Centrica, Qatar Petroleum to Buy Suncor Gas, Oil Assets

LONDON - U.K.-based energy firm Centrica PLC and state-owned Qatar Petroleum International said Monday they have reached an agreement with Suncor Energy Inc. to acquire a vast chunk of its natural gas and crude oil business in Canada for $1 billion Canadian dollars (US$0.986 billion), marking the first investment the two companies have made together since signing an agreement to explore such purchases two years ago.

The deal is in line with Centrica's quest to become a more self-sufficient retail energy provider in North America where it owns the retail business Direct Energy, and marks its first big purchase after announcing two months ago that it would no longer invest in a new U.K. nuclear power plant, thus freeing up cash to invest elsewhere in its business.

For QPI, the international arm of Qatar Petroleum, the deal represents an attempt to diversify its business, which is heavily concentrated in oil and gas production in the Persian Gulf.

The assets will be jointly held by Centrica and QPI in a joint venture that will own be 60% owned by Centrica and 40% owned by QPI, with Centrica acting as the operator. The transaction is expected to close in the third quarter of 2013, subject to regulatory approval.

The assets are located in the Canadian regions of Alberta, northeastern British Columbia and southern Saskatchewan.

The business is forecast to produce about 250 million cubic feet of natural gas equivalent a day in 2013 or 15 million barrels of oil equivalent a year, and has proven and probable reserves of 978 billion cubic feet equivalent of natural gas of which 10% is crude oil.

"Growing our upstream gas operations is an important step to ensuring the company is a solid long-term partner to millions of residential and business customers across North America," said Wes Morningstar, senior vice president at Centrica in Calgary.

Once the transaction is closed, Centrica will be able to cover about 60% of its unregulated daily gas requirements from its growing North American Direct Energy retail energy business.

Nasser Al-Jaidah, chief executive officer of QPI, said the deal "is a significant step in the development of QPI's global upstream business. We look forward to continuing to advance QP's overall North American energy business."

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

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Aker Wins Solan Field Contract

Aker Solutions reported Thursday that UK independent Premier Oil has awarded it a $46-million contract to provide hook-up, commissioning and facility management services to Premier Oil at its Solan field development, west of Shetland. The contract is valid for three years from first oil, with two one-year extension options.

Aker said the hook-up project will see two subsea production and two subsea injection wells tied back to a fixed production platform located in Block 205/26a of the UK North Sea, the first of its kind west of Shetland. The platform, which will not be permanently manned, will produce oil that will be stored in a subsea tank before being exported via an oil-offloading system to shuttle tankers.

Aker said that work on the project will be led from its Aberdeen facility.

 Mike Forbes, Aker's managing director for its maintenance, modifications and operations business, commented in a statement:

"I am pleased that we are continuing to develop our relationship with Premier Oil and their joint venture partner on this significant project in a challenging and increasingly important sector of the North Sea.

"Having worked with Premier Oil and Chrysaor on the project since 2010 and played a supporting role in the sanction of this development and the technology behind it, we look forward to embarking on the next stage of Solan's evolution."

The UK's Department of Energy and Climate Change approved Premier's plans for the Solan oil field in April 2012. Once brought online, Solan is expected to produce 40 million barrels of oil at an initial rate of 24,000 barrels per day.

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ConocoPhillips Suspends 2014 Alaska Drilling Plans

ConocoPhillips will place on hold its 2014 drilling plans for Alaska's Chukchi Sea due to the uncertainties of evolving federal regulatory requirements and operational permitting standards.

While the company is confident in its expertise and ability to safely conduct offshore Arctic operations, ConocoPhillips believes it needs more time to ensure that all regulatory stakeholders are aligned, said ConocoPhillips Alaska President Trond-Erik Johansen in a statement.

"We welcome the opportunity to work with the federal government and other leaseholders to further define and clarify the requirements for drilling offshore Alaska," Johansen commented. "Once those requirements are understood, we will reevaluate our Chukchi Sea drilling plans. We believe this is a reasonable and responsible approach given the huge investments required to operate offshore in the Arctic."

ConocoPhillips in 1998 was awarded 98 exploration lease tracts in the Chukchi Sea Outer Continental Shelf. The company is Alaska's largest oil producer and is operator of the Kuparuk and Alpine fields. ConocoPhillips' leases will expire in 2019. As of year-end 2012, the company had invested $650 million net in its Chukchi Sea operations, including leases, seismic, biological studies and well planning, a ConocoPhillips spokesperson told Rigzone in an email.

Royal Dutch Shell plc in February suspended its 2014 offshore Alaska drilling plans, saying it needed more time to ensure the readiness of its equipment and employees for future drilling.

