2H Offshore, an Acteon company, has been awarded a contract by Statoil for tieback conductor, platform conductor and surface riser engineering analysis on the Johan Sverdrup field in the Norwegian sector of the North Sea. 2H had already conducted engineering studies for Statoil to support wellhead specification on the Johan Sverdrup development.

The field extends over 200 km2 on the Utsira High, in a water depth of 110 - 120 m. It is one of the largest oilfields on the Norwegian continental shelf, and is expected to come onstream in late 2019. Phase 1 of the development consists of four bridge-linked platforms, as well as three subsea water injection templates.

Alex Rimmer, director, 2H, said, "We are delighted to be working closely with Statoil on the significant Johan Sverdrup development. This award enhances 2H's extensive experience in Norway, cementing our position as the leading contractor specialising in the design and analysis of riser and conductor systems for the Norwegian sector of the North Sea. We look forward to successfully delivering this study and further growing our reputation within Norway."

Harkand has secured a USD 5 million contract in Mexico to perform saturation diving services in support of an offshore pipeline project for offshore construction company Swiber Offshore Mexico S.A de C.V.

The global subsea inspection, repair, maintenance, and light construction company has recently finalized a joint venture with Arena Servicios de Mexico, a local Mexican company involved in infrastructure projects as their exclusive vehicle to deliver services in Mexico.

Harkand Arena will complete a wide ranging scope of work, including the installation of risers and expansion spools to the Ayatsil Field located in the waters of Campeche Sound. This project will be performed utilizing a portable saturation diving system to be provided by Harkand onboard the client's vessel. The project includes an option to utilize Harkand's DSV Swordfish.

All onshore support including the project management and engineering will be performed by Harkand Arena personnel from Harkand's new office in Ciudad del Carmen, Mexico.

Eduardo Borja, Arena's Director said, "We have worked diligently over the past 10 years as owner's representative for large infrastructure projects. Our interest in expanding into offshore projects brought us to Harkand, a company with a clear direction of becoming the leading IRM and light construction contractor. Harkand has the assets and more importantly the people with the knowledge, experience and reputation of providing innovative and cost-effective solutions to the complex projects this industry brings to the table."

Managing director for Harkand North America and Africa, AJ Jain said, "This is a significant contract win for us, not only as our first under the Harkand Arena name, but it also represents our clients' confidence in our growing diving division team and their combined experience."

Harkand provides offshore vessels, ROVs, diving, survey services, project management and engineering to the oil and gas and renewables industries. Headquartered in London with operations bases in Aberdeen, Houston, Mexico and Ghana, Harkand aims to be the leading subsea IRM and light construction contractor globally.

Hercules Offshore (NASDAQ: HERO) announced that it has signed a five-year contract with a subsidiary of Eni S.p.A. for use of the Hercules 260 in West Africa. The dayrate under the contract will range from a minimum of $75,000 per day when the price of Brent crude oil is $86 or less per barrel, to a maximum of $125,000 per day when the price of Brent crude oil is $125 or more per barrel. Contract commencement is expected in early April 2015. Costs for contract specific upgrades will be reimbursed by the operator.

Potential of Indonesian Merakes gas finding upgraded 
- New gas discovery offshore Libya, in the Bahr Essalam South exploration prospect

Eni has completed post drilling studies on the Merakes-1 gas finding, located in the Indonesia deep offshore East Sepinggan Block, which indicates significant upside gas potential. Eni is the operator of the East Sepinggan Block with an 85% interest.

The new studies upgrade the potential of Merakes from previously estimated 1.3 TCF up to 2 trillion cubic feet (Tcf) of gas in place. The well was drilled in October 2014 in 1,372 meters water depth, encountering a 60 meter section of high quality sandstones. Eni will bring forward the appraisal program to evaluate the possible fast track development of the finding, optimizing synergies with the near Jangkrik field, also operated by Eni.

