• Extending life of Schiehallion and Loyal fields

• Contracts for Hook up & commissioning and follow-on engineering

Amec Foster Wheeler announces today that it has been awarded three contracts by BP to provide services to the Glen Lyon Floating Production, Storage and Offloading (FPSO) vessel as part of the Quad 204 Project, located 175 km west of the Shetland Isles, UK. The three reimbursable contracts are worth £31.5 million and will create 100 onshore and 50 offshore jobs.

The hook up and commissioning contract, worth £27 million, will run through to June 2017. Amec Foster Wheeler will hook up the new Glen Lyon FPSO to the Schiehallion and Loyal fields as part of the BP’s Quad 204 redevelopment, extending the life of the two fields, enabling them to continue production beyond 2035.

Amec Foster Wheeler will also provide follow-on engineering as part of a contract for any residual works that emerge during the transition from the yard in Korea to BP operations. This contract continues to June 2017.

Amec Foster Wheeler’s completions and commissioning specialist, qedi, is providing electrical and instrument technicians as part of the commissioning support to the Glen Lyon hook up. This £2 million contract will run through to June 2017.

Alan Johnstone, Amec Foster Wheeler’s Managing Director for Upstream Asset Solutions, said:

“We are delighted to work with BP on their Quad 204 redevelopment, which extends field life and contributes to the future sustainability of the Schiehallion and Loyal fields. The three contracts allow Amec Foster Wheeler to demonstrate its leading hook up and commissioning capabilities, whilst ensuring a focus on safe and efficient operations.”

Amec Foster Wheeler has been providing hook up and commissioning services to BP’s two new Clair Ridge platforms since 2013.

BP announced last week that the Glen Lyon has started sea trials as it begins its journey towards the west of Shetland. The Glen Lyon left the Hyundai Heavy Industry quayside in Ulsan, South Korea, on Saturday 5th December. It will now complete approximately two weeks of sea trials, after which it will return to the quayside for final class and flag approvals to certify it as a ship, a prerequisite before the long tow to west of Shetland can commence.

Offshore Installation Services Ltd (OIS), an Acteon company, has named Colin Shellard as its new managing director. Based in Aberdeen, Shellard is responsible for setting the strategy at OIS, as the company continues to focus on new opportunities in the offshore decommissioning sector. He will also play a key role in developing opportunities for OIS to work together with other Acteon companies.

Shellard has more than 16 years of experience in offshore construction and subsea engineering. He joined OIS as vice president, operations, in December 2014, and was instrumental in leading OIS’ recent successful well decommissioning campaign with Centrica Energy and Antrim Energy. Prior to joining OIS, Shellard was project director at Technip Offshore Wind Ltd, where he oversaw all projects and tenders in the company’s cables and marine renewables sector.

Shellard has extensive knowledge of pipe and umbilical lay, diving operations, structures installation, remote (driverless) construction and decommissioning methods and trenching, gained during his time at Stolt Offshore and Saipem. He has also worked in leadership roles within consulting engineering and project management firms JP Kenny and Prospect, developing a deep understanding of the management of small teams and complex problems that face Operators in the offshore industry.

Mark Towell, vice president, Acteon, said, “OIS recently completed its largest vessel-based, multi-operator well decommissioning campaign and is well-positioned to provide North Sea Operators with the most cost-effective way to decommission non-revenue generating assets beyond 2015. The Acteon management team welcomes Colin as a director of OIS, and we are confident he will build on his achievements to date.”

Shellard said, “Well decommissioning activities are ideally suited to multi-operator campaigns and the multi-well approach, and OIS demonstrates that significant economies of scale are available to Operators willing to participate in this way. I am looking forward to leading the continual growth of OIS and developing new opportunities for the company in the global decommissioning sector.”

Trelleborg’s offshore operation has been awarded a Pioneering Technologies Award at this year’s Ocean Star Gala event in Houston, Texas. Trelleborg was awarded for its significant contribution to drilling technology for marine riser buoyancy and the company now joins a select group of companies in the prestigious Offshore Energy Center Hall of Fame.

After pioneering the introduction of commercial syntactic foams in 1957, Trelleborg’s manufacturing facility in Houston supplied the first syntactic riser buoyancy modules for use in oil drilling in the Santa Barbara Channel in 1969. For the next decade every new deepwater drilling record was achieved using the company’s buoyancy, as depths reached up to 9,000 feet.

Upon receiving the award on behalf of the company, Mark Angus, Executive Vice President for Trelleborg’s offshore operation, said: "To be recognized for our pioneering work in the use of syntactic foam buoyancy in offshore drilling applications is a huge honor for Trelleborg. We were responsible for innovating the use of syntactic foams for marine buoyancy applications and these are still widely used in today’s most demanding offshore drilling applications. We are very proud to be the only syntactic foam buoyancy manufacturer to be invited into the Offshore Energy Center Hall of Fame."

Established in 1989, the Offshore Energy Center is dedicated to increasing awareness of the energy resources available beneath the world’s oceans and to record the unique heritage and technological accomplishments of the industry that discovers, produces, and delivers these resources.

