Nigeria, South Africa Sign MOU to Boost Trade in Oil, Gas Sector

Nigeria and South Africa have signed a memorandum of understanding aimed at boosting the volume of oil and gas trade between the two countries, Diezani Alison-Madueke, Nigeria's oil minister, said Wednesday.

In a statement issued Wednesday by the Nigerian National Petroleum Corp., or NNPC, in Abuja, Ms. Alison-Madueke was quoted as saying on the sidelines of the Nigeria and South Africa Business Forum in Cape Town that the MOU would also "reinforce and strengthen the existing symbiotic relationship between the two largest economics in Africa."

Ms. Alison-Madueke is on the delegation of President Goodluck Jonathan who began a state visit to South Africa on Monday.

Nigeria, Africa's largest oil producer, has in the last six years unsuccessfully tried to pass in its National Assembly a bill meant to transform its inefficient and corruption-ridden oil and gas sector.

Oil thefts and pipeline vandalism are rising in the nation's oil-producing Niger Delta region while the uncertainty created in Nigeria's oil and gas sector due to the bill's failure to pass has compelled international oil companies to hold back further investments in the sector.

Ms. Alison-Madueke said the MOU on the oil and gas sector "is to basically help in the transfer of knowledge, skills, capabilities and technology."

She said when passed into law, oil bill would help to open the entire spectrum of the Nigerian oil industry to investors from all over the globe.

The bill is currently being debated in the National Assembly in Abuja where there is a sharp division among legislators from the southern and northern parts of the country on the provisions of bill and it is not clear when it will be passed into law.

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

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Tendeka to Grow Presence in North, South American Market

Tendeka, the provider of completions systems and services to the upstream oil and gas industry, announced Tuesday plans to significantly grow its North and South American market presence by promoting its full portfolio of complementary completions products and services in the region.

By opening an office in Canada to directly supply the Canadian market and widening its South American oil and gas market with an increased presence Tendeka will supplement its swellable packer market with its innovative technologies and services that have already added value to client's wells in other regions around the world.

Since its inception in 2009 Tendeka has gone from strength to strength and is a global employer. With 18 regional bases strategically located in key energy hubs, the company is now set to expand further.

Tendeka is a major player in the North American swellable packers market and has supplied packers for use in conventional and unconventional applications in liquid shales including the Bakken, Eagleford, Utica, Niobrara and Permian developments. Tendeka also supplies monitoring, modelling and control systems and services that manage reservoir performance, enhance production and reduce downtime.

Ken Miller, Tendeka vice president of North and South America, said: "We have achieved over 200% top line growth over the last 24 months in our international markets including North America. Swellable packers remain an important part of our North American service offering, particularly to the fraccing market, but we have established that there is a demand for the full range of Tendeka products and services not just in North America but also in Canada and South America.  Our recent contract wins for Cyclic Steam Stimulation monitoring, AICD in SAGD and software for reservoir interpretation are evidence of our increased market penetration in these regions.

"These systems combine to maximise output and efficiency from the reservoir," explained Miller. "We recently strengthened our position in Calgary; initial indications show that our assessment of the market conditions was correct and there is a strong demand for our wider systems offerings, especially in heavy oil operations. Brazil is also a key focus for us where we have recently established solid routes to market and been awarded seven figure contracts. 

Tendeka's CEO Gary Smart said: "Our full portfolio of completions systems and services now includes: leading electronic gauge, distributed and wireless monitoring technologies, to monitor reservoir performance; modeling software, to provide reservoir interpretation and build scenarios; wireless intelligent completions systems, to control reservoir production; sand and inflow control devices, to control reservoir phase filtering; and swellable and mechanical packers, to provide effective zonal isolation. This suite of completions products and services are all industry proven and has been developed to add value to our clients wells through improved production."

Smart continued: "We are keen to explore the wider market opportunities for the whole range of Tendeka systems and services. Our focus on geographic growth will continue to allow us to bring our existing high value portfolio to clients in new territories as well as providing an established route to market for the new product innovations that are currently under development in our research bases in Europe and North America. The oil and gas industry is a challenging one and Tendeka seeks to positively impact our clients' profitability through the implementation of innovative completions systems and services."

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Technip Scores Subsea Tieback Work for South White Rose

Technip was awarded by Husky Oil Operations two contracts, with a combined substantial value, for the planned subsea tieback of the South White Rose Extension field. The field is an extension of the White Rose field, located in the Jeanne d'Arc Basin, approximately 217 miles (350 kilometers) southeast of St. John's, Newfoundland and Labrador, Canada.

The first contract will be executed in 2013 and will include the supply and installation of gas injection flowlines, umbilicals and subsea structures.

The second contract will take place in 2014 and will cover the supply and installation of flowlines and subsea structures to support oil production and water injection.

Technip's operating center in St. John's will perform the management and engineering of both projects, with various materials and equipment being supplied from within the Group and local supply chain.

Knut Boe, Senior Vice President of Technip's North Sea-Canada Region, commented: “These two awards reinforce Technip's continuous involvement in Atlantic Canada's offshore oil and gas projects. They also mark a new step in the relationship between Technip and Husky Oil Operations, for whom we successfully completed the subsea production system contract for the White Rose field development in 2005.”

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EMAS AMC Awarded Smorbukk South Contract by Statoil

Subsea services firm EMAS AMC reported Thursday that it has been awarded a $75-million contract from Statoil for its Smørbukk South extension project in the Norwegian Sea.

The contract will see EMAS AMC supply subsea engineering, procurement and offshore construction services to the project. This will include the installation of flexible flowlines, tie-in spools, manifolds and umbilicals, as well as associated abandonment and removal activities. The extension will be developed with a new subsea template connected to existing infrastructure in the area.

Offshore activities will start in the second quarter of 2014, with the project being expected to last through 2015.

EMAS Managing Director Lionel Lee commented in a statement:

"We have been investing heavily in building up our global engineering expertise as well as technologically advanced and game-changing assets. This has borne fruit and I am extremely pleased with this latest win by EMAS AMC. It demonstrates an ever growing confidence in our project execution capabilities and validates EMAS."

Discovered in 1985, the Smørbukk South Extension holds estimated recoverable reserves of 16.5 million barrels of oil equivalent. 