The East Sepinggan block is located offshore of East Kalimantan (Borneo), 170 kilometers south of Bontang LNG plant and just 35 kilometers south of Jangkrik field.

Eni has been operating in Indonesia since 2001 and currently holds a large portfolio of exploration, production and development assets which have an increasing importance in contributing to the overall growth of the company. Eni's average equity production in the Country amounts to 17,000 barrels of oil equivalent per day.

Additionally, Eni has made a significant discovery of gas and condensates offshore Libya, in the Bahr Essalam South exploration prospect in Area D, 82 kilometers from the coast and 22 kilometers from the production field of BahrEssalam. Eni, through its subsidiary Eni North Africa BV, is operator of Contract Area D with 100% working interest in exploration phase.

The discovery was made through the B1-16/4 well, drilled at a water depth of 150 meters, which encountered gas and condensates in the Metlaoui Formation of Eocene age. During the production test, constrained by surface facilities, the well produced 29 million square cubic feet per day (mmscfd) and above 600 barrels per day (bbpd) of condensate with "64/64' choke size. In a producing configuration the well is estimated to deliver in excess of 50 mmscfd and 1,000 bblpd of condensate. The proximity to the Bahr Essalam infrastructures will allow a quick development of this new discovery.

Eni is currently active in the country's offshore with three drilling rigs used in the exploration and initial delineation of Contract Area D's discoveries.

This exploration success further confirms the enormous potential of Libyan gas resources. The future development of Libyan resources will allow supporting the growth of the domestic consumption and industry, while maintaining Libya's position as a strategic supplier for Italy and Europe. Eni started production in 2004 from the area D fields of Wafa and Bahr Essalam, which supply gas destined for domestic markets and Italy via the Greenstream sealine. These fields also yield high percentages of associated liquids.

With an important string of development projects in its pipeline, both ongoing and planned, Eni aims at capitalizing the significant commercial discoveries made in past years in Area D, and is undertaking an important exploration program to support the constantly growing domestic demand. This discovery in the Bahr Essalam South exploration prospect very well fits with such project pipeline. Eni's domestic deliveries grew from around 1 billion square cubic meters (Bscm) in 2009 to 4.3 Bscm in 2014, with the potential of reaching 6.2 Bscm in 2015.

Eni has been present in Libya since 1959 and currently produces approximately 350,000 barrels of oil equivalent per day in the country.

MMT and Reach Subsea have just completed their first commercial project with Surveyor Interceptor ROV for Gassco AS at Knarr Gas pipeline in the North Sea.

The pipeline inspection was conducted from the vessel Edda Fonn and all parties were very excited since the offshore tests conducted in 2014 exceeded all expectations. This first work was to verify that the rock berm on the pipeline was still intact prior to put a commissioning pig train and gas in the pipeline in near future.

Surveyor Interceptor work for Gasco on Knarr gas-pipeline

Ola Oskarsson, MMT´s founder and project manager for SROV, explains: "After the successful offshore tests on Europipe 2 last year we did some fine tuning on cameras and when we finally went to work – it was, once again, magic. The new Launch and Recovery System which was reconstructed after measurements during the sea trials performed well in sea state up to 3.8 HS. The Knarr gas pipeline, which runs from ca 400m water depth up to 140m over a stretch of 106 km, was surveyed in one go with speeds up to 4.5 knots. The Interceptor SROV swam 4-5 m above pipe and multibeam with 0.1 m gridsize and full 3d photomosaic was collected. The velocity and quality of data was outstanding and the system really proved itself. The field report was delivered 18 hours after the 17 hour survey. The final draft report was delivered 8 days after leaving the vessel. The weather had been dreadful during February and we needed to work fast in the given weather window since the pipe was ready to put in use."

