JDR, a leading provider of technology connecting the global offshore energy industry, is opening a new offshore engineering technology center in Cambridge. Building out from JDR's global HQ in North Cambridgeshire, the new center will put JDR at the heart of Cambridge's growing oil and gas innovation community as energy research seeks to exploit reserves in deeper and harsher offshore environments. The new center will be officially opened by Cambridge MP Julian Huppert on
28 July.

JDR's products are used by major energy companies and offshore service providers around the world as part of infrastructures that manage subsea energy production. The new Cambridge R&D team – from experienced engineers to graduates – will evolve JDR's specialist knowledge of subsea production umbilicals and subsea power cables to take on exploration challenges faced by oil, gas and offshore wind operators. They will focus on new technology development, from innovative product concepts to subsea materials development, developing collaborative relationships with other Cambridge-based technology companies and academia.

Andrew Norman, JDR's chief executive officer commented: "Subsea energy production is one of the fastest growing sectors of the international oil and gas industry; JDR has a strong track record in this field. Our new Cambridge Technology Center will strengthen our focus on advanced technology, for example products that enable production equipment to operate on the seabed, close to hydrocarbon sources.

"Our Cambridge Technology Center is an important development for JDR's international site and customer network. At the same time we want to build strong and mutually beneficial relationships in the Cambridge technology network, becoming part of the 'Cambridge effect' working with business and academia on new solutions for our industry."

Julian Huppert MP added: "I am delighted that JDR have chosen Cambridge as the base for its new

technology center and I am honored to be asked to officially open the center.

JDR is a leader in research in this highly specialized area and its work in Cambridge could result in exciting future developments in sustainable energy. This is encouraging for all of us as we work to find ways to lessen our dependency on fossil fuels and find greener alternatives.

"It is encouraging to hear that the company has plans to grow the center over the next year, opening up job opportunities in the city. I wish it every success for the future."

James Young, JDR's engineering director added: "We plan to grow our Cambridge team over the next

12 months, expanding the group with experienced and graduate engineers. This is a great time to join the JDR; our international client base is pushing exploration into increasingly challenging subsea environments. With our industry track record, we are ideally positioned to take on these challenges and help secure long-term energy supply.

"Our Cambridge Technology Centre has been custom-designed to support the work of our research and development team. It is also equipped with technology to enable cross site and functional team working across national boundaries and time zones. Our Cambridge team will be innovating the vital connection technologies to make our future customers subsea energy projects both technically and commercially successf

NYC-based PIRA Energy Group believes that with both the physical market and financial length bottoming, oil prices are at or near their lows. In the U.S., sharp crude stock reduction is offset by a product build.  In Japan, crude stocks posted a large draw. Specifically, PIRA’s analysis of the oil market fundamentals has revealed the following:

Sharp U.S. Crude Stock Reduction Offset by Product Build

Crude stocks fell for the week ending July 11, 2014 while product inventories built, causing an overall inventory build. This inventory pattern fits with record crude runs. Last year for the same week, inventories were down slightly so the year-on-year inventory excess widened. Crude oil and other products are up on last year while the four major product inventories are down.

Japanese Crude Runs Rise, Crude Stocks Post a Large Draw

Despite typhoon Neoguri hitting Japan the last week, runs still posted a sizable gain, while imports dropped and crude stocks drew. Product balances for gasoline and gasoil were little changed, while kerosene stocks resumed building. Both gasoline and naphtha stocks drew to record lows. Refining margins remained good with cracks little changed.

Freight Market Outlook

Crude markets have been whipsawed recently by the sectarian civil war in Iraq and changing perceptions on the return of Libyan supplies to the market. Dated Brent prices increased by $6/B to $115/B following the June 10th fall of Mosul to ISIS insurgents. But as it became apparent that exports from Basrah were unlikely to be impacted while prospects for the return of Libyan supplies increased, the price of Dated Brent fell by more than $12 per barrel to $103/B with a steep contango structure at the front end of the forward price curve. This has prompted the opportunistic storage of crude on tankers and increased incentives for the movement of additional long-haul volumes out of the Atlantic Basin to Asia, causing a counter-seasonal rise in crude tanker rates in the Atlantic. For tanker operators there are double benefits with higher spot tanker rates and lower bunker prices, at least for the moment.