Last month, the U.S. Department of the Interior (DOI) concluded that Shell failed to finalize key components of its 2012 Alaska Arctic drilling program. DOI called on the industry and government to collaborate to develop an Arctic-specific model for offshore Alaska oil and gas exploration.

DOI Secretary Ken Salazar said the agency would proceed with ConocoPhillips using the same regime it did with Shell. While the Obama administration is interested in pursuing Arctic resources, Salazar said they wouldn't allow shortcuts in terms of requirements, and that exploration would only be carried out with the "utmost safety."

Greenpeace International called decisions by ConocoPhillips and Norway-based Statoil ASA to shelve Arctic drilling plans on admission that the oil industry is still not capable of meeting the enormous challenges posed by operating in the world's most extreme environment.

"The time has come for governments around the world to call for a permanent halt to the reckless exploitation of the far north," said Greenpeace International Arctic campaigner Ben Wycliffe in a statement.

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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Saudi Aramco's Manifa Oil Field On Stream Ahead of Schedule

State-oil giant Saudi Arabian Oil Co., known as Saudi Aramco, said Monday it has started production at its vast Manifa oil field three months ahead of schedule.

Output at Manifa is expected to reach 500,000 barrels a day in July, which will gradually increase to 900,000 barrels a day by the end of 2014, Aramco said in an emailed statement.

Aramco has previously said that the field will have an initial capacity of 500,000 barrels a day of crude in the first half of 2013.

Crude from Manifa will feed refineries in the kingdom that are currently under construction. One is being built under a joint venture with France's Total SA and another with China's Sinopec.

Saudi Aramco, fully owned by the Kingdom of Saudi Arabia, is one of the largest oil and gas companies in the world, with activities in exploration, production, refining, distribution, shipping and marketing.

It plans to invest $35 billion over the next five years in crude oil exploration and development in a bid to keep its oil production portfolio robust, Chief Executive Khalid al-Falih has said.

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Union Drilling to Present at Stephens Fall Investment Conference

Posted on Friday, November 4th, 2011 at 11:20 pm

FORT WORTH, Texas, Nov. 8, 2011 /PRNewswire/ — Union Drilling, Inc. (NASDAQ: UDRL) announced today that Chris Strong, President and Chief Executive Officer, will participate in the Stephens Fall Investment Conference, which will be held in New York on November 15-16, 2011.

Union Drilling’s presentation at the conference will be webcast live on Tuesday, November 15, 2011 at 10:00 a.m. Eastern time. To listen to the live audio webcast and view accompanying presentation material, visit the Investor Relations section of Union Drilling’s website at www.uniondrilling.com. A replay of the webcast will be archived on the site shortly after the presentation concludes.

About Union Drilling

Union Drilling, Inc., headquartered in Fort Worth, Texas, provides contract land drilling services and equipment to oil and natural gas producers in the United States. Union Drilling currently owns and markets 51 rigs and specializes in unconventional drilling techniques.

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Opening: Motorman

Posted on Tuesday, October 11th, 2011 at 6:18 pm

Responsible for working board during tripping operations; mixes chemicals and oversees pit and mud pump operations. Must be able to perform all duties needed to rig-up, drill, rig-down and maintain rotary equipment.

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Potential Gas Discovery at North Kendang-1

South East Asia-focused Salamander Energy reported Thursday that it has suspended its North Kendang-1 exploration well, offshore Indonesia, as a potential gas discovery.

The NK-1 well – located in the South East Sangatta production sharing contract – was spud by the Ocean General (mid-water semisub) rig on February 10. So far, the well has been drilled to approximately 8,318 feet.

Salamander said the well drilled through a predominantly shale-prone section throughout the Pliocene and – on reaching the first Upper Miocene reservoir target at 8,310 feet – the well took "a significant kick from an influx of high pressure hydrocarbon gas" into the well bore at a wellhead pressure of around 4,000 pounds per square inch.

As a result of encountering high pressure gas, the well experienced what Salamander described as operational challenges that ultimately led to its suspension before evaluating the reservoir section. The gas has been sampled and is being analyzed with initial results pointing to a wet gas, while pressure data indicate a potentially significant column height.

Salamander is reviewing the option to return to NK-1 as part of the current drilling campaign, in order to drill ahead and evaluate the Upper Miocene section.

Salamander Chief Executive John Menzies commented in a statement:

"Finding wet gas at North Kendang is highly encouraging for continued exploration in the North Kutei basin, though further drilling will be required to determine reservoir quality and a range of hydrocarbon volumes. As the well results are integrated into the geological model and technical evaluation continues, we will drill the Bedug prospect with a view to returning to North Kendang thereafter."

Salamander said the Ocean General rig is now being mobilized to the Bontang PSC to drill the Bedug-1 exploration well, the third well in the firm's multi-well program in the North Kutei basin.

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