

Transocean also received a three-month contract through October for Jack Bates (DW semisub) from an undisclosed operator for work offshore Australia. The rig currently is drilling the Bassett West 1 well, according to RigLogix.

ConocoPhillips awarded a two month extension through February 2014 to the Transocean Legend (mid-water semisub). The rig will work at a day rate of $440,000, higher than Barclays' previous estimate of $325,000 and higher than its current rate of $293,000, Barclays analysts noted.

Transocean John Shaw (mid-water semisub) has also been awarded a one-year contract extension for work in the UK North Sea at $415,000, up from the rig's previous day rate of $360,000. The rig has been working for TAQA Bratani in the region.


12

View Full Article

Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at kboman@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
For More Information on the Offshore Rig Fleet:
RigLogix can provide the information that you need about the offshore rig fleet, whether you need utilization and industry trends or detailed reports on future rig contracts. Subscribing to RigLogix will allow you to access dozens of prebuilt reports and build your own custom reports using hundreds of available data columns. For more information about a RigLogix subscription, visit http://www.riglogix.com/.

View the original article here

ANP Says China's CNOOC Pulls Out of Brazil Oil-Concession Auction

Chinese integrated oil company CNOOC Ltd. pulled out of an auction of oil and natural gas exploration concessions in Brazil, the country's National Petroleum Agency, or ANP, said Tuesday.

ANP officials gave no reason for the company's withdrawal. CNOOC officials were not immediately available to comment. The ANP had approved 64 companies for the auction, the country's first since 2008.

The ANP is offering 289 oil and natural gas exploration blocks for sale at the auction.

The fresh round of bidding is expected to generate a surge in activity across Brazil's oil industry, which was running out of areas to explore in the absence of concession auctions. Oil companies had warned that exploration could dry up as soon as 2015 without new sales of exploration acreage.

The auction is the first of several sales of exploration acreage set to take place in Brazil this year, including the first sale of subsalt exploration acreage under new production-sharing agreements.

Billions of barrels of oil have been discovered in the subsalt region, where oil and natural gas were found trapped deep beneath the ocean floor under a thick layer of salt. Unconventional oil and natural gas concessions, the same type of shale and tight gas acreage that sparked an oil-industry revolution in the U.S., are also expected to be sold this year.

Many of the world's largest oil companies from 18 different countries have been cleared to participate in the auction, including Exxon Mobil Corp., Chevron Corp. and BP. Brazilian state-run energy giant Petroleo Brasileiro, or Petrobras, entrepreneur Eike Batista's OGX Petroleo e Gas Participacoes and startup HRT Participacoes em Petroleo also have been approved.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Kuwait: The Transformation Game

Kuwait: The Transformation Game

Kuwait's first commercial production of oil began in 1946, some 65 years ago. Up until 1990, its production had been dominated by a few reservoirs. Burgan Al Kabeer Field (Greater Burgan) had the biggest share of the total production reaching 70-80 percent.

At that time, all its production was natural flow, water free and average oil rate per well was significantly high. Reserve to production ratio was exceptionally high. In addition, Capital Investment and Operating Cost during that time were relatively low considering the high incremental production which reached almost 4 million barrels of oil per day (bopd) at one time.

However, such luxury and blessing can't continue forever. Over the past 20 years, and following the Iraqi invasion, Kuwait Petroleum Corporation (KPC) has exerted much effort to re-shape the oil sector to get ready for the future.

As the era of easy oil is drawing to a close, Kuwait seems to be ready for the next phase and have already started to plan for tapping the development of difficult reservoirs as well unconventional resources in the country.

"Talking about the contribution of easy oil is decreasing, and tougher to find and difficult oil is increasing," said Sami Al Rushaid, chairman and managing director, Kuwait Oil Company (KOC).

Kuwait is currently the fourth-largest oil exporter in the world, with its population of 5 million consuming only 10 percent of its oil domestically, and is now pushing at the limit of its production capacity. By 2020, Kuwait hopes to have production capacity of 4 million bopd, and has already announced a series of ambitious projects to make this happen.

"Our investment plans are strong and schedule to deliver this capacity, and most of the growth is coming from primary and secondary recovery schemes in easy to medium complexity reservoirs," said Al Rushaid. "However, it is our strategy to not over exploits our easy oil, we plan to create a more [manageable] transition to the more difficult oil structure," he added.


1234

View Full Article

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Tuesday, August 6, 2013

Total Production to Increase 3% PA to 2015

Total Production to Increase 3% PA to 2015

PARIS - French oil major Total SA's chairman and chief executive, Christophe de Margerie, Friday confirmed the group's medium-term production targets. 

Speaking during the group's annual shareholders meeting, Mr. de Margerie said Total still expects its hydrocarbon output will increase an average 3% a year between 2011 and 2015. 

Over the past two years the company has focused its strategy on an aggressive search for additional oil and gas reserves, as demand from emerging markets, notably Asia, keeps increasing. 

"Clearly in terms of exploration we decided to shift gears," Mr. de Margerie said, noting that the group recently acquired many blocks in Brazil's deep offshore fields as part of its new policy for riskier exploration locations. 

"Now we need to make discoveries," he added. 

He said he remains confident the group would be able to produce as much as 3 million barrels of oil equivalent per day by the end of 2017.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

ConocoPhillips CEO Says Production Will Start Rising by Year's End

ConocoPhillips CEO Says Production Will Start Rising by Year's End

HOUSTON - ConocoPhillips Chief Executive Ryan Lance told shareholders at the company's annual meeting Tuesday that the company's long-awaited production growth rebound will begin by the end of this year.

He said 2013 will be an "inflection point" for ConocoPhillips, as it closes on $8.5 billion in announced asset sales and reaches a production low. But production will start to ramp up again by the end of the fourth quarter and into next year as the sales put cash on the company's balance sheet to fund development and grow its dividend.

"The growth is coming," Mr. Lance said. "You don't have to wait for that growth and the margin improvement for our company."

ConocoPhillips is in the midst of a transformation facilitated by drilling technologies that have unlocked oil and natural gas within the U.S. that had been unreachable or too expensive to drill. Mr. Lance's presentation to shareholders emphasized ConocoPhillips' ability to fund its operations and deliver on its promises of 3-5% production and margin growth even as it continues to pay a high dividend.

Mr. Lance said there's a "clear line of sight" to production of 1.9 million barrels of oil equivalent a day by 2017, up from an estimated 1.5 million barrels of oil equivalent per day this year. Much of that will be fueled by ConocoPhillips' acreage in unconventional U.S. shale formations--the Eagle Ford and Permian formations in Texas, and North Dakota's Bakken.

Income brought in from production in those areas will be used to fund the company's major projects around the world and exploration that is expected to fuel long-term growth. Mr. Lance highlighted the company's work in the Gulf of Mexico, where company is working to renew its presence. It will participate in five to eight wells this year, including its first operated well there in nearly a decade.

"We are back," Mr. Lance said of the Gulf.


12

View Full Article

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

ExxonMobil Taps FMC for Julia Equipment

Exxon Mobil Corp. has awarded FMC Technologies, Inc. a subsea equipment order for the Julia development in the Gulf of Mexico. FMC's scope of supply includes six subsea trees, a manifold and associated tie-in equipment.

"FMC Technologies is pleased to provide ExxonMobil with subsea systems for this offshore project," said Tore Halvorsen, FMC Technologies' senior vice president, subsea technologies, in a statement. "We look forward to supporting ExxonMobil as they overcome the technological challenges of this ultra deepwater development."

Julia was discovered in 2007 and is estimated to hold almost 6 billion barrels of oil. The field is located in the Walker Ridge area in about 7,000 feet of water. The $4 billion project is expected to start producing in 2016. Phase 1 of the development will be designed to produce 34,000 barrels of oil per day from six subsea wells connecting to the Jack/St. Malo production facility.

Development drilling on the field is planned to kick-off in 2014 in waters ranging from 4,000 to 8,700 feet.

