GRAY, La. – Danos’ fabrication service line has achieved an important safety milestone: 1 million man-hours without an Occupational Safety and Health Administration (OSHA)-recordable incident.
“This achievement is a credit to the dedication of our fabrication team,” said Mark Danos, vice president of project services for Danos. “Despite taking on increasingly more complex projects, their commitment to operating safely and doing things the right way every time has never wavered; it is the key to our success.”
Danos’ unyielding emphasis on safety – it is one of the company’s core values – has produced a culture in which proper training and procedures are the bedrock of daily operations. These safety results demonstrate Danos’ commitment to ensuring every team member is provided the tools, environment and knowledge that enables them to work safe every day.
Danos’ Larose, La. fabrication facility has been OSHA-recordable incident-free for seven years and the company’s Amelia, La. facility has been incident-free since opening its doors in 2014.
Damen Shipyards Group has announced a new line of Trailing Suction Hopper Dredgers (TSHD). The new product range, comprising of the Marine Aggregate Dredger (MAD) 4000 and 5600 vessels, was introduced in response to extensive market research and customer consultation. The MAD vessels are expected to be well received by an aggregate industry facing rising demand and an aging fleet.
Photo courtesy: Damen
Designed in collaboration with Maritime Design and Engineering Services (MD&ES), an established name known for its innovative approach, the MAD 4000 and 5600 are welcome additions to Damen’s Trailing Suction Hopper Dredging portfolio. For offshore aggregate operations, the new vessels will be able to work in North Sea conditions up to depths of -60 meters. These capabilities allow operators to mine sand and gravel in deeper waters, farther from shore than preceding models.
Damen has invested considerably in research and development for the new MAD vessels, having observed an increase in demand for civil construction supplies deriving from an overall improving economy. The development aims at offering industry advanced technology, well suited to existing ports and delivering more uptime at sea.
Olivier Marcus, Damen’s Product Director Dredging comments: “We’ve tailored the technical specifications of the designs in line with the port infrastructure in the region in which the dredgers will operate.
“Furthermore, we’ve paid close attention to seakeeping behaviour in order to ensure the vessels can operate comfortably and safely, even in harsh weather conditions.”
Unlike traditional dredgers, the bow shape of the MAD vessels allows them to operate in adverse weather conditions. The shape is based on a proven Damen design applied to renowned vessels such as the Damen Offshore Carrier (DOC) and Platform Supply Vessel (PSV). In addition to improved seakeeping behavior, the bow shape also protects the sand and gravel cargo from green water ingress.
The MAD vessels have been developed with tomorrow in mind, states Mr. Marcus: “These vessels are future proof. Featuring Tier III engines and, requiring no ballast water, fully compliant with the latest IMO regulations, these dredgers are looking forwards. On top of that the design also takes into account the possible future requirement for advanced automation.”
Close attention has been paid to incorporating the most robust equipment for operations in harsh environments. A submerged, wear-resistant Damen dredge pump facilitates the loading of sand and gravel aboard the vessel. Once onboard, the aggregate then passes through the heavy-duty dredgers’ screening towers, where giant sieves allow for a better assessment and classification of the mined material. Following this, it is stored and de-watered in the vessel’s hopper – with a capacity of either 4,000 or 5,600 m3 – hence the categorisation of the two types of MAD. The operation is supported by state-of-the-art, optimised instrumentation, offering feedback throughout the entire process.
Upon arrival to port, the vessels’ fully automated clamshell system unloads the material onto a conveyer belt. The system conceived of by the design is a flexible one, suitable for use in varying locations.
Mr. Marcus continues: “With a single vessel you can do almost everything. You can go out, get the material, classify it, dry it and deliver it to location. It is the first standardised design in the world with such a scope.”
Standardized the design may well be, but it is also versatile and takes into account the need for customization and multi-role functionality. “A number of options exist in order to cater to differing client needs,” states Mr. Marcus. “The vessel can be supplied with bottom doors if required – which will offer additional versatility in case it is required to perform differing operations. It can also receive spud poles, for example. And, should the client wish to scale up at any point, the MAD 4,000 can easily be converted into a MAD 5,600 with a simple section addition.”
Concluding, Mr. Marcus says, “The MAD concept is one that tackles not only the needs of today, but of tomorrow also. We have developed a vessel that represents the lowest possible euro to cubic metre ratio. It is lightweight, with an optimised, efficient propulsion train, minimised hydraulic usage and offers both low and easy maintenance. We are very much looking forward to seeing it in action.”
Oil and gas exploration has always had a strong element of risk, not only in terms of making a discovery but also from fluctuating oil prices, turbulent exchange rates and changing geopolitics. There are many variables that can affect the potential value of a hydrocarbon find, and evaluation of exploration acreage for investment judgements is always complicated by the limited amount of data available to make an informed decision. The potential value of a prospect is not necessarily related to its volume, especially in today’s volatile economic and political environments, so the need to understand and quantify the geological risks and the complexities of petroleum economics is imperative.