The Pioneering Technologies Award recognizes important technologies and the development of those technologies by individuals, companies, organizations and institutions in the fields of offshore technology. The center’s Hall of Fame recognizes people and technological innovations that stand out in the development of the offshore industry and its resources.

Trelleborg’s marine riser buoyancy technology, specifically termed drill riser buoyancy modules (DRBM), helps to reduce a drilling riser’s net weight in water to ensure that the structure and drilling vessel are properly supported.

The Bureau of Safety and Environmental Enforcement (BSEE) has announced that offshore oil and gas lessees and owners of operating rights are now required to submit summaries of their actual expenditures for the decommissioning of wells, platforms and other facilities on the Outer Continental Shelf (OCS) as part of the final Decommissioning Costs Rule.

This information will help BSEE to better estimate future decommissioning costs related to OCS leases, rights-of-way, and rights of use and easement. The Bureau of Ocean Energy Management may use BSEE's future decommissioning costs estimates to set necessary financial assurance levels to minimize or eliminate the possibility that the government will incur decommissioning liability.

The Final Decommissioning Costs Rule will be published in the Federal Register Reading Room today and can be viewed by clicking here.

Halliburton and Baker Hughes Extend the Time Period for Closing the Transaction to No Later than April 30, 2016, as Permitted under the Merger Agreement

Halliburton Company (NYSE: HAL) and Baker Hughes Incorporated (NYSE: BHI) today announced that they expect that their timing agreement with the Antitrust Division of the U.S. Department of Justice (DOJ) will expire without reaching a settlement or the DOJ initiating litigation at this time to block their pending transaction. The DOJ has informed the companies that it does not believe that the remedies offered to date are sufficient to address the DOJ’s concerns, but acknowledged that they would assess further proposals and look forward to continued cooperation from the parties in their continuing investigation.

Halliburton and Baker Hughes believe that the proposed merger is good for the industry and customers. The merger is expected to create a strong company and achieve substantial efficiencies enabling it to compete aggressively to provide efficient, innovative and low-cost services. Completion of the transaction would allow customers to operate more cost-effectively, which is increasingly important due to the current state of the energy industry and oil and gas prices.

Over the last year, Halliburton and Baker Hughes have engaged in extensive and productive discussions with the DOJ regarding Halliburton’s acquisition of Baker Hughes. The parties have responded to numerous DOJ requests for information, producing millions of pages of documents, providing numerous written submissions in response to specific questions, and participating in multiple meetings with the DOJ.

As previously announced, early in the process, Halliburton proposed to the DOJ a substantial divestiture package that would facilitate the entry of new competition in markets in which products and services are being divested. Both companies strongly believe that the divestiture package, which recently was significantly enhanced to address the DOJ's specific competitive concerns, is more than sufficient to address concerns raised by competition authorities, including the DOJ.

The companies intend to continue their discussions with the DOJ, and remain focused on completing the transaction as early as possible in 2016, but there is no guarantee that an agreement with the DOJ or other competition authorities will be reached. In that regard, Halliburton and Baker Hughes have also agreed to extend the time period for closing the transaction to no later than April 30, 2016, as permitted under the merger agreement, though the parties would proceed with closing prior to such date if all relevant competition approvals have been obtained. As previously announced, the boards of directors of both Halliburton and Baker Hughes unanimously approved the Merger Agreement and the stockholders of each company overwhelmingly approved the transaction.

Halliburton and Baker Hughes are also continuing to work constructively to resolve any remaining issues with the European Commission and all other competition enforcement authorities that have expressed an interest in the proposed transaction. The pending acquisition has received regulatory clearances in Canada, Colombia, Ecuador, Kazakhstan, South Africa, and Turkey.

NYC-based PIRA Energy Group believes that oil prices have come under more downward pressure, as the global surplus looks likely to grow further through year-end. In the U.S., after a six-week run up, year-on-year U.S. inventory surplus had a significant decline. In Japan, crude runs continue to rise along with stronger demands. Specifically, PIRA’s analysis of the oil market fundamentals has revealed the following:

After Six-Week Run Up, Year-on-Year U.S. Inventory Surplus Has Significant Decline

Total U.S. commercial stocks, primarily crude, declined this week, narrowing the year-over-year surplus. Gasoline and jet stocks show a narrow surplus versus last year, although distillate still has a significant surplus. Total demand recovered to over 20.0 MMB/D this week, with strength is gasoline and jet, while distillate demand was very weak. PIRA (and others) were somewhat puzzled the change in sign of the crude balance item to -0.6 MMB/D, after averaging over 0.45 MMB/D for over 8 weeks. Since this balance item is a residual, all parts of the balance could have contributed to the move, but we suspect rebenchmarking to a new monthly final for December 4 data, along with some uncertainty in the timing of stocks versus import accounting, led to the big change.

LNG Price Drop Brings Out More Buyers

PIRA always likes to remind clients that even short- or medium-term changes in prices can have a long-term impact on both new contracts and decisions to build additional infrastructure. China aside, no place is this type of influence more on display than in the Mideast, which is offering the rare positive outlook for LNG demand amid domestic and regional gas shortages among countries looking to burn less oil, even at current prices.

