Houston: Oil, Gas Boomtown

Houston, Texas' energy industry is flourishing, making the job market for today and tomorrow very robust, remarked Huw Rothwell, executive director of Michael Page International at the American Petroleum Institute's (API) Houston chapter luncheon Tuesday. Michael Page is a global publically traded professional and executive recruitment consultancy with more than 5,000 employees worldwide.

"The oil and gas industry in Houston is in very good condition, adding about 102,000 jobs in the last three years," he said.

The driving economic growth is attributed to:

high oil prices - levels that encourage investmentinnovative technology - hydraulic fracturing, deep waterincreased domestic productioninvestments made to new infrastructure

Overall, Texas is witnessing an increase in employment in the oil and gas industry. Last week, the Texas Independent Producers and Royalty Owners (TIPRO) published the "State of Energy" report focusing on quarterly Bureau of Labor census data. Oil and gas industry employment in the state increased from 65,000 to 971,000 in 2012, according to TIPRO.

The industry itself has witnessed growth in the United States over the past five years, which has mainly been driven by increased domestic production from shale, said Sandy Fielden in her report "We Should be Heroes! – The Economic Bounty of Shale Oil & Gas".

In 2012, 65,000 new jobs were created in the nation's industry, including 36,000 new jobs in operations and support activities, 12,750 jobs in crude oil and gas extraction and nearly 8,000 jobs in oil and gas field machinery and equipment, according to the TIPRO report. These numbers are then broken down state by state with Texas ranking as the biggest oil and gas employer, adding more than 380,000 new jobs in 2012. Louisiana ranked second at 81,400, followed by Oklahoma (74,600), California (46,400), and Pennsylvania (34,900). 

With Texas ranking number one on the employment list, Houston is also ranked at the top as far as employment and people relocating to the city.

"The number of mid-to-large companies relocating to the city in 2011 was 195," stated Rothwell. "People see Houston as the real hub and investments in and around Houston are apparent."

Fifteen major buildings were completed in the first three quarters of last year, and currently, 3.9 million square feet of office space is under construction. Exxon Mobil Corp. is building a new complex on 385 acres near the Woodlands, a suburb north of downtown Houston. It is estimated the company will bring 10,000 jobs to the Woodlands in 2014. Additionally, ExxonMobil businesses in Virginia and Ohio and a refinery in southeast Houston are also relocating to the new campus.

With the booming job market and companies moving to Houston, the city is expected to see an increase in people relocating, making it the fastest growing major metropolitan area in the country, according to a Comerica Regional Economic report.

Job creation in the Houston-Sugar Land area increased 3.7 percent through October 2012, compared to the same time period in 2011. The area's average job creation outpaced the nation's 1.5 percent average increase through October 2012, according to the Comerica Regional Economic report. Furthermore, the report predicts that the unemployment rate will slip to 6.8 percent in 2013 and 6.4 percent in 2014.

"We anticipate that this boom will continue for the next five to 10 years, with Houston remaining a buoyant candidate-driven market," stated Rothwell. 

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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WPX's Niobrara Well Hits Output Milestone

WPX Energy announced Monday that its Niobrara Shale discovery well in the Piceance Basin exceeded 1 billion cubic feet of natural gas production in just over 100 days of operation.

At this rate, WPX expects the Niobrara well to produce in its first four months what a typical well in the Piceance Basin's Williams Fork formation produces over its estimated lifecycle of 25 to 30 years.

The Niobrara well is located on WPX's acreage in Western Colorado, where the company has the lease rights to approximately 180,000 net acres of the Niobrara/Mancos shale play.

The discovery well initially produced 16 million cubic feet per day at a flowing pressure of 7,300 pounds per square inch. It registered an average production rate of almost 10 million cubic feet per day over its first 90 days, despite being choked back substantially.

"We're very pleased with what we're seeing," said Ralph A. Hill, WPX's president and chief executive officer. "This well is demonstrating tremendous strength. It's a large discovery that has significant upside potential for creating shareholder value."

Over time, WPX believes that its Niobrara discovery has the potential to more than double the company's proved, probable and possible (3P) reserves, which were approximately 18 trillion cubic feet at year-end 2012.

WPX started drilling its second Niobrara well Wednesday, April 3. The company expects to begin completion activities in June.

As previously announced, WPX plans to drill a total of four horizontal Niobrara wells in 2013. The drilling plan is designed to prove up adjacent acreage and test the repeatability of the play on additional acreage the company owns.

WPX already has extensive processing and takeaway capacity under contract in the Piceance to support Niobrara production.

The Niobrara and Mancos shales are generally located at depths of 10,000 to 13,000 feet. The Williams Fork is a shallower formation, generally located at depths of 6,000 to 9,000 feet. In the Piceance Basin, WPX holds an average working interest of 66 percent in the Niobrara and Mancos shales.

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Huntington Field Starts Production

Premier Oil announced Monday that oil production has begun at the Huntington field in the UK zone of the central North Sea. After an initial ramp-up period, the field is expected to produce between 23,000 and 25,000 barrels of oil equivalent per day.

Premier holds a 40-percent interest in the field, while its operator, E.ON Exploration and Production holds 25 percent. Noreco and Iona Energy have 20 percent and 15 percent stakes respectively in Huntington.

Premier CEO Simon Lockett commented in a company statement:

"We are delighted to have achieved first oil from the Huntington oil field. This marks the first of four UK North Sea projects from our development portfolio which will come on-stream over the next few years.  We look forward to the field making a significant contribution to our worldwide production and cash flow growth."

The Huntington development is using the Voyageur Spirit FPSO vessel, a six-well subsea drilling template and a 7-mile gas export pipeline that is connected to the BP CATS transportation system.

