Last week DW renewables delegates attended the RenewableUK Annual Conference and Exhibition. In wake of the Global Offshore Wind Conference in June, expectations were for an upbeat demonstration of what the UK could provide in terms of world-leading technology and renewable solutions. However, the last few months have been somewhat tumultuous for our renewables industry, with the general feeling among attendees that the government had abandoned the industry at short-notice.

Dealing with what RenewableUK Chief Executive Maria McCaffery noted as an “ideological entrenchment”, the UK renewables industry now has two main points of focus: to maintain current cost-cutting efficiencies in order to make home-grown renewable power more cost-competitive, and to bring the government back on-side. We are on the right path – in some regions onshore wind is becoming competitive with gas and coal whilst solar is also making inroads on the LCoE gap; the main hurdle is in ensuring a strong pipeline, through public and government support. As noted by several speakers throughout the two days, this industry has the potential to secure energy supply, provide jobs and bring investment to the UK.

On display at RenewableUK, new technologies showed just how quickly the industry is developing. The UK offshore wind market, now forecast by DW to reach 27GW by 2020, is forcing the supply chain to react and innovate at pace. The use of aviation in the form of both drones and helicopters is part of the next phase of progress, both reducing operational costs and enabling digital inspection of turbines. Helicopters and wind-specific SOVs will see growth in this market, catering to the demands of the huge round three projects which will lie farther offshore; and as our industry matures so will our understanding of best-practice, which will inevitably aid further development.

Shell Nigeria Exploration and Production Company Ltd (SNEPCo) has announced the start-up of production from the Bonga Phase 3 project.

Andrew Brown, Shell’s Upstream International Director, said: “This new start up is another important milestone for Bonga, adding valuable new production to this major facility.”
 
Bonga Phase 3 is an expansion of the Bonga Main development, with peak production expected to be some 50,000 barrels of oil equivalent. This will be transported through existing pipelines to the Bonga floating production storage and offloading (FPSO) facility, which has the capacity to produce more than 200,000 barrels of oil and 150 million standard cubic feet of gas a day.



The Bonga field, which began producing oil and gas in 2005, was Nigeria’s first deep-water development in depths of more than 1,000 meters. Bonga has produced over 600 million barrels of oil to date.

The Bonga project is operated by SNEPCo as contractor under a production sharing contract with the Nigerian National Petroleum Company, which holds the lease for OML 118, in which the Bonga field is located. SNEPCo holds a 55% contractor interest in OML 118. The other co-venturers are Esso Exploration & Production Nigeria Ltd (20%), Total E&P Nigeria Ltd (12.5%) and Nigerian Agip Exploration Ltd (12.5%).

The Bonga North West development began producing vital energy resources in August 2014. The field is located around 120 km off the coast of Nigeria in the Gulf of Guinea at a depth off more than 1,000 meters (3,300 feet). All six wells (four oil producing and two water injection wells) are now completed and on stream, contributing more than 40,000 barrels of oil equivalent at peak annual production. This is transported by a new undersea pipeline to the upgraded Bonga floating production, storage and offloading facility.

Registration totals exceeded expectations as 13,500 global exploration and production professionals gathered at the Society of Petroleum Engineers (SPE) flagship event the Annual Technical Conference and Exhibition (ATCE) at the George R. Brown Convention Center in Houston over three days last week 28-30 September.

“2040: The Journey and the Destination—Diverse Perspectives” was the Opening General Session theme on Monday. ATCE 2015 General Chairperson, Gustavo Hernández-García, director of operations for PEMEX E&P, introduced a distinguished panel of industry experts who discussed current trends and the recent challenges faced by the oil and gas industry. However, discussion stressed the resilience of the industry, the continued importance of fossil fuel energy to the world economy, and reassurance the industry will come through a difficult period and be stronger. Panel member Scott Tinker, director of the Bureau of Economic Geology said the energy mix has changed little in the past 35 years. “It’s driven by security. Is energy affordable, available, reliable, and sustainable? A lower price over a long time extends the future of oil.” He adds, “I continue to believe that energy is the greatest industry on the planet. It underpins everything.”

