Iran Attempts to Recover Gas Platform after Sinking

LONDON - Iran Wednesday confirmed it was seeking ways to recover a natural-gas platform made by an affiliate of Iran's Revolutionary Guards after it sunk in the Persian Gulf, a setback for the country in its effort to cope with international sanctions.

Divers have been deployed to see how the $40 million, 1,300-metric-ton platform can be pulled up, in the giant South Pars field, the state-owned Pars Oil and Gas Co. Ltd., said on its website.

However, a full-scale recovery has yet to start because of unfavorable weather conditions in the Persian Gulf, it said.

The platform sunk to the bottom of the Gulf as it was being installed by POGC and its builder, Iranian Marine Industrial Co., or Sadra, which is controlled by the Guards.

POGC said it was investigating the causes of the incident, which remain unclear. A spokesman for Pars Oil and Gas couldn't be reached.

Faced with a ban to import key oil technologies from the U.S. and the European Union, Iran is building its own oil equipment in order to achieve self-reliance.

Copyright (c) 2012 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

BP Turns On Taps Offshore Angola

BP reported Thursday that production has started from the PSVM development area in Block 31 offshore Angola.

Initial production will come from three production wells in the Plutao field and this is expected to ramp up to around 70,000 barrels of oil per day (bopd). PSVM is expected to build towards plateau rates of 150,000 bopd over the coming year, with the additional production coming from the Saturno and Venus fields in 2013 and Marte in 2014.

The International Monetary Fund also reported Thursday that it expects Angola's oil production to grow more than four percent in 2013 to 1.8 million bopd. Angola, Africa's second-largest oil producer after Nigeria, produced 1.73 million bopd last year, according to OPEC.

Commenting on the PSVM start up Thursday, BP Group Chief Executive Bob Dudley said:

"PSVM is one of the largest subsea developments in the world and was one of BP's key project start-ups for 2012 as we grow higher-margin production. Over the coming decade, we expect Angola, where we have extensive interests from exploration through to production, to be one of the main hubs delivering growth for BP."

BP Exploration Angola is the operator of the development with a 26.67-percent interest. Other holders in Block 31 include: Sonangol E.P. (25 percent); Songangol P&P (20 percent), Statoil Angola (13.33 percent), Marathon International Petroleum Angola (10 percent) and SSI 31 (5 percent).

A former engineer, Jon is an award-winning editor who has covered the technology, engineering and energy sectors since the mid-1990s. Email Jon at jmainwaring@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

COSL Budgets $4-5B for its 2013 Project Requirements

China Oilfield Services (COSL) disclosed late Wednesday that its capital expenditure would reach $4 billion to $5 billion this year, as it moves forward on the development of several strategic projects.

In its statement, COSL said that the bulk of its expenditure will be used to develop the following rigs and offshore support vessels: the 3,000 horsepower COSL Prospector, two 400-foot jackups, one 5,000-foot semisub, 14 utility vessels, one oilfield production and support vessel, one integrated surveying vessel and one 12-streamer seismic vessel.

The COSL Prospector, currently being constructed at CMIC Raffles, is a dynamically-positioned semisub being fitted to Norwegian certification standards. The semisub, which is due for delivery in 2H 2014, can operate in a maximum water depth of 4,921 feet (1,500 meters) and drill to a maximum depth of 24,934 feet (7,600 meters).

In addition, some of the funds will be used to support the Tianjin research and development base in Singapore.

COSL added in its statement that over 80 percent of the drilling rigs operation contracts for 2013 have been secured.

"The volume of work relating to geophysical services, marine support and transportation services, and well services, will remain steady in 2013," COSL said.

COSL, a sister company of China National Offshore Oil Corporation (CNOOC), revealed Wednesday that its plans to spend $12 billion to $14 billion this year on its offshore projects, both domestically and globally. 

Quintella has reported on the upstream and downstream oil and petrochemicals markets from 2004. Email Quintella at quintella.koh@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

Chesapeake Asset Sales Likely to Accelerate with McClendon Departure

Chesapeake Energy's asset sale pace will likely accelerate beyond $17 billion to $19 billion in assets for 2012/2013 in light of co-founder and CEO Aubrey McClendon's departure in April, as the company's board will likely favor pulling the present value of Chesapeake's massive 15.1 million undeveloped acreage forward, according to a Jan. 30 research note from GHS Research.