Sabinas – Rio Grande Volumetric Heat Map. Source: EV2, mean volume estimates. Credit: CGG
EV2 is an exploration valuation platform that has been specifically designed to assist this decision-making process. It has been jointly developed by CGG and Wood MacKenzie to provide an independent, transparent and consistent analysis of undrilled acreage. EV2 uses the latest economic data and commercial insight from Wood MacKenzie, combined with Robertson’s unique basis of geological knowledge and expertise within CGG’s GeoConsulting group, to provide a user-friendly economic-modelling tool. Currently it contains block-level geological risk, volume and value data for 100 prospective basins and by early 2017 this will increase to over 180 basins and so provide a global assessment tool for exploration.
EV2 allows geologic assumptions to be changed to accommodate different views of play risk or lead density. Different scenarios can be tested to provide a range of possible outcomes so that budgets and resources can be planned. Play and basin metrics can be compared in a transparent and objective manner in order to evaluate corporate portfolios for petroleum economists and financial institutions.
Where additional proprietary information is available, this can be used to edit the underlying geological assumptions in EV2 to refine the baseline volumetric assessments. This enables users to create their own customized scenarios quickly, in a confidential, in-house environment and so maximize their competitive advantage. EV2 provides the means for New Ventures and Exploration teams to compare prospects in a consistent manner in order to guide license round screening and farm-in evaluation.
Evaluation of the blocks on offer in Mexico’s licensing Round One provides a good example of where using EV2 for the fast assessment of potential volume and value of the exploration blocks on offer could provide valuable insight to inform bidding strategies. Investigation of the EV2 data for the Sabinas-Rio Grande basin identifies eight geologic plays, based on the interpretation of a number of data sources by Robertson’s regional experts. Most of the yet-to-find reserves (over 80%) are expected to be found in the Upper Oligocene, Lower Oligocene and Upper Paleocene to Lower Eocene plays. EV2 identifies the most exciting play to be the Upper Paleocene to Lower Eocene, with potential volumes of between 6 bnboe and 10 bnboe estimated.
However, value depends on more than just volume, and EV2 enables pre-tax and post-tax Net Present Value (NPV) to be assessed at various price and exchange rate scenarios so that economic attractiveness can be evaluated quickly. The assessment of the Sabinas-Rio Grande basin reveals that, as it is closer to shore and in shallower waters, the Upper Oligocene play in fact has greater potential value than the Upper Paleocene to Lower Eocene play. EV2 provides understanding of how all the plays intersect with the license blocks on offer and the mapping can guide further efforts in analysing opportunities. As more work is done on the blocks on offer and more data are acquired, extra information can be incorporated into EV2 to give additional insight to those owning the new data.
This fast but rigorous evaluation demonstrates that EV2 can be used to analyse exploration acreage and provide valuable insight to New Ventures teams. The flexibility of the EV2 platform, enabling assumptions to be changed and different scenarios to be tested, provides answers quickly for informed decision-making.
Asia's Refinery Cracking Capacity Additions Slowing, but India Continues to UpgradeOil rebalancing is slowing due to higher October OPEC output and lower China demand, but supply creation will become the market’s focus in 2017 as the market tightens. Asia’s refinery cracking additions are slowing, but India continues to upgrade and catch up with China's cracking capability. China’s crude imports are expected to recover from the low in October for the next two months as refineries return from maintenance to meet seasonal demand and utilize unused product export quotas. PIRA expects Asian cracking margins to stay healthy for the next couple of months, with prospects for better margins in 1Q17 assuming normal winter weather.
The mild weather that has unfolded this month that extended the traditional injection season has placed an even larger premium on weather demand in the months ahead to help work off the expanding inventory overhang. Moreover, much is riding on conditions during December in particular. On that front, even if the industry manages to pull working gas in storage toward 3.4 TCF before exiting 2016, a more convincing stock reduction will still be required early in 1Q17 to propel prices decidedly into new high ground.
As French nuclear availability remains at historically lower levels, French total commercial flows collapsed by 94% year-on-year to a mere 420 MW so far in the fourth quarter. The impact of lower French nuclear to flows toward Italy is particularly interesting. Italian PUN prices have been settling only about €4 below France in October and November to date, although the NORD region has been coupling more often with France (45% of the hours in November to the 21, or about 227 hours, while in Oct. about 299 were coupled with France). More interestingly, the Italian forward curve is trading at a large discount relative to France for the balance of the winter, raising the broader question of whether this is really sustainable.
Forward coal prices had a volatile week this week, with the market posting several dollar moves on four out of five trading days. The net result was upward, with prices, particularly in the Pacific Basin, recovering a portion of the sizeable losses posted last week. The market continues to look for firm direction, with a bullish fundamental picture facing off against powerful interests (including the Chinese government and at least one major trading company) in keeping prices somewhat low. However, it appears as if the market, like PIRA, has become somewhat wary of such a downward move.
The November WCI current vintage auction saw a much-improved coverage ratio and participation (80 unique registered bidders vs. 51 in August). Secondary market pricing remains above the $12.73 auction reserve price, which is poised to increase at next February’s auction. If subsequent auctions are fully subscribed, there may be minimal potential supply implications for CP2 (if CARB adopts amendments to move unsold allowances to the reserve). Oral arguments will be held January 24th in the CA auction litigation, with a decision expected in spring 2017 and an appeal to follow. The November Election results help prospects for a legislative fix should the auction be invalidated, but are not a guarantee.