2015 President Helge Hove Haldorsen focused his comments on “the new normal.” At the Opening General Session he said, “We need to continuously adapt, strengthen, and reinvent our industry because oil and gas will be needed for decades to come.” On Wednesday he wrapped up his presidential term saying, “We will see what the new normal will be.”

Nathan Meehan began his term as SPE 2016 president with his vision stating, “We are on a mission to educate and provide safe, affordable energy to improve people’s lives.” Meehan said his priorities for the year ahead will focus on stressing public benefit; mentoring the next generation; sustainability; as well as health, safety, and environmental issues.

The more than 400 technical presentations provided break-through and improved efficiencies for best practices for the oil and gas industry. The 500 exhibits offered promising new and enhanced products and services. Networking opportunities were expanded due to the Open Access Day on Wednesday where more than 400 people took advantage of the complimentary registration. The conference featured more than 45 technical sessions, 34 training sessions, and young professional and student events and activities.

Some new features of the conference included the ENGenious program, which resulted in standing room only presentations from innovative technology companies. Another new feature was the opportunity to access live-stream and virtual sessions for those who could not attend the conference.

Participating in ATCE were engineers, operators, scientists, managers, and executives involved in all aspects of the global petroleum industry. ATCE offered unique opportunities for people at all career levels - including young professionals and students - to meet industry experts, network with peers, and access new technologies.

ATCE 2016 will be held in Dubai 26-28 September at the Dubai World Trade Centre.

Aker Solutions has been awarded a contract from Murphy Sabah Oil Co., Ltd. (Murphy) to deliver the subsea production system for the Rotan deepwater natural gas development offshore Malaysia.

The delivery includes hardware for four subsea wells, a hub manifold, in-line tees, a connection system and production control system. First deliveries are scheduled for the second quarter of 2016. The contract will be booked as part of the company's third-quarter order intake.

"We're very pleased to team up with Murphy on this important development," said Ravi Kashyap, country manager for Aker Solutions in Malaysia. "We look forward to continuing the good cooperation we've built over several years having worked with Murphy on other projects in this strategically important region."

Aker Solutions has worked with Murphy on the Kikeh oil and gas project, the first deepwater development in Malaysia, and the Siakap North-Petai oil and gas development, a tieback to Kikeh. Both fields are in Block K offshore East Malaysia at the easternmost state, on the island of Borneo.

GMC has received an award from DeepStar (www.deepstar.org) as part of DeepStar Phase XII-B funding. The project titled ‘Testing of High-Strength Mechanically Connected Steel Riser’ will demonstrate the strength and fatigue resistance of high-strength mechanically connected and friction welded pipe for steel catenary riser applications. Full-scale testing will be performed to Industry Standards for risers and pipelines and will include mechanical testing of friction joints, as well as full-scale fatigue testing friction joints and the connector rated for 15Ksi pressure service.

“This project award underscores the urgent requirement in the offshore oil & gas industry to develop cost effective technical solutions for developing deepwater and ultra-deepwater prospects. Completion of this testing will significantly advance the technology readiness level of GMC’s Intelligently Connected Pipe (ICP™). GMC appreciates the support of the DeepStar organization who play a key role in advancing new technologies to solve offshore challenges,” said Glen Viau, Chief Operating Officer of GMC Limited.

About DeepStar

DeepStar is an innovative, joint-industry technology development project that has established itself as upstream’s longest-running and most successful research consortium. DeepStar is committed to advancing the technologies of its members deepwater business needs in order to increase production and reserves. DeepStar consortium provides a forum to execute deepwater technology development projects and to leverage the financial and technical resources of the deepwater industry. DeepStar Phase XII commenced in January 2014 with twelve Oil Company Participants. DeepStar participants represent a strong mix of large and mid-size operators, USA and non-USA based, drawing in a rich array of diverse expertise to address common deepwater challenges.