Dry Weather and Looming Coal Retirements a Blessing for Gas-Fired Generation

PIRA remains optimistic about the recovery spark spreads. In Italy, the freshly updated official statistics suggest that extremely dry weather has contributed to drive the increases in day ahead prices over the past month, as hydro output is near a 10-year low. Going forward, Italian prices may also be impacted by the acute hydro shortfall in Switzerland, while Swiss nuclear output is still constrained.

Limited Bullish Catalysts for European Carbon

Warmer weather is suppressing short-term demand, but a short-term price rise (in thin markets) could follow the final 2015 auction, subsiding in January when auction volumes rise. Auction supply will be rising every year through 2018, and demand looks weak. We are not expecting any price reaction from the Paris talks. Long term implied CO2 prices are expected to be far lower for the rest of Phase III and Phase IV, limiting upward price potential for EUAs, absent further intervention.

Falling Oil Prices Push Coal Lower

Coal pricing once again experienced significant week-on-week declines, with 1Q16 API#4 and FOB Newcastle prices each sliding by $1.45/mt, while API#2 prices declined by just $0.70/mt after exhibiting the most downside in pricing over the previous several weeks. Plunging global oil prices and a sharp decline in China’s thermal coal imports were the impetus for the downturn in pricing this week. Potential for a rise in pricing is considerably limited with low oil prices and a lack of reaction by both supply and demand from the weakness in pricing.

U.S. LPG Prices Fall with Crude, Natural Gasoline Remains Stable

Mt Belvieu LPG prices fell in tandem with WTI last week, with January propane losing 10% week-on-week and butane falling 11% to 56.3¢/gal. Natural gasoline at the Gulf Coast market center held strong, decreasing by just 1.6%, having taken its cues from NYMEX RBOB which managed to gain fractionally in last week’s energy price carnage.

Better Data from Emerging Markets, but Challenges Remain

Chinese economic data releases for November were better-than-expected, though fragilities remained in key sectors (housing and exports). Most emerging economies reported third quarter GDP data by now, and they were constructive by and large. Looking to 2016, however, challenges remain. One issue is elevated private sector debt levels (especially in emerging Asia), and an increasing need to curb borrowing. There are also concerns about how emerging markets will actually react to the upcoming U.S. monetary tightening.

Inventories Drew After Building for Five Straight Weeks

The week ending December 4, U.S. ethanol production rebounded to 993 MB/D from a five-week low 956 MB/D during the preceding week. Inventories were drawn by 168 thousand barrels to 19.8 million barrels, breaking a streak of five consecutive weekly builds.

WASDE Offers Few Changes

PIRA doesn’t see the corn crop getting smaller in the all-important January report, so the obvious focus is on demand from here on out. This week’s reduction in exports was warranted, an increase in ethanol grind not so much.

Asia-Pacific Oil Market Forecast

Oil prices have come under more downward pressure, as the global surplus looks likely to grow further through year-end. Any substantial and sustained improvement will wait until Iran fully returns to oil markets and the global surplus, now pushing 500 MMBbls, shows signs of appreciably lessening.

3Q15 U.S. Gas Producer Survey: Appalachia Still Helping Keep Production Afloat

Despite extreme price weakness and steep related cuts in capital spending, the 51 companies included in PIRA’s Gas Producer Survey (“PIRA Group”) managed to realize moderate sequential and year-on-year U.S. gas production growth in 3Q15, in contrast to the Group’s marginal losses experienced in the prior quarter. Driven in large part by the continued ramp up of Appalachian production, total domestic production was up quarter-on-quarter by ~1 BCF/D and year-on-year by 4.3 BCF/D. Based on PIRA’s overall assessment, production gains outside of the survey (“non-group companies”) were again more substantial. Even so, PIRA Group companies reported a collective ~1.7 BCF/D year-on-year 3Q15 production increase; while less than prior quarters gains, an impressive feat considering the price environment.

Eastern Grid/ERCOT Market Forecast

A solid majority of eastern power markets saw m/m price declines in November as gas prices fell and loads remained weak. Gas prices were down in all markets with Henry Hub averaging below $2.10/MMBtu, the lowest monthly average since April 2012. On a year-on-year basis. Loads in the East fell by over 20 aGW as temperatures averaged above normal across the region. With gas prices down sharply, gas-fired generation rose by 20 aGW while coal dropped by over 30 aGW and oil also moved down. Looking ahead, gas prices have been revised down as continued mild weather may lead to a substantial storage overhang at the end of the heating season. Power prices are lower in all markets with the sharpest drops in New England and eastern NY winter prices.

EPA Regs in TX Pressuring Coal, Opportunity for Gas

EPA’s final Regional Haze Plan for Texas, did not change the costly requirements from last year’s proposal for new scrubbers and scrubber upgrades across 14 coal-fired units in a 3 to 5-year timeframe. The covered plant operating and retirement decisions can have major implications for reserve margins and natural gas demand. Litigation is inevitable, and PIRA believes the decision on the venue (which could come as early as 2Q16) could well determine whether the rule will ultimately be upheld.

