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.  

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

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Tata Showcases Deepwater Pipeline Solutions at OTC

Tata Steel pipe laying. Source: Tata Steel

Tata Steel will demonstrate its ability to deliver pipeline solutions to some of the world's most challenging and complex projects at this year's Offshore Technology Conference (OTC) in Houston May 6-9 2013.

As global demand for key energy sources increases and the search for hydrocarbons takes the industry into deeper and more difficult environments, Tata Steel products will continue to play a vital part in their extraction and distribution offshore, meeting even the most demanding of offshore line pipe requirements.

The company has an extensive track record in every stage of hydrocarbon recovery, from exploration and drilling, oil and gas production and transportation through to refining, processing and developing renewable technologies.

Tata Steel recently completed a $150 million (GBP 100 million) project to provide pipe for the Discovery Producer Services L.L.C. (Discovery) gas pipeline in Keathley Canyon, Gulf of Mexico. Discovery is a 60:40 joint venture between Williams Partners L.P. and DCP Midstream Partners L.P. 

Tata Steel supplied Discovery's Keathley Canyon ConnectorTM with 214 miles (345 kilometers) of 20-inch diameter submerged arc welded line pipe, weighing more than 110,000 metric tonnes, which was manufactured at the company's 42-inch mill in Hartlepool, UK.  The pipe was laid at water depths of up to 7,380 feet (2,250 meters) and is designed to meet the required specification for deepwater conditions.

Richard Broughton, commercial manager for Pipelines & Petrochemical at Tata Steel, said: "Tata Steel applies decades of experience and expert knowledge to deliver strong, reliable and innovative pipeline solutions for challenging and complex projects around the world.

"At OTC this year, we will be showcasing our proven success in providing line pipe for deepwater conditions in the Gulf of Mexico, Brazil, the UKCS and Russia. Recent contracts have been awarded based on our excellent dimensional tolerance control, enabling us to offer enhanced deepwater anti-collapse properties, easy fit-up and fast lay rates."

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GE Awarded for New Technology Addressing Deepwater Drilling Challenges

GE Oil & Gas has received Spotlight on New Technology awards from the 2013 Offshore Technology Conference (OTC) for two new products that address the challenges of deepwater drilling. The awards showcase the latest and most advanced hardware and software technologies that are leading the offshore exploration and drilling industry into the future.

The two GE products honored are:

RamTel Plus System and ROV Subsea Display Panel. Blowout preventers (BOP) are critical components to drilling operation safety and are used on all wells, both on and offshore. GE's RamTel Plus System and Remotely Operated Vehicle (ROV) Display provide the industry with real-time, electronic measurements of the BOP's ram position and the pressure required to actuate the blades and/or sealing elements. This proven technology provides new data on the operational performance of the BOP that can be used in trending and prognostics in a way that mechanical systems cannot provide.

Deepwater BOP Blind Shear Ram. GE Oil & Gas has developed next-generation technology for shearing and sealing wellbore tubulars (casings and pipes). The patent-pending 5K Blind Shear Ram is designed for use in GE's ram BOPs for offshore drilling and has demonstrated the capability to shear 6-5/8 inch S-135 drill pipe tool joints while achieving a wellbore seal at 15,000 psi pressure differential. The technology was developed by GE to address an industry need to shear and seal today's large diameter, advanced metallurgy (strength, thickness and ductility) drilling tubulars.

"We are very honored to be recognized by the OTC for our development of these two new products," said Chuck Chauviere, president of Drilling for GE Oil & Gas. "They are among the latest examples of how GE continues to seek and develop innovative solutions for the challenges faced in today's complex drilling programs."

In total, OTC presented 15 Spotlight on New Technology awards to exhibitors at this year's show. GE Oil & Gas was one of only two companies to receive two awards.

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GE Awarded for New Technology Addressing Deepwater Drilling Challenges

GE Oil & Gas has received Spotlight on New Technology awards from the 2013 Offshore Technology Conference (OTC) for two new products that address the challenges of deepwater drilling. The awards showcase the latest and most advanced hardware and software technologies that are leading the offshore exploration and drilling industry into the future.