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EMAS AMC Awarded Smorbukk South Contract by Statoil

Subsea services firm EMAS AMC reported Thursday that it has been awarded a $75-million contract from Statoil for its Smørbukk South extension project in the Norwegian Sea.

The contract will see EMAS AMC supply subsea engineering, procurement and offshore construction services to the project. This will include the installation of flexible flowlines, tie-in spools, manifolds and umbilicals, as well as associated abandonment and removal activities. The extension will be developed with a new subsea template connected to existing infrastructure in the area.

Offshore activities will start in the second quarter of 2014, with the project being expected to last through 2015.

EMAS Managing Director Lionel Lee commented in a statement:

"We have been investing heavily in building up our global engineering expertise as well as technologically advanced and game-changing assets. This has borne fruit and I am extremely pleased with this latest win by EMAS AMC. It demonstrates an ever growing confidence in our project execution capabilities and validates EMAS."

Discovered in 1985, the Smørbukk South Extension holds estimated recoverable reserves of 16.5 million barrels of oil equivalent. 

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Sudan, South Sudan Start Talks Over Former National Oil Company Assets

KAMPALA, Uganda - Oil producing Sudan and newly independent South Sudan started talks on Monday aimed at resolving a dispute over the sharing of assets belonging to former national oil company Sudapet, said officials.

A South Sudanese delegation from the oil and mining ministry has arrived in Khartoum for talks with their Sudanese counterparts, said Sudanese government spokesman Rabie Abdelaty, as the two former civil war foes continue to disentangle their oil assets.

"Both sides are keen to ensure that the issue of Sudapet is resolved quickly," said Mr. Abdelaty.

The talks are part of the African Union-mediated framework on the implementation of cooperation agreements signed in September last year.

Sudan is demanding up to $2 billion from South Sudan as compensation for assets including buildings, storage tanks, processing facilities and pipelines located in the south. Juba has in the past dismissed Khartoum's claim, arguing that it is the rightful owner of the assets within its territory following its independence in July 2011.

Sudan is also demanding compensation for damage to its oil facilities in the oil hub of Heglig that was briefly occupied by South Sudanese forces in April last year.

According to Barnaba Benjamin, South Sudan's information minister, the talks are expected to yield positive results.

"We have just restarted our oil, things are improving, we are hoping for the best," Mr. Benjamin said.

Land locked South Sudan broke away from Sudan taking control of as much as 75% of the oil fields but has to rely on ports and pipelines, which pass through the north, to ship its crude for export.

The two countries have since been embroiled in a number of disputes over the sharing of oil revenues, which led to the shutdown of the south's 350,000 barrels-a-day of crude last year plunging both economies into turmoil.

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

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Musings: China And The Importance Of The South China Sea

The world has been riveted with the drama unfolding in the northern Pacific region as North Korea rattles its rockets and threatens war. One of the key players in this drama is China, a long-time supporter of North Korea. China has many conflicting geopolitical objectives, some of which are driven by the nation's need for increased energy supplies and raw minerals to power its economy in order to support its 1.2 billion in population.

China realizes it has emerged as a super power, and with that status it must demonstrate its power meaning it must establish dominance in the Pacific region.

Economically, militarily and politically, China has power throughout Asia from Vietnam to North Korea. What it hasn't had until recently is a significant naval presence. That situation is changing as China has built it first aircraft carrier and other sophisticated naval vessels including submarines. At the same time, China has reiterated its long-standing claim over the South China Sea, and with it the country's claim over whatever mineral and energy resources might be present.

China's claim over most of the South China Sea is based on its 1946 undefined claim – the nine dashes on a map.

The South China Sea is a large and strategic body of water. Exhibit 3 shows the numerous agreed boundaries negotiated between South China Sea neighboring countries since the late 1950s. It also shows the declared limits claimed by countries beginning with the 1946 Chinese claim. While there are many geopolitical implications due to these conflicting declarations, our purpose is to examine the significance of the South China Sea to China from an energy perspective.

The initial consideration is the location of possible oil and gas deposits. The Energy Information Administration (EIA), coupled with the resources of other research firms, has put together a map of the possible oil and gas deposits in the South China Sea. A number of these areas have been explored and continue to be explored and developed. Those include deposits offshore Vietnam, China, Brunei and Malaysia. If one re-examines the nine dashes encompassing the area of the South China Sea claimed by China (Exhibit 3, page 5), some resources claimed by Vietnam, Brunei and Malaysia could be claimed by China setting up tension amongst the countries. (See Exhibit 4.)

However, as the EIA shows, these resources are not truly significant in the global scheme of resource deposits. According to the EIA, the undiscovered oil resources of the South China Sea, excluding the Gulf of Thailand, Indonesia's Java, Borneo and Sumatra basins, and the Solu Sea, are slightly greater than those of Europe at roughly 10 billion barrels of oil. The South China Sea ranks seventh in all geographic regions and along with Europe represents a minor increment of the world's undiscovered oil resources.

The South China Sea ranks in the same position relative to Europe and the other regions of the world with respect to undiscovered natural gas resources.

The South China Sea has about a quarter of the estimated undiscovered natural gas of North America, a mature conventional gas resource region, but with a rapidly growing unconventional shale gas potential. At the end of the day, all the proved oil and gas reserves plus all the possible undiscovered ones still leaves the region as a bit player in the world's energy business.

If the oil and gas resource potential of the South China Sea is so limited, why does China find it must demonstrate power in the region? The need to show that as an emerging super-power and with the second largest economy on the planet, China must show strength. At the same time, China is also a significant importer of energy and raw materials, all of which are extremely important for the health of the country, its people and its government. China is targeted to surpass six million barrels per day (mmb/d) of crude oil imports during the second half of 2013. At the same time, the United States, the globe's largest oil importer, will be bringing in less than 6 mmb/d of crude sometime early in 2014, dropping the country into second place behind China on the list of the world's largest oil importers.

For China that is rapidly becoming the world's largest oil importer, protecting that flow of oil becomes a prime consideration of the government. Note in Exhibit 7 (page 8) that nearly 13 mmb/d of oil, almost 15% of total world oil consumption, flows into the Strait of Malacca near Singapore, one of the world's well-established shipping chokepoints. About 11 mmb/d of that oil flow goes beyond Singapore and Thailand and toward Hong Kong, China, South Korea and Japan, making protecting these shipping lanes imperative for the health of those economies.