On the 1st of March, Gassco became the operator for the Knarr Gas pipeline. This first survey with the SROV reached a world record in speed with its 4.5 knots. The SROV has potential to survey in a speed up to 6 knots (beating a normal ROV inspection speed by a factor of 3 knots) but all parties wanted to hold back with this new equipment to ensure a successful survey. However, Gassco hopes that long term potential cost savings of more than 30% from normal ROV inspections can be possible as a result of using this new type of equipment and technology and smaller support vessels. This is something that should interest most operators and license holders with the current economic climate in the Oil & Gas industry, says David Rodrigues de Miranda, Asset Manager at Gassco AS.

MMT and Reach Subsea agree with Gassco´s new terminology "fast and furious" for offshore missions with this new revolutionary SROV.

Ola Oskarsson comments on the submission of his first report of the SROV: "The Surveyor Interceptor has achieved its first track record and put the record straight with this "2 fast, 2 furious" mission.

On 26 March, the Solitaire pipe-laying vessel started on the first stage of the Polarled installation project. The 482-kilometer long pipeline will transport gas from the Aasta Hansteen field in the Norwegian Sea to Nyhamna in western Norway.

Statoil is operator during the development of the Polarled project and therefore responsible for laying the pipeline between Aasta Hansteen and Nyhamna. As operator for the gas plant, Shell is responsible for preparing the Nyhamna processing plant for gas reception.

One of the world's largest pipe-laying vessels, Solitaire, has started laying the Polarled gas pipeline. (Photo: Svein Roger Ivarsen/Shell)

"I am pleased to note that the pipeline is now connected to the Nyhamna processing plant. The pipeline pull-in to Nyhamna is an important milestone to the project and the Polarled licensees," says Håkon Ivarjord, MPR's project venture manager.

World record
The gas pipeline will be laid in water depths of up to 1265 meters. Even though smaller pipelines have been laid in waters exceeding this depth, this is the first time a gas pipeline measuring 36 inches in diameter is being installed at such water depth.

"When the pipeline is laid, we will install an end manifold with connection points for Aasta Hansteen and any future fields. Six T-joints on the pipeline for any further connections are also a unique feature of Polarled," says Alfred Øijord, PRO's project manager for Polarled.
Considerable cost reductions have so far been made by the Polarled Pipeline Project compared to the initial PAD estimate, as the company has obtained lower prices from the suppliers than originally calculated due to synergy effects with other pipeline projects and strict change and cost control.

Strategic
This part of the Norwegian Sea has no infrastructure for gas, and efforts have been made over several years to develop various alternative gas transport solutions. The Polarled pipeline is the first pipeline to take the Norwegian gas infrastructure across the Arctic Circle.

"Polarled will have great and strategic impact on the future development of the region. The new pipeline will open a new gas province and stimulate exploration and resource development, which will fortify Statoil's position as an exporter of gas to Europe," says Jan Heiberg, acting head of the pipelines and processing unit of MPR asset management.

A pioneer
Aasta Hansteen is one of the largest and most complex industrial projects in Europe, and the first deepwater project in the Norwegian Sea.

The field development will include a so-called Spar platform. It will be the world's biggest of its kind and also the first platform of this type on the Norwegian continental shelf.

The Polarled pipe-laying operation is scheduled to be completed by the end of August. Nyhamna will be ready to receive Aasta Hansteen gas in 2017. When the pipeline comes on stream, Gassco will be operator for the pipeline and for the Nyhamna gas processing plant.

Wood Group has been awarded a five year, US$ multi-million contract by Total, which includes the option for two, one year extensions. Under the contract Wood Group PSN (WGPSN) will deliver engineering, procurement, construction and commissioning services to four offshore assets and two onshore facilities in the UK continental shelf (UKCS).

The contract, effective immediately, continues WGPSN's 12 year history of providing these services to the Alywn, Dunbar, Elgin and Franklin platforms and the St Fergus Gas Terminal. It also covers support for the Shetland Gas Plant (SGP), the onshore receiving facility for Laggan Tormore, which will start production later this year.