The pending departure of McClendon over "philosophical differences" took GHS analysts by surprise. In a meeting with McClendon in last year's fourth quarter, GHS analysts said they came away thinking that these philosophies were more in line than worlds apart.

"In fact we were told that everything positive that could come from tighter corporate discipline at Chesapeake would in fact emerge," according to a Jan. 30 GHS research note.

Analysts were also told that the board was on the right track in terms of setting management's 2013 bonus criteria in which return on capital, efficiency gains, and hitting budgets would be the favored incentives versus prior year targets that centered almost entirely on growth.

Chesapeake Chairman Archie Dunham told company employees in an email that Chesapeake is not for sale. GHS does see value for a major who might want to make a play on Chesapeake, which has massive undeveloped acreage positions in plays such as the Utica, Marcellus, Eagle Ford, Mississippian and Power River/DJ Basin.

However, Chesapeake's intimidating capital structure, which includes seven joint ventures, $12.6 billion in long-term debt, $3 billion in preferred equity, and $2.4 billion non-controlling interests, present complications.

"We think that a major with lower cost of capital versus Chesapeake can quickly get to a starting point of $30/share of value fairly easy," GHS noted.

To meet future funding gaps, Chesapeake needs to sell a large, desirable position of undeveloped acreage in order to right-size its balance sheet, as selling production by itself is not accretive to multiples, and the loss of cash flow generation offsets an improved balance sheet, according to a Jan. 30 research note from TPH Energy Research.

"Given the current strategy, the Marcellus is the only gassy asset that fits the bill," said TPH analysts, who believe Chesapeake's Marcellus asset could fetch $8 billion, or $6.4 billion after tax.

Even after selling its single most valuable asset, it's not enough to repair the long-term leverage trajectory without making other adjustments to future plans, such as scaling back leasing and spending less on ancillary investments.

A sale of Marcellus assets would reduce 2013 cash flow by $550 to $600 million, according to TPH estimates, while reducing aggregate production by 22 percent. The cost structure of the company also would change slightly with gas differentials worsening by 10 percent to 15 percent, given transportation commitments on other assets.

All else equal and assuming no incrementally announced asset sales, TPH anticipates the company will reaccumulate $9 billion in new debt by year-end 2015 which again puts the balance sheet in an undesirable position. Chesapeake would have to further reduce drilling activity in the Mississippi Lime and the Cleveland-Tonkawa, and reduce capital expenditures by $500 million to $1 billion per year, and leasing by $300 million per year.

"Only then would Chesapeake's outspend be in-line with cash flow growth by 2015," TPH noted.

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

Clean Up Underway of Oil Spill on Mississippi

The U.S. Coast Guard unified command continues to respond to a crude oil spill in the lower Mississippi River near mile marker 436 in Vicksburg, Miss., Tuesday.

A lightering and salvage plan has been approved and multiple response crews have been dispatched to begin removing oil from the damaged barge.

Response crews have deployed 2,800-feet of boom to contain the source of the oil leak. Skimming vessels have recovered approximately 2,300 gallons of oil-water mixture since the incident occurred. The tank levels are being continually monitored. The leaking tank contained approximately 80,000 gallons of light crude oil. An estimated 7,000 gallons of oil is unaccounted for with an unknown quantity potentially contained in the void spaces of the damaged barge.

The Mississippi River remains closed to all traffic for a 16-mile distance between mile marker 425 and mile marker 441 near Vicksburg. Currently there are 21 northbound and 34 southbound vessels affected due to the river closure.

Mississippi River vessel traffic queue management is ongoing. Vessels will be allowed to transit the area as soon as it is environmentally and operationally safe to do so.

Personnel from Coast Guard Sector Lower Mississippi River, Coast Guard Marine Safety Detachment Vicksburg and the Coast Guard Gulf Strike Team from Mobile, Ala., are on scene as part of a unified command effort to oversee cleanup and salvage operations. The unified command consists of representatives from the Coast Guard, State on-scene coordinators from Mississippi and Louisiana and the owner of the towing vessel, Nature's Way Marine LLC.

The Coast Guard investigation into the incident is ongoing.