Strong Week for International LPG

Tightness in LPG supplies in Europe, particularly in butane, had prices bid up this week. European supply has tightened considerably on lower export volumes out of Russia, and refinery maintenance in Antwerp and the UK. Russian maintenance at gas processing plants has lowered prompt Russian output. Coaster sized parcels of butane in NWE ended the week 4% higher at $838/MT. Asian prices were also higher on strong demand -- as soaring VLGC freight rates have industrial consumers worried that supply will be impacted.

Ethanol Prices Decline

U.S. ethanol prices showed some strength early in the week ending July 11, but then resumed their recent descent, weighed down by rising inventories. Ethanol manufacturing cash margins improved for the second consecutive week, largely due to plunging corn costs.

Ethanol Output Up, but Inventories Down

U.S. ethanol output rebounded to 943 MB/D the week ending July 11, up from 927 MB/D during the holiday-shortened week ending July 4. Inventories declined by 341 thousand barrels to a four-week low 17.9 million.

Political Risk Scorecard

Concerns about potential further sanctions on Russia, along with Iraqi instability, will support prices next week.

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.

To accommodate the future needs of the rapidly growing Angola offshore oil and gas industry Fugro has opened its new facility in the SONILS Oil Service Centre in Luanda. Angola is now the second largest oil producer in Sub-Saharan Africa, after Nigeria.

The official opening of the facility on 10 July by Mrs Lilianne Ploumen, the Dutch Minister for Foreign Trade and Development Cooperation, was attended by the Angolan Minister for Construction, Waldemar Pires Alexandre as well as the Secretary of State of the Ministry of Petroleum, Eng. Anibal Silva; the Dutch Ambassador to Angola, Mrs Susanna Terstal; and local dignitaries and clients.

"Our new site demonstrates Fugro's strong commitment to the Angolan market," said Ms Christina Brokahne, Managing Director of Fugro Angola as she took Mrs Ploumen and guests on a tour of the facility, which comprises a building area of approximately 7,000 m2.

The new site hosts a double storey administrative building housing offices, conference rooms, a training facility and staff canteen. Attached to the office building is a large warehouse facility of 2,500 m2 with a 20-ton overhead crane and ample storage space, as well as workshops for equipment testing and maintenance, a dedicated area for subsea equipment and ROV tooling and a large state-of-the art geotechnical laboratory.

The ceremony also provided an opportunity for Fugro Angola to demonstrate its practical support for the 'Challenge the Silence' programme of the Forum de Mulheres Jornalistas para a Igualdade no Genero. Mr Herivaldo Augusto, Director Fugro Angola Limitada and Mr Wilhard Kreijkes, Fugro Regional Director Africa together with Mrs Ploumen presented a cheque to the charity, which raises awareness of gender equality and domestic violence in Angola.

Beyond a doubt, Alfa Laval is today's environmental front-runner among marine equipment suppliers. The company's Pure Thinking portfolio comprises not only compliant solutions for the broadest range of environmental legislation, but also leading technology – or even the only technology – in each respective area. At this year's SMM, Alfa Laval will be showcasing the portfolio's most recent developments, which include the soon-to-be-launched PureSOx 2.0.

When Pure Thinking was introduced as a concept in 2004, Alfa Laval solutions were already associated with high efficiency and the reduction of waste. However, there was a growing sense that more would soon be called for when it came to the environment. Indeed, the International Convention for the Control and Management of Ships' Ballast Water and Sediments, adopted by IMO earlier that year, proved to be just one of the seemingly insurmountable hurdles placed before ship owners and operators.

"Ballast water treatment was on everyone's minds a decade ago, in much the way that emission control is today," says Peter Leifland, President Marine & Diesel Division. "There were others besides Alfa Laval with a ballast water solution in development, but already then we were looking at a much bigger picture. We anticipated more and tougher environmental legislation in the years to come, and we knew our customers would have to meet it without damage to their business. Pure Thinking became the platform for meeting that need."

As the name suggests, Pure Thinking began as a strong vision, with only a handful of finalized products and much that was still in the idea stage. PureBallast, for example, was not yet named and just setting out on its first trials at sea. But the formulation of a goal and a systematic approach would prove the key to addressing legislative demands. Ten years later, with US ballast water regulations already in place and Emission Control Areas (ECAs) soon entering into force, Alfa Laval's environmental portfolio is a concrete offering prepared for an increasingly concrete reality.