ExxonMobil operates the field with a 50 percent stake while Statoil holds the remaining percentage.

With more than 10 years of journalism experience, Robin Dupre specializes in the offshore sector of the oil and gas industry. Email Robin at rdupre@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

AmericaCNG to Roll Out Solution to Associated Gas Production

AmericaCNG to Roll Out Solution to Associated Gas Production

Dallas-based AmericaCNG.com Inc. will begin offering in September a new service that allows natural gas liquids (NGL) and methane to be stripped from production at the wellhead. The company's new mobile, portable plants offer producers a temporary solution for dealing with NGLs and methane until the necessary pipeline infrastructure is in place.

Through a Y-grade extraction process, natural gas is separated at the wellhead from oil production, and the NGLs and methane are separated through two pipes. The NGLs are sold off and the producer paid on the netback, while the methane is converted to liquefied natural gas (LNG). The converted LNG can then be used to power drilling rigs, allowing producers to keep drilling at fields where no gas lines are available and still make money. That LNG can also be transported to a pipeline on behalf of the producer.

The company's skid-mounted LNG machines allow LNG in the field to be sold for $1/gallon, depending on individual company analysis, saving exploration and production companies millions each month in fuel costs, allowing them to drill with no flaring, according to a company presentation.

The company's strategic alliance partners construct the plants based on the gas analysis obtained from oil and gas producers.

"The volume commitment that we get from the oil and gas producers and the gas analysis will dictate the sizes of these plants," said Joseph Farley, director of global business development, in an interview with Rigzone.

Plant sizes can range from 5,000 gallons up to 100,000 gallons.

AmericaCNG can also build a LNG/compressed natural gas (CNG) station for companies interested. Once methane is converted to LNG, it can be taken to a LNG/CNG station and distributed. LNG is stored at minus 260 degrees; however, once it begins to warm up, it turns back into a gas and that gas can then be compressed and placed in CNG storage tanks. The company would need to have a commitment of 5,000 gallons per day in order to build a CNG/LNG station for larger fleet customers.


12345

View Full Article

Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at kboman@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Job Market Particularly Strong for Deepwater Pros

Job Market Particularly Strong for Deepwater Pros

An uptick in deepwater activity has contributed to a marked increase in demand for riser, drilling and completion engineers worldwide over the past year, an oil and gas recruitment specialist told Rigzone at last week's Offshore Technology Conference (OTC) 2013.

"The demand is great," Carolyn Stewart, Houston-based business development manager with NES Global Talent, said at the sidelines of OTC, which was held May 6-9 in Texas' energy hub Houston.

"We've seen quite a bit of drilling and completion," Stewart explained. "There's more specialization coming into play in high-pressure areas, deepwater areas."

As a result of this trend toward deeper developments, wells are becoming more complex and operators are placing wells closer together, Stewart noted.

"The technology for an FPSO [floating production, storage and offloading unit], FSO [floating storage and offloading vessel] – even just a general offshore rig, a TLP [tension-leg platform] or spar – has greatly increased," Stewart continued, adding that how operators configure wells is changing.  

Dart Targets Several CBM Developments in the UK

In turn, the skill sets that companies are demanding from engineers, technicians and other specialists needed to drill and complete wells and position infrastructure are becoming more specialized, she said.

Although companies are asking more of deepwater professionals, qualified individuals seeking these highly specialized positions can earn very competitive compensation packages and be selective in terms of work rotations, Stewart said. In addition, she pointed out that demand for such candidates is robust is virtually all offshore oil and gas provinces – ranging from the Gulf of Mexico and the North Sea to West Africa and Southeast Asia.

For Stewart's company, the tight demand for drilling engineers, riser engineers and other deepwater experts has been good for business.

"We follow our clients," she said, noting that NES Global Talent now operates 46 locations worldwide and applies a "discipline-specific" recruiting approach that aids in expanding the breadth of its networking capabilities.

"Our focus is in all areas. We've been able to open offices on our clients' growth."

Because the demand for deepwater experts far outstrips the pool of available talent, offshore employers will need to redouble their efforts to encourage seasoned professionals to impart their expertise to their younger peers, Stewart said.

"Companies will have to get creative in how they bring that workforce in, how they train the workforce," she explained.

In some cases, companies have instituted mentoring programs in which senior-level engineers work directly with their less experienced counterparts, she added.

"I think as we go along, we'll see more mentoring programs, more development programs," Stewart concluded.

Matthew V. Veazey has written about the upstream and downstream O&G sectors for more than a decade. Email Matthew at mveazey@downstreamtoday.com. Twitter: @Matthew_Veazey

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

OMV Petrom to Redevelop Oprisenesti Field

BUCHAREST - Romania's largest oil and gas group OMV Petrom plans to invest about 90 million euros ($115.7 million) by the end of this year to redevelop its Oprisenesti oil field in the eastern county of Braila, the company said in a statement Friday, news agency Mediafax reports. 

The project targets unlocking additional oil reserves of 8 million barrels of oil equivalent. 

"OMV Petrom is constantly investing in new technologies and secondary recovery methods to redevelop mature fields in Romania in order to improve the oil and gas recovery rate and stabilize production levels," said Johann Pleininger, member of OMV Petrom's executive board, responsible for exploration and production. 

Oprisenesti is a mature oil field, in production for almost 50 years, with a daily production of around 2% of the total oil production of Petrom in Romania, the oil company said. 

The redevelopment project entails drilling 30 new wells, as well as the construction of a water treatment station, a new pipeline transport network and three new pump stations. 

Oprisenesti is one of the six redevelopment projects Petrom plans to implement between 2013 and 2015. Total investment in the six projects is estimated at EUR400 million. 

Petrom is 51.01% owned by Austrian oil and gas group OMV AG, while the Economy Ministry holds a 20.64% stake.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Premier Reaches Out to Xodus for Catcher FEED Study

Premier Oil has reached out to Xodus Group to conduct a subsea Front End Engineering Design study for the Catcher project in the Central North Sea. Catcher is situated on Block 28/9. The oil field was discovered in June 2010.

Xodus will develop and engineer field and subsea architecture, flow assurance processes, subsea control systems, pipelines and tie-ins, as well as providing technical safety and risk support. The company will also assist in the FEED for the three riser systems for each of the wells, to allow production from the field through the subsea tieback.

Work for the FEED contract will be developed in two phases. Premier stated in a release that a review of previous and current studies, preliminary process flow diagrams and investigative work to identify structural functional requirements, will lay the foundations for the subsequent select phase.

Premier Oil and partners formally agreed on a development concept and have moved into the design phase, which should be completed by the end of September.

"Xodus is proud to be involved in the Catcher project which is a significant development in the North Sea," said Andrew Wylie, senior consultant at Xodus Group in a statement. "Our fully independent, integrated and highly technical service will deliver a wealth of knowledge to this project. Xodus is committed to Aberdeen and the North Sea market and our breadth of capability and multidisciplinary service makes us a preferred partner for FPSO projects. From risers to pipelines, and design to pre-commissioning, we have a proven track record."

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Transocean Inks New Contracts, Extensions; Sees More Downtime

Drilling contractor Transocean Ltd. reported late Wednesday several new contracts and contract extensions valued at approximately $662 million.

The company also increased its expected downtime estimate for this year by 117 days, Transocean reported in its fleet summary update. However, 75 percent of this downtime is related to preparations for a new ultra-deepwater award at a leading-edge day rate, according to a May 16 analysts note for Barclays Research.

This downtime includes 89 days due to shipyard acceleration into 2013 from 2014 and contract preparation for the Deepwater Millennium (UDW drillship), which has been awarded a two-year contract through February 2016 by an unnamed operator for work offshore Australia. The rig currently is drilling the Kiboko-1 well for Anadarko Petroleum Corp. offshore Kenya, according to Rigzone's RigLogix database.

