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.

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Revised Hydraulic Fracturing Rule Available for Comment Period

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.

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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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PA Resources Welcomes New CEO

The Board of Directors of PA Resources has decided with immediate effect to appoint Board member Philippe R Probst as the company's CEO. Bo Askvik is thereby leaving his position as CEO but will be available to the company for a number of months. Philippe R Probst will be CEO during an interim period and the Board intends to start immediately on the work of recruiting a permanent CEO.

It is well known that PA Resources has been in a vulnerable financial situation for some time. The ownership structure changed during the spring and the company acquired an almost entirely new Board at the Annual General Meeting May 14.

The newly appointed Chairman of the Board, Sven A Olsson, commented: "With a new Board and a changed ownership structure, it is natural to also replace the CEO."

Philippe R Probst, who has been appointed CEO, has many years of experience of the oil industry with a past which includes Exploration and Production Manager within the Shell Group as well as a position with the Swiss oil company Addax. He presently acts as advisor to companies mainly in Africa and the Middle East.

The new Board and CEO will work to create a long-term stable foundation for the continued operations of PA Resources.

As already announced, Tomas Hedström has been appointed as CFO of the company and took up his position May 2.

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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."

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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."

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Cal Dive Makes a Big Splash with Pemex Contract

Pemex Exploracion y Produccion (PEMEX) awarded Cal Dive International, Inc. two additional contracts totaling $188 million on top of a previously awarded contract in March.

In March, Cal Dive received a contracted to engineer, procure, install and commission 7 miles (12 kilometers) of 8-inch subsea pipeline and associated tie-ins on four existing platforms located in the Abkatun-Pol-Chuc field in the Bay of Campeche.  

The newly-minted contract is for the procurement, installation and commissioning of a 29 mile-long pipeline of 20-inch diameter and associated tie-ins to an existing platform. Offshore work construction on this portion of the contract will commence in the third quarter using two of the company's vessels and a third-party unit.

The second contract is for the procurement, installation and commissioning of 6 miles (9 kilometers) of two medium diameter subsea pipelines and associated tie-ins to existing platforms. Offshore construction for this contract is expected to commence in the fourth quarter of 2013 and should be completed by the end of the second quarter 2014.

"With the $63 million Pemex contract we announced in March, total contract awards with Pemex this year currently stand at $250 million," stated Cal Dive's Chairman, President and Chief Executive Office Quinn Hebert, in a released statement. "These awards increase our total Company backlog to over $400 million, our highest level in five years. We believe these awards demonstrate Pemex's confidence in Cal Dive as a reliable contractor. These recent contract awards not only secure work for the second half of 2013, but also provide significant visibility for the first half of 2014 when our domestic business is historically slow due to the winter work season. Also, we continue to bid for additional work in Mexico that would mostly benefit our 2014 results."

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.

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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.

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Rig Released for Nervesa Drill

Italy-focused Sound Oil confirmed Friday that the land rig it will use to drill the first appraisal well on its onshore Nervesa asset is on its way to the drill site.

Sound said that LP Drilling, the operator of the contracted TB2100S drilling rig, informed it that drilling operations in the Netherlands are now complete and that the rig has been released from the site in Holland.

Earlier in May, Sound said that it expected to spud the Nervesa appraisal well by the end of the month.

Nervesa is a gas discovery estimated at some 21 billion cubic feet. It was discovered by ENI in 1985. Sound CEO James Parsons said in March that the successful drilling of the asset will be “the first step in unlocking the significant value inherent in the Sound Oil portfolio”.

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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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.

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