The two GE products honored are:

RamTel Plus System and ROV Subsea Display Panel. Blowout preventers (BOP) are critical components to drilling operation safety and are used on all wells, both on and offshore. GE's RamTel Plus System and Remotely Operated Vehicle (ROV) Display provide the industry with real-time, electronic measurements of the BOP's ram position and the pressure required to actuate the blades and/or sealing elements. This proven technology provides new data on the operational performance of the BOP that can be used in trending and prognostics in a way that mechanical systems cannot provide.

Deepwater BOP Blind Shear Ram. GE Oil & Gas has developed next-generation technology for shearing and sealing wellbore tubulars (casings and pipes). The patent-pending 5K Blind Shear Ram is designed for use in GE's ram BOPs for offshore drilling and has demonstrated the capability to shear 6-5/8 inch S-135 drill pipe tool joints while achieving a wellbore seal at 15,000 psi pressure differential. The technology was developed by GE to address an industry need to shear and seal today's large diameter, advanced metallurgy (strength, thickness and ductility) drilling tubulars.

"We are very honored to be recognized by the OTC for our development of these two new products," said Chuck Chauviere, president of Drilling for GE Oil & Gas. "They are among the latest examples of how GE continues to seek and develop innovative solutions for the challenges faced in today's complex drilling programs."

In total, OTC presented 15 Spotlight on New Technology awards to exhibitors at this year's show. GE Oil & Gas was one of only two companies to receive two awards.

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BP Confirms Mexican Lawsuit over Deepwater Horizon

BP confirmed Wednesday that it is being sued by the Mexican government in relation to the Deepwater Horizon disaster. The firm's first quarter results Tuesday revealed that, since March 6, it is among a number of companies named as defendants in more than 2,200 additional civil lawsuits related to the incident.

Plaintiffs include a "foreign government", which press reports speculated was Mexico. In a phone call with Rigzone Tuesday, a BP press officer confirmed that the foreign government is indeed Mexico, which had said back in 2010 that it would look at some sort of action against the company in relation to the Deepwater Horizon spill.

BP is currently evaluating the lawsuits, of which it said the vast majority consist of claims under the US Oil Pollution Act 1990 (OPA 90). BP said it believes that claimants in these new lawsuits may have sought to file them in advance of the third anniversary of the incident on April 20 2013 in order to avoid time bar challenges under OPA 90's three-year statute of limitations.

Meanwhile, BP reported late Tuesday that it has reached agreement with Federal and Natural Resources Damages trustees on two additional proposed early restoration projects in Louisiana that are expected to cost approximately $340 million.

The projects are part of a commitment from BP to provide up to $1 billion in early restoration funding to speed up recovery of natural resources that were damaged as a result of the Deepwater Horizon incident.

"We are extremely pleased to have reached agreement with the trustees on the new projects, which will provide significant long-term benefits to the environment and the people of Louisiana," said Laura Folse, BP's executive vice president for Response and Environmental Restoration.

"With the help of the extensive cleanup efforts, early restoration projects, and natural recovery processes, the Gulf is returning to its baseline condition, which is the condition it would be in if the accident had not occurred."

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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Deepwater Gulf of Mexico Drilling Activity to Keep Rising

Drilling activity in the deepwater U.S. Gulf of Mexico continues its recovery, according to data from Rigzone's database RigLogix.

As of April 23, 37 semisubmersibles and drillships are under contract in the deepwater Gulf of Mexico, according to RigLogix. Shell has seven deepwater rigs under contract – currently the highest number of rigs for an operator in the Gulf of Mexico. BP has the second largest number of deepwater rigs under contract with six, followed by Chevron with five, and Anadarko with four.  

Other operators currently active in the U.S. Gulf include Petrobras, BHP Billiton Plc, Eni S.p.A., LLOG Exploration and Hess. , which have two deepwater rigs each under contract.  Walter Oil & Gas, Noble Energy, ExxonMobil Corp., Cobalt International Energy and Apache Corp. each have one deepwater rig under contract in the region.

The number of deepwater semisubmersibles and drillships working in the U.S. Gulf of Mexico could rise to 52 in June 2014 and 54 in December 2014 if all of the deepwater rigs currently under contract remain so  according to data from Rigzone's RigLogix database.