Deepwater Millennium will work at a day rate of $605,000, higher than its previous day rate of $545,000. The new award represents a $442 million estimated contract backlog, Transocean said in its rig fleet summary.

Transocean also received a three-month contract through October for Jack Bates (DW semisub) from an undisclosed operator for work offshore Australia. The rig currently is drilling the Bassett West 1 well, according to RigLogix.

ConocoPhillips awarded a two month extension through February 2014 to the Transocean Legend (mid-water semisub). The rig will work at a day rate of $440,000, higher than Barclays' previous estimate of $325,000 and higher than its current rate of $293,000, Barclays analysts noted.

Transocean John Shaw (mid-water semisub) has also been awarded a one-year contract extension for work in the UK North Sea at $415,000, up from the rig's previous day rate of $360,000. The rig has been working for TAQA Bratani in the region.


12

View Full Article

Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at kboman@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
For More Information on the Offshore Rig Fleet:
RigLogix can provide the information that you need about the offshore rig fleet, whether you need utilization and industry trends or detailed reports on future rig contracts. Subscribing to RigLogix will allow you to access dozens of prebuilt reports and build your own custom reports using hundreds of available data columns. For more information about a RigLogix subscription, visit http://www.riglogix.com/.

View the original article here

Brazil's First Oil Auction in Five Years Draws Record Bids

RIO DE JANEIRO - Brazil saw record bidding at its first oil auction in five years Tuesday as the growing promise of oil finds along the equator attracted huge interest in exploration blocks at the mouth of the Amazon River.

Large oil finds in the Gulf of Guinea off the coast of Africa, along with promising finds in French Guyana on the South American continent, have shifted attention to Brazil. The South American country suspended its annual oil auctions in 2008 after the discovery of the subsalt oil province--close to 40 billion barrels of oil equivalent trapped under a layer of salt several thousand meters below the South Atlantic seabed.

Interest in that so-called equatorial margin "created more appetite for companies to invest," said Magda Chambriard, head of Brazil's national petroleum agency, ANP. "Those areas have become more important" to the global oil industry, which was reflected in the heavy bidding for the blocks, she said Tuesday.

A group led by France's Total SA--and that includes BP PLC and Brazil's state-run oil Petroleo Brasileiro SA--agreed to pay 345.95 million Brazilian reais ($172 million) for rights to explore an area of about 900 square kilometers at the mouth of the Amazon, topping a previous record set in 2006 for an oil field off Brazil's southeastern coast.

Ms. Chambriard said she sees the possibility of several platforms in the region producing 120,000 to 150,000 barrels of oil a day, similar to what is already happening in the Jubilee oil field off the African coast.

At the end of the auction, Brazil's government had raised BRL2.88 billion from selling exploration rights, topping the record BRL2.1 billion raised during a 2007 auction.

The record bids suggest that companies weren't scared off by requirements imposed by Brazil's government that a portion of exploration equipment be manufactured locally. However, bids Tuesday hewed relatively close to the minimum local-content level, showing that firms are being "more cautious," even as they acknowledge that the local-content requirement is "here to stay," Ms. Chambriard said.


1234

View Full Article

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Transocean Shareholders Reject Icahn's Dividend Proposal

Transocean Shareholders Reject Icahn's Dividend Proposal

Transocean Ltd. shareholders voted overwhelmingly Friday to reject a $4 a share dividend proposal by activist investor Carl Icahn but ousted long-time company Chairman Michael Talbert and added one of Mr. Icahn's candidates to the offshore drilling giant's board of directors.

"I'm glad the shareholders took a reasonable and thoughtful approach to the issues and voted overwhelmingly in favor of our business model," Transocean Chief Executive Steve Newman said in a phone interview following the company's annual meeting in Zug, Switzerland.

Nearly 75% of shareholders, not including Mr. Icahn's shares, voted against the $4 dividend, Mr. Newman said.

Mr. Newman said that Sam Merksamer, one of three director candidates recommended by Mr. Icahn, was elected against Mr. Talbert. Mr. Newman said that despite the difference of opinions between the board and Mr. Icahn, it won't be an issue to add Mr. Merksamer to the board. "We welcome Mr. Merksamer to the board," Mr. Newman said. The board will meet Friday to change committee assignments to include the new member.

Investor advisory firms Institutional Shareholder Services and Glass, Lewis & Co. both backed a smaller dividend announced by the company and recommended replacing Mr. Talbert, despite an announcement earlier this week that if re-elected, he would step down in the next year. It was a move by Transocean that appeared to be aimed at appeasing shareholders frustrated with the company's lagging performance while preventing Mr. Icahn's candidates from winning board seats.

Mr. Icahn first revealed his stake in the world's largest offshore oil and gas driller in February. He argued Transocean has underperformed its peers in total shareholder returns over the past five years due to a litany of poor investment decisions.

Analysts and Mr. Icahn have said some of the problems could be blamed on the 2010 Deepwater Horizon accident, in which a Transocean rig leased by BP PLC exploded, killing 11 and leading to the largest oil spill in U.S. waters.

But Mr. Icahn argues there were problems that preceded the accident, including paying too much to purchase rival Global Santa Fe in 2007, an acquisition that the company says helped it become the largest offshore driller in the world.

Mr. Icahn also criticized the fact that the company unexpectedly had to issue debt and equity to cover the 2011 acquisition of rival Aker Drilling.

Transocean's Mr. Newman has acknowledged some of the troubles, but argued that Mr. Icahn's recommendation to focus on an oversized dividend ignored the realities of the offshore drilling business, namely that companies need to continue to invest in their offshore drilling fleets while keeping the balance sheet strong enough to weather expected down cycles in the oil and gas business.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Monday, August 5, 2013

Salamander Pens PSC for Central Kalimantan Licenses

Salamander Energy plc announced that it has signed Production Sharing Contracts (PSC) for the Northeast Bangkanai and West Bangkanai license areas, onshore central Kalimantan, Indonesia. Salamander is the operator of both PSCs with a 100-percent working interest.

Each PSC covers an area of approximately 2,124 square miles (5,500 square kilometers) and both are located in the vicinity of the Salamander-operated Bangkanai PSC containing the Kerendan gas field development. These new PSCs increase the Group's position in one of its core areas and represent a large tract of additional acreage that will provide further growth opportunities around the Kerendan gas field.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Moniz Unanimously Confirmed as Energy Secretary

WASHINGTON - The U.S. Senate on Thursday confirmed Ernest Moniz, a nuclear physicist who has lauded the U.S. natural gas boom, as the next U.S. Energy Secretary.

Mr. Moniz, who was confirmed unanimously, won broad support while some other nominees from President Barack Obama are running into Republican opposition. Gina McCarthy, Mr. Obama's choice to be the next leader of the Environmental Protection Agency, has already seen her nomination vote delayed by Republican opposition.

Ms. McCarthy did get committee approval Thursday by the Senate Environment Committee on a 10-8 party-line vote, but her nomination may need support from Republicans to win approval from the full Senate.

Mr. Moniz has a less contentious track record than Ms. McCarthy, who as the EPA's air-quality chief has presided over the adoption of strict environmental rules. As an academic, Mr. Moniz advocated both advancing renewable energy and moving toward increased use of natural gas as a near-term way to reduce the carbon dioxide emissions linked to climate change.

Senators approved him in a 97-0 vote Thursday. He will take over the Department of Energy as it weighs several applications to export U.S. natural gas.

Mr. Moniz spoke positively about the U.S. natural gas boom at a Senate Energy Committee hearing last month, but he didn't take a firm position on exports. In his previous job as head of the Massachusetts Institute of Technology's Energy Initiative, he led a study that said the U.S. shouldn't erect barriers to exports and that a global gas market would advance U.S. interests.

There are more than a dozen export applications waiting for the Obama administration's approval.

The Department of Energy has limited regulatory power, but Mr. Moniz will be among President Barack Obama's top energy advisers as the administration considers new policies to cut carbon emissions. Mr. Moniz told senators last month his department should focus on supporting "low-carbon options" of energy use, such as small-scale nuclear reactors, renewable energy and technology to capture the carbon emissions from burning coal.