An equally important energy trade is the flow of liquefied natural gas (LNG), much of which comes from Australia and Southeast Asia, but with a growing volume coming from the Middle East. LNG is likely to become an important fuel for China who has relied upon coal-fired electricity to power its economy with the attendant problem of serious pollution problems in its major cities. In 2011, China imported 12 million metric tons (mts) of LNG, equivalent to 1.5 billion cubic feet per day (Bcf/d). China was projected to import 16 million mts in 2012, or roughly 2.0 Bcf/d, and to reach Japan's 56.6 million mts of LNG consumed in 2012 by 2020. To handle that increased volume, China is planning to construct 15 new LNG receiving terminals to go along with the five already in operation. Given the North American shale revolution, the potential for LNG exports from Canada and the United States has become a real possibility. The opening of a widened Panama Canal by 2015 means LNG carriers coming out of the Gulf of Mexico will have a shorter shipping route to Asia then if they were forced to circle South America in order to reach the Pacific market. Two other developing natural gas industry trends will also impact the global flow of LNG. One is the development of the recent huge gas discoveries in East Africa. The Asian region is the target market for the natural gas recently found offshore Mozambique and Tanzania, but the energy industry is also excited about exploration opportunities in Madagascar, Kenya and Uganda, any and all of which would likely flow to Asia.

Longer term there is also the wildcard of China's gas shale potential. Estimates are that China has the world's largest shale gas resources. If it successfully develops these resources, China could rapidly shift from being an LNG importer to becoming an LNG exporter. Both situations put a premium on China being able to insure the safe passage of LNG tankers, either to terminals in China to offload cargos or to load cargos destined for world markets.

As President Barack Obama has indicated his foreign policy initiatives have pivoted toward Asia, the geopolitical tensions in the region will be elevated, not just because of what North Korea is doing. The United States has entered into upgraded trading relationships with our Asian friends, so we must demonstrate our willingness to stand by them when and if they have to confront China over its South China Sea territorial claims. At the same time, the U.S. Navy must demonstrate our strength in the region to prevent the appearance of the U.S. being perceived as a "paper tiger" by other nations in the world. Defense Department budget cuts coupled with a shrinking and aging fleet of naval vessels is hurting our ability to fulfill the many and varied missions assigned to the Navy. Any change in that course will take considerable time.

While oil and gas developments in the South China Sea will be of interest to the petroleum industry and investment community, the real story of this region is its strategic placement within the flow of energy globally and its importance in the geopolitical struggle between the two leading super-powers – the U.S. and China. With a better understanding of the true importance of the South China Sea to China's economic and political stature, one should be better able to understand the significance of actions and events likely to unfold over the next few years.

G. Allen Brooks works as the Managing Director at PPHB LP. Reprinted with permission of PPHB.

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Noble Energy Spuds Carla South Prospect Offshore West Africa

Noble Energy Inc. began drilling the I-7 exploratory well on the Carla South prospect in Block I using the Atwood Hunter (DW semisub) last week, PA Resources reported.

The Carla South prospect is on trend with the Carla North discovery recently appraised in Block O to the north of Block I, which houses the Aseng field, in Equatorial Guinea, PA Resources stated in a press release. The operator, Noble Energy, is targeting Tertiary sandstones of similar age to those in the discovery to the north. Drilling is expected to reach total depth in around 25 days with plans for a subsequent sidetrack of similar duration.

"We are very glad to have resumed exploration drilling in Block I, following an extended period focused on development of the Aseng and Alen Fields," said PA Resources' CEO Bo Askvik in a press release. "In addition it is likely that an appraisal well will be drilled in Block I later this year on the existing Diega discovery and this year's drilling program will be valuable in progressing the next field development or developments in Block I."

The Carla discovery that was made in November 2011 encountered 26 feet of oil pay in good quality upper Oligocene sands below the Alen field. It was drilled in 1,900 feet of water and reached a total depth of 11,500 feet. Noble Energy estimates between 35-100 million barrels of oil equivalent, of which 80 percent are liquids, at the Carla prospect.

Noble plans to develop the field and connect it to the producing Aseng field in Block I, or the Alen field in Block O, that is due to come onstream in late 2013.

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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South Sudan to Restart Oil Production Soon

KAMPALA, Uganda - South Sudan hopes to restart oil production "within a few days" after more than a year of closure, following a border security deal with former civil war foe Sudan, a company executive told Dow Jones Newswires Wednesday.

A Sudanese government delegation is expected in Juba, South Sudan's capital on Thursday, to prepare for the finalization of the paperwork required for the resumption of crude pumping, from the South's oil fields, through pipelines and ports that straddle the north, Paul Adong Deng, managing director of state oil company, Nile Petroleum Corp. said.

The resumption of crude production and shipments is critical for both economies, which have been struggling under the burden of a host of economic hardships.

"Once the paperwork is finalized, oil production will start immediately, the facilities are ready," Mr. Deng said, adding that production would start with a few oil fields, before gradually being extended to the country's entire oil blocks, in Upper Nile and Unity states.

The country is expected to initially start pumping around 30,000-40,000 barrels a day of crude as early as next week, before reaching a pre-independence capacity of around 350,000 barrels a day within two months, Mr. Deng added. Analysts expect the country's crude to reach global oil markets by next month.

Preparations to resume oil production have been ongoing for some time, back in early March a top official at South Sudan's national oil company also said oil exports were expected to reach the international market by May after South Sudan and Sudan signed an agreement signaling their commitment to resuming crude-oil shipments from the South through Sudanese pipelines.

Sudanese President Omar al Bashir is expected to visit Juba later this week for the first time in nearly two years, to endorse the oil deal, according to the Sudanese presidency.

Earlier this month, Sudan and South Sudan agreed to pull their troops from contested oil-rich regions along their 1,120-mile poorly marked border, to create a 12-mile demilitarized zone, a condition for the resumption of crude shipments. South Sudan separated from Sudan in July 2011 after two decades of war, retaining around 75% of the oil fields.

Last week, global economic trader, Trafigura announced that it had signed fuel supply deal with South Sudan for the supply of Dar Blend crude oil through Port Sudan.

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

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FMC Wins Contract to Supply Smorbukk South

Oilfield equipment supplier FMC Technologies reported Wednesday that it has received a $96 million order from Statoil to supply the Smørbukk South extension project in the Norwegian Sea with several subsea components.