Operators with rigs under firm contract in the U.S. Gulf in December 2014 will include BP plc, which will have six rigs, the most from any operator. Royal Dutch Shell plc will have five rigs under firm contract during that time. Anadarko Petroleum Corp. is expected to have four rigs working, followed by Chevron Corp. and LLOG Exploration Co. LLC, with three rigs each under firm contract.

Exxon Mobil Corp., Petroleo Brasiliero S.A. (Petrobras), Plains Exploration & Production Company, and Statoil ASA each are expected to have two rigs under contract in the Gulf of Mexico in December 2014.  At that time, BHP Billiton Ltd., Eni S.p.A, and Murphy Oil Corp. will each have one rig under firm contract.

Eight of these units have unexercised options, while 13 units do not have any future contracts. If these options are exercised and 13 units without contracts receive awards, the number of rigs under contract will reach 54, according to RigLogix.

Since the beginning of the year, 10 new contracts have been awarded, plus two options exercised, for a total of 12 contracts. Of those 10 contracts, two were sublet contracts.

Optimism over the Gulf of Mexico's exploration and production outlook continues to grow as drilling activity and bidding activity resumes following the post-Macondo moratorium imposed by the Obama administration. Earlier this month, Parks Paton Hoepfl & Brown Managing Director G. Allen Brooks noted that the results of Central Gulf of Mexico Lease Sale 227 suggest the oil and gas industry is bullish on prospects in the region.

Shell, Anadarko, Noble, ExxonMobil, BHP and Murphy Oil Corp. have drilled successful appraisal wells since the beginning of 2011. Statoil, Chevron, Noble, LLOG, Cobalt and Anadarko have also drilled successful exploration wells during that time.

Last month, Chevron reported making a deepwater U.S. Gulf oil discovery at the Coronado prospect. In November 2012, Noble reported it had made a discovery in the Big Bend exploration area of the deepwater Gulf. 

Challenging conditions of the Lower Tertiary, including deep well depths, high pressure, high temperature conditions, and dense sub-surface salt have raised questions over the potential and timing for exploration success in this frontier Gulf play. Barclays analyst James C. West said in an April 23 research note.

The Coronado, Shenandoah and other Lower Tertiary discoveries have helped confirm the potential and drive further operator interest in the Lower Tertiary play in the deepwater Gulf, West added.

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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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/.

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Deepwater Gulf of Mexico Drilling Activity to Keep Rising

Drilling activity in the deepwater U.S. Gulf of Mexico continues its recovery, according to data from Rigzone's database RigLogix.

As of April 23, 37 semisubmersibles and drillships are under contract in the deepwater Gulf of Mexico, according to RigLogix. Shell has seven deepwater rigs under contract – currently the highest number of rigs for an operator in the Gulf of Mexico. BP has the second largest number of deepwater rigs under contract with six, followed by Chevron with five, and Anadarko with four.  

Other operators currently active in the U.S. Gulf include Petrobras, BHP Billiton Plc, Eni S.p.A., LLOG Exploration and Hess. , which have two deepwater rigs each under contract.  Walter Oil & Gas, Noble Energy, ExxonMobil Corp., Cobalt International Energy and Apache Corp. each have one deepwater rig under contract in the region.

The number of deepwater semisubmersibles and drillships working in the U.S. Gulf of Mexico could rise to 52 in June 2014 and 54 in December 2014 if all of the deepwater rigs currently under contract remain so  according to data from Rigzone's RigLogix database.

Operators with rigs under firm contract in the U.S. Gulf in December 2014 will include BP plc, which will have six rigs, the most from any operator. Royal Dutch Shell plc will have five rigs under firm contract during that time. Anadarko Petroleum Corp. is expected to have four rigs working, followed by Chevron Corp. and LLOG Exploration Co. LLC, with three rigs each under firm contract.

Exxon Mobil Corp., Petroleo Brasiliero S.A. (Petrobras), Plains Exploration & Production Company, and Statoil ASA each are expected to have two rigs under contract in the Gulf of Mexico in December 2014.  At that time, BHP Billiton Ltd., Eni S.p.A, and Murphy Oil Corp. will each have one rig under firm contract.

Eight of these units have unexercised options, while 13 units do not have any future contracts. If these options are exercised and 13 units without contracts receive awards, the number of rigs under contract will reach 54, according to RigLogix.