The equity market moved further into record territory, with the S&P 500 moving above 2,200. Volatility (VIX) continued to ease and the price of domestic high yield debt (HYG) rose. Emerging market debt (EMB) was little changed. The U.S. dollar remained strong, and commodities were higher. Bond yields continued to rise globally, particularly for longer-term maturities.
The EPA increased the mandate for biofuels to 19.28 billion gallons for 2017. The new mandate is up 6.5% from 8.11 billion in 2016. The total is also up from 18.8 billion proposed in May, but much less than the 24 billion gallons originally set forth in RFS2.
Last week’s “working theory” on soybean strength came from those who said there was very little confidence the Chinese would be able to halt their currency slide anytime soon. The theory went on that end users, who were afraid the Yuan would continue to decrease in value, were buying up soybean supplies before their currency became “worthless”.
U.S. adjusted oil demand continues to be relatively strong, up 3.6% or 680 MB/D year-on-year in the latest four weeks. Gasoline stocks are building seasonally despite robust demand because of high imports and high production, with the latter inflated by butane blending. Distillate stocks built just slightly as increased heating demand supplemented the last bit of harvest demand.
North American spare production capacity is light this winter with dry powder largely limited to the WCSB and Appalachia. The dearth of heating demand over the past month has meant that Canadian imports have had to more aggressively compete with Appalachian for the limited market opportunities. Moreover, TransCanada’s withdrawal of its Long Term Fixed Toll plan suggests that the challenge to find a home for surplus WCSB production will continue.
RGGI pricing declined sharply following the elections, with the next auction on Dec 7th. PIRA does expect the auction to be fully subscribed, helped by required annual bank draws resulting from banking adjustments to the cap. Given unclear signals from the Program Review process, PIRA does not see significant price recovery until a draft Model Rule is released next year that clarifies cap declines post-2020 and price support mechanisms, such as banking adjustments and the proposed soft price floor “Emissions Containment Reserve.” Longer term, the RGGI price signal appears likely to take a back seat to individual state/regional clean energy policy initiatives. RGGI could play a more significant role, however, should these complementary policies face implementation challenges.
Over the last month, eastern coal prices were pulled up by hot international markets for both metallurgical and thermal coal, a trend that is likely to remain in place in the near term and one factor leading us to adopt a bullish bias through 1H17. Even though natural gas prices have recently given back some gains, we still expect gas prices to rise over the heating season, tightening coal balances by mid-2017. Beyond that, our pricing views turn bearish as we forecast that gas prices will fall on increased drilling and we expect continued CCGT and renewables build out.
U.S. equity markets posted solid gains across the board and pushed into record territory. Among the tracking indices, retail, materials, and industrials did the best. Both growth and defensive tracking indices posted strong increases of about 2%. Internationally, those tracking indices also gained with emerging markets, Latin America, and China doing the best. Japan performance was the laggard and neutral.
Inventories grew by 1.8 MMB to 102.7 MMB, despite relatively high export volumes of 5.8 MMB for the week ending November 18. The deficit to last year narrowed slightly by 108 MB to nearly 3.5 MMB. Last year for this reference week, stocks rebounded by 1.7 MMB to 106 MMB. The following week, stocks declined by 2.1 MMB and largely continued drawing until mid-March.
U.S. ethanol stocks built the week ending November 18, following three consecutive weeks of decline. Production increased by 3 MB/D to 1,014 MB/D. Ethanol blended gasoline manufacture jumped to 9,100 MB/D from 8,955 MB/D the prior week.
The EPA’s announcement last Wednesday that the 2017 biofuel quota will be raised to 19.28 billion gallons, including 15 billion gallons of corn-based ethanol, was more dramatic for soybean oil, which traded limit up on the news, than corn. While widely hailed as a victory for the ethanol lobby and U.S. farmers, should gasoline consumption in 2017 match projected 2016 consumption of 144 billion gallons, the 15 billion gallons of ethanol still results in a blend rate of just 10.4%.
Crude runs eased slightly on the week and crude imports surged, thus building crude stocks 4.9 MMBbls. Finished products drew 1 MMBbls and set a new cyclical low. Gasoline demand was modestly higher. Stocks drew slightly. Gasoil demand was lower but a jump in exports left stocks little changed. Kerosene demand was little changed and remained seasonally normal.
U.S. ethanol prices rose the week ending November 18. Values were supported by higher corn and oil. Manufacturing margins increased, boosted by a strong demand for exports. RIN values rebounded in anticipation of final 2017 mandates and standards that were to be set by November 30.
Shipped LNG has eluded Northwest Europe to a great extent since 1Q, in favor of higher deliveries to Southern Europe. Price is the main driver. With much of the spiking risk ending up on the isolated southern shores of Southern Europe – these markets certainly have made the better case so far. Spanish, Italian, and Southern French gas prices have all, at one time or another, made themselves price competitive on a global scale to try and attract volumes and have succeeded at the expense of the U.K. Instead, N.W. Europe has relied on pipeline supplies. Opting for pipeline gas in N.W. Europe instead of LNG has highlighted just how much pipeline suppliers have done to make their gas attractive.