Dave Stewart, chief executive officer (CEO) of WGPSN said: "Our knowledge and in-depth understanding of this key client's needs, and our strong commitment to working safely, collaboratively, innovatively and efficiently to maximize productivity of these assets, helped us to secure this contract. We look forward to continuing our long-standing partnership with Total in the UKCS."

WGPSN has UK offices in Aberdeen, Glasgow, Runcorn and Hull.

Sale reflects market conditions, industry interest in steady development of federal offshore oil and gas resources

The Department of the Interior's Bureau of Ocean Energy Management (BOEM) t held an oil and gas lease sale yesterday for the Central Gulf of Mexico that drew $538,780,056 in high bids for tracts on the U.S. Outer Continental Shelf offshore Louisiana, Mississippi and Alabama.

A total of 42 offshore energy companies submitted 195 bids on 169 tracts, covering about 923,700 acres. The sum of all bids received totaled $583,201,520.

"The Gulf remains a critical component of our nation's energy portfolio and holds important energy resources that spur economic opportunities for Gulf producing states, creating jobs and home-grown energy and reducing our dependence on foreign oil," said Secretary of the Interior Sally Jewell, who opened the lease sale. "While this sale reflects today's market conditions and industry's current development strategy, it underscores a steady, continued interest in developing these federal offshore oil and gas resources."

Lease Sale 235 builds on the first six sales held under the Obama Administration's Outer Continental Shelf Oil and Gas Leasing Program for 2012-2017 (Five Year Program) that offered more than 60 million acres for development, garnered $2.4 billion in bid revenues and awarded 877 leases. The Five Year Program makes available all offshore areas with the highest resource potential and includes 75 percent of the nation's undiscovered, technically recoverable offshore oil and gas resources.

"As one the most productive basins in the world, the Gulf of Mexico continues to be the keystone of the Nation's offshore oil and gas resources," BOEM Director Abigail Ross Hopper said. "The recent drop in oil prices and continued low natural gas prices obviously affect industry's short-term investment decisions, but the Gulf's long-term value to the nation remains high and the President's energy strategy continues to offer millions of offshore acres for development while protecting the human, marine and coastal environments, and ensuring a fair return to the American people."

Lease Sale 235 offered 7,788 unleased blocks, covering about 41.2 million acres, located from three to 230 nautical miles offshore in water depths ranging from nine to more than 11,115 feet (3 to 3,400 meters). BOEM estimates the sale could result in the production of 460 to 890 million barrels of oil, and 1.9 trillion cubic feet to 3.9 trillion cubic feet of natural gas.

The lease sale also included 201 blocks located, or partially located, within the three statute mile U.S. - Mexico Boundary Area, as well as blocks within the former Western Gap that lie within 1.4 nautical miles north of the Continental Shelf Boundary between the United States and Mexico. These ares are subject to the terms of the U.S. - Mexico Transboundary Hydrocarbon Agreement which entered into force on July 18, 2014. None of those blocks received bids yesterday.

BOEM established the terms for this sale after extensive environmental analysis, public comment and consideration of the best scientific information available. These terms include measures to protect the environment, such as stipulations requiring that operators protect biologically sensitive features as well as providing trained protected species observers. The observers would monitor marine mammals and sea turtles to ensure compliance with protective measures and restrict operations when conditions warrant.

The lease terms include a range of incentives to encourage diligent development and ensure a fair return to taxpayers, including an increased minimum bid for deepwater tracts and escalating rental rates. The leases would also allow a lessee to earn a longer lease term for spudding a well in deeper water or by drilling to a minimum target depth.

Following today's sale, each bid will go through a strict evaluation process within BOEM to ensure the public receives fair market value before a lease is awarded.

Statistics for Lease Sale 235 are available at http://www.boem.gov/Sale-235/ or at www.boem.gov.

Subsea UK has launched a new market intelligence service to help subsea companies exploit global opportunities.

The industry body, which represents the UK's £9billion subsea sector, has developed SubseaIntel – a unique on-line database which provides regularly updated details on almost 1,200 subsea projects worldwide.