The scope of the contract includes ubsea trees, wellheads, a manifold, control systems and other associated equipment.

Smørbukk South is part of the Åsgard development in the Norwegian Sea, and the award is the third order for FMC Technologies from the fast-track portfolio agreement announced in 2012. The equipment is scheduled for delivery in 2014.

Tore Halvorsen, FMC Technologies' senior VP for Subsea Technologies, commented in a statement:

"FMC Technologies has been providing subsea equipment for the Asgard field since 1996."

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South Sudan: 160 Killed in Border Clashes With Rebels

KAMPALA, Uganda - More than 160 people were killed this week in border battles between soldiers and rebels in South Sudan's Jonglei state, officials said on Friday.

At least 143 rebels and 20 soldiers died in several clashes since Tuesday, South Sudan military spokesman Col. Phillip Aguer told The Wall Street Journal.

South Sudan has been trying to quash a rebellion that started earlier this month so it can resume crude-oil shipments.

"Our forces dealt a severe blow to the rebels," Col. Aguer said. "We are now in control of the airstrip which these rebels have been using to get supplies."

The rebels are led by tribal war lord and defeated local-election candidate David Yau Yau. South Sudan accuses former civil war enemy Sudan of backing the insurgent. It denies this.

Landlocked South Sudan seceded from Sudan in July 2011 and retained 75% of the country's oil fields. However, South Sudan relies on pipelines running through Sudan to get its crude oil to ports.

The two disagree over the location of their border. In January last year South Sudan halted crude-oil shipments as the border disagreement escalated.

Earlier this month they agreed to resume shipments after international intervention.

Until January 2012 South Sudan shipped as much as 350,000 barrels a day to refiners in China and Malaysia.

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

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Eagle Ford Impact on South Texas to Keep Growing

Eagle Ford shale play activity in 2012 had an economic impact of $46 billion and supported over 86,000 jobs in the 14-county area in South Texas where Eagle Ford activity is more active, counties in South Texas, according to a report from UTSA's Center for Community and Business Research (CCBR).

The new study includes a 2012 update of direct, indirect and induced economic impacts by county in the 14-county and 20-county regions of the Eagle Ford shale. The report also provides a more comprehensive analysis of the economic impact in the Eagle Ford in regards to construction projects completed in 2012, crude oil transportation infrastructure, impacts on Texas Gulf Coast, impacts on Texas high education, innovations and advancements in natural gas applications, increases in county sales taxes, and pipeline construction costs.

The Eagle Ford shale's economic impact on South Texas in 2022 is estimated to grow to over $61 billion and support 89,000 jobs, according to the CCBR's latest study. The latest study released by CCBR focuses specifically on the impacts of 14 counties that are most active in the Eagle Ford play. These include Atascosa, Bee, DeWitt, Dimmit, Frio Gonzales, Karnes, La Salle, Live Oak, Maverick, McMullen, Webb, Wilson and Zavala.

Other impacts of Eagle Ford activity on the 14-county region include:

Roughly $3.3 billion in salaries and benefits paid to workersOver $800 million in local government revenuesState revenues including severance taxes are estimated at around $374 millionOver $22 billion in gross regional product (value added) impacts

However, significant activity beyond Eagle Ford exploration and drilling is occurring in six adjacent counties and are included in the analysis: Bexar, Jim Wells, Nueces, San Patricio, Uvalde and Victoria. In the larger 20-county area, Eagle Ford activity created over $61 billion in economic impact and supported 116,000 jobs last year. In 2022, the Eagle Ford's economic impact is estimated to grow to over $89 billion and support 127,000 jobs.

The Eagle Ford's impacts on the larger 20-county region in South Texas include:

$3.69 billion in payroll$28.43 billion in gross regional product (value added)$1.01 billion in total local revenues$1.24 billion estimated state revenue

Out of the top 10 industries within the Eagle Ford play in 2022, oil and gas extraction, support activities for oil and gas operations and drilling oil and gas wells will rank among the top three industries. The oil and gas extraction industry will have a total output of approximately $32 billion in 2022.

The CCBR in May 2012 released a study of the economic impact of the Eagle Ford which focused on production, drilling and related activities. In October 2012, the "Eagle Ford Shale Impact for Counties with Active Drilling" report provided a detailed image of challenges and opportunities emerging from drilling and production activities in South Texas.

CCBR also released in October of last year the report, "Workforce Analysis of the Eagle Ford Shale", which analyzed the impact of the Eagle Ford shale on the workforce of 20 South Texas counties and focused on occupational and workforce impacts including short term and long term effects on the region's workforce.

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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Eagle Ford Impact on South Texas to Keep Growing

Eagle Ford shale play activity in 2012 had an economic impact of $46 billion and supported over 86,000 jobs in the 14-county area in South Texas where Eagle Ford activity is more active, counties in South Texas, according to a report from UTSA's Center for Community and Business Research (CCBR).

The new study includes a 2012 update of direct, indirect and induced economic impacts by county in the 14-county and 20-county regions of the Eagle Ford shale. The report also provides a more comprehensive analysis of the economic impact in the Eagle Ford in regards to construction projects completed in 2012, crude oil transportation infrastructure, impacts on Texas Gulf Coast, impacts on Texas high education, innovations and advancements in natural gas applications, increases in county sales taxes, and pipeline construction costs.

The Eagle Ford shale's economic impact on South Texas in 2022 is estimated to grow to over $61 billion and support 89,000 jobs, according to the CCBR's latest study. The latest study released by CCBR focuses specifically on the impacts of 14 counties that are most active in the Eagle Ford play. These include Atascosa, Bee, DeWitt, Dimmit, Frio Gonzales, Karnes, La Salle, Live Oak, Maverick, McMullen, Webb, Wilson and Zavala.

Other impacts of Eagle Ford activity on the 14-county region include:

Roughly $3.3 billion in salaries and benefits paid to workersOver $800 million in local government revenuesState revenues including severance taxes are estimated at around $374 millionOver $22 billion in gross regional product (value added) impacts

However, significant activity beyond Eagle Ford exploration and drilling is occurring in six adjacent counties and are included in the analysis: Bexar, Jim Wells, Nueces, San Patricio, Uvalde and Victoria. In the larger 20-county area, Eagle Ford activity created over $61 billion in economic impact and supported 116,000 jobs last year. In 2022, the Eagle Ford's economic impact is estimated to grow to over $89 billion and support 127,000 jobs.