PIRA is kicking off its global weather monitor, which will track weather anomalies in the U.S., Europe, Russia, and Asia. PIRA has analytically tabulated daily degree day data for key countries and for Europe and Asia; they have been aggregated into regional measures. We look at a cumulative comparison to last heating season, and the 10-year normal, expressed as a percent deviation. We also look at daily degree days, relative to a 10-year range, including the norm and last heating season. Charts will be issued regularly on a weekly basis during the heating season.
The recent run up in Asian spot prices appears to have crested, as buyers are done with their winter planning. Adding more length does not seem to be in the cards, although the myriad of nuclear problems among Japan, Korea, and Taiwan is giving LNG a second and third life in the power sector. Japan continues to be largely nuclear free, while South Korea and Taiwan have also seen nuclear load factors collapse largely due to natural disasters (storms & earthquakes). Korea is seeing significant gains for LNG and coal burn, and Taiwan’s reserve capacity margin is extremely tight.
The decline in gasoline prices since mid-2015 has given a significant boost to gasoline demand on both sides of the Atlantic. While the lagged effects of this decline are expected to provide further support through 2018, U.S. gasoline demand growth is expected to slow to 0.5% in 2017 as crude oil prices recover. Faster economic growth in 2018 should lead to a pick-up in demand growth to 0.9% in 2018. In Europe, the end to dieselization of the car fleet in addition to the lagged price effect causes gasoline demand growth to accelerate to 1-1.5% in 2017 and 2018.
State-owned energy giants PetroChina and China National Offshore Oil Corp. (CNOOC) have hiked their wholesale gas prices for non-residential users. The move reflects tighter supplies of the fuel and follows the end on Sunday of a one-year moratorium on price adjustments. PetroChina’s gas sales branch for northern China informed customers on 7 November that it would raise non-residential citygate prices by 15% from 20 November until 15 March 2017.
The information above is part of PIRA Energy Group's weekly Energy Market Recap - which alerts readers to PIRA’s current analysis of energy markets around the world as well as the key economic and political factors driving those markets.
BP announced on Tuesday, that it has acquired interests in two North Sea exploration prospects, Jock Scott and Craster, in a further demonstration of the organization’s commitment to the basin.
BP has acquired a 25% interest in the Statoil-operated licenses located to the east of Shetland, P2275 and P2097, which includes the Jock Scott prospect, and a 40% interest in the nearby P2163 and P2147 licenses. Statoil will remain the operator for all of these licenses.
Statoil and BP are planning to drill an exploration well on Jock Scott in mid-2017.
Map Image credit: Statoil
In the west of Shetland, BP has acquired a 40% interest in the north and a 30% interest in the south of the Nexen-operated license P2062, which includes the Craster prospect. Nexen will remain the operator of the license.
BP and Nexen are also planning to drill an exploration well on Craster in mid-2017.
Mark Thomas, BP North Sea Regional President commented: “Working together with companies such as Statoil and Nexen to access the North Sea’s remaining resource is an important part of our strategy to remain a material North Sea producer, investor and employer for decades to come. We look forward to working with both Statoil and Nexen on these exciting prospects.”
The North Sea is an important region for BP where it expects to sustain a significant business for the long term.
Over the next 18 months, BP plans to participate in up to five exploration wells in addition to drilling approximately 50 development wells over the next 3-4 years.
BP North Sea is set to grow UK production to around 200,000 barrels per day by 2020, with an exciting set of future investment and renewal options capable of sustaining a material business well into the 2030s.
Along with its co-venturers, BP has invested at record levels in the North Sea. In 2016, BP will still invest around $1.8bn of capital investment and $1.6bn running its operations. BP is expecting important new oil production from its major projects Quad204 and Clair Ridge in early 2017 and 2018 respectively.
BP is also investing significantly in the reliability and integrity of existing assets through an extensive renewal program.
The CI-GNL (Ivory Coast LNG) consortium led by Total has been awarded the rights to build and operate a liquefied natural gas (LNG) re-gasification terminal in Ivory Coast with a capacity of 3 million tons per year.
The decision announced by the Government of the Ivory Coast on October 4th was followed by the signature of the shareholders’ agreement in Abidjan between Total, which will operate the project with a 34% interest, national companies PetroCI (11%) and CI Energies (5%) as well as SOCAR (26%), Shell (13%), Golar (6%) and Endeavor Energy (5%).
Map courtesy: Total
Total will use the terminal to supply LNG volumes from its global portfolio in proportion to its participating interest in the project. The re-gasification terminal project is expected to become operational by mid 2018.
“This project illustrates Total's strategy to develop new gas markets by unlocking access to LNG for fast-growing economies. Working closely with our partners enabled us to put together an integrated proposal combining LNG supply and import infrastructure through a floating storage and re-gasification unit,” said Philippe Sauquet, President Gas, Renewables and Power of Total. “We are very pleased to have been selected by the Ivorian authorities to manage this project, which will meet growing domestic and regional needs for gas and power.”
The project involves the construction of a terminal with a floating storage and re-gasification unit (FSRU) in Vridi, Abidjan area, and a pipeline connecting the FSRU to existing and planned power plants in Abidjan, as well as to regional markets connected to the Ivorian network. This will enable Ivory Coast to become the first regional LNG import Hub in West Africa, and to meet both regional and domestic demand.