Global Equities Broadly Lower

All our tracking indices lost ground on the week. In the U.S., utilities and consumer staples held up the best, but still declined. Banking and energy were the weakest performers. Internationally, all the tracking indices fared worse than the U.S. average. Emerging markets were the weakest, followed by China and emerging Asia.

D6 RIN Prices Come Back Down

U.S. ethanol prices were little changed the week ending December 4 as downside pressure from high ethanol inventories was balanced by soaring D6 RIN values, which are embedded in the assessments. D6 RIN assessments came down late in the week.

USDA Baseline Projections

Usually released during February in conjunction with its annual Outlook Forum, the USDA decided to release their so-called baseline projections for the next 10 years “early” this time around.

Japanese Crude Runs Continue to Rise, Along with Stronger Demands

Crude runs rose again in broad agreement with our turnaround schedules. Crude imports increased enough to provide for a small crude build. Finished product stocks also built slightly due to a large naphtha build more than offsetting declines in gasoline, gasoil and kerosene. There were strong demand gains in gasoil and kerosene which drove the resulting stock draws for those products. Refining margins remain strong, though cracks, other than naphtha, generally eased on the week.

Greek Gas Price Change to Impact Power Prices

An upcoming re-assessment in the price of Greek gas could depress power prices from Jan. by bringing down the cost of gas-fired generation below lignite-fired units, market participants said. Power producers in Greece buy gas from natural gas incumbent DEPA, with contracts indexed to Brent crude prices via an algorithm. DEPA carries out a readjustment every quarter.

Beyond the Capacity Auction, How the U.K. Mix is Changing

The second U.K. capacity auction – for delivery in 2019/20 – cleared at ₤18/KW versus ₤19.4/KW at last year’s auction. The outcome, once again, offers several implications for the U.K. energy mix, even in the shorter- and medium- term. While the future of several coal units is tied, in part, to the outcome of the auction, traditional combined cycle gas turbines (CCGTs) will now face additional competition from growing participation by distributed generation. A higher reliance on embedded generation adds a layer of risks – with the wholesale market most likely set to reflect those challenges down the road. Finally, the policy debate will continue to intensify on whether the introduction of the capacity market in the U.K. may effectively be beneficial for the system's reliability.

Financial Stress Grows

Financial stress grew substantially this past week. The S&P 500 fell sharply. All of the accompanying indicators also performed poorly, including Volatility (VIX), Russell 2000, high yield debt (HYG) and emerging market debt. The cautionary signal and underperformance that we noted last week with regard to high yield credit and emerging market debt proved prophetic this week. Commodities remain in a downtrend, though ex-energy has been rather flat as energy remains the strong drag to the overall complex.

Stock Surplus Widened in November

Commercial stocks in the three major OECD markets – United States, Europe and Japan – were close to flat in November, declining just 3 million barrels or 0.12% versus the prior month. So far in the fourth quarter stocks are down 4 million barrels, or 0.16%. This relatively flat stock profile compares with a typical decline over these two months. Also, the sharp increase in VLCC freight rates since September is clearly telling us there is more oil on the water. Thus, as expected, the global oil surplus continued to widen in November. By the end of the fourth quarter, PIRA is forecasting the global stock surplus will be 500 million barrels.

What will Drive the NBP–TTF spread for the Balance of Winter?

As we approach the midpoint of winter and the gas complex reaches new lows, it is easy to lose touch with the relationships among Europe’s multiple spot trading hubs. NBP and TTF remain the most important of these hubs, particularly now that the Dutch gas market’s role in the fundamental underpinning of the market is radically shifting. As absolute prices go down, spreads will narrow and when they do, implications will emerge on future flows and activity.

4Q15 Iraq Oil Monitor

The KRG stopped transferring crude to SOMO in Ceyhan, but ~600 MB/D of independent Kurdish exports continues to find its way to market. Meanwhile, a power struggle between Abadi and his political opponents persists, and the lack of reforms and fiscal stress are exacerbating tensions throughout the country. The fight against ISIS remains broadly stalemated. Ongoing Turkish military operations against the PKK in Syria, plus rising tensions between the PKK and KRG, are interrupting flows on the 650 MB/D export pipeline to Turkey. Southern operators are reviewing development plans after the oil ministry requested 2016 investment cuts at major fields. Strong November southern exports were supported by stocks accumulated in October (when bad weather limited exports) and the start of a fourth SPM.

Gas Flash Weekly

Despite Thursday’s bullish storage report, NYMEX price action underscores the market’s increasing concern over the intensity of the El Niño and the related potential for heating load shortfalls extending into next year. The evolving “super” El Niño clearly has increased the potential for unusually mild weather next quarter, but for the time being, PIRA’s Reference Case only assumes 5% fewer GWHDDs than the 10-year normal.

December Weather: The U.S., Europe and Japan Warm

At mid-month, December looks to be 21% warmer than the 10-year normal for the three major OECD markets, bringing the month oil-heat demand to 1030 MB/D below normal. On a 30-year-normal basis, the markets are 24% warmer.

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.

Click here for additional information on PIRA’s global energy commodity market research services.