Subsea UK says this unique database will provide sought-after subsea market intelligence all in one place, at the touch of a button. Subsea Intel allows users to delve deeper into current projects across the globe and discover upcoming opportunities using intensively researched data. Users will be given a unique and secure log-in to search for, track and monitor global subsea discoveries and projects.

The database will allow them to identify which contracts have been awarded and to whom, when contracts are up for tender or renewal and what the values are, where available. This includes major EPC contracts, front-end engineering and design, well intervention, inspection and repair through to flexible pipelay and acoustic positioning.

Data can be customized to review and compare the current status of subsea projects and developments as well as uncover the market-leading countries and industry trends.

Information is categorized by a number of key factors including: region, operating or contracting company and water depth.

Neil Gordon, chief executive of Subsea UK (photo) said: "SubseaIntel represents a considerable investment by Subsea UK in an added value service for members. For the first time, valuable intelligence on the global market will be readily available to help them with planning, forecasting and business development.

"Members will be able to pinpoint the most relevant regions, projects and contracts for them with all the project characteristics and analysis they need to make informed decisions.
"In the current climate, companies need all the support they can get and SubseaIntel will give our members valuable business development and analyst support at no cost."

Each project in SubseaIntel has been individually researched and analyzed to provide accurate and up-to-date information, presenting a comprehensive overview of global subsea activity. The site has been designed so members can update or add data themselves, offering a fully interactive service.

SubseaIntel has just gone live and is exclusive to members of Subsea UK.

AVEVA announces that Total E&P Norge As (TOTAL) has chosen AVEVA Activity Visualization Platform (AVEVA AVP) to support training activities on its Martin Linge topside platform in the North Sea. Seeking an immersive training environment to facilitate advanced training for their HSE (Health, Safety and Environment) and other scenarios, TOTAL chose AVEVA after a competitive selection process.

'TOTAL required a captivating advanced training solution to provide an accurate and realistic environment to familiarize staff early, thoroughly and safely prior to deployment on-site in the North Sea', said Derek Middlemas, COO and Head of Enterprise Solutions, AVEVA. 'While the facility is still under construction, the ability to perform realistic training scenarios in a virtual environment is important for initial safety familiarization activities. Later, such training methods provide a risk free environment to practice more complicated and hazardous training scenarios throughout the life of the platform. AVEVA AVP, part of AVEVA's advanced Immersive Training offerings, reduces the need to go on-site, thus resulting in reduced costs and saving of time.'

AVEVA's unique Digital Asset approach enables solution delivery teams to enhance the use of detailed design models for purposes other than traditional design and construction activities. AVEVA's Immersive Training solutions provide a software platform allowing owner operators to tailor and repurpose design models for training, simulation and operational readiness activities. Virtual training environments created using AVEVA AVP can enhance traditional training effectiveness in a manner that reduces overall training costs.

Mr. Middlemas added, 'TOTAL's selection of AVEVA AVP for its Martin Linge Advanced Immersive Training solution is an important milestone in AVEVA strategy. AVEVA looks forward to working with TOTAL on this effort to maximize use of their AVEVA PDMS and AVEVA E3D models to further Owner Operator activities in training and simulation.'

Transocean Ltd. (NYSE: RIG) (SIX: RIGN) announced that it intends to scrap, in an environmentally responsible manner, the following two rigs: GSF Aleutian Key and Sedco 707.

These rigs are classified as held for sale. As a result of this decision, the company expects its first quarter 2015 results to include an estimated non-cash charge of $90 million to $110 million, net of taxes. Including these two rigs, Transocean has announced plans to scrap a total of 18 floaters.

As the company continues to evaluate the long-term competitiveness of its fleet, additional rigs may be identified as candidates for scrapping.

Statoil has been awarded new exploration acreage through the Aru Trough I license offshore Indonesia.

The license covers an area of approximately 8,300 square kilometers, adjacent to Statoil's existing exploration acreage in the Aru and West Papua IV licenses. Statoil will operate the license with a 100% working interest.

