Sunday, April 21, 2013

Statoil Starts Up Vigdis NE Production

Norwegian major Statoil announced Monday that its Vigdis North-East oil field has started production.

The field, located offshore Norway in the southern North Sea, is the third project in Statoil's fast-track portfolio of projects that employ standardized solutions using existing infrastructure rather than building all required infrastructure from scratch.

Vigdis North-East is just four miles south of the Snorre A platform, so the field development – comprising a subsea installation of four wells – is tied back to the existing Vigdis facility on Snorre A for processing. The total investment cost for the development is approximately $730 million, while the volume of hydrocarbons that Statoil expects to extract from the field has been estimated at around 37 million barrels of oil equivalent.

"The project adds new and valuable volumes for Statoil and its partners, and we have managed to meet the ambitious schedule and cost frames for this type of fast-track developments," Edvin B Ytredal, Statoil's head of production for the Snorre, Tordis and Vigdis fields.

"We have reached another important milestone in our fast-track portfolio through good cooperation in the licence and with the authorities."

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Petrofac Wins Deepwater Contract, Offshore Mexico

Petrofac announced Monday that it has been awarded a project management contract by PetrĂ³leos Mexicanos (PEMEX) for the Lakach project, offshore Mexico.

The contract, which Petrofac's Engineering & Consulting Services business won in partnership with Doris Engineering of Houston, covers specialized technical assistance and supervision for the construction, installation, commissioning, testing and start-up of deep-water subsea wells and infrastructure for the project. The scope also involves drilling activities and tie-ins to existing onshore facilities.

Initially involving around 25 engineers, based in Mexico and Houston, the project is scheduled to complete towards the end of 2015.

Petrofac ECS Managing Director Craig Muir commented in company statement:

"I am delighted that Petrofac's Engineering & Consulting Services business has been selected to support such a significant project for PEMEX with this its first major deepwater development. PEMEX will benefit from the full breadth of Petrofac's specialist subsea pipeline consulting and engineering services in addition to our well management capabilities. We look forward to working closely with PEMEX on this significant project and further building Petrofac's presence in Mexico."

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Endeavor to Advise Petrobras on Papa Terra Project

Endeavor Management announced Monday that Petrobras has retained the Houston-based consulting firm to provide third party review and advisory services on the Papa Terra project. Endeavor will work with the Papa-Terra Integrated Project Team to identify potential improvements to the drilling and completion program of all wells to be drilled with the new Tension Leg Wellhead Platform (TLWP) and Tender Assisted Drilling Rig (TAD) for the Papa Terra field. Endeavor Management will also evaluate the schedule status of the TAD semi and TLWP drilling package.

The Papa Terra field is a heavy crude oil field located in the Campos Basin offshore Brazil. Bruce Crager, executive vice president of Endeavor Management, stated, "This is a major project for Petrobras and is their first use of a TLWP and tender assisted drilling unit. We are pleased to have been selected to join Petrobras on the Integrated Project Team along with personnel from Chevron, who are a partner in the Papa Terra field."

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Drilling Report, March 10

Posted 11:30 pm  Sunday, March 10, 2013

The drilling report was produced with data from the Texas Railroad Commission, from February 24 to March 2. The following counties were searched: Anderson, Angelina, Camp, Cass, Cherokee, Dallas, Ellis, Freestone, Gregg, Harrison, Henderson, Houston, Kaufman, Leon, Limestone, Marion, Nacogdoches, Navarro, Panola, Rains, Robertson, Rusk, San Augustine, Shelby, Smith, Upshur, Van Zandt and Wood. For information contact Business Editor Casey Murphy at cmurphy@tylerpaper.com or 903-596-6289.


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Ex-Cove Energy Team Launches Africa-focused Explorer

Newly-launched sub-Saharan Africa focused oil and gas explorer Discover Exploration issued a statement Monday in which it outlined its strategy.

Discover said that it plans to participate in exploration and appraisal programs that focus on deepwater petroleum systems within young, emerging basins that have been de-risked through 2D and 3D seismic analysis. It will also, where appropriate, participate in multi-well drilling programs through farm-ins, farm-outs and acquisitions.