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

Shell Gets Apparent Win in Nigeria Oil Spill Cases

LONDON - A court in the Netherlands Wednesday dismissed four claims for compensation against Royal Dutch Shell PLC's Nigerian subsidiary, but awarded damages in a fifth, in cases brought by farmers and fishermen claiming that oil spills from pipelines in Nigeria damaged their livelihoods.

The size of damages awarded has yet to be decided, but the ruling is an apparent victory for the oil giant. The court concluded that the oil spills weren't caused by poor maintenance by Shell's Nigerian subsidiary, but by sabotage from third parties.

Significantly, the court also dismissed all claims against the parent company, based in the Netherlands, saying that Nigerian law meant only Shell's local subsidiary was liable. This means the case doesn't set a legal precedent over how Dutch companies are held responsible for the actions of their foreign subsidiaries.

Oil companies will be relieved by the verdict, principally that a precedent of a general responsibility of the parent company to the subsidiary hasn't been established in relation to Nigeria, said Simon Tysoe, a partner at law firm Herbert Smith Freehills, who specializes in the energy and natural resources sector.

The ruling could also dissuade other people from bringing claims such as this in a European court, he added.

The lawsuit was brought by environmental group Friends of the Earth Netherlands and four Nigerian farmers and fishermen, who were seeking compensation over claims that oil spills from Shell pipelines in Nigeria damaged their livelihood. They also said they wanted the Anglo-Dutch oil company, based in The Hague, to complete the cleanup of the spills.

The court, which posted the verdict on its website, said that in the single case where Shell's Nigerian subsidiary was ordered to pay compensation, the company "could and should have prevented" the sabotage of its pipeline that caused the spill by installing a concrete plug on an abandoned oil well before 2006.

The sabotage was committed in 2006 and 2007 by opening the underground valves with a monkey wrench, the court said. Shell installed a concrete plug on the well in 2010.

Mutiu Sunmonu, the managing director of Shell Petroleum Development Company, Shell's subsidiary in Nigeria, welcomed the court's ruling that all spill cases were caused by criminal activity.

"Oil pollution is a problem in Nigeria, affecting the daily lives of people in the Niger Delta. However, the vast majority of oil pollution is caused by oil thieves and illegal refiners," Mr. Sunmonu said. "This causes major environmental and economic damage, and is the real tragedy of the Niger Delta."

Friends of the Earth Netherlands oil and mining campaigner Evert Hassink said the group would appeal the court's verdict in the four cases that were dismissed and would also appeal the ruling that the parent company wasn't responsible.

Mr. Hassink said that Shell had a duty of care to prevent sabotage of its pipelines. "An oil giant cannot leave 7,000 kilometers of pipeline and hundreds of installations unprotected and unguarded in a politically unstable and economically underdeveloped region," Friends of the Earth Netherlands said.

The oil spills at Oruma, Goi and Ikot Ada Udo in the Niger Delta took place between 2004 and 2007. The total amount of oil spilled in the three locations was about 1,100 barrels.

Shell had said previously that a joint investigation found that sabotage was the cause of the spills in each of the three spill locations. In the first case a hole had been bored into the pipeline, in the second it had been cut with a hacksaw and in the third a valve had been manually opened, the investigation found. The joint investigation team included members of the local community, local authorities and Shell.

Pipelines are commonly tapped in Nigeria to steal the oil inside. Many parts of the Niger Delta have a thriving trade in oil stolen this way, known locally as "bunkering." A report by the United Nations Office on Drugs and Crime in 2009 estimated as much as 150,000 barrels of oil a day was being stolen in that manner.

Copyright (c) 2012 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

Wireline Evaluation Confirms Oil Find in the Kangaroo-1 Exploration Well

Pacific Rubiales Energy disclosed Thursday that a wireline evaluation program has confirmed the previously announced light oil discovery in the Kangaroo-1 exploration well on block S-M-1101, in the Santos basin, offshore Brazil. The well was drilled as part of an agreement announced by Pacific Rubiales Energy Sep.18, 2012, as a minimum work commitment for both the S-M-1101 and S-M-1165 blocks, where the company holds a 35 percent participating interest.

The operator of the block, Karoon Gas Australia, said Thursday that the wireline evaluation of the Eocene discovery zone in the Kangaroo-1 well, including petrophysical logs, core samples, fluid samples and flow tests all conducted on wireline, is nearing completion.