Fugro Scout, the new 83-metre geotechnical drilling vessel, has completed its maiden project in the Middle East. Since its maiden project in the Persian Gulf it has been successfully deployed in the Arabian Sea and the Red Sea, completing several geotechnical and geophysical survey scopes for various clients. The vessel is currently in transit to The Netherlands to execute a geotechnical survey for an offshore windfarm in the Dutch sector of the North Sea.

The new vessel is specifically designed to address the varied demands of both the shallow and deep water survey markets. With a twin tower drilling derrick over a centrally located moon pool, the Fugro Scout supports automated pipe and tool handling equipment to promote safe drill floor operations. A large soil laboratory provides a unique open plan working environment for geotechnical operators; other equipment includes both downhole and seabed sampling and testing systems rated for 3,000 meters water depth. The vessel is equipped with a dynamic positioning station holding capability (DP2) and is built to Comfort Class COMF-V(3) standards with quarters for up to 60 operational staff.

Like the Fugro Voyager drillship, the new Fugro Scout vessel represents a further advancement in marine technology and enables Fugro to standardize its global operations. A range of specialist equipment and subject matter experts enables Fugro to help customers reduce the risks associated with wells and subsea infrastructure.

ABS, the leading provider of classification services to the global offshore industry, has granted Mitsui Engineering & Shipbuilding Co. Ltd. (MES) approval in principle (AIP) for a floating production, storage and offloading (FPSO) vessel design and an epoch-making construction concept.

This work is the result of an ABS/MES joint development project that began in March 2015. The "noah-flex modular design" for the FPSO and the flexible construction procedure, "noah-flex modular construction," were granted AIP on 15 September.

"ABS is working with industry to develop and employ new technologies," says ABS Chairman, President and CEO Christopher J. Wiernicki. "To effectively support Class of the Future, ABS has to provide the services the industry needs to make adjustments as operating conditions and markets change. Granting AIP to new technologies is an essential element of that future."

"ABS is one of the world's leading classification societies with excellent technology and a wealth of know-how in the offshore industry," says MES General Manager Dr. Taketsune Matsumura. "MES recognizes that ABS is our dependable partner and plays an indispensable role in developing and realizing such an epoch-making concept as our "noah-FPSO Hull."

The noah-flex modular construction processes consists of multiple steps that take place in parallel to shorten the construction time efficiently, with keel laying marking the commencement of construction. The first step of the project is FPSO design and hull construction, including propulsion and relevant machinery equipment/systems, which will be carried out by MES, Japan while construction of the oil storage component takes place at another yard, outside Japan for example. Following this process, the topside facilities will be subsequently/simultaneously fabricated in the different/the same shipyard and installed on the elongated hull, after which the completed FPSO will move to the specified operation site for hookup and commissioning.

The FPSO design will be reviewed for compliance with the ABS Rules and applicable International/National Regulations to make sure the unit is in full compliance, particularly when executing transits from one shipyard to another during construction.

"ABS recognizes that working with industry to advance technology is critical," says ABS Special Advisor Ken Tamura. "Engaging in this project with Mitsui provided ABS the opportunity to help shape the future of vessel construction."

The American Heart Association has recognized Danos for its commitment to employee health and wellness. The company was named a Gold-level Fit Friendly Worksite for offering employees physical activity support, healthy eating options and promoting a wellness culture.

Danos employees benefit from a variety of health and wellness initiatives, including an on-site gym that can be accessed by employees 24/7. The gym offers treadmills, elliptical trainers, stationary bikes and free weights, along with men’s and women’s locker rooms with shower facilities. The company’s new 61,000-square-foot facility also includes the Bayou Market, which offers healthy, affordable options for busy workers like soups, salads and sandwiches prepared fresh daily.

Danos also sponsors a number of local events, like half-marathons, 5K races and triathlons, and even pays the entry fee for employees who participate. Company-wide fitness challenges build teamwork and improve employee health.

“Danos is a family company, so we believe in putting our employees and their health first,” said Paul Danos, executive vice president. “We’re proud to offer a workplace that supports a healthy lifestyle.”