Mr. Moniz previously served in the department under President Bill Clinton, helping to oversee research programs and the nation's nuclear weapons stockpile. One of his first tasks this time around will be wrangling with Congress over the department's budget. Despite cuts to many accounts, the president has proposed a huge boost in funding for renewable energy and energy efficiency research. It isn't clear lawmakers will follow along.

Mr. Moniz moved easily through the Senate except for one stumbling block: South Carolina's two Republican senators, Lindsey Graham and Tim Scott, objected to the nominee moving forward unless the Department of Energy vowed to push ahead with a plutonium-disposal project in that state. The Obama administration says the project may cost more than anticipated and wants to look at alternatives.

Mr. Moniz declined to take a position on the South Carolina matter prior to his confirmation.

Mr. Graham dropped plans to block a vote on Mr. Moniz after it became clear the nominee had wide support from senators in both parties. Mr. Graham and Mr. Scott have said they will be looking for other opportunities to raise the issue.

Mr. Moniz will be the second consecutive scientist to the lead the research-focused energy department. His predecessor, the physicist Steven Chu, left the department for a post at Stanford University after serving most of President Barack Obama's first term.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Turkey's State Oil Co, ExxonMobil to Develop Oil Projects in Kurdistan

ISTANBUL - Turkey's state-run oil firm has struck an agreement with U.S. oil giant Exxon Mobil Corp. to develop joint projects in Kurdish-administered northern Iraq, Prime Minister Recep Tayyip Erdogan said Tuesday.

Mr. Erdogan also said that Turkey can pursue separate arrangements with the Erbil-based Kurdistan Regional Government, or KRG.

"Countries from various parts of the world are taking steps to explore and produce oil in different parts of Iraq, and then deliver it to world oil markets," he said. "There's nothing more normal, more natural than Turkey, which provides all kinds of support and aid to its next-door neighbor, to take a step that is based on mutual benefit."

The prime minister's statements, made just before he departed for the U.S. to meet with President Barack Obama, could herald an expansion of Turkey's influence in the energy-rich north of Iraq and help it generate enough energy to meet rising demand amid a robustly growing economy.

But Washington has also been cool on ventures that lack Baghdad's approval, fearing that empowering regional players such as the Kurds and Sunnis may push Iraqi Prime Minister Nouri al-Maliki, a Shia, closer to Iran and tip the delicate power balance in the Middle East following the U.S. withdrawal from Iraq, analysts say.

"The U.S. administration has consistently sent the same signals and repeated the same message: 'We want this to be done with Baghdad as part of a win-win-win formula involving Ankara, Erbil and Baghdad.' Obviously, by signing an agreement Turkey and Iraqi Kurds have moved to a certain stage, but whether this happens will depend to a great extent on what happens in Washington," said Bulent Aliriza, director of the Turkey Project at the Center for Strategic & International Studies in Washington.

Exxon Mobil declined to comment on the agreement announced by Turkey's prime minister. The Kurdish regional government couldn't immediately be reached for comment.

"The deal [between Turkey's oil company and Exxon to explore in Iraqi Kurdistan] is illegal and is not in line with the Iraqi constitution. Any agreement signed without the approval of the central government is illegal," said Faisal Abdullah, spokesman for Hussein al-Shahristani, Iraq's deputy prime minister for energy.

Striking an agreement with Ankara offers Iraqi Kurdistan a gateway to export its huge reserves of crude oil directly to world markets via Turkey, after a new pipeline is completed.

The move may also have destabilizing effects, coming at a time when Sunni-Shia tensions in Iraq are mounting and Mr. Maliki is seeking to assert Baghdad's authority across the country.

The Kurdish regional government and the Shia-Arab-led central government dispute control of territory, oilfields and revenue sharing from energy resources in Iraq. A KRG-Turkey deal could also deepen growing rifts between Baghdad and Ankara.

Some analysts said Tuesday's announcement contrasts sharply with a carefully honed policy in Ankara. Turkish officials have consistently called for the territorial integrity of Iraq and reiterated that they won't pursue any deals that would undermine the country's stability.

The Iraqi central government in Baghdad has long opposed the KRG's agreements with oil companies and plans for oil exports to Turkey.

"The regional government in northern Iraq has a constitutional right to 17% of [oil and gas] revenues," Mr. Erdogan said. "Since it has the ability to readily spend that share, it's in its right to use that in exchanges with Turkey.

"It is possible for us to have mutual agreements, there's nothing to prevent that," he told reporters in televised comments from Ankara before boarding his jet.

There is a deep divide between Erbil and Baghdad about the interpretation of Iraq's constitution. The Kurds maintain that it allows them the right to grant new contracts while letting the central government manage existing licenses. Yet Mr. Maliki says all new agreements need to be approved by Baghdad.

To get its energy framework with Iraqi Kurdistan moving, Turkey would have to persuade Washington to back the deal, analysts say.

"This is a step with the regional government in northern Iraq for exploration there. Now, to get results from this move, we need to get done with this trip with good results, our steps will mature accordingly," Mr. Erdogan said ahead of his meeting with Mr. Obama.

Still, that hasn't stopped drilling in northern Iraq by energy giants like Exxon Mobil and Chevron Corp., as well as smaller explorers such as Turkey-based Genel Energy PLC, run by former BP PLC (BP) chief Tony Hayward.

Genel Energy, which is listed in London and has been active in Iraqi Kurdistan since 2002, is already pumping oil and selling mostly to the domestic market. The KRG is using some of Genel's oil in a barter trade with Turkey, which provides the Kurdish government with processed petroleum products such as kerosene and fuel oil.

Hassan Hafidh, Ali Abbas and Tom Fowler contributed to this article.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Petroceltic to Farm out More of Isarene

North Africa and Mediterranean-focused Petroceltic International reported Friday that it is close farming out a further 18.375-percent interest in its Isarene Permit, onshore Algeria. The Isarene Pemit contains the Ain Tsila gas and condensate field.

Petroceltic said the farm-out process is "substantially complete", but is still subject to partner and regulatory approvals that could take several months. The firm also said that it would be seeking to complete the farm-out prior to it transferring its shares to the official lists of the UK Listing Authority and the Irish Stock Exchange in order to make the farm-out process smoother.

Petroceltic Chief Executive Brian O'Cathain commented in a statement:

"The second Ain Tsila farm-out is a major commercial milestone for Petroceltic. The company's decision to give it priority over the listing at this time is a prudent measure to help ensure the farm-out moves forward smoothly in the months ahead. We are still fully committed to the listing."

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Greenland Minister: Will Issue New Oil Exploration Licenses

COPENHAGEN - Greenland's new government has clarified its stance on allowing more offshore oil exploration with the small Arctic territory's new minister of industry and minerals saying that new licenses will be handed out as current licenses are turned in.

Jens-Erik Kirkegaard, in an interview at a conference in Copenhagen, said "we would like to stick to the current level of activity." He said more licenses will be handed out--including licenses for new areas--once current licenses are turned in, and more licenses will be granted after old ones are turned in 2013 and likely also in 2014.

The total level of exploration activity in Greenland isn't expected to increase or decline for the time being.

Mr. Kirkegaard's statements differ from the stance that the Social Democratic Siumut party--under newly installed Prime Minister Aleqa Hammond--was expected to take. In March, after her party took the largest number of seats in parliamentary elections, coalition agreements said that the government would be "reluctant" to offer more licenses and that existing licenses would be under more scrutiny.

The disclosure was greeted with optimism by environmental activists such as Greenpeace due to the impression that Greenland would halt exploration activities. Mr. Kirkegaard, however, sought to clarify the government's position.

Greenland technically belongs to the Kingdom of Denmark and relies on the Danes for massive subsidies needed to keep public finances afloat. However, Greenland operates under a self-rule regime and is looking to better develop its massive mineral and oil reserves so that it can become more financially independent from Denmark.