ATR Group has announced a six-figure investment towards developing its inspection capabilities which will see in-house personnel delivering further rope access services and non-destructive testing (NDT), a method fast becoming one of the most in-demand techniques used by the energy industries across the globe.
NDT measures various material and mechanical properties of an object without affecting its operating performance. According to a recent report the global NDT market was estimated to be valued at $12.98 billion (USD) in 2015 and is projected to reach $18.88 billion by 2020.
As part of strengthening the capabilities of ATR Lifting Solutions’ 33 in-house engineers, the Group has appointed George Byers as divisional manager. An industry veteran with 30 years’ experience in oil and gas under his belt, he joins ATR following six years at international inspection services company Reel Group where since March 2015 he was the regional general manager in Houston, Texas.
ATR’s personnel are currently fully trained to industry body Lifting Equipment Engineers Association standards and are also qualified in accordance with Lifting Operations and Lifting Equipment Regulations 1998. Based in Aberdeen, Mr. Byers will oversee the workforce as they attend a combination of external and in-house training to become fully qualified in magnetic particle, dye penetrant, eddy current and ultrasonic NDT methods.
Findlay Moir, ATR Lifting Solutions Divisional Director
ATR Lifting Solutions divisional director Findlay Moir said: “We have one of the largest teams of inspection engineers in the UK oil and gas industry and, with George on board, the company is in a strong position to further develop our inspection and testing services to the next level.
“Given the challenging times facing the sector, we believe it is important to keep investing in and developing our people to ensure we can continue to offer increased value to our clients and galvanize our workforce.
“Advanced inspection services are the next logical step for ATR Lifting Solutions and we’ve already had strong interest from our clients to deliver this class of inspection. With the prospect of just one engineer needed to carry out routine inspections and NDT on the same work scope, it automatically makes it more time and cost effective for clients. It also has better safety implications.
“We look forward to George coming on board and broadening our inspection team’s expertise.”
Mr. Byers, who began his career as an NDT technician moving into management 10 years later, added: “ATR has a fantastic reputation for delivering successful campaigns here in the UK and globally, and I’m thrilled to be part of helping build on this even further.
“The supply chain has been hit hard by the downturn with companies looking to cut costs and make savings where possible. I truly believe this kind of investment in training will not only pay dividends to the business but strengthen ATR’s position as a leader in the sector.”
ATR Group is the market leader in the rental, sale and inspection of specialized equipment to the petrochemicals, marine, subsea and the offshore oil and gas industry. Its four business units are ATR Equipment Solutions, ATR Lifting Solutions, Underwater Engineering Services and Safety & Technical Hydraulics.
E&P deepwater exploration and appraisal activity has dramatically declined. In line with falling E&A activity, Reserve Replacement Ratios (RRRs) have been declining for the majority of major E&P companies. This week, we highlight some of the positive newsflow from offshore E&A activity in recent times.
Myanmar, once impeded by political and economic trade embargoes, has seen a dramatic turnaround in fortunes since the lifting of international sanctions in 2012. A number of Western E&P players such as Shell, ENI and Chevron, as well as Independents including Reliance Industries and Oil India amongst others, have been drawn to the country’s gas potential, most notably in the deepwater Rakhine basin. Following the discovery of the Thalin-1 well in the AD7 block in Feb 2016, Woodside has shown significant commitment to exploring and developing acreage (up to 4-7 E&A drilling campaigns). The Australian operator has recently contracted the Dhirubhai Deepwater KG2 (a deepwater drillship), scheduled for a year-long campaign in 2017.
In June 2016, an Exxon-Hess alliance has upgraded the total reserves for its Liza field discovery offshore Guyana to 1.4 billion barrels; twice the size of previous estimates. The find represents the first commercial discovery in the country for the past 50 years. The success of the Liza field has injected strong enthusiasm for exploration activities offshore neighboring Suriname, where Petronas has begun an exploration drilling campaign in May 2016, while Apache has commenced seismic acquisition on block 58 in June 2016. Compared to the tepid reaction in 2015, the current round of acreage offered by Staatsolie, a state-owned oil company, has garnered widespread interest amongst the international E&P community.
Current oil prices do not support major stand-alone deepwater developments. All of the sanctioned deepwater projects in 2016 are subsea tie-backs to shore. However, it is evident that as the market recovers there are substantial reserves that can be brought into development as oil prices allow. We expect operators to develop these finds through conceptual / front-end engineering during the downturn if they wish to be a ‘first mover’ when the market conditions allow sanctioning.
Chen Wei, Douglas-Westwood Singapore
Eni has agreed to sell to BP a 10% participating interest in the Shorouk Concession, offshore Egypt, where the supergiant gas field Zohr is located. The deal was struck for 375 million USD and a 150 million USD pro-quota reimbursement of past capital expenditures.
Eni has agreed to sell to BP a 10% participating interest in the Shorouk Concession, offshore Egypt, where the supergiant gas field Zohr is located. Eni, through its subsidiary IEOC, currently holds a 100% stake in the block.