Discover's directors include the former Cove Energy management team. Cove, which was focused on Mozambique's Rovuma Basin, was acquired by Thailand's PTT Exploration and Production last summer after a hard-fought takeover battle that also involved Royal Dutch Shell.

The firm has already signed a production sharing contract (PSC) offshore Comoros Islands. The PSC license area is located over the outboard part of the Rovuma Delta, near to major gas discoveries by Anadarko Petroleum Corporation and ENI offshore northern Mozambique.

The initial work program for the PSC will see the firm acquire further 2D seismic data to that already acquired over the 6,900-square mile area. Discover holds a 60-percent stake in the PSC.

Discover CEO John Craven commented in a statement:

"I am very pleased to introduce Discover Exploration and its strategy, core to which is utilising the strong geo-technical expertise, industry contacts and successful track record of our board and management team to identify frontier oil and gas prospects, as we build a balanced portfolio of assets.

"The signature of this strategic PSC with the Government of the Union of the Comoros and Bahari Resources, covering the seaward section of the Rovuma Delta and bordering the highly prospective offshore Mozambique hydrocarbon province, presents a unique opportunity given its geographical and geological position."

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.

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Turbine Technology Powers Green Field Multi-Fuel Frack Pump

Turbine Technology Powers Green Field Multi-Fuel Frack Pump

Custom turbine technology has allowed Green Field Energy Services to offer hydraulic fracturing pumps that can run solely and cost-effectively on natural gas, including liquefied natural gas (LNG), compressed natural gas (CNG), and field gas, along with offering oil and gas producers flexibility to use diesel and liquid fuels such as kerosene.

The Lafayette, La.-based company late last year commissioned the first multi-fuel hydraulic fracturing pump that could either run on diesel or natural gas after blood, sweat, tears and attempts with several prototypes, said Rick Fontova, president of Green Field Energy Services, in an interview with Rigzone.

While diesel has been widely used in the oil field service industry for a number of years, the abundance of low-cost, cleaner-burning U.S. gas supplies due to shale exploration has sparked interest among some oil and gas companies to using more natural gas in their operations. This emerging trend prompted interest by Green Field in moving towards a pump that could burn only natural gas on a cost-effective basis, Fontova commented.

Green Field has worked with companies such as Apache Corp. who are seeking to fuel their exploration efforts with natural gas. Last month, Rigzone reported that Green Field has run a hydraulic fracturing pump for Apache at Apache's Granite Wash fields using 100 percent field gas.

USGS: Estimate of Conventional Gas Resources Grows InternationallyTwo turbine pumps representing 4,500 horsepower on one trailer

Around eight years ago, Marine Turbine Technology (MTT), a southern Louisiana-based company that designs custom turbine engine installations, was approached by an oilfield service company, Key Energy Services, about building a prototype of a conventional hydraulic fracturing pump that utilizes turbine technology, said MTT CEO Ted McIntyre in a recent interview with Rigzone.

MTT produces turbine systems for unique applications, including what McIntyre calls "big boy toys" – motorcycles and high-performance boats. The company – whose customer list has included Jay Leno –has also worked with the U.S. military, including a recent agreement with the U.S. Air Force to develop a high-pulse weapon. The company's turbines were also used to pump water out of New Orleans following Hurricane Katrina in 2005.

The prototype caught the attention of Mike Moreno, now chairman and CEO of Green Field. Moreno had headed up a group who acquired Hub City Industries (HCI) in May 2011 and changed the company's name to Green Field. Founded in 1969, HCI initially focused on pumping stimulation, but expanded its services to offer hydraulic fracturing, cementing, acidizing, coil tubing, gravel packing and nitrogen services.

MTT and Green Field then formed a joint venture, Turbine Powered Technology (TPT), to design and produce turbine-driven equipment, said McIntyre. MTT and Green Field each own 50 percent interest in TPT. MTT manufactures and licenses the technology, and Green Field holds the exclusive license for the turbine-driven equipment.

In November 2011, Moreno raised $250 million in a high-yield bond offering; once the capital was raised, Green Field came into existence, as did TPT. At that point, production of the turbine equipment started ramping up, with 30,000 horsepower produced in the month the multi-fuel pump was rolled out. Currently, Green Field has 160,000 horsepower and five hydraulic fracturing spreads, with plans to build two more spreads in the first quarter of this year.