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Swire Strengthens East African Presence with New Manager

Swire Oilfield Services, the leading global supplier of cargo carrying solutions, modular systems, offshore aviation services and fluid management, is strengthening its newly established presence in Kenya, East Africa with the appointment of Dan Davies as the new commercial manager. Dan will be responsible for the commercial activity across East Africa and further developing business in Kenya, Tanzania, Uganda, Madagascar and the wider East African region.

The opening of an office in Kenya and the appointment of Dan comes as part of an overall growth strategy for Swire Oilfield Services in East Africa. The company is investing approximately $16 million (£10.5 million) in its rental fleet and infrastructure in the African Continent this year demonstrating its commitment to a region that provides an increasingly optimistic outlook created by a number of onshore and offshore discoveries.

Wayne Manning, general manager & director of Swire Oilfield Services Sub-Saharan Africa, said: "The East coast of Africa is one of the most exciting exploration areas in the region and bringing Dan onto the team will enhance Swire Oilfield Services offering. We have identified a growing demand for our quality equipment and services as a result of exploration inland on the great lakes and in remote and challenging locations.

"Activity both on and offshore is continuously growing. Oil and gas majors have recognised that the region is a hotspot frontier for reserves, with significant onshore discoveries in Uganda and Kenya by Tullow Oil and Total E&P as well as offshore oil and gas discoveries made in Kenya and Tanzania by BG Group Plc, Statoil and Anadarko Petroleum Corporation."

Swire Oilfield Services first began operations in Africa more than 10 years ago and now employs over 120 staff with recognition as the largest supplier of rental units across its other offices in Nigeria, Angola and Ghana. The organisation offers the highest specification, DNV 2.7-1 and EN 12079, across all of its certified reliably dynamic equipment including cargo carrying units, modular systems, fluid management and aviation services.

Globally, Swire Oilfield Services has in excess of 150 standard unit designs and has increased its fleet size by approximately 67 percent in the last six years from 34,000 to 57,000 cargo carrying units.

Copyright 2013 Universal Solutions S.A.E. Provided by Syndigate.info, an Albawaba.com company. All Rights Reserved.

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Wintershall Spuds Mjosa Well

Anglo-Norwegian junior Bridge Energy reported Monday the spudding of the Mjøsa exploration well on production license 511 in the Norwegian Sea.

Operated by Wintershall, exploration well 6406/6-3 is located around six miles northeast of the Linnorm discovery in the Haltenbanken area of the Norwegian Sea. It is targeting Lower and Middle Jurassic reservoirs.

Bridge – which has a 7.5 percent stake in the license – said the estimated un-risked mean potential of Mjøsa attributed to the company is 14 million barrels of oil equivalent.

Other parties involved in the well include: Wintershall, with 25 percent; Maersk, also with 25 percent; Petoro, with 20 percent; VNG, with 12.5 percent; and Tullow, which has a 10-percent stake.

The well is being drilled by the Transocean Arctic (mid-water semisub) rig.

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Regal Updates on Ukrainian Reserves

Regal Petroleum issued an update Monday on its reserves and resources in its onshore Ukrainian gas and condensate fields.

Regal reported that remaining reserves as of Dec. 31 2012 in the Visean reservoirs of its Mekhediviska-Golotvshinska (MEX-GOL) and Svyrydivske (SV) gas and condensate fields stood at 7.7 million barrels of oil equivalent of proved (1P) reserves, 31.6 MMboe of proved and probable (2P) reserves and 52.6 million barrels of proved, probable and possible (3P) reserves.

Contingent resources at the reservoirs were estimated at between 36.6 MMboe (1C) and 148.8 MMboe (3C).

Regal noted that there has been a "material reduction" in 1P and 2P reserves compared to estimates made in 2010 that showed them to be 40.9 MMboe and 151.3 MMboe respectively. The firm said that these reductions reflect lower expected recovery factors. However, it said that further development of the fields may result in future movement of contingent resources into reserves.

Regal said that independent petroleum consultants ERC Equipoise carried out the assessment for the remaining reserves and contingent resources.

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Egypt Says It Will Invest To Raise Oil Output

DUBAI - Cash-strapped Egypt will spend $18 billion over coming years to build new refineries and modify existing plants in a move to increase its annual fuel output, the country's oil minister said in an interview with Al Tahrir Television.

"There are some urgent measures to be taken this fiscal year to operate some refineries safely ... and there are measures in the next couple of years to lift the output of the existing refineries from the current 25-26 metric tons a year to more than 30 million tons," Osama Kamal told the Egyptian channel.

Overall "we have decided in November to invest $18 billion until 2017 to build new refineries and upgrade the existing refineries we have," he said.

Egypt has been paying hefty premiums for its crude deliveries for its refineries due to a weaker pound and difficulties in securing letters of credit for its transactions, while a shortage of state-subsided diesel has paralyzed transportation in many parts of the country.

Continuing unrest in the country since the ousting of former President Hosni Mubarak has led to a risky economic mix of dwindling foreign-exchange reserves, declining tourism revenue and costly price subsidies, economists said. To prop up the Egyptian currency, the central bank has gone through nearly two-thirds of its foreign-currency reserves, pushing the country to the brink of a liquidity crisis.

Egypt is trying to secure a $4.8 billion loan from the International Monetary Fund, a move viewed as critical to rescuing its economy and mending its reputation as a place to do business.

The IMF wants Egypt to reduce its subsidy spending, as part of a reform plan for the loan, say those close to the talks. But any subsidy changes would likely only enrage the legions of poor who rely on cheap fuel.

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

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