Aqueos Corporation, a premier subsea service provider for the offshore oil and gas sectors of the Gulf of Mexico and the Pacific West Coast, receives a prestigious safety award from a major Offshore Oil & Gas operator.

This distinguished award was presented to Aqueos President and CEO, Ted Roche, during a recent Safety forum and recognizes Aqueos Corporation for “Safety Excellence” for working over 505,592 hours without a recordable injury. “This is evidence of the hard work and commitment of our offshore personnel, a supportive and talented project management and administrative staff, and steadfast senior management all working as a focused team,” comments Ted Roche.

Roche further commented, “We attribute a large part of our success to continuous improvement, communication, and remaining focused on our core value of safety. Even in these difficult market conditions, the team at Aqueos looks forward to continued managed growth without sacrificing our core values.”

Aqueos Corporation, with offices in Broussard, LA and Ventura, CA, provides marine construction and specialty subsea services, including a complete range of commercial diving, remotely operated vehicles (ROV’s) and vessel-related services primarily to the offshore oil and gas markets.

On 2 October 2015, Statoil acquired First Oil’s 24% equity share in the UK license for the Alfa Sentral field for USD 15 million.

Alfa Sentral is a c.60 mmboe gas and condensate field planned to be developed as a tie-back to the existing infrastructure for Sleipner on the Norwegian Continental Shelf (NCS), which Statoil operates. Alfa Sentral will therefore increase the utilization of the Sleipner facilities.

“Statoil has set ambitious goals for future activity, production and value creation. This transaction demonstrates the potential on both the UK and Norwegian side of the Continental Shelf. The acquisition of this Alfa Sentral license increases the resource base and strengthens our efforts to further develop the Sleipner area towards 2030", says Mette Halvorsen Ottøy, senior vice president for the operations south cluster in Development & Production Norway (DPN).

Through this transaction Statoil has taken a 24% interest in UK Continental Shelf (UKCS) license P312 which, with license PL046 on the NCS, comprises the Alfa Sentral field. Statoil is the operator in PL046 with a 62% holding.

As a result, Statoil has increased its equity holding in a high priority project in a core area, deepening its presence on both the NCS and UKCS. The transaction is expected to close by the end of 2015.

Concept selection for the Alfa Sentral project was passed in September 2015. Negotiations to unities the field will commence shortly. A final investment decision is planned for late 2016 with production start-up in 2020.

Willard Marine, global leader in the manufacture of mission-proven boats, was awarded a contract to provide the National Oceanic and Atmospheric Administration (NOAA) with three aluminum Hydrographic Survey Launch Ships.

The three 28-foot Hydrographic Survey Launch Ships (HSLs) will be used on the coastal waters of the United States to conduct oceanographic surveys with hull-mounted and towed sonar units. A Cummins QSC8.3 engine capable of 510 HP with a ZF Marine 305-2 transmission will be used to power the boats. Outfitted to support traditional manned survey operations, the HSLs will offer additional flexibility to add unmanned autonomous capability. Two Willard Marine HSLs will be built for the 208-foot NOAA ship Thomas Jefferson, and an additional Willard Marine HSL will be built for the 231-foot NOAA ship Rainier, reported by NOAA to be one of the most modern and productive hydrographic survey platforms of its type in the world.

Using advanced sonar technology, the crews of the Thomas Jefferson and Rainier conduct hydrographic surveys for the primary purpose of updating NOAA’s suite of nautical charts. Commercial shipping, commercial fishing and recreational vessels all rely on accurate NOAA nautical charts for safe navigation of coastal water in the United States.

“For 35 years, Willard Marine has built dependable, mission-proven vessels for American and international government agencies around the world,” said Ulrich Gottschling, president of Willard Marine. “NOAA has been procuring fiberglass SOLAS rescue boats from Willard Marine since 2004, and we are proud to continue serving them with larger, aluminum survey ships to support their very important charting responsibilities,” Gottschling added.

The customized HSLs for NOAA are derived from a former SeaArk Marine commercial boat design that Willard Marine acquired the licensing rights to last year. The HSLs are scheduled to be delivered to NOAA in Fall of 2016.