Anadarko Petroleum Corporation (NYSE: APC) announces that, along with the concessionaires of Offshore Area 1 (operated by Anadarko Mozambique Area 1 Ltd. (AMA1)) and Offshore Area 4 (operated by Eni East Africa (EEA)), it has signed a Unitization and Unit Operating Agreement (UUOA) for the development of the massive natural gas resources that straddle the two blocks.

"We appreciate the cooperation of the Government of Mozambique, Eni and our co-venturers in Offshore Area 1 for their collaborative efforts in achieving this UUOA, which is fair, equitable and consistent with best industry practices," said Mitch Ingram, Anadarko Executive Vice President, Global LNG. "We have already made tremendous progress advancing the natural gas resources in the Golfinho and Atum fields that are fully contained within our block, and with this UUOA, we can also expect to move the Prosperidade and Mamba straddling reservoirs forward more efficiently, while capitalizing on greater economies of scale."

Under the terms of the UUOA and previously announced Decree Law, the Prosperidade and Mamba straddling natural gas reservoirs, which comprise the Unit, will be developed in a separate but coordinated manner by the two operators until 24 trillion cubic feet (Tcf) of natural gas reserves (12 Tcf from each Area) have been developed. All subsequent development of the Unit will be pursued jointly by the Area 1 and Area 4 concessionaires through a joint-venture operator (50:50 Anadarko and Eni). The UUOA is subject to final approval by the Government of Mozambique.

DOMESTIC NATURAL GAS

In addition, Anadarko reached a Memorandum of Understanding (MOU) with the Government of Mozambique to provide natural gas from its Mozambique LNG development for domestic use.

Under the terms of the MOU, Offshore Area 1 will provide initial volumes of approximately 50 million cubic feet of natural gas per day (MMcf/d) per train (100 MMcf/d) for domestic use in Mozambique. The natural gas will be provided at pricing that is fair to all parties and supports local natural gas development, and the concessionaires are prepared to sell up to 300 MMcf/d of additional volumes into the domestic market in future years as projects are matured and commercial terms agreed.

"Signing this MOU is an important step," added Ingram. "We look forward to continuing to work with the Government of Mozambique to finalize the legal and contractual framework that will enable us to deliver natural gas for domestic projects and LNG cargoes for export to premium markets around the world, both of which will benefit Mozambique through a reliable source of cleaner energy and significant revenue generation."

OFFSHORE AREA 1

Anadarko is the operator of the Offshore Area 1 Block with a 26.5-percent working interest. Co-venturers include the National Oil Company Empresa Nacional de Hidrocarbonetos, E.P. (ENH) (15 percent), Mitsui E&P Mozambique Area 1 Limited (20 percent), Beas Rovuma Energy Mozambique Limited (10 percent), BPRL Ventures Mozambique B.V. (10 percent), ONGC Videsh Limited (10 percent), and PTTEP Mozambique Area 1 Limited (8.5 percent).

OFFSHORE AREA 4

Eni operates Area 4 with a 50-percent indirect interest owned through Eni East Africa (EEA), which holds 70 percent of Area 4. The other partners are Galp Rovuma (10 percent), KOGAS Mozambique (10 percent) and ENH (10 percent). CNODC owns a 20-percent indirect participation in Area 4 through Eni East Africa.

Pipeline development projects are becoming increasingly complex, spanning longer and deeper terrains. Pipelines must operate at higher pressures and temperatures, in harsher environments and to stricter regulatory requirements. Projects must also be feasible in a cost-constrained market. DNV GL is inviting industry players to take part in two Joint Industry Projects (JIP) to help the industry work more efficiently while maintaining safety.

The first JIP will reduce uncertainty in tensile testing results and the associated costs of inaccuracies and delays, while the second will help operators save time and money in adapting to new industry requirements.

Gaining confidence in tensile testing results


Inaccurate yield strength measurements can have significant negative implications for a pipeline project, ranging from schedule disruptions and commercial disputes to unanticipated costs and potential regulatory challenges. Current industry standards allow a wide range of tensile testing parameters, creating variability and uncertainty in the test results.

The Standardization of Flattened-strap Tensile Testing of Line Pipe JIP will investigate different tensile testing variables that affect results, including material properties, sample flattening and preparation practices, testing equipment and testing procedures. The objective is to establish testing parameters and procedures to reduce the variability in yield strength results for large diameter line pipe. The results will be applicable to both onshore and offshore pipelines.

“The project will ensure that the tensile testing results are both more reproduceable and indicative of line pipe performance. It will reduce the uncertainty of the results and give pipeline operating companies the confidence they need when purchasing new line pipe as well as during the testing and analysis of existing pipe, ultimately saving time and cost,” says Melissa Gould, Senior Engineer, DNV GL - Oil & Gas.

The JIP will be carried out in conjunction with recognized parties such as the US National Institute of Standards and Technology (NIST) Material Measurement Laboratory (MML) and the former chair of the ASTM (American Society for Testing and Materials) Committee E28, Earl Ruth. The project is expected to last for 18 months and the results will be suitable for incorporation into standards and recommended practices, as applicable.