Since the beginning of the year, 10 new contracts have been awarded, plus two options exercised, for a total of 12 contracts. Of those 10 contracts, two were sublet contracts.

Optimism over the Gulf of Mexico's exploration and production outlook continues to grow as drilling activity and bidding activity resumes following the post-Macondo moratorium imposed by the Obama administration. Earlier this month, Parks Paton Hoepfl & Brown Managing Director G. Allen Brooks noted that the results of Central Gulf of Mexico Lease Sale 227 suggest the oil and gas industry is bullish on prospects in the region.

Shell, Anadarko, Noble, ExxonMobil, BHP and Murphy Oil Corp. have drilled successful appraisal wells since the beginning of 2011. Statoil, Chevron, Noble, LLOG, Cobalt and Anadarko have also drilled successful exploration wells during that time.

Last month, Chevron reported making a deepwater U.S. Gulf oil discovery at the Coronado prospect. In November 2012, Noble reported it had made a discovery in the Big Bend exploration area of the deepwater Gulf. 

Challenging conditions of the Lower Tertiary, including deep well depths, high pressure, high temperature conditions, and dense sub-surface salt have raised questions over the potential and timing for exploration success in this frontier Gulf play. Barclays analyst James C. West said in an April 23 research note.

The Coronado, Shenandoah and other Lower Tertiary discoveries have helped confirm the potential and drive further operator interest in the Lower Tertiary play in the deepwater Gulf, West added.

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/.

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Judge Rules CSB Has Jurisdiction Over Deepwater Horizon Accident

A federal judge has ruled that the U.S. Chemical Safety Board has jurisdiction to investigate the 2010 Deepwater Horizon accident in the Gulf of Mexico.

A Congressional committee had asked the board, which typically investigates accidents at chemical plants and refineries, to examine the oil-rig explosion and accident, which killed 11 workers and triggered the largest offshore oil spill in U.S. history.

But Transocean Ltd., which owned the drilling rig that sank during the explosion, refused to honor subpoenas issued by the board in 2010 and 2011 for documents and employee testimony. It argued that the board lacked jurisdiction over offshore oil spills and that most of the documents had been turned over to other government agencies.

U.S. District Judge Lee Rosenthal disagreed with Transocean, ruling late Monday that it had to honor the subpoenas because legislation that created the board, known as the CSB, didn't bar it from looking at all offshore incidents. He noted that the investigation focused on the explosion on the rig, not the ensuing oil spill. The House Energy and Commerce Committee had asked the board to compare the Deepwater Horizon disaster to a lethal 2005 explosion at what was then BP PLC's Texas City, Texas refinery.

Transocean didn't immediately respond to requests for comment on Tuesday.

"This ruling greatly supports the CSB's ongoing investigation and will enable CSB investigators to access critical information that might have otherwise been unavailable," the board said in a statement.

The board issued a report last July concluding that offshore oil and gas drillers put too much emphasis on issues such as individual worker injuries while neglecting other indicators of danger, such as whether safety equipment is being maintained on schedule.

Copyright (c) 2012 Dow Jones & Company, Inc.

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Judge Rules CSB Has Jurisdiction Over Deepwater Horizon Accident

A federal judge has ruled that the U.S. Chemical Safety Board has jurisdiction to investigate the 2010 Deepwater Horizon accident in the Gulf of Mexico.

A Congressional committee had asked the board, which typically investigates accidents at chemical plants and refineries, to examine the oil-rig explosion and accident, which killed 11 workers and triggered the largest offshore oil spill in U.S. history.

But Transocean Ltd., which owned the drilling rig that sank during the explosion, refused to honor subpoenas issued by the board in 2010 and 2011 for documents and employee testimony. It argued that the board lacked jurisdiction over offshore oil spills and that most of the documents had been turned over to other government agencies.

U.S. District Judge Lee Rosenthal disagreed with Transocean, ruling late Monday that it had to honor the subpoenas because legislation that created the board, known as the CSB, didn't bar it from looking at all offshore incidents. He noted that the investigation focused on the explosion on the rig, not the ensuing oil spill. The House Energy and Commerce Committee had asked the board to compare the Deepwater Horizon disaster to a lethal 2005 explosion at what was then BP PLC's Texas City, Texas refinery.