NYC-based PIRA Energy Group Reports that global oil stocks will draw less than normal in 4Q15, increasing the inventory excess. U.S. commercial crude stocks built the week ending September 25th to a new record high. In Japan, crude runs dropped, but imports stayed sufficiently low to contain crude stock change. Specifically, PIRA’s analysis of the oil market fundamentals has revealed the following:

European Oil Market Forecast

Global oil stocks will draw less than normal in 4Q15, but the demand for inventory should set a floor for prices, limiting deterioration in the first half of the quarter. PIRA expects prompt crude prices to actually rally with stock draws later in the quarter but a sustainable rally will have to wait on physical balances substantially tightening in 2016. Gasoline cracks are declining seasonally. For middle distillates, high stocks will linger into next year capping diesel cracks. European refinery margins were the best in many years over the summer but are now coming off.

Bearish Storage Risks Ahead of Structurally Tighter Balances

Thanks to hot-weather-aided gas-fired electricity generation and tepid sequential production growth, concerns over storage congestion have diminished for the remainder of the injection season. Yet, bearish Henry Hub price risks persist in the near-term landscape; in particular, Producing Region stocks are still headed to an all-time end-October high.

Western Grid Market Forecast: September 2015

Strong cooling loads helped maintain California prices near July/August levels despite weaker gas prices. Mid-Columbia and Palo Verde markets both declined month-on-month. In the Northwest, below normal temperatures sapped late summer cooling loads while hydro output and net imports from BC held up well, supported by much above normal precipitation in the province. In the Southwest, seasonal cooling load declines reduced the call on less efficient generation and implied heat rates tumbled.

Coal Pricing Sinks Further on Softening Global Demand Growth Prospects

Physical coal prices again moved lower over the past month with weak macroeconomic data coming out of China, softness in the oil market, and generally unsupportive fundamentals. So long as China’s thermal coal imports decline year-on-year, it will be difficult for FOB Newcastle prices to rally. Both CIF ARA (Northwest Europe) and FOB Richards Bay (South Africa) prices also fell this past month, with slack demand from India driving the latter price lower. While Pacific Basin balances have the potential for tightening, weaker import demand in Europe and robust supply will keep Atlantic prices weak relative to Pacific.

European Electricity Markets Scorecard

The short-term pricing picture remains heavily tied to the French nuclear availability. Lower French nuclear availability adds a layer of risk, especially since colder weather is expected from the middle of the week. In addition, Belgium's nuclear output is now set to stay closer to 2014 levels, which is to say that we expect no change in the total Belgium net imports through the balance of the year. The increase in the NTC with Spain is also broadly bullish, but flows have been typically volatile in 4Q15, depending on Spanish wind conditions.

U.S. Crude Stocks Grind Higher W/W

U.S. commercial crude stocks built the week ending September 25th to a new record high, a level 167.3 million barrels over 2014 levels. Crude stocks had the highest surplus of the year. Demand growth has begun to sputter, with the latest four weeks of adjusted demand basically flat year-on-year. Gasoline demand and jet demand - possibly driven by accumulations for non-commercial uses - remain strong performers. Refinery turnarounds will continue to dominate crude balances for the next few weeks, although not enough to cause containment issues.

India Presses Forward with Gas Price Reduction

The Indian government reduced the price of the locally-produced natural gas by 18% for six months beginning Thursday (Oct-1), following a global slide in commodity prices. This is the second six-month revision since November when the government introduced a gas price formula linking it with international prices following demands from the industry that prices were too low to incentivize producers. Following the introduction of the formula, the prices went up by a third, but fell about 8% in the first revision in April.

Aramco Pricing Adjustments for November- Lower for Asia and the U.S., Europe Higher

Saudi Arabia's formula prices for November were released. Significant discounts were extended for Asian pricing, more modest cuts to the U.S., while European prices were mostly raised. The more generous terms to Asia suggest a desire to encourage more Asian refiner liftings, especially with imminent 2016 contract discussions. Pricing fundamentals in Asia suggested a less aggressive stance could have been taken. Refining margins in Asia had strengthened over the month, as had the economic incentive of running Saudi crude against competing grades.