The Eagle Ford's impacts on the larger 20-county region in South Texas include:

$3.69 billion in payroll$28.43 billion in gross regional product (value added)$1.01 billion in total local revenues$1.24 billion estimated state revenue

Out of the top 10 industries within the Eagle Ford play in 2022, oil and gas extraction, support activities for oil and gas operations and drilling oil and gas wells will rank among the top three industries. The oil and gas extraction industry will have a total output of approximately $32 billion in 2022.

The CCBR in May 2012 released a study of the economic impact of the Eagle Ford which focused on production, drilling and related activities. In October 2012, the "Eagle Ford Shale Impact for Counties with Active Drilling" report provided a detailed image of challenges and opportunities emerging from drilling and production activities in South Texas.

CCBR also released in October of last year the report, "Workforce Analysis of the Eagle Ford Shale", which analyzed the impact of the Eagle Ford shale on the workforce of 20 South Texas counties and focused on occupational and workforce impacts including short term and long term effects on the region's workforce.

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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Eagle Ford Impact on South Texas to Keep Growing

Eagle Ford shale play activity in 2012 had an economic impact of $46 billion and supported over 86,000 jobs in the 14-county area in South Texas where Eagle Ford activity is more active, counties in South Texas, according to a report from UTSA's Center for Community and Business Research (CCBR).

The new study includes a 2012 update of direct, indirect and induced economic impacts by county in the 14-county and 20-county regions of the Eagle Ford shale. The report also provides a more comprehensive analysis of the economic impact in the Eagle Ford in regards to construction projects completed in 2012, crude oil transportation infrastructure, impacts on Texas Gulf Coast, impacts on Texas high education, innovations and advancements in natural gas applications, increases in county sales taxes, and pipeline construction costs.

The Eagle Ford shale's economic impact on South Texas in 2022 is estimated to grow to over $61 billion and support 89,000 jobs, according to the CCBR's latest study. The latest study released by CCBR focuses specifically on the impacts of 14 counties that are most active in the Eagle Ford play. These include Atascosa, Bee, DeWitt, Dimmit, Frio Gonzales, Karnes, La Salle, Live Oak, Maverick, McMullen, Webb, Wilson and Zavala.

Other impacts of Eagle Ford activity on the 14-county region include:

Roughly $3.3 billion in salaries and benefits paid to workersOver $800 million in local government revenuesState revenues including severance taxes are estimated at around $374 millionOver $22 billion in gross regional product (value added) impacts

However, significant activity beyond Eagle Ford exploration and drilling is occurring in six adjacent counties and are included in the analysis: Bexar, Jim Wells, Nueces, San Patricio, Uvalde and Victoria. In the larger 20-county area, Eagle Ford activity created over $61 billion in economic impact and supported 116,000 jobs last year. In 2022, the Eagle Ford's economic impact is estimated to grow to over $89 billion and support 127,000 jobs.

The Eagle Ford's impacts on the larger 20-county region in South Texas include:

$3.69 billion in payroll$28.43 billion in gross regional product (value added)$1.01 billion in total local revenues$1.24 billion estimated state revenue

Out of the top 10 industries within the Eagle Ford play in 2022, oil and gas extraction, support activities for oil and gas operations and drilling oil and gas wells will rank among the top three industries. The oil and gas extraction industry will have a total output of approximately $32 billion in 2022.

The CCBR in May 2012 released a study of the economic impact of the Eagle Ford which focused on production, drilling and related activities. In October 2012, the "Eagle Ford Shale Impact for Counties with Active Drilling" report provided a detailed image of challenges and opportunities emerging from drilling and production activities in South Texas.

CCBR also released in October of last year the report, "Workforce Analysis of the Eagle Ford Shale", which analyzed the impact of the Eagle Ford shale on the workforce of 20 South Texas counties and focused on occupational and workforce impacts including short term and long term effects on the region's workforce.

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

STEER to Guide Oil, Gas Industry Integration in South Texas

The Eagle Ford shale play has transformed the South Texas landscape since Petrohawk Energy Corp. drilled the first Eagle Ford well in 2008. The Eagle Ford was named for a small town west of Dallas where the shale is visible on the surface as clay oil, and stretches from the Mexican border to East Texas. But new applications of hydraulic fracturing and horizontal drilling have unlocked Eagle Ford shale production the South Texas region.

Oil production from the Eagle Ford shale has grown from 358 barrels of oil per day (bopd) to 338,911 bopd in 2012, and condensate production has increased from 1,423 bopd in 2009 to 72,126 bopd last year. Natural gas production also grew in the Eagle Ford from 8 million cubic feet per day (MMcf/d) to 964 MMcf/d in 2012.

The Eagle Ford's success has primarily been due to its greater productivity compared with other traditional shale plays. Oil revenues and petroleum liquids production across the play also are supporting economic development even in a time of low U.S. natural gas prices, according to a March 13 report by the Eagle Ford Shale Task Force. With 235 rigs running in the play, the Eagle Ford could potentially become the most active oil and gas play in North America, with operators forecasting exploration and production activity to continue developing in the coming decades.

The Eagle Ford boom has brought jobs and economic growth to South Texas. In 2011, the Eagle Ford supported nearly 50,000 full-time jobs in 20 counties and contributed more than $25 billion to the South Texas economy, the Eagle Ford Shale Task Force reported. Earlier this year, Wood Mackenzie reported that oil and gas companies will spend $28 billion in capital expenditures (CAPEX) this year in the Eagle Ford, and expects Eagle Ford CAPEX from 2012 to 2015 to exceed the entire $116 billion Kashagan project in Kazakhstan, the world's most expensive standalone energy project.

However, the influx of oil and gas workers to the region has also strained local infrastructure, such as roads and medical services, and raised issues such as driver safety on South Texas roads, concerns about water usage, air emissions, landowner issues and the impact of hydraulic fracturing. These challenges have highlighted the need to plan for the region's future needs, including a sustainable workforce development and a sustainable housing plan for the Eagle Ford region.