Transocean didn't immediately respond to requests for comment on Tuesday.

"This ruling greatly supports the CSB's ongoing investigation and will enable CSB investigators to access critical information that might have otherwise been unavailable," the board said in a statement.

The board issued a report last July concluding that offshore oil and gas drillers put too much emphasis on issues such as individual worker injuries while neglecting other indicators of danger, such as whether safety equipment is being maintained on schedule.

Copyright (c) 2012 Dow Jones & Company, Inc.

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Total Seeks More Deepwater Drilling Supervisors, Superintendents

If you're a drilling supervisor or superintendent with deepwater experience, Total wants to talk to you.

"Total has an ambitious deepwater exploration and development program in the next five years, and the number of worldwide senior competent staff is limited today," said Benoit Ludot, deputy vice president of Drilling and Wells at Total E&P.

Benoit Ludot

Total has 25 offshore rigs under contract for 2013, and the company plans to drill 70 subsea wells this year alone. Like other operators, the French supermajor is ramping up its drilling program -- particularly in deepwater areas.

Given the tight demand industrywide for drilling supervisors and superintendents with deepwater expertise, Total has launched a dedicated recruitment campaign for numerous career opportunities in both areas of specialization. Ludot emphasized that Total is taking a long-term view as it adds to its ranks of deepwater drilling supervisors and superintendents.

Three positions on an offshore drilling rig make up the chain of command for drilling activities: the drilling supervisor, the drilling superintendent and the drilling manager. The following bullet points highlight the major responsibilities of drilling supervisors and drilling superintendents.

• As the representative of the operating company onboard the drilling rig, the drilling supervisor executes the drilling program and implements any procedures to remediate unexpected events during operations. This individual is held accountable on the company's behalf for any action and decision relating to HSE.

•The drilling superintendent oversees drilling operations for one or more rigs, coordinating the work of different specialists.

"Our drilling activities are located in more than 35 countries, and ranging [in] a large variety of domains such as deep water, HP/HT [high pressure/high temperature], acid gas and also unconventional resources and extended reach," said Ludot. "Total proposes a comprehensive training program and a dedicated drilling competency management system in order to operate with state-of-the-art qualified personnel."

Ludot noted that Total ran a benchmark study and can offer qualified supervisors and superintendents "an attractive and competitive package." Also, he said the company exhibits "a true commitment to HSE [health, safety and environment]."

"Our standards are best in class in the oil and gas industry to provide our staff with the ultimate level of safety they deserve," Ludot said.

In addition, he said Total's Drilling and Well Division uses a "centralized resource management" system worldwide to guide employees' growth within the company.

"We will ensure that every individual will face different technical challenges during his career and will therefore develop his technological skills," said Ludot. "Every employee can rely on a strong high standard set of company rules and general specifications. These rules and specifications capitalize on our know-how and experience and every employee is asked to contribute to its improvement and enrichment."

Total welcomes applicants worldwide, but it is concentrating its quest to find deepwater talent by maintaining a physical presence in four key "recruiting hub" cities with strong ties to the offshore sector: Aberdeen, UK, Houston, Texas, Rio de Janeiro, Brazil and Singapore.

"Recruiting hubs are an integrated approach allowing the potential candidates to meet all actors of the recruitment process and also to provide them with all the answers they could have," explained Laurent Stephane, Head of International Recruitment for Operation Development and HSE at Total E&P. "It is a unique opportunity for potential candidates to know more about Total. Our specificities allow us to be a technological leader and a precursor in career management."

Laurent Stephane

In addition, Total will maintain a strong recruitment presence at the upcoming Offshore Technology Conference (OTC) in Houston and on Rigzone.

"Proximity to potential candidates is one of the key points for recruitment success," said Stephane. "We need the opportunity to meet people to explain our difference and convince them to come onboard with us … We are developing our partnership with Rigzone, both for online events and specific events like OTC to help us."