Egyptian offshore where Eni discovered Zohr. Image courtesy: Eniday
The agreed conditions include a consideration of 375 million US dollars and the pro-quota reimbursement of past expenditures, which amount so far at approximately 150 million US dollars. In addition, BP has an option to buy a further 5% stake under the same terms. This transaction is in line with the Eni’s “dual exploration model” aiming at an early monetization of the value through the dilution of recent huge exploration discoveries owned with high participating interests.
The completion of the transaction is subject to the fulfillment of certain standard conditions, including all necessary authorizations from Egypt’s authorities.
The Zohr field, located in the Shorouk Concession, was discovered by Eni in August 2015 and is the largest natural gas field ever found in the Mediterranean, with a total potential of 850 billion cubic meters of gas in place. On February 2016, the authorization process for the development of field was completed, while the first gas is expected by the end of 2017.
Eni has been present in Egypt since 1954 where it operates through IEOC Production BV. The equity production was about 200,000 barrels of oil equivalent per day in 2015.
Kongsberg Maritime has launched a new Dynamic Positioning (DP) Maintenance Refresher Course for personnel involved in the maintenance of a vessel’s DP System. The new two-day course will be available at KONGSBERG training centers globally and has been developed to provide the technical and refresher training as recommended in the latest International Marine Contractors Association (IMCA) guidelines (M117 Rev.2) in addition to compliance with IMO-STCW Part B section B-V/f.
The first Dynamic Positioning (DP) Maintenance Refresher course took place last week at Kongsberg Maritime’s training center in Kongsberg, Norway. Kongsberg Maritime Ltd’s Aberdeen training center will host its first Dynamic Positioning (DP) Maintenance Refresher course starting on 18th January, with courses in February, March and April already scheduled to meet predicted demand for this unique training.
The new DP Maintenance Refresher Course directly addresses the latest IMCA guidelines
KONGSBERG’s new DP Maintenance Refresher Course offers in-depth training to reduce the risk of accidents involving the DP system on board and to ensure that Electrical/ Electronic Engineers (ETOs) and maintenance personnel can continue to identify faults and perform periodic maintenance in a competent and safe manner. The course is also suitable for personnel who have not worked with a DP system for a long period or are due to work with a vessel that has been upgraded from legacy KONGSBERG DP systems to the current generation K-Pos DP systems and K-Master workstations.
A task-centered approach created in accordance with DNV-GL standard ST-0008 Learning Programs, the DP Maintenance Refresher Course combines theoretical lessons and practical exercises, with the main part focused on technical aspects and fault finding. The technical bridge in the training center will be used for theoretical and practical exercises. Participants must have previously attended a DP Maintenance course for KONGSBERG systems and in order to benefit fully, participants should have general knowledge of electronics and computer-based control systems.
“Competence and awareness leads to increased operational safety, which is why training has been a core aspect of our work since KONGSBERG led the DP revolution in the 1970s and we are committed to continually improving and updating the course offering at our training centers worldwide,” said Eirik Hagensen, General Manager, Global Customer Training, Kongsberg Maritime. “The new DP Maintenance Refresher Course directly addresses the latest IMCA guidelines while meeting high demand for training on Kongsberg Maritime’s latest generation of DP systems.”
New decommissioning service launched by Lloyd's Register helps operators, equity holders, investors and regulators navigate the regulatory and technical complexities of late-life operations and decommissioning to drive significant cost savings, improve project efficiency, reduce risk, and safely decommission assets and facilities.
In-depth technical knowledge, cost estimation and determining decommissioning risk liabilities make it easier for companies to plan and execute with confidence against a challenging low oil-price market.
"Operators are faced with a huge challenge and conflict between maximizing economic recovery, a low oil price and decommissioning on the horizon," says Alasdair Buchanan, Energy Director at Lloyd's Register.
"We understand decommissioning requires an investment with little to no return for operators, accompanied by an element of ambiguity globally about the requirements set by regulators and uncertainty on long term liability. The onus is on operators to execute decommissioning in the most cost effective manner, especially in jurisdictions such as the UKCS where tax relief is available on decommissioning activities."
Image courtesy: Lloyd’s Register
Lloyd's Register is offering an integrated portfolio of late-life and decommissioning services to support operators, equity holders and regulators in key territories including the UKCS, GOM and across Asia in how best to manage their operations productivity, with minimal risk and cost effectively in the run up to Cessation of Production (CoP) and decommissioning.
"We are launching this new service to help duty holders, owners, operators, equity holders and regulators drive significant cost savings, improve project efficiency, reduce risk and safely decommission assets and facilities," highlights Buchanan. "Following several years of acquisition, we have the in-house capability to support industry across late-life operations and decommissioning. It is a unique offering from CoP preparation, planning and surveys, to plug and abandonment, waste management and monitoring post removal – all from one independent provider."
The expertise covers subsea operations through to topsides, offshore and onshore technical and engineering solutions, project and data management, assurance and commercial services.
Industry estimates suggest the tax certainty created by the UK Government's policy for oil and gas decommissioning will drive at least an additional £13 billions of capital investment in the North Sea.
"If you're responsible for any element of decommissioning or if your operations are moving towards CoP, you'll know only too well the scale of the project ahead of you," says Buchanan. "For any operator or investor, issues exist around managing costs, environmental and safety implications and the daunting challenge of navigating through the regulations and standards that must be adhered to, but it doesn't have to be a daunting process."