The wireline data confirms a 82 foot (25 meter) light oil column sitting above a well-defined oil water contact in the well. Multiple oil samples measuring 42 degree API were recovered to surface from two separate intervals in the zone. Petrophysical well logs indicate porosities in the 25 to 32 percent range, and permeabilities of 100 to 300 millidarcies have been determined from pressure flow tests. Multiple wireline core samples collected across the zone and to be analyzed in a laboratory will provide additional measurements of the reservoir zone's porosity and permeability characteristics.

"Although not the primary objective, this is an exciting discovery in our first exploration well drilled on the Karoon blocks in Brazil," commented Ronald Pantin, Chief Executive Officer of Pacific Rubiales. "At this stage we believe that the wireline testing and evaluation indicates that the Kangaroo-1 Eocene reservoir is of good quality, has the potential to flow light oil at commercial rates, and we feel very comfortable that this is a significant discovery. We are proceeding with plans to drill an appraisal well to further delineate the extent of the Kangaroo reservoir. In addition, the discovery of an oil bearing reservoir and an effective trap in the Eocene de-risks other undrilled Eocene structures identified on the Karoon blocks."

When the current wireline operations are completed, the operator will relocate the rig to drill the Emu-1 exploration well to evaluate blocks S-M-1102 and S-M-1037, where the Company also holds a 35 percent participating interest.

Karoon is currently working to acquire a second rig to drill an appraisal well (Kangaroo-2) at a more optimal up-dip location for full reservoir and production testing of the discovery. The appraisal well would expect to penetrate a larger hydrocarbon column at the crest of the structure where the gross reservoir section could be as thick as 1,148 feet (350 meters) and contain sandstone packages with better petrophysical characteristics. 

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

Ferguson Group Extends Middle East Presence

The Ferguson Group, specialists in the rental of equipment to the offshore energy industry, has announced the launch of its new Ferguson Middle East Abu Dhabi division.

Ferguson Middle East LLC, based in Abu Dhabi, will support the Ferguson Group's increasing presence in the Middle East that saw the opening of its Dubai office in August 2012.

The new Abu Dhabi division will allow Ferguson Middle East to offer its range of offshore containers, refrigeration containers and its accommodation and, workspace modules to a wider market and range of companies operating within Middle East.

Mike Melville, commercial director for the Ferguson Group said: "The launch of our new office in Dubai last year was an extremely positive move for the company. Having this new office in Abu Dhabi is a great start to 2013 for Ferguson Middle East.

"I am excited about the future plans for our Middle East offices, as the company is able to expand and better support the offshore energy sector in the region."

The new company will be based in the Al Hilal Building in Abu Dhabi. The new division will offer the company's full range of products that include offshore containers, tanks, baskets, refrigeration/chiller containers, accommodation solutions and workspace modules.

Steven Ferguson, Chairman and CEO of the Ferguson Group, said: "We are delighted to launch this second company in UAE, servicing our clients in the Middle East. Our presence in these two key locations demonstrates our commitment to the region, acknowledging how important this market is to the Ferguson Group and recognizing the growing client demand in the region.

"Internationalization is a key aspect of our business and allows us to provide our high quality products across the globe, teamed with short lead times and first class, on the ground support."

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

Aker Wins Dagny/Sleipner Tie-In Contract

Aker Solutions reported Wednesday that it has been awarded a $117 million contract by Statoil to carry out modification work on the Sleipner A offshore platform in the Norwegian sector of the North Sea. The contract will see Aker carry out engineering, procurement, construction, installation and commissioning (EPCIC) work to tie in gas production from the Dagny platform.

Engineering work for the project will be carried out from Aker Solutions' offices in Stavanger, Bergen and Mumbai and will also engage prefabrication resources at its yard in Egersund, the firm said.

"We are very proud to be selected by Statoil for another tie-in project. Modification work is part of our core business and it is important for us to stay competitive and be awarded key projects such as this," Tore Sjursen, Aker's head of maintenance, modifications and operations, said in a company statement.

The Sleipner area is the second largest gas producer in the North Sea, after the Troll field. The Dagny field is located approximately 20 miles northwest of Sleipner East. Dagny was discovered in 1974.

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