To address issues surrounding development of the Eagle Ford shale and better integrate the oil and gas industry in the South Texas region, 11 of the largest Eagle Ford shale operators have founded the South Texas Energy and Economic Roundtable (STEER), with new offices in San Antonio.

Rigzone recently interviewed Omar Garcia, who will serve as president of STEER, to learn more about the organization.

STEER President Omar Garcia Source: South Texas Energy and Economic Roundtable (STEER).

Rigzone: You have extensive experience in economic and business development in the South Texas region. Before the Eagle Ford shale, what was the business climate like in South Texas? What was the difficulty level in recruiting/retaining businesses to the area?

Garcia: During my time with the Economic Development Foundation in San Antonio and the Economic Development Corporation in Corpus Christi, business and economic growth and development were steady in the Eagle Ford region. Retention of companies wasn’t a significant challenge as the local organizations understood the potential and the benefits of the area, while recruitment numbers also remained close to national averages. However, the activity associated with the Eagle Ford Shale has propelled that growth and development to an entirely new, unprecedented level, that is booming in comparison to both the region, as it were, and most of the United States today.

That is in large part why STEER was developed -- to help support positive developments that are beneficial for the communities that have nurtured and maintained this region for decades, and to help to successfully integrate the industry into the region.

Rigzone: What do you see as the biggest challenges for South Texas and the Eagle Ford play? Obviously, getting oil and gas companies to come to the region is not an issue, but are there other businesses that need to be attracted to the region to meet the growing population?

Garcia: There are some challenges that are important to address as activity surrounding the Eagle Ford Shale continues, including the recruitment of skilled labor, availability of housing, healthcare services and infrastructure. As an organization, STEER will help to ensure those topics are addressed by encouraging dialogue, providing resources and information and acting as a conduit to bridge communities and the oil and natural gas industry.

With the growth of the Eagle Ford Shale, there is a new need in the region for the expansion and development of many novel industries to support the shale activity, which is creating tremendous economic development opportunities for local companies. Those support industries include retail, the hospitality sector, construction and, perhaps most significantly, development of medical facilities.

This ripple effect creates holistic community growth that can be sustained across various industries – an effect that is already having a hugely positive impact on the local communities who are benefiting from the new economic prospects.

Rigzone: Had there been oil and gas exploration in South Texas prior to the Eagle Ford? If so, how does this compare with the Eagle Ford shale, and how has the Eagle Ford changed the South Texas landscape?

Garcia: Historically, there has been oil and gas drilling and exploration in South Texas, but never of this magnitude. The oil and natural gas industry has become one of the most fundamental economic drivers in the region since the discovery of the Eagle Ford Shale in 2008. To put it into perspective, this shale is considered to be one of the most noteworthy oil and natural gas discoveries ever found in the state, and is currently one of the most active shale plays in the world. The Eagle Ford Shale has truly redefined South Texas, and even the domestic oil and natural gas landscape as a whole.

Rigzone: What have been some of the issues that have cropped up with the Eagle Ford shale? How has this activity impacted the local community? What about relations with the local communities and state officials?

Garcia: The challenges that South Texas faces as a result of this incredible activity relate namely to infrastructure needs and environmental considerations. Along with rapid growth and expansive development comes a need to adapt and develop infrastructure in a given area, and many communities in the region are seeing an increased need to address this growth. STEER was initiated to help recognize those challenges, and ensure that both the industry and communities are able to learn about these challenges and communicate effectively to facilitate the development of positive solutions.

In terms of environmental concerns, there is a large portion of the population, nationally, that may not understand the complexities and demands of the regulatory institutions in this region. The oil and natural gas industry is one of the most heavily regulated industries in the country, and is subject to federal, state and local regulations that oversee all aspects of the industry, from initial permitting to wastewater disposal.

STEER is connecting the oil and natural gas industry with local officials, regulatory bodies, legislature and South Texas Communities to help bridge any gaps in communication or understanding surrounding the Eagle Ford Shale in the region.

Rigzone: What has prompted the decision to establish this group now? Have other groups been established/attempted? Do you anticipate companies besides the 11 initially involved to join anytime soon?

Garcia: STEER was established by 11 of the largest operators in the Eagle Ford Shale region including: Anadarko, Chesapeake Energy Corporation, ConocoPhillips, EOG Resources, Lewis Energy Group, Marathon Oil, Murphy Oil, Pioneer Natural Resources, Shell, Statoil and Talisman Energy.

The operators saw a need in South Texas to maintain a cohesive and collaborative stakeholder relations effort throughout the Eagle Ford Shale and developed STEER to lead that initiative.

There are truly no other groups like STEER; we are the first regional oil and natural gas trade association that is specifically focused on South Texas.

STEER does have an established membership program we do anticipate other organizations becoming involved with STEER in the future and growing our membership base.

Rigzone: What kind of communication pathways were being used by oil and gas companies to state officials and local communities? Why do you think these were not effective?

Garcia: Prior to the development of STEER, the individual member companies did a great job communicating with officials, communities, academia and beyond. STEER was founded to be an interconnected and collective resource for the region as related to the Eagle Ford shale. The purpose of STEER is to serve as channel for both intra-organizational communication, to ensure that operators are sharing information and resources with one another for the betterment and enhancement of the communities and the industry, and also to be a resource for external communication – to be the recipient and facilitator for questions, inquiries and information.

Rigzone: What kind of strategies will you employ to address the challenges of infrastructure?

Garcia: STEER is committed to staying informed and educated about all challenges and issues as they relate to the Eagle Ford Shale, including infrastructure. With that, we will continue to act as a resource to help the industry and the communities to understand these challenges in order to make positive solutions for the region. STEER’s purpose is to gather and share resources and information in order to help inform stakeholders about challenges.

Rigzone: Some international companies have acquired interests in the Eagle Ford shale. What kind of challenges come with having international companies in the region?

Garcia: We welcome the international investment and attention that the Eagle Ford Shale has helped bring to Texas. These companies are working toward developing a comprehensive understanding of the region and the industry, and STEER is here to help serve as the conduit between these companies, industry and the communities of South Texas.

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

STEER to Guide Oil, Gas Industry Integration in South Texas

The Eagle Ford shale play has transformed the South Texas landscape since Petrohawk Energy Corp. drilled the first Eagle Ford well in 2008. The Eagle Ford was named for a small town west of Dallas where the shale is visible on the surface as clay oil, and stretches from the Mexican border to East Texas. But new applications of hydraulic fracturing and horizontal drilling have unlocked Eagle Ford shale production the South Texas region.