Sluggish Tone of September U.S. Jobs Data Is Potentially Worrisome

The U.S. employment situation report for September was discouraging in key respects. The reported pace of job growth decelerated sharply in recent months, and the sluggishness was widespread across major industries. The unemployment rate was flat month-to-month, but a fall in the labor force participation rate was disappointing. As for GDP, the underlying pace of growth was probably decent in the third quarter, even though the drag from the trade and inventory sectors was substantial. Outside the U.S., August industrial production in Japan and Brazil had negative implications for growth.

Gas Regional Basis Monthly, September 2015

Mother Nature proved to be no match for gas market bears despite a valiant effort on her part in the form of record-breaking CDDs this month. Even so, many cash price markers, including Henry Hub are near, if not at, new lows for the year. And headwinds remain that could warrant even lower prices. In the South, the Producing Region set record highs for injections in both September and October last year, yet end-October storage still only reached 1,120 BCF — the lowest level since 2008. With September refills set to rival last year’s record, and stocks already nearing record highs, refills need to be upwards of 1 BCF/D lower than a year ago this October.

Asia-Pacific Oil Market Forecast

The global oil surplus has not materially diminished. PIRA’s 4Q15 balances now show a smaller commercial stock draw in the three major OECD markets than our previous estimate. The forecast draw is less than normal. Global economic weakness, centered in Asia, is a growing concern.

U.S. Ethanol Prices Increased During September

U.S. ethanol values rose during most of September as the market tightened, with inventories falling to the lowest level of the year. Manufacturing margins fell early in the month, though some improvement was achieved the last week of the month.

Pricing Parity Between Regions Strongly Implies More European Buying in 4Q/1Q

At this week's PIRA Client Seminar in New York, we will take an expansive look at the short and long-term outlook for LNG gas balances in the broader context of the global gas market. It is a story that will be making buyers smile and sellers looking for answers to difficult questions in the years to come.

U.S. July 2015 DOE Monthly Revisions

DOE released its final monthly July 2015 (PSM) U.S. oil supply/demand data today. July 2015 demand came in 430 MB/D higher than what PIRA had carried in its monthly balances. Compared to the DOE weeklies, total demand was lowered 253 MB/D. Total demand for July '15 versus July '14 (PSA) grew 696 MB/D, or 3.6%, which maintained similar growth from June. End-July total commercial stocks stood at 1,273.5 MMBbls, lower than the PIRA's assumption for end-July by 13.9 MMBbls, with product lower by 10.2 MMBbls. Compared to the weekly preliminary data, DOE lowered total commercial stocks 0.4 MMBbls. While both crude and product remain in excess relative to last year, the crude excess grew only slightly, while the product excess fell a more significant 8.6 MMBbls.

U.S. Coal Market Forecast

U.S. Consumer stocks of both natural gas and coal are poised to remain above comfortable target levels (especially for the latter), with downside weather risks a notable concern for this coming winter given prospects for continued El Niño conditions through early 2016. This poses downside price risks for gas, and thus coal over this coming winter.

Japan Data Show Storm and Holiday Impacts

Two weeks of data were reported due to the string of holidays September 21-23. Japanese crude runs dropped both weeks, but imports stayed sufficiently low to contain crude stock changes. Gasoline demand was disappointing driven lower by a typhoon and then displayed only modest holiday uplift, with stock builds for both weeks. Gasoil demand was much higher in the first week, and then sharply lower. Kerosene stocks drew marginally the first week, on continuing good seasonal demand and then compensated with a sizable stock build on lower demand. Refining margins are strong and supported by a late-season resurgence in gas cracks.

Weather-adjusted Balances Fueling Renewed Downward Price Momentum

In spite of a major leg-up from September CDDs, more than 30% above normal, PIRA’s balances show considerable weakness in weather-adjusted gas-fired electrical generation along with further weakness in the industrial sector.