In May 2012, the company began working under a long-term contract with Royal Dutch Shell plc to offer pressure pumping services. The contract marked the company's official move beyond the manufacturing phase for its multi-fuel hydraulic fracturing pump to the operational phase. The agreement with Shell called for two frack spreads to be provided with the option for additional spreads.

USGS: Estimate of Conventional Gas Resources Grows InternationallyFracturing services in the Permian Basin, February 2013

While Green Field's multi-fuel pump utilizes a conventional hydraulic fracturing pump widely available throughout the industry, what makes Green Field's pump unique is the turbine placed on top and the proprietary reduction gear box, or rosetta stone, that lets the company match the turbine to a pump.

The result is a frack stack pack that is powerful but light and compact enough for two to fit onto a typical 45-foot long trailer. This technology allows Green Field to double the horsepower available at a site with the same footprint, McIntyre noted. When operating on No. 2 diesel fuel, Green Field's clean turbine pumping technology emits 87 percent fewer emissions than those released by a diesel engine. The turbines also weigh significantly less. Diesel engines can weigh anywhere between 18,000 to 25,000 pounds; Green Field's turbines weigh 1,500 pounds.

The oil and gas industry has utilized reciprocating engines to power its equipment for years, despite the known limitations of diesel engines. However, diesel engines have lower pump rates, and are oversized, heavy and face reliability issues, said Fontova.

The ability of using a frac pump to run on gas-powered turbine offers a critical advantage over diesel engine. Starting in 2015, diesel engine manufacturers will be required by the U.S. Environmental Protection Agency (EPA) to produce engines that meet lower emissions standards. Green Field's engines already meet the new standards, coming in at 60 percent below the Tier IV standards on liquid fuel. When gas is used, the amount of emissions is reduced by another 15 to 20 percent.

Other pumps are available on the market which can run on bifuel, a mix of natural gas and diesel that has received a lot of press lately, but lose power when the run on solely on gas. When Green Field's turbines run on natural gas, the fuel economy and emissions are even better than with diesel, said McIntyre. Green Field's clean turbine pumping technology allows the company to reduce emissions by 87 percent and offer the highest power density on the market.

A turbine engine is naturally capable of running on gas, said Fontova. The difficult part for Green Field was to get the turbines to run on diesel, which remains the most abundant fuel in the oil and gas services industry.

"The infrastructure was not sufficiently in place when we were launching this," Fontova noted. "We didn't want fuel to be a reason that customers couldn't equipment."

Even with 100 percent diesel, Green Field's turbines already meet the EPA standards because of how the turbine operates.

"It's much more clean and efficient and offers maximum flexibility for its customers," Fontova commented. "So that way, we're never in a situation where we're ever able to access a fuel."

By using after-market turbines that had been utilized for Chinook helicopters, the company is able to bring down the cost of the turbines to build equipment more competitive in price with diesel.

"If you had to buy these turbines new it would be cost-prohibitive compared to diesel engines," said Fontova.

Besides cost-savings and a smaller footprint, Green Field's multi-fuel pump means less trailer traffic on roads in places where surging shale activity has resulted in heavier road traffic involving large trucks, McIntyre commented.

One challenge Green Field faced in its development of the multi-fuel pump was a gear box that could handle the tremendous torque that a turbine produces and creating a control package similar to a conventional diesel operation that would allow operators to run the turbines.

"Frack operators were not intended to be pilots, so we had to create a user friendly system to allow conventional frack operators to transition to new technology," said McIntyre.

However, one of the biggest hurdles is proving to the oil and gas industry that the turbines would work, McIntyre noted.

Oil field service companies such as Halliburton Co. and Schlumberger Ltd. tried using a turbine in a frac pump in the 1960s and early 1970s, said McIntyre, who knew about the turbine experiments through his father, a former Halliburton employee.

While using turbines was a good idea, the turbines available then were underpowered and the electronics available then weren't up to the task of running multiple fracks. The turbine engines available today are more reliable and have a longer life. Over time, the diesel engine also became cheaper and cheaper to use, Fontova commented.

USGS: Estimate of Conventional Gas Resources Grows InternationallyA significant pad reduction in Eagle Ford shale play using turbine fracturing pumps

In addition to fueling hydraulic fracturing pumps solely on gas, the company has secured commitments with two customers to test power generation of oil and gas equipment using field gas.