Oil production from the Eagle Ford shale has grown from 358 barrels of oil per day (bopd) to 338,911 bopd in 2012, and condensate production has increased from 1,423 bopd in 2009 to 72,126 bopd last year. Natural gas production also grew in the Eagle Ford from 8 million cubic feet per day (MMcf/d) to 964 MMcf/d in 2012.

The Eagle Ford's success has primarily been due to its greater productivity compared with other traditional shale plays. Oil revenues and petroleum liquids production across the play also are supporting economic development even in a time of low U.S. natural gas prices, according to a March 13 report by the Eagle Ford Shale Task Force. With 235 rigs running in the play, the Eagle Ford could potentially become the most active oil and gas play in North America, with operators forecasting exploration and production activity to continue developing in the coming decades.

The Eagle Ford boom has brought jobs and economic growth to South Texas. In 2011, the Eagle Ford supported nearly 50,000 full-time jobs in 20 counties and contributed more than $25 billion to the South Texas economy, the Eagle Ford Shale Task Force reported. Earlier this year, Wood Mackenzie reported that oil and gas companies will spend $28 billion in capital expenditures (CAPEX) this year in the Eagle Ford, and expects Eagle Ford CAPEX from 2012 to 2015 to exceed the entire $116 billion Kashagan project in Kazakhstan, the world's most expensive standalone energy project.

However, the influx of oil and gas workers to the region has also strained local infrastructure, such as roads and medical services, and raised issues such as driver safety on South Texas roads, concerns about water usage, air emissions, landowner issues and the impact of hydraulic fracturing. These challenges have highlighted the need to plan for the region's future needs, including a sustainable workforce development and a sustainable housing plan for the Eagle Ford region.

To address issues surrounding development of the Eagle Ford shale and better integrate the oil and gas industry in the South Texas region, 11 of the largest Eagle Ford shale operators have founded the South Texas Energy and Economic Roundtable (STEER), with new offices in San Antonio.

Rigzone recently interviewed Omar Garcia, who will serve as president of STEER, to learn more about the organization.

STEER President Omar Garcia Source: South Texas Energy and Economic Roundtable (STEER).

Rigzone: You have extensive experience in economic and business development in the South Texas region. Before the Eagle Ford shale, what was the business climate like in South Texas? What was the difficulty level in recruiting/retaining businesses to the area?

Garcia: During my time with the Economic Development Foundation in San Antonio and the Economic Development Corporation in Corpus Christi, business and economic growth and development were steady in the Eagle Ford region. Retention of companies wasn’t a significant challenge as the local organizations understood the potential and the benefits of the area, while recruitment numbers also remained close to national averages. However, the activity associated with the Eagle Ford Shale has propelled that growth and development to an entirely new, unprecedented level, that is booming in comparison to both the region, as it were, and most of the United States today.

That is in large part why STEER was developed -- to help support positive developments that are beneficial for the communities that have nurtured and maintained this region for decades, and to help to successfully integrate the industry into the region.

Rigzone: What do you see as the biggest challenges for South Texas and the Eagle Ford play? Obviously, getting oil and gas companies to come to the region is not an issue, but are there other businesses that need to be attracted to the region to meet the growing population?

Garcia: There are some challenges that are important to address as activity surrounding the Eagle Ford Shale continues, including the recruitment of skilled labor, availability of housing, healthcare services and infrastructure. As an organization, STEER will help to ensure those topics are addressed by encouraging dialogue, providing resources and information and acting as a conduit to bridge communities and the oil and natural gas industry.

With the growth of the Eagle Ford Shale, there is a new need in the region for the expansion and development of many novel industries to support the shale activity, which is creating tremendous economic development opportunities for local companies. Those support industries include retail, the hospitality sector, construction and, perhaps most significantly, development of medical facilities.

This ripple effect creates holistic community growth that can be sustained across various industries – an effect that is already having a hugely positive impact on the local communities who are benefiting from the new economic prospects.

Rigzone: Had there been oil and gas exploration in South Texas prior to the Eagle Ford? If so, how does this compare with the Eagle Ford shale, and how has the Eagle Ford changed the South Texas landscape?

Garcia: Historically, there has been oil and gas drilling and exploration in South Texas, but never of this magnitude. The oil and natural gas industry has become one of the most fundamental economic drivers in the region since the discovery of the Eagle Ford Shale in 2008. To put it into perspective, this shale is considered to be one of the most noteworthy oil and natural gas discoveries ever found in the state, and is currently one of the most active shale plays in the world. The Eagle Ford Shale has truly redefined South Texas, and even the domestic oil and natural gas landscape as a whole.

Rigzone: What have been some of the issues that have cropped up with the Eagle Ford shale? How has this activity impacted the local community? What about relations with the local communities and state officials?

Garcia: The challenges that South Texas faces as a result of this incredible activity relate namely to infrastructure needs and environmental considerations. Along with rapid growth and expansive development comes a need to adapt and develop infrastructure in a given area, and many communities in the region are seeing an increased need to address this growth. STEER was initiated to help recognize those challenges, and ensure that both the industry and communities are able to learn about these challenges and communicate effectively to facilitate the development of positive solutions.

In terms of environmental concerns, there is a large portion of the population, nationally, that may not understand the complexities and demands of the regulatory institutions in this region. The oil and natural gas industry is one of the most heavily regulated industries in the country, and is subject to federal, state and local regulations that oversee all aspects of the industry, from initial permitting to wastewater disposal.

STEER is connecting the oil and natural gas industry with local officials, regulatory bodies, legislature and South Texas Communities to help bridge any gaps in communication or understanding surrounding the Eagle Ford Shale in the region.

Rigzone: What has prompted the decision to establish this group now? Have other groups been established/attempted? Do you anticipate companies besides the 11 initially involved to join anytime soon?

Garcia: STEER was established by 11 of the largest operators in the Eagle Ford Shale region including: Anadarko, Chesapeake Energy Corporation, ConocoPhillips, EOG Resources, Lewis Energy Group, Marathon Oil, Murphy Oil, Pioneer Natural Resources, Shell, Statoil and Talisman Energy.