Among the companies holding licenses in Greenland are Royal Dutch Shell PLC, Statoil ASA and A.P. Moller-Maersk AS. The U.S. Geological Survey has estimated that the Greenlandic basin contains around 17 billion barrels of oil, but so far none has been extracted for export.

Dealing with Greenland's rich collection of resources will be atop Ms. Hammond's agenda after her Siumut Party collected 43% of the votes in a March election. The Inuit Ataqatigiit, or IA, previously ruled Greenland and, over the past four years, has worked to open up the secluded country to mining companies and others capable of advancing a variety of mining projects, including a plethora of rare-earth minerals, natural gas and other resources.

Ms. Hammond has vowed to put in place more-stringent financial requirements on foreign companies looking to eventually profit in Greenland. In March, she told The Wall Street Journal that she plans to demand royalties from companies as they set up exploitation activities.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Second DST Test Successfully Completes Lengo Appraisal

AWE Limited reported that a second successful drill stem test was conducted at the Lengo-2 appraisal well that is situated in the Bulu Production Sharing Contract offshore East Java, Indonesia. The test achieved a maximum gas flow rate of 21.2 million standard cubic feet per day (MMcf/d).

AWE, a partner on the field, reported that two further cores were cut in the Kujung I reservoir from 2,485 to 2,571 feet, recovering an estimated 79 feet of carbonate Kujung I reservoir formation. Gas samples were collected and a final result of the compositional analysis from both DST tests is expected in coming weeks.

"The results from the two DSTs at Lengo-2, combined with the data we have previously acquired from the Lengo-1 well, will be used by the Joint Venture as the basis for evaluating the future commercial development potential of the Lengo field," said Bruce Clement, AWE's managing director in a statement. "The growing domestic energy market in East Java is an attractive destination for this gas resource, should it prove commercial."

The Randolph Yost (300' ILC) jackup is drilling the appraisal well to a total depth of about 2,717 feet. Upon completion of the logging program, the well will be plugged and abandoned as planned.

KrisEnergy Satria Limited operates the license with a 42.5 percent stake. Partners include AWE Limited (42.5%), PT Satria Energindo (10%) and PT. Satria Wijaya Kusuma (5%).

With more than 10 years of journalism experience, Robin Dupre specializes in the offshore sector of the oil and gas industry. Email Robin at rdupre@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
For More Information on the Offshore Rig Fleet:
RigLogix can provide the information that you need about the offshore rig fleet, whether you need utilization and industry trends or detailed reports on future rig contracts. Subscribing to RigLogix will allow you to access dozens of prebuilt reports and build your own custom reports using hundreds of available data columns. For more information about a RigLogix subscription, visit http://www.riglogix.com/.

View the original article here

Hess, Elliott Management Reach Agreement to End Proxy Contest

Hess, Elliott Management Reach Agreement to End Proxy Contest

HOUSTON - Hess Corp. (HES) settled a months-long proxy fight hours before a shareholder vote Thursday morning, agreeing to name three directors backed by dissident hedge fund Elliott Management Corp.

Elliott, which owns about 4.5% of Hess's shares, is withdrawing its slate of five nominees and will support the Hess-backed directors at the company's annual meeting here.

The settlement represents a remarkable shakeup of the international oil company's 14-member board, which will now have eight new directors. It is the latest board overhaul stemming from shareholder pressure amid a rise in activism throughout the energy patch.

John Hess, the company's chief executive, said in a statement that the settlement is in the best interests of company's shareholders. He added that the new board "will provide effective oversight to ensure that we continue to create meaningful long-term value for all Hess shareholders."

John Pike, a senior portfolio manager at Elliott, said the hedge fund is "pleased to welcome a highly qualified and refreshed board at Hess."

The settlement was hashed out overnight before being finalized Thursday morning, according to a person with knowledge of the negotiations. It followed months of sparring between Hess and Elliott over strategy and governance. Elliott said Hess's management had destroyed shareholder value by engaging in costly and ineffective tactics. Hess argued that it was successfully transitioning into becoming a more focused and profitable company, and Elliott's plans for an overhaul would derail its progress.

The directors backed by Elliott that will join the board include Harvey Golub, former chairman and chief executive of American Express Co.; Rodney Chase, former deputy chief executive of BP Plc; and David McManus, a longtime energy executive who recently served at Pioneer Resources Co.

The new directors Hess recruited include John Krenicki Jr., former CEO of GE Energy; Frederic Reynolds, former chief financial officer of CBS Corporation; William Schrader, former Chief Operating Officer at TNK-BP; Kevin Meyers, a former BP PLC and ConocoPhillips executive; and Mark Williams, a former Royal Dutch Shell PLC executive. With the exception of Mr. Reynolds, all of these directors have energy backgrounds, a bid by Hess to address criticism that its board lacked oil and gas experience.

Hess said last week that Mr. Hess, the CEO, would give up its chairman role, and Mr. Krenicki would become the company's new independent chairman if all of its five nominees were elected to the board. But on Thursday the company said that Mr. Williams, the former Shell executive, would be the new chairman. In a statement released by Hess, Mr. Krenicki said that Mr. Williams "is the perfect choice for non-executive Chairman. I fully support the choice and look forward to working closely with him and the rest of the board."

All directors, including Mr. Hess, will stand for election next year after shareholders approved a resolution eliminating the three-year, staggered terms for board members.

Mr. Hess, the company's long-time CEO and its founder's son, tightly ran Hess without much challenge until this year, when Elliott launched its "reassess Hess" campaign seeking to redress stock underperformance. The company has made many changes, including the sale of its Russia assets and a move to sell its refining and marketing assets, and more recently, the splitting of its CEO and chairman roles. Analysts with investment bank Tudor, Pickering, Holt & Co. say that Hess shares have outperformed peers by 20% since the campaign started, but that it's "tough to say whether these changes would have occurred without Elliott catalyst."

It isn't clear whether the board's new composition will lead to further strategic changes. Elliott in January proposed splitting Hess into two companies, spinning off its oil and gas properties in shale-rock formations in the U.S. from its international operators. Hess rejected the idea, and Elliott's nominees had said they wouldn't necessarily adopt the hedge fund's recommendation.

After Thursday's shareholder meeting at the Hess Tower in Houston, Elliott representatives said the new board should consider the spin-off it had proposed or even a sale of the company, if such actions would benefit shareholders.

"We think the board should look at all options," said Quentin Koffey, associate portfolio manager for Elliott, adding that he thinks the company's shares are undervalued.

Shares were down 2.15% at $69.08.

Angel Gonzalez contributed to this article.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Moller-Maersk Net Profit Falls, Demand to Stay Subdued

The world's largest container shipping company A.P. Moller-Maersk A/S Friday posted a smaller-than-expected drop in first-quarter net profit, supported by increased freight rates and efficiency measures at its main shipping unit, but said it expects container transport demand to remain subdued this year amid "challenging" conditions.

Last year's earnings were boosted by the settlement of a tax dispute in Algeria.

The Danish shipping and oil conglomerate said it is maintaining its full-year guidance, expecting a result for 2013 below that of 2012 of $4 billion, while the net result excluding exceptionals is expected to be in line with the 2012 figure of $2.9 billion.

"Global demand for seaborne containers is expected to increase by 2%-4% in 2013, lower on the Asia-Europe trades but supported by higher growth for imports to emerging economies," the company said.

Indications for the first quarter of 2013 "show modest improvements in the global demand for container transport, reflecting the weak economic situation, especially in developed countries."

"Demand is expected to stay subdued in 2013 while capacity will grow significantly. Accordingly, conditions for the container industry remain challenging and managing supply will be even more important this year," it said.

The company posted a first-quarter net profit of 4.01 billion Danish kroner ($693 million), beating analyst expectations of DKK3.4 billion. In the year-earlier period, the company recorded a net of DKK6.15 billion.