 Source for all images: Total

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

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Petrofac Wins Deepwater Contract, Offshore Mexico

Petrofac announced Monday that it has been awarded a project management contract by Petróleos 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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Petrofac Wins Deepwater Contract, Offshore Mexico

Petrofac announced Monday that it has been awarded a project management contract by Petróleos 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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Petrofac Wins Deepwater Contract, Offshore Mexico

Petrofac announced Monday that it has been awarded a project management contract by Petróleos 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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Apache Could Earn $3B on Rumored Deepwater US Gulf Sale

Apache Corp. could realize up to $3 billion in a rumored sale of its deep water Gulf of Mexico oil and natural-gas assets, analysts said Thursday.

Apache was said to be considering an exit from the Gulf to concentrate on its onshore North America drilling assets, an unnamed person told Bloomberg Wednesday. Apache declined to comment on the rumors, only noting that it announced in its fourth-quarter earnings release that it planned to sell $2 billion in assets.

"When we have something concrete to share, we will do so," Apache spokesman Bill Mintz said.

A sale would undo Apache's relatively recent investment in the Gulf of Mexico, when it acquired Mariner Energy in 2010 for about $2.4 billion in debt and cash.

Operating costs in the Gulf of Mexico have risen since the deadly 2010 Deepwater Horizon accident due to new safety requirements.

Michael Yeager, CEO of BHP Billiton Petroleum said during a talk at the IHS CERAWeek conference in Houston this week that his company's Gulf of Mexico wells now cost about $170 million to drill, up from $120 million before the Deepwater Horizon accident.

Many U.S. oil and natural-gas producers are trimming their exposure to the deep water Gulf of Mexico, where developing wells thousands of feet under the waves can cost billions of dollars. As hydraulic fracturing, or fracking, and other new drilling methods have proliferated, producing oil and gas in onshore shale formations is seen as less technically challenging and more profitable.

In 2012, Apache drilled one operated and five nonoperated wells in the Gulf of Mexico deepwater region, according to the company's web site. Apache finished the year with an interest in 166 blocks in region and about 900,000 gross acres.

Apache held nonoperating interest in two deep water Gulf of Mexico wells, Lucius and Heidelberg, according to its annual report. Apache's Gulf of Mexico total daily production averaged 10,000 barrels of oil and liquids and 48 million cubic feet of natural gas, about 2% of the company's overall production.

Proceeds from the rumored sale could reach $3 billion, analysts at energy investment bank Tudor Pickering Holt & Co. said in a note. Analysts at Simmons & Co International put the figure closer to $2 billion.

"Apache would not be selling a large amount of production or reserves," Simmons analyst Bob Herbert said in a note.

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Apache Could Earn $3B on Rumored Deepwater US Gulf Sale

Apache Corp. could realize up to $3 billion in a rumored sale of its deep water Gulf of Mexico oil and natural-gas assets, analysts said Thursday.

Apache was said to be considering an exit from the Gulf to concentrate on its onshore North America drilling assets, an unnamed person told Bloomberg Wednesday. Apache declined to comment on the rumors, only noting that it announced in its fourth-quarter earnings release that it planned to sell $2 billion in assets.

"When we have something concrete to share, we will do so," Apache spokesman Bill Mintz said.

A sale would undo Apache's relatively recent investment in the Gulf of Mexico, when it acquired Mariner Energy in 2010 for about $2.4 billion in debt and cash.

Operating costs in the Gulf of Mexico have risen since the deadly 2010 Deepwater Horizon accident due to new safety requirements.

Michael Yeager, CEO of BHP Billiton Petroleum said during a talk at the IHS CERAWeek conference in Houston this week that his company's Gulf of Mexico wells now cost about $170 million to drill, up from $120 million before the Deepwater Horizon accident.

Many U.S. oil and natural-gas producers are trimming their exposure to the deep water Gulf of Mexico, where developing wells thousands of feet under the waves can cost billions of dollars. As hydraulic fracturing, or fracking, and other new drilling methods have proliferated, producing oil and gas in onshore shale formations is seen as less technically challenging and more profitable.

In 2012, Apache drilled one operated and five nonoperated wells in the Gulf of Mexico deepwater region, according to the company's web site. Apache finished the year with an interest in 166 blocks in region and about 900,000 gross acres.

Apache held nonoperating interest in two deep water Gulf of Mexico wells, Lucius and Heidelberg, according to its annual report. Apache's Gulf of Mexico total daily production averaged 10,000 barrels of oil and liquids and 48 million cubic feet of natural gas, about 2% of the company's overall production.