Harvest Low Chatter

Every year around this time we hear the seasonal traders talking about harvest lows. Last year it happened on October 1st for both corn and soybeans, so the short memories are still intact.

International Coal Markets Scorecard

Coal prices continue to test new lows last week, with the temporary lifting of the Fenoco rail ban in Colombia and weaker oil prices pressuring the coal market lower. There has been a decided lack of bullish developments in this market, with very limited upside for demand (with considerable downside if China’s imports continue to implode), and not enough supply coming off the market. The gas and oil markets are not providing any support for coal prices either, with input costs for coal producing dragging valuations lower.

Global LPG Weekly Scorecard

Recent fundamentals developments in global LPG, including price issues, international arbitrage, trade flows, petrochemical margins, operating rates, spot and forward feedstock preferences, as well as the divergent regional weather influences.

European Economy

Europe experienced a constructive pace of economic growth during 3Q15, according to recent activity and confidence indicators. Credit data also improved markedly, as the European Central Bank’s aggressive policy easing has begun to bear fruit. But the economic outlook has become somewhat uncertain recently, due to several worrisome developments. The list of concerns includes possible negative spillover effects from emerging market weakness, volatility in financial markets, and declining long-term inflation expectations.

Global Equities Rebound W/W

Global equity markets largely advanced the week ending October 2nd. In the U.S. equity market, materials and energy led the way. They had previously been two of the biggest laggards. Housing was the weakest performer and declined. Internationally, all the tracking equity indices advance strongly, other than Japan, which was neutral. On the week, the international equity tracking indices outperformed the advances made in the U.S.

Harvest Lows?

PIRA is not in the business of calling harvest lows, but we certainly respect the seasonality of these markets. Corn has held up better than beans for the loud chorus promoting a bottom, but corn has most definitely benefited from a wheat market that has led the way on many occasions over the past two weeks. Corn remains stuck between soybean weakness and wheat strength, not a great trading environment.

U.S. Ethanol Output Up/ Stocks Down

U.S. ethanol production rose 6 MB/D the week ending September 25 to 943 MB/D, rebounding from a 19-week low. Inventories declined by 118 thousand barrels to 18.8 million barrels, slightly lower than stocks at the same time last year.

European Gas Price Scorecard

Russian exports in September were the second highest of the year and will move higher as the weather becomes colder. With the ruble weakened and prices falling in dollars, the incentive for Russia to export as much gas as possible is both a strategic and financial imperative. Russian gas prices are more or less dead even with spot prices, although some buyers seem to have a discount to current NGC and Gaspool levels.

S&P 500 Higher at Week End

The S&P 500 declined on a weekly average basis. However, a strong performance on Friday allowed the market to close higher on a Friday-to-Friday basis even in the wake of a weak employment report. Volatility was higher, while high yield credit (HYG) and emerging market credit weakened (higher yields). Overall, commodities declined again, but ex-energy was flat. With regard to currencies, many of the emerging Asia currencies continued to weaken against the U.S. dollar, as did the Brazilian real and British pound. The Russian ruble strengthened.

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.

The oil and gas industry is by nature one of the most challenging environments in the world, so a high level of business integrity is critical to safely keep operations up and running. As a result of its commitment to continuous improvement in the industry, Trelleborg’s offshore operation in England has been awarded an International Organization for Standardization (ISO) / Technical Specification (TS) 29001:2011 certification.

The standard defines the quality management system requirements for the design, development, production, installation and service of products for the petroleum, petrochemical and natural gas industries.

Ray Cann, Operations Director for Trelleborg’s offshore operation, says: Meeting the criteria involved creating and implementing detailed procedures and auditing, as well as facilitating various cross functional meetings with individual departments over eight months. In addition we had to complete three British Standards Institute audits - a pre-assessment and stage one and two audits.

Though it was challenging in parts, we were committed to ensuring that all tasks were completed as thoroughly and effectively as possible and the hard work paid off. We believe that this accreditation will provide our customers with added peace of mind and the assurance of consistently high quality products and services.”