Revenue was lower than expected, dipping 2% to DKK79.32 billion, from DKK81.31 billion in the year-ago period. Analysts had forecast revenue of DKK82.32 billion.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

PetroChina Withdraws Bid for Australian Gas Producer

PetroChina Co., China's largest natural-gas producer, confirmed Tuesday that it withdrew a bid for an Australian coal-bed methane gas producer but said it would continue to invest in other Australia projects because of their commercial value and importance for energy security.

"We have completed a number of mergers and acquisitions in Australia and will make further investments in those projects," the company said in an email. "These projects are of strong operational and strategic significance and will [supplement PetroChina's reserves] in the future, secure needs for sustainable overseas development and bring economic returns for the company."

WestSide Corp., which has coal-bed methane gas prospects in Queensland state, said earlier Tuesday that PetroChina withdrew its 185.1 million Australian dollar (US $184.7 million) offer for the company. WestSide's shares fell 11% to 25 cents a share Tuesday on the Australian Securities Exchange.

The decision comes as labor shortages and cost pressures have squeezed energy projects in Australia.

PetroChina made the bid for WestSide in November but withdrew almost six months later "because the general situation in Australia has changed so much," WestSide said, without elaborating.

WestSide, which produces natural gas extracted from coal deposits, said it was still in talks with other parties that could invest in the company either through a gas-sales agreement, joint venture or takeover.

PetroChina's decision comes about one month after Australia's Woodside Petroleum Ltd. and its partners, including Royal Dutch Shell PLC, shelved plans for a liquefied natural gas terminal that was forecast to cost more $40 billion.

China has been on an international quest to secure multiple sources of natural gas to help it meet targets to more than double the cleaner burning fuel's contribution to its energy mix to 10% by 2020 from less than 5% now.

Piped gas imports from Myanmar are expected to start later this year, complementing pipelined supplies already coming in from Turkmenistan. China and Russia are in advanced talks for another pipeline to supply Siberian gas. LNG imports are expected to ramp up from Australia and Qatar, and China has also spent the past few years trying to jump-start development of unconventional resources such as shale gas.

WestSide's gas would have supported a small LNG project in Queensland state planned by PetroChina and a smaller Australian partner, Liquefied Natural Gas Ltd. That project was slated to produce up to 3 million metric tons of LNG a year.

PetroChina bought another small Queensland gas producer, Molopo Energy Ltd., last year for A$43.4 million, and is also is a partner with Shell in a much larger joint-venture project with Arrow Energy, also in Queensland.

The Arrow partners are still considering whether to go ahead and build a multi-billion dollar LNG plant. They face mounting cost pressures and the possibility that competing LNG supplies to Asia could emerge from North America and East Africa, making it harder to find customers.Yvonne Lee in Hong Kong contributed to this story.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Myanmar Pipelines on Schedule Despite Attack

A deadly attack this week by Myanmar rebels won't delay the launch of two pipelines scheduled to begin pumping oil and natural gas into China later this year, a senior Myanmar government official said. 

Two Myanmar nationals working as subcontractors for China National Petroleum Corp. were killed on Monday after rebels opened fire at a compound near the Chinese border, said Htay Aung, head of office for the ministry of energy. 

"The incident will have no impact on the timeline," said Mr. Htay Aung. Construction is near completion, allowing for the first gas to be supplied in July, while no exact date has been set for first delivery of crude oil under the "flexible supply contract," he said. "We will try to deliver the first oil this year," he said. 

The pipelines are majority-owned by CNPC and stretch from the Bay of Bengal to China's Yunnan province. When completed, they will be able to supply up to 440,000 barrels of Middle Eastern and African crude oil a day and 12 billion cubic meters of natural gas a year from Myanmar offshore fields. 

However, following this week's deadly attack, analysts and human rights groups say escalating violence in Myanmar is threatening to delay the $2.5 billion project, which passes through the Shan state, and comes within 12 miles of the border with the Kachin state, where the heaviest fighting between minorities seeking greater independence and the government has taken place. 

"I think it is unavoidable," said Mr. Wong Aung, a spokesman for the Shwe Gas Movement, a human rights group. He estimates that because of the fighting, the launch of the pipelines "may take a few months longer." 

Ethnic minority groups in Myanmar have for decades fought the government, seeking greater independence. Myanmar's government, which took power in 2011 after five decades of military rule, has reached ceasefires with most groups. But fighting has picked up in recent months near the Chinese border. 


12

View Full Article

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Sunday, August 4, 2013

ExxonMobil Taps FMC for Julia Equipment

Exxon Mobil Corp. has awarded FMC Technologies, Inc. a subsea equipment order for the Julia development in the Gulf of Mexico. FMC's scope of supply includes six subsea trees, a manifold and associated tie-in equipment.

"FMC Technologies is pleased to provide ExxonMobil with subsea systems for this offshore project," said Tore Halvorsen, FMC Technologies' senior vice president, subsea technologies, in a statement. "We look forward to supporting ExxonMobil as they overcome the technological challenges of this ultra deepwater development."

Julia was discovered in 2007 and is estimated to hold almost 6 billion barrels of oil. The field is located in the Walker Ridge area in about 7,000 feet of water. The $4 billion project is expected to start producing in 2016. Phase 1 of the development will be designed to produce 34,000 barrels of oil per day from six subsea wells connecting to the Jack/St. Malo production facility.

Development drilling on the field is planned to kick-off in 2014 in waters ranging from 4,000 to 8,700 feet.

ExxonMobil operates the field with a 50 percent stake while Statoil holds the remaining percentage.

With more than 10 years of journalism experience, Robin Dupre specializes in the offshore sector of the oil and gas industry. Email Robin at rdupre@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Ruspetro Reports Progress with Appraisal Drilling

West Siberia-focused Ruspetro reported Wednesday that it has made progress with appraisal drilling at its field in the Khanty-Mansiysk region.

Ruspetro said that preparations – including pipelines, power, road and bridge access – had been completed at the Pad 4 area in the gas/condensate part of the field and that drilling had commenced. The company will use drilling here to continue its appraisal and characterization of the gas/condensate formations.

Meanwhile, rig build-up preparations are ongoing at the Pad 23 area, which is located in the crude oil-producing western part of the field, and two further wells are to be converted into water injectors in the Pad 21 area during the third quarter of 2013.

Ruspetro said that its average production rate for the first quarter of the year was 5,986 barrels of oil per day. During April, this production rate fell to 5,452 bopd.

Ruspetro Chief Executive Don Wolcott commented in a statement:

"In line with the plan laid out at our Strategic Review Presentation of 12 April, we are pleased with the progress made in our appraisal drilling program. Pad 4 has now been completed, with infrastructure in place and drilling commenced. Appraisal drilling from Pad 4 will enable us to further delineate the gas and condensate reservoir in the North.

"Drilling from Pad 23 will delineate the productive sands going west from the prolific crude oil producing Pad 21 area. Our discussions with Sberbank are progressing and we are confident that they will be completed in the first half of 2013."

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Chevron, YPF Sees Argentina as Possible Shale-Oil Pioneer

Chevron, YPF Sees Argentina as Possible Shale-Oil Pioneer

BUENOS AIRES - Just as U.S. companies have revolutionized the global shale-gas industry, businesses working in Argentina have the opportunity to set new standards in shale-oil production, according to executives from Argentina's state-run oil company, YPF SA, and Chevron Corp.

YPF Chief Executive Miguel Galuccio and Ali Moshiri, president of Chevron's Latin America and African operations, said Argentina's unique geology and infrastructure give the country advantages over other shale-oil and gas producing nations.

"From the geological point of few, after the U.S., Argentina is No. 2. Some people say China is No. 2 but really...in terms of shale oil Argentina is No. 2," Mr. Moshiri said in a meeting with the foreign press Wednesday.

Argentina's shale-oil and shale-gas reserves are located mainly in the Vaca Muerta formation, which means "dead cow" in Spanish, in the Andean province of Neuquen.