The operators saw a need in South Texas to maintain a cohesive and collaborative stakeholder relations effort throughout the Eagle Ford Shale and developed STEER to lead that initiative.

There are truly no other groups like STEER; we are the first regional oil and natural gas trade association that is specifically focused on South Texas.

STEER does have an established membership program we do anticipate other organizations becoming involved with STEER in the future and growing our membership base.

Rigzone: What kind of communication pathways were being used by oil and gas companies to state officials and local communities? Why do you think these were not effective?

Garcia: Prior to the development of STEER, the individual member companies did a great job communicating with officials, communities, academia and beyond. STEER was founded to be an interconnected and collective resource for the region as related to the Eagle Ford shale. The purpose of STEER is to serve as channel for both intra-organizational communication, to ensure that operators are sharing information and resources with one another for the betterment and enhancement of the communities and the industry, and also to be a resource for external communication – to be the recipient and facilitator for questions, inquiries and information.

Rigzone: What kind of strategies will you employ to address the challenges of infrastructure?

Garcia: STEER is committed to staying informed and educated about all challenges and issues as they relate to the Eagle Ford Shale, including infrastructure. With that, we will continue to act as a resource to help the industry and the communities to understand these challenges in order to make positive solutions for the region. STEER’s purpose is to gather and share resources and information in order to help inform stakeholders about challenges.

Rigzone: Some international companies have acquired interests in the Eagle Ford shale. What kind of challenges come with having international companies in the region?

Garcia: We welcome the international investment and attention that the Eagle Ford Shale has helped bring to Texas. These companies are working toward developing a comprehensive understanding of the region and the industry, and STEER is here to help serve as the conduit between these companies, industry and the communities of South Texas.

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

Statoil Gives Go-Ahead to Smorbukk South Extension Project

Statoil reported Wednesday that, along with its partners, it has decided to go ahead with the Smørbukk South Extension project on the Åsgard development, offshore Norway.

The extension holds estimated recoverable reserves of 16.5 million barrels of oil equivalent and will be developed with a new subsea template that will be connected to existing infrastructure in the area.

Recovered gas will be re-injected into the reservoir in order to maintain pressure as oil is drained out of it. The field will be connected to the Åsgard A FPSO installation.

Astrid Helga Jørgenvåg, Statoil's asset owner for Åsgard, commented in a company statement:

"We've matured a profitable project out of a discovery from 1985. Experience from Åsgard operations, existing infrastructure and a bit of patience have contributed to an investment decision for this project.

"In addition we will consider the use of a new well technology that will increase the recovery from this type of reservoir. Smørbukk South Extension is a strategically important project that emphasizes our ambitions to increase recovery from mature areas."

The extension project will use standard equipment, and Statoil has already made investments to minimize the time from project sanction to production start-up, the firm said.

Statoil will now award several contracts for the development, it added.

Drilling operations are planned to begin in early 2015, with production start-up planned for September 2015. Total investments for the project are estimated to be around $595 million.

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

View the original article here

Statoil Gives Go-Ahead to Smorbukk South Extension Project

Statoil reported Wednesday that, along with its partners, it has decided to go ahead with the Smørbukk South Extension project on the Åsgard development, offshore Norway.

The extension holds estimated recoverable reserves of 16.5 million barrels of oil equivalent and will be developed with a new subsea template that will be connected to existing infrastructure in the area.

Recovered gas will be re-injected into the reservoir in order to maintain pressure as oil is drained out of it. The field will be connected to the Åsgard A FPSO installation.

Astrid Helga Jørgenvåg, Statoil's asset owner for Åsgard, commented in a company statement:

"We've matured a profitable project out of a discovery from 1985. Experience from Åsgard operations, existing infrastructure and a bit of patience have contributed to an investment decision for this project.

"In addition we will consider the use of a new well technology that will increase the recovery from this type of reservoir. Smørbukk South Extension is a strategically important project that emphasizes our ambitions to increase recovery from mature areas."

The extension project will use standard equipment, and Statoil has already made investments to minimize the time from project sanction to production start-up, the firm said.

Statoil will now award several contracts for the development, it added.

Drilling operations are planned to begin in early 2015, with production start-up planned for September 2015. Total investments for the project are estimated to be around $595 million.

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

View the original article here

Statoil Gives Go-Ahead to Smorbukk South Extension Project

Statoil reported Wednesday that, along with its partners, it has decided to go ahead with the Smørbukk South Extension project on the Åsgard development, offshore Norway.

The extension holds estimated recoverable reserves of 16.5 million barrels of oil equivalent and will be developed with a new subsea template that will be connected to existing infrastructure in the area.

Recovered gas will be re-injected into the reservoir in order to maintain pressure as oil is drained out of it. The field will be connected to the Åsgard A FPSO installation.

Astrid Helga Jørgenvåg, Statoil's asset owner for Åsgard, commented in a company statement:

"We've matured a profitable project out of a discovery from 1985. Experience from Åsgard operations, existing infrastructure and a bit of patience have contributed to an investment decision for this project.

"In addition we will consider the use of a new well technology that will increase the recovery from this type of reservoir. Smørbukk South Extension is a strategically important project that emphasizes our ambitions to increase recovery from mature areas."

The extension project will use standard equipment, and Statoil has already made investments to minimize the time from project sanction to production start-up, the firm said.

Statoil will now award several contracts for the development, it added.

Drilling operations are planned to begin in early 2015, with production start-up planned for September 2015. Total investments for the project are estimated to be around $595 million.

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

South Sudan Orders Resumption of Crude-Oil Production

LONDON - The government of South Sudan has ordered the resumption of crude-oil production, days after the country and its neighbor, Sudan, came to an agreement over their disputed border.

In an official document, South Sudan's minister of petroleum and mining, Stephen Dhieu Dau, said, "Foreign oil companies and pipeline operators operating in the [Republic of South Sudan] are hereby ordered and instructed...to recommence and re-establish the production of crude oil."

South Sudan ceded from Sudan in July 2011, taking with it most of the region's oil fields. This week's deal will unlock some 350,000 barrels a day that have been shut-in since January 2012 amid a bitter spat with Sudan over oil transit fees and contested oil-rich regions along the poorly marked 1,120-mile border.

A top official in South Sudan's national oil company told Dow Jones on Wednesday that oil exports were expected to reach the international market by May.

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