Developed as a result of a partnership between ISO and the international oil and gas industry (led by the American Petroleum Institute - API), ISO 29001 specifically focuses on the oil and gas supply chain. It aims to emphasize the prevention of defects and reduce variation and waste from service providers.

Meeting the requirements laid out by ISO/TS 29001:2011 ensures standardization and consistency across the sector and improved assurance in the supply of quality goods and services from providers. This is particularly important when the failure of goods or services have severe ramifications for the companies and industries involved.

To find out more about these products and services, please visit the website here.

RigNet, Inc. (NASDAQ: RNET), a leading global provider of remote managed offshore communications solutions, telecoms systems integration services and collaborative applications to the oil and gas industry, announced that it has signed an agreement with Inmarsat to offer Fleet Xpress, the maritime version of its Global Xpress service, to the oil and gas maritime sector. The agreement will enable RigNet to extend high-speed communications to offshore service and supply vessels within the oil and gas industry across the globe.

“RigNet differentiates itself in the oil and gas industry by providing fit-for-purpose technologies to help our energy customers operate remotely in a more productive, efficient and safe manner,” said Mark Slaughter, RigNet’s CEO and President. “The addition of Inmarsat’s Fleet Xpress to our energy maritime offerings will enable RigNet to deliver a high degree of service and functionality to this important sector of the oil and gas market.”

“We are continually looking to strengthen our partner network through working with organizations that have the length and breadth of experience, industry knowledge and commitment to best service the market”, commented Ronald Spithout, President, Inmarsat Maritime. “With the launch of Fleet Xpress, the world’s first hybrid Ka/L-band mobile satellite system, we are committed to driving innovation and bringing a new high-speed broadband service that will re-define maritime connectivity. By working with organizations such as RigNet, we can extend our market reach and open up new possibilities to the maritime community, offering competitive and innovative solutions.”

Deep Down, Inc. (OTCQX: DPDW) ("Deep Down"), an oilfield services company specializing in complex deepwater and ultra-deepwater oil production distribution system support services announced it has received the largest order in the company's history valued at $13 million directly from a super-major operator.

This order includes one phase of new systems and equipment to be delivered in 2016 for installation in the Gulf of Mexico. The project is structured to ensure a continuous cash-positive position for the company.

Ron Smith, Chief Executive Officer of Deep Down, Inc. stated, "Receiving an order of this magnitude, during the current industry downturn, is a major vote of confidence in our ability to continue providing innovative solutions for our customers. We are humbled by the trust placed in us and are well prepared for the work ahead."

Oil prices have stabilized in the $45-50 range over the last month, however, performances of major oilfield stocks have continued to suffer. According to analysis undertaken by DW, decline of a further 8% has been seen through September, down 39% year-on-year.

As E&P firms start to plan for 2016, the current oil price is driving expectations of further cutbacks in industry investment. Drillers have borne the brunt of oil price decline since June 2014. Declining rig utilization has been compounded by industry-wide cost deflation which has hit all companies reliant on providing services to the oilfield. According to DW’s World Oilfield Services Market Forecast total OFS expenditure has declined 36% over 2014-2015, while onshore and offshore drillers have seen an average of 57% and 51% of their value been wiped off stock markets respectively.

The oilfield equipment sector, however, appears to be faring better, with average stock performance declining only 20% according to DW analysis. Falling input prices, particularly steel, has led to an ability to better accommodate the tightening of operator purse strings.

Exposure to multiple upstream segments has aided the majority of manufacturers, particularly those involved in subsea manufacturing. The current subsea hardware backlog is high at $13.4bn (due to a significant number of contracts being agreed in the years preceding oil price decline) and this will take some 18-24 months to work-through, by which time we may see a raft of new orders if oil prices recover.

Manufacturers with capabilities outside of upstream oil and gas have fared better still, with healthy activity remaining in both midstream and offshore production systems. According to initial outputs from DW’s World Oilfield Equipment Market Forecast, only a 4% decline in midstream spend is expected in 2015, compared to 26% in upstream equipment. A detailed analysis of some 60 categories of equipment spend is due to be launched later this month. We will continue to follow the sector with keen interest.