Proceeds from the rumored sale could reach $3 billion, analysts at energy investment bank Tudor Pickering Holt & Co. said in a note. Analysts at Simmons & Co International put the figure closer to $2 billion.

"Apache would not be selling a large amount of production or reserves," Simmons analyst Bob Herbert said in a note.

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Witness Says Deepwater Horizon Accident Was 'Classic Failure of Management'

NEW ORLEANS - An expert witness for plaintiffs suing BP PLC said the 2010 Deepwater Horizon accident was "a classic failure of management and leadership in BP," at the trial here in Federal District Court over liability for the disaster.

Robert Bea, a University of California Berkeley engineering professor who has worked as a safety consultant for BP starting in 2001, said Tuesday that he sent many warnings to the company's management in the years before the accident about how cost-cutting would hurt the safety of operations.

"It was too lean," Mr. Bea said of BP's operations after it reduced spending.

The testimony came on the second day of the civil trial that will determine the degree of culpability that BP and the other companies have for the accident, which killed 11 workers. On Monday lawyers for BP, drilling contractors Transocean Ltd. (RIG) and Halliburton Corp. (HAL), the federal government, Gulf Coast states and local businesses traded barbs over who was to blame for the explosion that unleashed the worst offshore oil spill in U.S. history.

Mr. Bea also criticized BP's own internal investigation of the Deepwater Horizon incident for failing to investigate management decisions leading up to the accident. Instead, he said, BP's study, known as The Bly Report, focused on the direct cause of the explosion on the drilling rig and the role that equipment and crew on the rig played.

During cross-examination, Mike Brock, a lawyer for BP, tried to challenge the credibility of Mr. Bea's testimony, emphasizing the limits of his expertise and emphasizing the role the companies suing BP played in providing him information for a report he did that was critical of BP's work leading up to the blowout.

"You understood that the plaintiff's legal team was focused on finding documents that hurt BP, not helped BP?" Mr. Brock asked.

Mr. Bea said he and his colleagues "were searching for the truth, the facts."

Mr. Brock also walked Mr. Bea through many efforts the company and its management made over the years to improve its safety operations, including surveying workers about safety operations.

BP has argued that the accident was due to many errors and misjudgments by all of the companies involved in the project, including rig owner Transocean and cement contractor Halliburton.

Other witnesses expected soon include Lamar McKay, chairman and president of BP Americas, and previously recorded depositions of former BP CEO Tony Hayward and Kevin Lacy, the former head of BP's Gulf of Mexico operations.

A second trial, scheduled for the fall, will determine how much oil leaked into the Gulf of Mexico. Together, they will determine the size of fines the companies face under the Clean Water Act, which could total as much as $17.6 billion.

BP, which hired Transocean and Halliburton to work on drilling its well, has said the fines would likely be under $5 billion.

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BP to 'Vigorously' Defend Itself in Deepwater Horizon Civil Trial

BP insisted Tuesday that it will defend itself "vigorously" against gross negligence allegations during the Deepwater Horizon civil liability trial, which starts next Monday.

The first phase of the civil trial – to be held in the U.S. District Court for the Eastern District of Louisiana – will be focused on the causes of the Deepwater Horizon accident and will examine who should be held responsible and to what degree.

"We have always been open to settlements on reasonable terms, failing which we have always been prepared to defend our case at trial. Faced with demands that are excessive and not based on reality or the merits of the case, we are going to trial," said Rupert Bondy, Group General Counsel of BP. "We have confidence in our case and in the legal team representing the company and defending our interests."

The court will ultimately determine whether BP or any other party was grossly negligent, but BP strongly disputes this charge.

"Gross negligence is a very high bar that BP believes cannot be met in this case,” said Mr Bondy. “This was a tragic accident, resulting from multiple causes and involving multiple parties. We firmly believe we were not grossly negligent."

Last November, BP and the U.S. government agreed to resolve all Federal charges and all Securities and Exchange Commission claims connected to the April 2010 disaster in return for $4.5 billion settlement paid by BP.