"The potential in Vaca Muerta is big enough to make Argentina energy independent," Mr. Moshiri said.

And that is exactly what Argentina is seeking after years of declining oil and natural-gas production turned the country into a net energy importer. Argentina now spends billions of dollars each year to import expensive gas from Bolivia and Trinidad and Tobago even though it is sitting on vast reserves.

Argentina ranks third in the world, behind China and the U.S., in potentially recoverable shale-gas reserves, with 774 trillion cubic feet, according to a study by the U.S. Energy Information Administration. Argentina is also thought to be home to vast quantities of shale oil.


1234

View Full Article

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Statoil, Noble Ink Deal for Newbuild Jackup

Statoil ASA has awarded a drilling contract valued at $655 million, including mobilization costs, to Noble Corp. for a newbuild ultra-high specification jackup.

The rig, an enhanced version of Statoil's Cat J specifications, will begin a four-year drilling contract in the third quarter of 2016 for Statoil at the Mariner project in the UK North Sea.  Statoil is operator of Mariner, located on the East Shetland Platform approximately 150 miles east of the Shetland Isles.

The newbuild jackup will be based on the Gusto MSC CJ-70-150 design, and uniquely suited to operate over a very large platform or in a subsea configuration in the Norwegian sector.  It will be capable of operating in up to 492 feet (150 meters) of water in harsh environments, with total drilling depth capacity of 33,000 feet (10,000 meters). The rig also will be capable of deploying either a surface or subsea blowout preventer when drilling wells in these challenging environments.

"We believe that the fundamentals of the high-specification jackup market segment will continue to be strong in the decade ahead," said Noble President and Chief Executive Officer David W. Williams in a statement Tuesday. "This unit is designed to meet some of the industry's most stringent operating requirements and supports Noble's ongoing commitment to increasing the technological and operational capabilities of our fleet."

Zug, Switzerland-based Noble is negotiating a contract for the new jackup, which will have construction and delivery costs of approximately $690 million, including project management, spares and start-up costs, but excluding capitalized interest.

The deal will position Noble strategically with a key North Sea operator, and continues to recent trend among offshore drillers opting to build jackups versus additional ultra-deepwater floaters, according to a May 14 analyst note from Tudor Pickering and Holt.

Noble has eight jackups currently operating in the North Sea, and is expected to deploy several of its JU-3000N newbuilds to the region, but has no rigs currently working for Statoil, according to a May 14 GHS Research analyst note.  GHS also sees opportunity for second newbuild in the future. However, the economics of the deal aren't attractive when the build cost and cash flows are combined versus the recent newbuild drillship and jackup awards obtained by Noble.

Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at kboman@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
For More Information on the Offshore Rig Fleet:
RigLogix can provide the information that you need about the offshore rig fleet, whether you need utilization and industry trends or detailed reports on future rig contracts. Subscribing to RigLogix will allow you to access dozens of prebuilt reports and build your own custom reports using hundreds of available data columns. For more information about a RigLogix subscription, visit http://www.riglogix.com/.

View the original article here

Second DST Test Successfully Completes Lengo Appraisal

AWE Limited reported that a second successful drill stem test was conducted at the Lengo-2 appraisal well that is situated in the Bulu Production Sharing Contract offshore East Java, Indonesia. The test achieved a maximum gas flow rate of 21.2 million standard cubic feet per day (MMcf/d).

AWE, a partner on the field, reported that two further cores were cut in the Kujung I reservoir from 2,485 to 2,571 feet, recovering an estimated 79 feet of carbonate Kujung I reservoir formation. Gas samples were collected and a final result of the compositional analysis from both DST tests is expected in coming weeks.

"The results from the two DSTs at Lengo-2, combined with the data we have previously acquired from the Lengo-1 well, will be used by the Joint Venture as the basis for evaluating the future commercial development potential of the Lengo field," said Bruce Clement, AWE's managing director in a statement. "The growing domestic energy market in East Java is an attractive destination for this gas resource, should it prove commercial."

The Randolph Yost (300' ILC) jackup is drilling the appraisal well to a total depth of about 2,717 feet. Upon completion of the logging program, the well will be plugged and abandoned as planned.

KrisEnergy Satria Limited operates the license with a 42.5 percent stake. Partners include AWE Limited (42.5%), PT Satria Energindo (10%) and PT. Satria Wijaya Kusuma (5%).

With more than 10 years of journalism experience, Robin Dupre specializes in the offshore sector of the oil and gas industry. Email Robin at rdupre@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
For More Information on the Offshore Rig Fleet:
RigLogix can provide the information that you need about the offshore rig fleet, whether you need utilization and industry trends or detailed reports on future rig contracts. Subscribing to RigLogix will allow you to access dozens of prebuilt reports and build your own custom reports using hundreds of available data columns. For more information about a RigLogix subscription, visit http://www.riglogix.com/.

View the original article here

Greenland Minister: Will Issue New Oil Exploration Licenses

COPENHAGEN - Greenland's new government has clarified its stance on allowing more offshore oil exploration with the small Arctic territory's new minister of industry and minerals saying that new licenses will be handed out as current licenses are turned in.

Jens-Erik Kirkegaard, in an interview at a conference in Copenhagen, said "we would like to stick to the current level of activity." He said more licenses will be handed out--including licenses for new areas--once current licenses are turned in, and more licenses will be granted after old ones are turned in 2013 and likely also in 2014.

The total level of exploration activity in Greenland isn't expected to increase or decline for the time being.

Mr. Kirkegaard's statements differ from the stance that the Social Democratic Siumut party--under newly installed Prime Minister Aleqa Hammond--was expected to take. In March, after her party took the largest number of seats in parliamentary elections, coalition agreements said that the government would be "reluctant" to offer more licenses and that existing licenses would be under more scrutiny.

The disclosure was greeted with optimism by environmental activists such as Greenpeace due to the impression that Greenland would halt exploration activities. Mr. Kirkegaard, however, sought to clarify the government's position.

Greenland technically belongs to the Kingdom of Denmark and relies on the Danes for massive subsidies needed to keep public finances afloat. However, Greenland operates under a self-rule regime and is looking to better develop its massive mineral and oil reserves so that it can become more financially independent from Denmark.

Among the companies holding licenses in Greenland are Royal Dutch Shell PLC, Statoil ASA and A.P. Moller-Maersk AS. The U.S. Geological Survey has estimated that the Greenlandic basin contains around 17 billion barrels of oil, but so far none has been extracted for export.

Dealing with Greenland's rich collection of resources will be atop Ms. Hammond's agenda after her Siumut Party collected 43% of the votes in a March election. The Inuit Ataqatigiit, or IA, previously ruled Greenland and, over the past four years, has worked to open up the secluded country to mining companies and others capable of advancing a variety of mining projects, including a plethora of rare-earth minerals, natural gas and other resources.

Ms. Hammond has vowed to put in place more-stringent financial requirements on foreign companies looking to eventually profit in Greenland. In March, she told The Wall Street Journal that she plans to demand royalties from companies as they set up exploitation activities.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

ConocoPhillips Awards FMC with Bayu Undan Phase III Contract

ConocoPhillips Australia Pty. Ltd. and FMC Technologies Inc. have signed a contract for the supply of subsea equipment for its Bayu-Undan gas and condensate project in the Timor Sea. The contract is valued at $26 million.

Bayu Undan, which has been in production since April 2004, is undergoing a third phase of development. The contractor will supply subsea trees, wellheads, jumper kits and associated control systems.

During the first half of 2013, the Bayu-Undan Phase 3 development will focus on procuring long-lead items and securing contracts for a semisubmersible drilling rig, the company said. A final investment decision is expected in mid-2013 and will be followed by further detailed engineering and procurement activities. Drilling is anticipated to commence in the second quarter of 2014.

"FMC Technologies is pleased to provide ConocoPhillips with the subsea systems required to develop this field," said Tore Halvorsen, FMC Technologies' senior vice president, subsea technologies, in a statement.