"We offer a wide range of services across the decommissioning life-cycle that provide a standardized process to decommissioning, that in itself, will lead to further cost savings and commercial incentives in planning, project managing, budgeting and execution."
The company has brought together a decade of investment in new technology and company acquisitions, and which now give operators a one-stop-shop for the technical expertise and experience needed to run decommissioning projects. Its unique standardized process to decommissioning can be applied in:
"Determining the nature, timing and sequence of ending the life of a field or facility, in the most cost effective way, requires specialist knowledge of the reservoir, well design, production properties and the process equipment."
Buchanan states that before any operator embarks on decommissioning, experienced subsurface teams are needed that use specialists in geology, geophysics, petrophysics, reservoir and petroleum engineering and field development to conduct a range of technical studies.
"Our aim is to provide a high level of certainty and reassurance to industry that the approach to decommissioning and the associated costs of carrying out decommissioning can be done effectively," emphasizes Buchanan. "The oil price drop has made decommissioning more relevant for many operators and we believe that as those costs are so big at the end of field life, cost estimates for decommissioning should be subject to careful scrutiny.
"Our process at Lloyd's Register is also about understanding the minimum that needs to done to achieve a safe and robust decommissioning process. It is also important that solutions are not over-engineered or over compensated for in costly, unnecessary remedial activity that has little to do with compliance to certain standards or processes."
Lloyd's Register points out that the service extends to non-operated partners or M&A organizations.
"If you are considering an asset purchase or transfer, you need to understand your decommissioning liabilities and where you are exposed to cost escalation," comments Buchanan. "Our independent evaluations provide that in-depth asset knowledge, residual value determination and decommissioning cost liabilities."
Unique Group, a leading integrated subsea and offshore solution provider, has announced that its On-Site Engineering division, through its Wellube brand, has partnered with KSB Group to offer a new service to its customers in the Middle East and Africa region. On-Site Spark Erosion is the latest addition to the division's wide portfolio of services that include hot tapping & line stopping, on-site machining, and safety valve testing among many others.
The KSB Group, headquartered in Germany, is a leading supplier of pumps, valves and services. KSB also continues to remain the world market leaders in the spark erosion industry supplying their services for over 20 years to a wide variety of sectors ranging from oil and gas to marine.
Removal of the coupling bolts on a 9E gas turbine using spark erosion technique. Photo credit: Unique Group
Spark erosion, also known as metal disintegration or electro discharge machining (EDM), is a technique that's primarily used for tap, stud, bolt and drill removal or seized fasteners. The cutting action of a metal disintegrator is accomplished by creating a series of intermittent electric arcs that break down the hardest metals into minute particles in a safe and controlled manner.
An electrode, held in the head of the disintegrator, vibrates as it cuts while a coolant is pumped through the electrode to wash away the powdered metal. The technique chiefly employs electrical energy to remove metal from the work piece without creating any contact with it. The technique can also be used for marine and marine engine repairs.
As there are no cutting forces involved in a spark erosion process, delicate operations can be performed on thin work pieces. The technique can produce shapes unobtainable by a conventional machining process and can also be used to provide a texture on the inside of mold tools for plastic products.
Sahil Gandhi, Director at Unique Group's On-Site Engineering division commented, "Our Wellube brand is widely recognized as a leader in the provision of on-site machining services. As a world-renowned brand, we're continuously on the lookout to grow our reach by offering new services to customers the world over. The decision to partner with KSB was imminent considering their in-depth experience in the spark erosion industry."
"Their spark erosion machines are powerful and highly reliable, thereby ensuring maximum material removal in minimum time, thus keeping the customer on schedule."
Paul Eccles, Spark Erosion Sales Manager at KSB asserted, "We're pleased with our new association with Unique Group. We at KSB have always aimed at giving our customers the best possible service to suit their business needs backed by a 24hr support plan and the same ideology resonates with the Unique Group team. Their strong customer base and sound knowledge of the market is instrumental in establishing the best-in-class metal disintegration service to customers in the region."
MetOcean Solutions recently provided free access to all their hindcast data statistics from around the world.
"Anyone with internet access can now view and download historical weather statistics from a range of global locations," states Dr. Rafael Guedes, Manager of Hindcasts. "In total we have statistics available from more than 380,000 datapoints around the world, a number which is constantly increasing as we run our models for new locations."
Historical data such as 100 year return period value (RPV) wave height is important baseline information for anyone operating in the ocean.
MetOcean Solutions’ hindcast data provide high quality marine weather information generated in-house by a team of expert scientists using state-of-the-art atmospheric and oceanographic models. The hindcast statistics can be accessed through the MetOceanView platform with no login required.
"Our historical data archives reach back to 1979," adds Rafael. "The information available includes wind and wave distribution statistics, roses, joint probability tables and extreme value analysis data."
Suitable for environmental investigations and climate analysis, the datasets offer key baseline information for project scoping, offshore and coastal design, project planning and environmental impact assessment.
"We display tiles with gridded statistics from selected global datasets, including gridded mean wave height, period and direction for total swell and wind-sea wave components, percentiles and extreme value analysis of significant wave height and wind speed, vector-average currents, as well as mean air and sea-surface temperature."
Click here for free access to the more than 380,000 hindcast data locations worldwide.