"This is a low-cost access into a frontier area with considerable potential where Statoil is already present. This position strengthens the optionality in Statoil's long-term portfolio and secures potential upsides from our existing exploration acreage," says Erling Vågnes, Statoil's senior vice president for exploration in the Eastern hemisphere.

Statoil will initially collect seismic data during the first three years of the exploration period. The information obtained from the seismic survey will form the decision basis for Statoil's next steps in the license.

McDermott International, Inc. (NYSE:MDR) ("McDermott") has announced that it has been awarded a sizeable contract to transport and install subsea umbilicals, manifolds, jumpers and flying leads for Chevron U.S.A. Inc. ("Chevron") to support the brownfield expansion of the Jack and St. Malo fields in the U.S. Gulf of Mexico. The value of the award is included in McDermott's first quarter 2015 backlog.

Harkand has secured a multi-million pound contract with Maersk Oil North Sea Ltd for the provision of DSV services in the North Sea region.

The 12-month contract will be serviced by Harkand's two DSVs, the Harkand Da Vinci (photo) and Harkand Atlantis, supported by project management and engineering from Harkand's Aberdeen office.

The contract covers well tie-ins, structure installation, piling, flexible flowline lay, flexible riser installation, pre-commissioning, riser recovery, decommissioning and general inspection, repair and maintenance (IRM) work.

Harkand Europe managing director, David Kerr said: "This contract win is a further acknowledgment, not only of the expertise and capacity we have built up within the region, but also the open culture that we have at Harkand. We look forward to delivering a consistent and cost efficient service to Maersk, which is especially critical in today's business environment.

"By utilising both our sister DSVs, we will provide a robust and fully flexible approach to executing both planned and unplanned interventions and we will work closely with Maersk to ensure safe and successful campaigns."

The Harkand DaVinci and Harkand Atlantis are both equipped with state-of-the-art saturation diving systems, 140t active heave compensated cranes and Super Mohawk ROV spreads.

Harkand provides offshore vessels, ROVs, diving, survey services, project management and engineering to the oil and gas and renewables industries. Employing close to 1,000 people at operation bases in Aberdeen and Houston with headquarters in London; Harkand aims at being the leading subsea IRM and light construction contractor globally.

Lifting the 40-year-old export ban on U.S. crude oil would have far-reaching effects on pricing, energy security and energy sector investment, according to new research from the Center for Energy Studies at Rice University's Baker Institute for Public Policy in Houston.

The study, "The US Crude Oil Export Ban: Implications for Price and Energy Security," was presented today at a news conference at the National Press Club in Washington, D.C., by Kenneth Medlock, the center's senior director and the paper's author.

Medlock's research assessed a wide range of crude oil prices, from $30 per barrel to $150 per barrel, whereas previous studies looked a narrow range of high prices only. This, along with the fundamental approach taken in the study, distinguishes it from previous studies. The study highlights, among other things, the importance of addressing this policy issue even in the current low-price environment.

Over the past decade, innovative techniques involving the use of horizontal drilling and hydraulic fracturing have triggered unprecedented increases in production of crude oil, natural gas and natural gas liquids from shale.

"The United States has recently experienced an unprecedented surge in domestic crude supply, thanks to significant production increases from areas like the Bakken and Eagle Ford shale formations," Medlock said. "The production surge has led to a large decline in U.S. crude oil imports. The trade balance effects extend to petroleum product markets where, due to stagnant domestic demand, the U.S. has become a net exporter of petroleum products over the last few years."
Medlock found that lifting the ban would level the playing field for the U.S., as it faces continued discounted domestic crude oil prices relative to internationally traded crudes. In fact, the study shows that because the majority of light tight oil produced from U.S. shale formations is of higher quality than both WTI and Brent, if it were exported it would fetch higher prices than WTI and Brent in the international market, he said.