The field sends hydrocarbons to the Darwin LNG plant which converts gas from the field into LNG for sale to Tokyo Electric and Tokyo Gas in Japan. In 2012, the company sold 148 billion gross cubic feet of LNG.

With more than 10 years of journalism experience, Robin Dupre specializes in the offshore sector of the oil and gas industry. Email Robin at rdupre@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

EnQuest on Track for Kraken Go-Ahead

UK independent EnQuest reported Wednesday that it is on course to submit a field development plan for its Kraken development in the UK North Sea during the current quarter. The firm said it expected to sanction the development of Kraken later in 2013.

"EnQuest's growth and execution remain on course.  We are on track to submit the field development plan (FDP) for Kraken by mid-year and to sanction the project later in 2013.  The well results in north Kraken are in line with expectations and give further confidence in the field development," EnQuest Chief Executive Amjad Bseisu commented in a company update released Wednesday morning.

Bseisu also noted that EnQuest completed its acquisition of eight percent of the Alba field, which he said has similar characteristics to Kraken, in the first quarter.  

"Alba adds four non-operated wells to the twelve wells that EnQuest had originally planned for 2013," he said.

Meanwhile, the firm's Alma/Galia project remains on track for first production during the fourth quarter of 2013 and dry dock work on the EnQuest Producer vessel is now complete.

EnQuest said that its average production during the first four months of the year amounted to 20,494 barrels of oil equivalent per day, compared with 20,976 boepd over the same period in 2012.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Baghdad Blasts Turkey/Kurdistan Deal

Baghdad Blasts Turkey/Kurdistan Deal

ISTANBUL - A Turkish state-run oil firm struck a deal with Exxon Mobil Corp. and Iraq's semiautonomous Kurds to develop projects in northern Iraq, Turkey's leader said Tuesday, an agreement fraught with political risks for the energy-rich region. 

The deal thrust Turkey into a long-standing feud between Iraq's central government and the Kurdistan Regional Government over who has rights to northern Iraq's vast energy resources and raised tensions with Baghdad, which called it illegal. 

The deal could help underpin a peace accord that Turkey is negotiating to end a three-decade conflict with its own Kurdish population as it enters a delicate phase, analysts say. It could also help Turkey meet rising energy demand and raise Ankara's sway in the oil-rich region next door. 

Prime Minister Recep Tayyip Erdogan's announcement came two days before he was scheduled to meet in Washington with President Barack Obama, whose support could help propel the deal forward. 

The White House is caught between a desire to support the aspirations of Turkey, a Washington ally, and trepidation that empowering regional Iraqi authorities like the Kurds could alienate Iraq Prime Minister Nouri al-Maliki, who is seeking to extend Baghdad's influence across the divided country. 

U.S. officials also fear setting a precedent for allowing regional governments to strike independent resource deals could destabilize Mr. Maliki's government during a time when Sunni-Shiite tensions in Iraq are mounting. 

The Obama administration called for talks between Iraq's central government and the regional Kurdish government to resolve the issue. "Our position on energy trade from Iraq has been consistent and remains unchanged: The United States doesn't support oil exports from any part of Iraq without the appropriate approval of the federal Iraqi government," said Caitlin Hayden, a spokeswoman for the National Security Council. 


12

View Full Article

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Revised Hydraulic Fracturing Rule Available for Comment Period

Industry Execs See Higher Costs, Improved Safety with New Regulations

An updated draft rule that would empower the Bureau of Land Management (BLM) to regulate hydraulic fracturing on U.S. federal and Indian lands will be made available for an additional 30-day public comment period before the rule is finalized.

The "common sense" regulatory update is needed to bring rules originally written in the time of Sony Walkmans and Atari video games into the 21st century, Secretary of the Interior Sally Jewell told reporters in a conference call on Thursday.

"Regulations need to keep pace with advances in technology," said Jewell, noting her oil and gas industry experience and knowledge of how hydraulic fracturing works and the need to safely tap U.S. oil and gas resources.

BLM, an agency within the Department of Interior (DOI), initiated plans to update federal hydraulic fracturing regulations in late November 2010, when federal and state officials and NGO representatives discussed the need to modernize hydraulic fracturing regulations. Using information gathered from eight public forums across the United States and consultation with tribal officials, an initial proposed rule was written and released in May 2012, said DOI Deputy Secretary David J. Hayes during the conference call.

The updated proposed rule takes into account the more than 177,000 comments gathered in a 120-day comment period last year from the oil and gas industry, tribal officials, and other stakeholders. In January, BLM said it would publish an updated proposal to maximize flexibility, facilitate coordination with state practices and ensure operators utilize best practices on public lands.

"We look forward to receiving additional comments, and feel it is important to move forward as stewards of the state with sound regulations," Hayes noted.

The updated rule focuses solely on hydraulic fracturing and retains the three main components of the original proposal, requiring operators to disclose the chemicals they use in hydraulic fracturing, improving assurances for wellbore integrity to confirm that fluids are not contaminating groundwater, and requiring oil and gas operators to have a water management plan in place to handle flowback water.


1234

View Full Article

Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at kboman@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Saturday, August 3, 2013

Total Production to Increase 3% PA to 2015

Total Production to Increase 3% PA to 2015

PARIS - French oil major Total SA's chairman and chief executive, Christophe de Margerie, Friday confirmed the group's medium-term production targets. 

Speaking during the group's annual shareholders meeting, Mr. de Margerie said Total still expects its hydrocarbon output will increase an average 3% a year between 2011 and 2015. 

Over the past two years the company has focused its strategy on an aggressive search for additional oil and gas reserves, as demand from emerging markets, notably Asia, keeps increasing. 

"Clearly in terms of exploration we decided to shift gears," Mr. de Margerie said, noting that the group recently acquired many blocks in Brazil's deep offshore fields as part of its new policy for riskier exploration locations. 

"Now we need to make discoveries," he added. 

He said he remains confident the group would be able to produce as much as 3 million barrels of oil equivalent per day by the end of 2017.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Revised Hydraulic Fracturing Rule Available for Comment Period

Industry Execs See Higher Costs, Improved Safety with New Regulations

An updated draft rule that would empower the Bureau of Land Management (BLM) to regulate hydraulic fracturing on U.S. federal and Indian lands will be made available for an additional 30-day public comment period before the rule is finalized.

The "common sense" regulatory update is needed to bring rules originally written in the time of Sony Walkmans and Atari video games into the 21st century, Secretary of the Interior Sally Jewell told reporters in a conference call on Thursday.

"Regulations need to keep pace with advances in technology," said Jewell, noting her oil and gas industry experience and knowledge of how hydraulic fracturing works and the need to safely tap U.S. oil and gas resources.

BLM, an agency within the Department of Interior (DOI), initiated plans to update federal hydraulic fracturing regulations in late November 2010, when federal and state officials and NGO representatives discussed the need to modernize hydraulic fracturing regulations. Using information gathered from eight public forums across the United States and consultation with tribal officials, an initial proposed rule was written and released in May 2012, said DOI Deputy Secretary David J. Hayes during the conference call.

The updated proposed rule takes into account the more than 177,000 comments gathered in a 120-day comment period last year from the oil and gas industry, tribal officials, and other stakeholders. In January, BLM said it would publish an updated proposal to maximize flexibility, facilitate coordination with state practices and ensure operators utilize best practices on public lands.

"We look forward to receiving additional comments, and feel it is important to move forward as stewards of the state with sound regulations," Hayes noted.

The updated rule focuses solely on hydraulic fracturing and retains the three main components of the original proposal, requiring operators to disclose the chemicals they use in hydraulic fracturing, improving assurances for wellbore integrity to confirm that fluids are not contaminating groundwater, and requiring oil and gas operators to have a water management plan in place to handle flowback water.


1234

View Full Article

Karen Boman has more than 10 years of experience covering the upstream oil and gas sector. Email Karen at kboman@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here