As part of the deal, BP agreed to plead guilty to 11 felony counts of "misconduct or neglect of ships officers" relating to the loss of the lives of 11 people as a result of the accident. It also agreed to plead guilty to one misdemeanor count under the Clean Water Act, one misdemeanour count under the Migratory Bird Treaty Act and one felony count of obstruction of Congress.

The Deepwater Horizon explosion on April 20, 2010 resulted in the largest offshore spill in U.S. history.

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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BP to 'Vigorously' Defend Itself in Deepwater Horizon Civil Trial

BP insisted Tuesday that it will defend itself "vigorously" against gross negligence allegations during the Deepwater Horizon civil liability trial, which starts next Monday.

The first phase of the civil trial – to be held in the U.S. District Court for the Eastern District of Louisiana – will be focused on the causes of the Deepwater Horizon accident and will examine who should be held responsible and to what degree.

"We have always been open to settlements on reasonable terms, failing which we have always been prepared to defend our case at trial. Faced with demands that are excessive and not based on reality or the merits of the case, we are going to trial," said Rupert Bondy, Group General Counsel of BP. "We have confidence in our case and in the legal team representing the company and defending our interests."

The court will ultimately determine whether BP or any other party was grossly negligent, but BP strongly disputes this charge.

"Gross negligence is a very high bar that BP believes cannot be met in this case,” said Mr Bondy. “This was a tragic accident, resulting from multiple causes and involving multiple parties. We firmly believe we were not grossly negligent."

Last November, BP and the U.S. government agreed to resolve all Federal charges and all Securities and Exchange Commission claims connected to the April 2010 disaster in return for $4.5 billion settlement paid by BP.

As part of the deal, BP agreed to plead guilty to 11 felony counts of "misconduct or neglect of ships officers" relating to the loss of the lives of 11 people as a result of the accident. It also agreed to plead guilty to one misdemeanor count under the Clean Water Act, one misdemeanour count under the Migratory Bird Treaty Act and one felony count of obstruction of Congress.

The Deepwater Horizon explosion on April 20, 2010 resulted in the largest offshore spill in U.S. history.

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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Technip Wins TLP Malikai Deepwater Contract

Sabah Shell Petroleum has awarded Technip and Malaysia Marine and Heavy Engineering a contract for the engineering, procurement and construction of a tension leg platform (TLP) for the TLP Malikai Deepwater Project.

Technip said Friday that the TLP will be designed as a fully-manned platform that will be installed some 70 miles offshore Sabah, Malaysia, in a water depth of approximately 1,600 feet. It will weight approximately 26,000 tons – including a topside, which will have facilities to process 60,000 barrels of oil and 50 million cubic feet of gas per day.

Technip will lead the joint venture, with engineering and procurement to be carried out at its operating center in Kuala Lumpur, Malaysia. Hull and moorings engineering will be done at KL by Technip MHB Hull Engineering.

Meanwhile, the Malikai TLP will be constructed and commissioned at MMHE's fabrication yard at Pasir Gudany in Johor, Malaysia.

The tendons will be fabricated in the US Gulf of Mexico before being transported to Malaysia.

Lim Kwee Keong, senior vice president for Technip's Asia Pacific operation, commented in a statement:

"This award to the Technip-MMHE joint venture extends our participation in pioneering deepwater field development projects in Malaysia. It also confirms Shell's trust in the combined Technip and MMHE's capabilities to deliver successful projects. This contract marks Technip's first TLP contract and a new step in our development into the burgeoning deepwater floating production facilities market in the Asia Pacific region."

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Statoil, Pertamina Relinquish Stakes in Deepwater Karama Block

Statoil Indonesia and Pertamina Hulu Energi have relinquished their stakes in the deepwater Karama block, sited offshore in the Makassar Strait, after evaluation works completed by both of the companies indicated that there are no hydrocarbon reserves in the block, temporary regulatory unit SKMigas said in a statement late Wednesday.

The exploration activities Statoil has undertaken under the agreement include the study of geology and geophysics, 3D seismic and the drilling of three wells.

"For six years, Statoil has made all the commitments and obligations of exploration activities specified in the contract agreement," SKMigas said in its disclosure. The entire exploration program in the work area is estimated to have cost at least $271 million.

Statoil, as operator, held a 51 percent stake in the block, while Pertamina Hulu Energi held the remaining 49 percent interest.

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

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