In a pilot program scheduled to begin in this year's first quarter, Green Field will power a 1,500 horsepower land drilling rig for Apache at its Granite Wash play using four 1 megawatt turbine engines running on field gas. Green Field is conducting final tests on a 1 MW turbine generator that runs on natural gas for use in SandRidge Energy Inc.'s Mississippi Lime play asset, McIntyre commented.

Green Field's customer commitments for pilot programs were announced in conjunction with the recent agreement the company inked with GE Oil & Gas. In early January, the company signed a global supplier agreement with GE to supply power generation solutions to the oil and gas industry.

Through the agreement, GE will provide technology and equipment, including electric submerged pumps (ESP) used in artificial lift systems in oil and fluids production, modular CNG in a box compressed natural gas systems and LNG production systems and more.

Green Field will use these technologies in conjunction with its own fueling technologies, which can significantly reduce a site's environmental footprint and increase efficiency by replacing diesel fuel for power generation.

The two companies will also further investigate ways of making their technologies even more efficient when deployed together, Green Field said in a Jan. 7 announcement.

The generators are used to power ESPs, which are used to produce oil and gas. The ability to use field gas – like Apache did in the Granite Wash – or have access to sources of electricity at oil and gas fields in areas with no power transmission lines will be the next challenge that exploration and production companies will have to solve.

"The world needs cheap electricity, and we certainly feel we have a solution," McIntyre commented.

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

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New World Sees Danica Jutland Stake Doubled to 25%

New World Oil and Gas announced Friday that the Danish Energy Authority has approved the assignment to its Danish subsidiary an additional 12.5-percent working interest in licenses 1/09 and 2/09. Consequently, the company's working interest in the Danica Jutland project has increased to 25 percent.

The Danica Jutland licenses are located in what New World describes as the "highly prospective" Jutland onshore area of southwest Denmark, covering a total area of approximately 1,575 square miles. The additional 12.5-percent working interest is a second tranche promised to New World under a farm-out agreement announced Oct. 11 2011, following the acquisition of 2D seismic data.

New World CEO William Kelleher commented in a company statement:

"At our Danica Jutland project, we have combined P50 indicative volumetrics and success case economic outcomes totalling 134 million barrels of oil equivalent and a NPV10 [net present value] of $1.22 billion net to New World. These numbers include only the three of 10 identified prospects or leads that have been formally reported on. As with our other Danish project, Danica Resources, there is considerable potential to significantly increase the combined volumetrics further.

"In Denmark as a whole, we have identified 39 prospects/ leads, a number of which have the potential to be company makers in their own right. With this in mind, we are looking forward to advancing operations in Denmark later this year, as we aim to deliver on our goal of building a leading oil and gas exploration and production company."

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UK Oilfield Services Firms Plan Workforce Increase of 10%

UK Oilfield Services Firms Plan Workforce Increase of 10%

UK oilfield services companies plan to increase their workforces by an average of 10 percent over the next two years, according to a new report from corporate accountants Ernst & Young.

Ernst & Young said that more than 75 percent of businesses surveyed in conjunction with Oil & Gas UK expect to expand their staff, with 90-percent expecting an increasing in revenues. But 53 percent of respondents identified sourcing suitably-qualified personnel as the main factor limiting growth in their organizations.

Nearly two-thirds of firms stated that any surprise changes to the fiscal terms for the oil and gas sector would negatively affect their plans.

"The oilfield services segment continues to outperform most other UK industrial sectors, despite the recession. The UK, particularly the north east of Scotland, is recognized as a global leader and has the potential to deliver even more skilled jobs and greater export opportunities," commented Ernst & Young partner Ally Rule, the report's author, in a statement.

"There is evidence of record order books and rising revenues, but this is dependent on a stable fiscal environment. Changes made to the tax regime following the increase in the supplementary charge in 2011, alongside the introduction of an agreed framework for assurances on decommissioning tax relief, are redressing the balance and increasing confidence in the sector."

Ernst & Young's report follows a report by Lloyds Banking Group earlier this week that stated that the UK oil and gas sector could create more than 34,000 new jobs within the next two years. Lloyds also said that a skills shortage remains the sector's biggest challenge.

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.

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