In the wake of the domestic supply surge, Medlock said there is an increasing realization that the U.S. refining infrastructure was not originally designed to handle the domestic crude qualities that are increasingly available. And given the ban on crude oil exports, he said this has prompted concerns that domestic crude oil prices are becoming increasingly discounted relative to internationally traded crudes.

"In turn, this could dampen U.S. upstream investment. Opening foreign markets to U.S. crude would facilitate new investments in the upstream and midstream sectors, as domestic oil prices would move into greater parity with other international crudes," he said.

"Studies that focus on the differential between WTI and Brent effectively underestimate the 'discount' that is being realized by the higher-quality light oils produced from shale," Medlock said. "The implication is that earlier studies likely underestimate the impact on U.S. shale production from removing the oil export ban. Our study includes a statistical analysis that explains what the relationship would be between the prices of crudes of different qualities in an unconstrained setting without an export ban, which is important to providing a more accurate projection of the impact of current U.S. policy."

Data also shows that the U.S. refining sector has backed out the lighter crude imports through substituting the domestic light shale oils. In fact, with growing shale oil production, refiners are now backing out imported crude oils heavier than WTI and the shale oils, he said. However, since those refineries made previous investments to process the heavier crudes, they will only switch to lighter shale oils if those shale oils are priced competitively with the heavier crudes they would normally buy, which means they must be discounted relative to international prices.

"Counterintuitive to some, removing the ban generates distinct energy security benefits," Medlock said. Some have argued that crude oil exports would increase gasoline prices in the U.S. However, because refined products, such as gasoline, can be freely exported, the prices of refined products sold in the U.S. are in parity with international refined product prices. Thus, the discounted prices of oil produced in the U.S. are not reflected in U.S. gasoline and refined product prices. Thus, removing the crude export ban, although it would raise the price of crude oil domestically, would not increase the price of gasoline in the U.S.

The full study provides an in-depth analysis of the U.S. energy security benefits of ending the restrictions on oil exports. Specifically, the research shows that removing the ban yields positive impacts by providing a more stable and secure source of oil to the world. That greater stability would lessen price volatility that U.S. consumers face and thus improve U.S. energy security. The study also shows the positive implications for overall market function, investment capital inflows and economic activity.

▪ Estimated project startup remains on target for 2016
▪ Ice road opens between Deadhorse and Point Thomson's central pad
More than 800 people working at site and additional several hundred around the state

ExxonMobil has announced that it has resumed drilling at Point Thomson on Alaska's North Slope as construction continues toward bringing the initial production system online.

"The Point Thomson field is a vital part of unlocking Alaska's North Slope gas resources," said Jim Flood, ExxonMobil Development Company's arctic vice president. "The initial production will give us invaluable insight into the potential development of the reservoir and help provide Alaskans with economic benefits."

The initial production system is designed to produce up to 10,000 barrels per day of natural gas condensate and is scheduled for startup in 2016. Two injection wells will work in tandem with a production well, cycling up to 200 million cubic feet of natural gas per day through an onsite central processing facility. The condensate will then be transported by a 22-mile pipeline to the Trans-Alaska Pipeline System.

The Point Thomson reservoir holds an estimated 8 trillion cubic feet of natural gas and associated condensate, a high quality hydrocarbon similar to kerosene or diesel. The gas represents 25 percent of known gas resources on the North Slope and could be used to partially underpin the proposed Alaska LNG project. Potential future development will depend on a range of factors such as business considerations, investment climate and the fiscal and regulatory environment.

As of year-end 2014, ExxonMobil and working interest owners have invested more than $2.6 billion in the development of Point Thomson. About 70 percent of that amount has been spent in Alaska. More than 70 Alaska companies have contributed to the success of the project, with more than 800 people working on-site and an additional several hundred around the state.

Winter construction continues with the opening of a 50-mile ice road from Deadhorse to central pad.

Point Thomson is located on state acreage along the Beaufort Sea, 60 miles east of Prudhoe Bay and 60 miles west of the village of Kaktovik.