For a list of full historical datasets available, click here.
Statoil and Petrobras have completed their previously announced transaction, whereby Statoil has acquired Petrobras’ 66% operated interest of the BM-S-8 offshore license in Brazil’s Santos basin.
Photo courtesy: Statoil
BM-S-8 contains a substantial part of the Carcará pre-salt oil discovery.
On the completion of the transaction, Statoil has paid Petrobras USD 1.25 billion, half of the total consideration. The remainder will be paid at the passage of certain future milestones, mainly relating to the future unitization of Carcará.
| Location | Interest | Status | |
|---|---|---|---|
| Peregrino | Campos-basin | 60% (operator) | Production in 3Q 2016 was 69,500 barrels a day Reserves of 300-600 million barrels of oil |
| Peregrino Phase II | Campos-basin | 60% (operator) | Construction Production from 2020 at c. 60,000 barrels a day Reserves ~255 million barrels of oil |
| Licence BM-C-33 comprising the Pão de Açúcar, Gavea and Seat discoveries | Campos-basin | 35% (operator) | Evaluation/development Approximately 1bn boe in recoverable reserves |
| Licence BM-S-8 comprising the Carcará discovery and exploration prospects | Santos-basin | 66 % (operator) | Evaluation/development, pre-unitization Approximately 700 to 1,300 million boe recoverable reserves within the license from Carcará, plus additional exploration upside |
| Eight exploration blocks | Espírito Santo-basin | Four operated by Statoil, four by Petrobras | Exploration |
Trelleborg’s offshore operation based in Houston has invested in a new Global Riser Analysis team to incorporate in-house mathematical simulation capabilities into its current engineering group.
The Global Riser Analysis team consists of experienced local and global finite element (FE) and computational fluid dynamics (CFD) analysis personnel utilizing specialized software to enable Trelleborg to deliver an even more complete engineering service to new and existing customers. The team are able to model equipment and system responses to environmental forces, providing greater opportunities for design optimization across the full range of Trelleborg’s product offerings. Potential benefits to customers include cost savings, increased service life and multi-functional designs.
Riser Analysis team 2. Image courtesy: Trelleborg
Antony Croston, Business Group Director with Trelleborg’s offshore operation states: “We are committed to continuously improving our engineering and manufacturing services and the Global Riser Analysis team will be a great addition to our engineering group. Through this new service, the team will help advance our product development and design opportunities at the system level as well as bring innovative ideas and cost savings to our customers.”
In addition to advances in product design, Trelleborg’s offshore operation aims to utilize established consulting backgrounds within the Global Riser Analysis team to offer customers in-house global and local analyses of offshore drilling and production operations, applying a fully coupled vessel to well approach. These riser studies will assist clients in defining operational methodologies and structural system limitations for offshore drilling and production operations globally.
Croston continues: “The Riser Analysis team will be able to consult with our clients on active projects and offer the best solution based on a true optimization of product performance and the overall effect on the system design. We will be ideally placed to advise which design choices give the biggest payback in terms of maximizing operational efficiency.
“Our future strategy is to expand our analysis capabilities, through partnerships, integration of real world data from field deployed acquisition systems, and verification testing to develop creative solutions to the present and future challenges presented to the offshore energy industries.”
The Global Riser Analysis team is currently developing solutions to reduce drilling riser drag and fatigue loadings for the purposes of improving rig uptime in the most demanding environments.
Offshore accommodation and workspace solutions specialist HB Rentals has secured contracts in excess of £1,000,000 for the manufacture of workshops, local equipment rooms and pressurised offshore service modules for multiple clients.
The company was commissioned by Prosafe to design, manufacture and supply two DNV 2.7-1 and 2.7-2, Safe Area certified welding workshops for the Safe Zephyrus semi-submersible accommodation vessel, operating offshore Norway.
HB Rentals was also commissioned to design, manufacture and supply a local equipment room by OneSubsea GmbH for subsea operations in the Taurus Libra field, offshore Egypt. The module was required to be DNV 2.7-1 and 2.7-2, A60 and Safe Area certified.
And HB Rentals was commissioned by Semco Maritime to design, manufacture and supply a DNV 2.7-1, A60, Zone II rated pressurised offshore service module for subsea services in the UK sector of the North Sea.
All of the modules were designed and manufactured at HB Rentals’ service facilities in Sauchen, Aberdeenshire. The premises include almost 3,000m sq. of workshops and stores, incorporating a fully equipped 450m sq. fabrication shop and a 2,000m sq. outfitting shop.
HB Rentals is a Superior Energy Services company that specialises in the design, manufacture, sale and rental of DNV & ABS certified temporary offshore accommodation solutions, Zone I/Zone II hazardous area service modules, and workshop and refrigeration containers. The global organisation has been based in Aberdeen and Aberdeenshire for more than 25 years.
HB Rentals managing director Norman Porter said: “At a time when the industry is experiencing significant challenges, these multiple contracts in our expanding build for sale division represent good news not only for us but for the sector in the North-east of Scotland as a whole.
“The personnel and facilities we have in our workshop and service premises have once again enabled us to design and create a range of modules to the very highest standards, which we hope will provide an environment to assist our clients in achieving their targets.”
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