Standardized approach to meet new requirements for girth weld repairs


The offshore and onshore pipeline industry is adapting to the updated requirements for repair welding in the Twenty-First Edition of the well-known API Standard 1104, “Welding of Pipelines and Related Facilities”. The updates place more requirements on the qualification of repair welding procedures and welders.

The JIP on the Development of Industry Best Practice for Girth Weld Repairs will, in cooperation with pipeline engineering specialists Kiefner/Applus RTD, address the technical aspects of girth weld repairs and the practical aspects of repair welder qualification during the construction of new pipelines. The project is expected to be concluded within 18 months and will result in procedures and guidelines to help the industry meet the new API 1104 requirements.

“Repair welds are often made under more challenging conditions than production welds, which can potentially reduce the quality of the completed welds,” says Brad Etheridge, Senior Engineer, DNV GL – Oil & Gas. “The project fulfils an industry need to meet new requirements and has the potential to reduce cost and complexity, increase safety and reliability, and deliver better quality pipelines.”

DNV GL, the leading technical adviser to the oil and gas industry, today published the first industry standard providing guidance on offshore personnel transfer by gangway. DNVGL-ST-0358 will contribute in documenting and securing safe operational performance of offshore gangway solutions and contribute to predictability and transparency within the industry.

Offshore gangways are used as a bridge between two vessels or between a fixed object and a floating installation to transfer people, cargo or equipment. For offshore operations, offshore gangways provide a safe and cost effective alternative to personnel transfer by helicopter, basket transfer or boat landing.

The gangways can take many forms ranging from use for long duration personnel transfer between accommodation units and offshore production assets, to use for short duration transfer between service vessels and unmanned installations such as offshore wind turbines, offshore fish farms and similar installations.

“By addressing a complete set of requirement for materials, strength, safety and functionality as well as testing and recommended in-service follow-up, we have created a specific and dedicated standard to make gangway operation safer and more efficient,” says Per Arild Åland, Business Development, Offshore Classification, DNV GL – Maritime.

Until now, the ISO7061 standard from 1993 has partly served as a reference document by industry for offshore gangway applications despite only addressing ship-to-shore transfers. Next to the ISO07061, offshore gangways are also certified against man-riding crane standards. The limited relevance and lack of offshore specific requirements has driven the development for a dedicated offshore gangway standard providing in-depth and specific guidelines on offshore gangway operation.

In 2013, DNV GL gathered major industry players in a joint industry project to examine offshore gangway transfer operations. Experience gained through this W2W ("walk-to-work") project resulted in the publication of an industry guidance to assist offshore facility operators achieve safe and efficient personnel transfers to/from their facilities via a gangway system on a workboat, ship or semi-submersible.

The new standard, DNVGL- ST-0358, is the result of further development of this work and continuous DNV GL research. It covers the majority of gangway operations offshore including where there is controlled or uncontrolled people flow. The Standard for Certification of Offshore Gangways reflects the experience gathered on all relevant operating modes and will contribute to predictability and transparency, and at the same time help to reduce risk in personnel transport offshore.

“Finally we can base our work on a set of definite criteria. The industry has for some time needed a dedicated set of guidelines addressing the specifics of offshore personnel transfer through gangway solutions,“ says Christian Bernbo, Business Area Manager Gangway in Marine Aluminium, Norway.

“The new standard for offshore gangways is a welcome addition to DNV GL’s list of guidelines to improve quality, function and safety for offshore personnel. As a launching customer we believe this will be a crucial part in our development of the first compact mobile motion compensating gangway solution,” says Marcel van Meel, General Manager in L-bow Offshore Access Solutions BV, The Netherlands.

The new standard DNVGL-ST-0358 is launched today in a workshop at the London Offshore Accommodation Access conference, where leading industry experts gather to discuss practical guidance on ensuring safe and efficient crew transfer in difficult offshore environments.

Download the standard here.

Following the announcement of Douglas-Westwood joining the ESIA Group on 7th December, we were delighted to be able to exhibit with our new colleagues at PROSPEX 2015 in London on 9th and 10th December. Together with ESIA members Hannon Westwood, Novas Consulting and Richmond Energy Partners, we looked to showcase the group’s well-established E&P consulting and analytics offering alongside DW’s respected oilfield service-focused capabilities.

PROSPEX 2015 commenced with the OGA’s Gunther Newcombe providing an overview of the current state-of-play in the North Sea and information on the upcoming 29th and 30th licensing rounds. The 29th round will feature acreage in the frontier Rockall basin, an area opened up considerably by a government-sponsored 3D seismic shot earlier this year. Additionally, Mr. Newcombe outlined the OGA’s strategy for the coming years – looking to encourage exploration in both mature and frontier areas as well as greater collaboration between operators.

Ireland proved to be a key theme over the two days of PROSPEX following the country’s most successful licensing round this year with 43 applications submitted – mostly for acreage on the Atlantic Margin. This is nearly three times the number of applications received in the 2011 offering.

As is the usual focus for PROSPEX, a host of independents exhibited oil & gas prospects from around the world. Many companies were advertising promising opportunities around the British Isles, whilst some players chose to introduce prospects from unexplored international regions. Tullow Oil demonstrated the potential of a number of blocks from either side of the Atlantic whilst Envoi showed-off finds from all corners of Africa.

Statoil has, on behalf of the Johan Sverdrup partners, awarded contracts for the linepipe , coating and pipe installation of the Johan Sverdrup export pipelines.

The total contract value is estimated at slightly less than NOK 2.5 billion, the three contracts cover both the oil and the gas export pipelines for Johan Sverdrup.

The linepipe fabrication contract for the export pipelines was awarded to Mitsui & Co. Norway A.S. Mitsui will deliver 220 000 tons of steel for the oil and gas pipelines, totaling 430 kilometers. Linepipe production will start at Nippon Steel & Sumitomo Metal (NSSMC) steelworks in Japan early in 2016.

Wasco Coatings Malaysia Sdn Bhd was awarded the contract for external anti-corrosion treatment and concrete weight coating for the oil and gas pipelines, as well as internal flow coating for the gas pipeline. The work will be performed at Wasco’s factory in Malaysia in 2017.

Saipem Ltd has been awarded the pipe-laying contract for the Johan Sverdrup oil and gas export pipelines. The pipe-laying operation is scheduled to start in the spring of 2018, using the laying vessel CastorOne.

“We have selected a solid team of principal suppliers for the Johan Sverdrup export pipelines, and are thus well positioned to deliver first oil from Johan Sverdrup from late 2019,” says Kjetel Digre, senior vice president for the Johan Sverdrup project.

Stabilized oil will be exported to the Mongstad terminal through a new oil pipeline connected to existing storage caverns. The oil export solution consists of a 274-kilometre, 36-inch pipeline to the Mongstad terminal, including required modifications at the terminal.

Gas will be exported to Kårstø gas terminal through a new gas pipeline. The gas export solution includes a 156-kilometre, 18-inch pipeline tied in to the Statpipe rich gas pipeline, including a hot-tap hook-up to this pipeline. No modifications are required at Kårstø for the reception of the Johan Sverdrup gas.

The oil and gas export development will meet the transportation needs for all phases of the Johan Sverdrup development.

Contracts worth more than NOK 50 billion have been awarded so far in the Johan Sverdrup project, about 75 percent of which have been landed by suppliers with Norwegian invoice addresses.

NorSea Group (UK) Ltd has won a five-year contract with Wild Well Control for the storage of its emergency response WellCONTAINED System at NorSea Group’s facilities in South Base, Montrose.

The WellCONTAINED system of services includes contingency planning and response from Source Control Emergency Response Planning (SCERP) through field deployment of the system capping a subsea uncontrolled well.

Mike Munro, Operations Director at NorSea Group (UK) said: “This type of hi-tech intervention equipment is designed to minimise exposure in the event of an offshore emergency and a top priority is the ability to respond without delay. Our storage and supply base operations at Montrose, with direct quayside access and geographical proximity meet all the requirements for optimising response time.”

Freddy Gebhardt, Wild Well (left) and Mike Munro, NorSea Group (UK Wild Well Control’s WellCONTAINED System

Freddy Gebhardt, Wild Well President, who visited Montrose to view the facilities, said Wild Well was very pleased to make a commitment to the region for the exclusive use of warehousing facilities for the WellCONTAINED system.

“Having immediate access quayside in the case of mobilization and deployment offers an all-encompassing logistics solution for our consortium members,” he said. “Providing 24/7/365 emergency response to ensure our clients get the timely service and support they need is a pre-requisite, and the set up at South Base guarantees that requirement will be met.

“We extend a warm welcome to our new partners in this arrangement— NorSea Group (UK) and the Montrose Port Authority— and look forward to a healthy working relationship between all parties for the term of the agreement.”

Nik Scott-Gray, Chief Executive of Montrose Port Authority (MPA), said: “We are delighted that NorSea Group and Wild Well have forged this new relationship, which broadens the marine and offshore services portfolio we can offer at Montrose Port. The port is strategically placed as a service and logistics hub for the offshore oil and gas sectors, and this new agreement helps advance our ongoing development and expansion plans. We look forward to working closely with NorSea Group and Wild Well over the coming years. ”

NorSea Group has a 15-year lease agreement with MPA on the South Base covering warehousing and 11,000m2 of external quayside laydown. Quayside support services include stevedores, forklifts, cranes, water and fuel. It also has additional internal and external storage at nearby Broomfield Industrial Estate in Montrose.

Bibby Offshore, a leading subsea services provider to the oil and gas industry, has been awarded a multimillion pound contract by BP to replace subsea infrastructure in the Central North Sea.

Bibby Offshore personnel on vessel deck

The work is part of the $1billion Eastern Trough Area Project (ETAP) Life Extension Project announced by BP in the summer. ETAP is one of the largest and most complex developments in the North Sea, comprising nine oil and gas reservoirs, six of which are operated by BP. The ETAP Life Extension Project (ELXP) will help secure the future of the fields until 2030 and beyond.

The Bibby Offshore ELXP contract involves installing new subsea control system infrastructure to safeguard power and communication links to ETAP’s Machar, Madoes and Mirren fields, some 150 miles East of Aberdeen.

Howard Woodcook, Chief Executive Bibby Offshore

From April 2016, Bibby Offshore will provide dive support and construction support vessels from its international fleet to deliver services including; umbilical installation, trenching, structure installation and commissioning through to final survey of the completed workscopes.

Howard Woodcook, Chief Executive Bibby Offshore said: “This is a significant contract win for Bibby Offshore, and we are delighted to be working with BP again, having previously undertaken subsea intervention work for BP in 2014.

“The contract award as part of this high-profile life extension project highlights our wide range of subsea services and affirms our capability to consistently and successfully deliver complex and challenging projects for our clients.”

(Left to Right : Jack Roszelle, John Danos, Marc Distefano)

Danos announces the hiring of Marc Distefano, John Danos and Jack Roszelle to leadership positions with the company.

“We are pleased to welcome Marc, John and Jack to the Danos team,” said CEO and President Hank Danos. “Their expertise and experience will help us ensure we are delivering outstanding results for our customers.”

John Danos (no relation) serves as construction division general manager, working to develop a best practices foundation for the way Danos executes projects in conjunction with the company’s project management group. Prior to joining Danos, he held leadership positions at J. Ray McDermott, International Offshore Services, International Construction Group and Harvey Gulf International Marine.

As fabrication operations manager of the Amelia facility, Marc Distefano is responsible for overall leadership of the facility and maintaining a culture of continuous improvement. Prior to joining Danos, Distefano held leadership positions at Alison Marine Contractors, Conrad Industries, Alliance Consulting Group, U.S. Army, Shell and Enron Corporation.

Jack Roszelle joins Danos as corporate quality director, overseeing quality control and quality assurance for the company. Prior to joining Danos, he served as vice president of quality for Dynamic Energy Services International, LLC, and area quality manager for the Americas region with McDermott Inc.

McDermott International, Inc., (NYSE:MDR) announced it has been awarded a sizeable transport and installation contract by an upstream oil and gas operator for a project offshore Trinidad, West Indies.

The contract award includes the transport and installation of a 1,000-ton deck and 1,600-ton jacket. It also covers the onshore fabrication, reel-lay and pre-commissioning of 14,000 feet of 14-inch pipeline that includes the pull-in of a 12-inch riser at an existing offshore platform scheduled to be completed using McDermott vessels, Derrick Barge 50 (DB50) and the North Ocean 105 (NO105). Project completion is expected to be in the third quarter of 2016. The pipeline will be welded at McDermott’s new Gulfport, Mississippi, spoolbase.

“McDermott’s customer-focused approach, in combination with project execution expertise, best-in-class assets and alignment with the client on project objectives set us apart,” said Scott Munro, Vice President for Americas, Europe and Africa. “We’re pleased to be able to provide an integrated approach involving our new spoolbase in Gulfport, the NO105 and the DB50 that addresses all project drivers to deliver the best overall solution.”

Revenue from the award will be included in McDermott’s fourth quarter 2015 backlog.

Leading provider of multi-discipline engineering, project management and project services to the international energy industry, Project Development International (PDi) has secured a £1.5million contract with Nigerian oil service company Marine Platforms Limited (MPL), to provide technical support to the Chevron Agbami Phase 3 transport, installation and pre-commissioning project.

Due for completion in early Q2 2016, MPL has appointed PDi to support with onshore and offshore installation engineering activities in the Agbami Field, Nigeria’s largest deepwater development, located in central Niger Delta, west coast of Nigeria.

The agreement involves PDi working alongside the MPL engineering team in their Lagos office to provide both project and structural engineering services, as well as installation analysis and offshore support. PDi will also provide specialist support in pre-commissioning, survey, geotechnical and procurement when required.

Commenting on the project, Mark Gillespie, managing director at PDi said: “We’re delighted to be strengthening our long standing relationship with MPL on this challenging project. Continuing our successful support of MPL in Nigeria and delivery of expert engineering services on international projects of this significance is clear testament to the team’s global capabilities.

“On this project PDi will provide a dedicated project engineering team in MPL’s office in Lagos who will work on a rotational basis with the indigenous MPL engineering team and be supported by project management and discipline engineering teams in the UK. The Lagos team will include individuals with Structural Engineering and Installation Analysis capability.”

PDi has worked with MPL for more than five years on numerous international engineering workscopes, supporting and delivering on projects including Agbami Jumper Installation, Bonga Jumper Installation and BOOR Recovery.

Taofik Adegbite, CEO AT MPL said: “We have established a strong working relationship with PDi and value the dedicated teams, engineering support and track record here in Nigeria. At MPL we adhere to the highest standards of professionalism and strive to exceed the expectations of our clients through integrity, maintaining a very strict safety culture and quality service delivery, standards we know are shared with the team at PDi.”

MPL has chartered the Polar Onyx and hired other project equipment to execute the offshore installation activities, with PDi providing the onshore and offshore installation engineering support.

“We are still operating in a very challenging global market, but by combining expertise and understanding where there are opportunities to collaborate on projects of this nature, we are succeeding in progressing our biggest asset – our highly skilled and knowledgeable team of engineers” concluded Mr Gillespie.