Unique developments of core technologies
While the Pure Thinking portfolio addresses a wide range of applications, some of which are completely new, the products within it remain true to Alfa Laval's proven strengths. "The principle of Pure Thinking has not been to venture into unproven areas, but rather to meet challenges by applying our core expertise in new ways," says Leifland. "Separation, fluid handling and heat transfer are Alfa Laval cornerstones, even when addressing environmental issues."

PureBilge, the centrifugal separator that became the very first Pure Thinking product, serves as an excellent example. "Centrifugation has been an Alfa Laval hallmark for over a century," says Leifland. "In PureBilge we use it to counteract the vessel's roll and pitch, thereby removing the reliability issues associated with static bilge water treatment solutions." This reliance on core technologies, however, has not kept radical advances from being made within Pure Thinking.

PureBilge was recently joined by PureDry, a very different kind of separator that enables waste fuel recovery in accordance with MEPC.1/Circ.642. PureDry is a paradigm shift in centrifugal separation, combining a solid bowl and disc stack with self-cleaning capabilities. Together, PureDry and PureBilge form an integrated waste oil and bilge water handling system that produces three streams: clean water, a minimal amount of super-dry solids and reusable ISO-quality fuel.

"PureDry is actually the only technology capable of taking advantage of MEPC.1/Circ.642," says Leifland. "In addition to minimizing waste oil volumes, it allows vessels to recoup up to 2% of their consumed fuel volume – which is why it's being adopted rapidly by leading actors in almost every niche of the energy-focused marine industry." Leifland points out that over 100 PureDry systems have been sold in little more than a year of sales.

Environmental protection with energy in mind
For those with energy in focus, there have also been recent developments in PureBallast, a long-time flagship of the Pure Thinking portfolio. PureBallast, which in 2006 became the first ballast water treatment system to reach the market, was launched in its third generation in 2013, bringing with it energy savings of up to 60% over previous versions.

"Ratification of the IMO ballast water convention has taken more time than expected, but in light of US legislation, there is no question that it will happen," says Peter Leifland, President Marine & Diesel Division. "In the meantime, we have continued to develop PureBallast for the best possible fit with today's market demands. Those demands include not only high energy efficiency, but also compactness and flexibility – all aspects that have been greatly improved in PureBallast 3.0."

Beyond the energy savings, PureBallast 3.0 offers space savings of 50% over previous versions and much greater flexibility, thanks to newly optimized reactors in a variety of sizes. Introduced at launch with 300 and 1000 m3/h reactors, the system was expanded with a 600 m3/h reactor in the spring of 2014, enabling a further range of compact and energy-saving configurations.

Meeting the emission challenge

Statoil has been awarded interest in the COL4 license offshore Colombia in the Caribbean Sea in the2014 Colombia Licensing Round.

Statoil will hold 33.33% in the license. Repsol will be the operator of the license and will hold 33.34%. ExxonMobil Exploration Colombia will hold 33.33%.

The award is subject to the final approval of the National Hydrocarbons Agency of Colombia (ANH).

"Deepwater offshore Colombia is virtually untested. The award of new acreage in this frontier area is in line with our exploration strategy of early access at scale", says Nick Maden, senior vice president for Statoil's exploration activities in the Western Hemisphere.

The license award represents a country entry for Statoil into Colombia. The entry is an early exploration phase and the initial working commitments include 2D and 3D seismic acquisition which will allow Statoil to further assess the potential of the basin.
There are no well commitments during the first exploration phase.

Oceaneering International, Inc. (NYSE: OII) has reported record quarterly earnings for the second quarter ended June 30, 2014.

On revenue of $927.4 million, Oceaneering generated net income of $110.3 million, or $1.02 per share. During the corresponding period in 2013, Oceaneering reported revenue of $820.4 million and net income of $98.8 million, or $0.91 per share.

Summary of Results
(in thousands, except per share amounts)

                             Three Months Ended                                                   Six Months Ended
                                   June 30,                         March 31,                              June 30,

                           2014             2013                     2014                           2014              2013

Revenue           $ 927,407      $ 820,372             $ 840,201                 $ 1,767,608      $ 1,538,924

Gross Margin       218,215        201,864                 189,491                      407,706           362,239

Income from Ops. 161,311       146,337              132,862                         294,173           254,627

Net Income         $ 110,295     $ 98,811              $ 91,225                     $ 201,520        $ 173,660

Diluted Earnings

Per Share (EPS)         $1.02         $0.91                    $0.84                            $1.86             $1.60

Year over year, quarterly EPS increased on profit improvements from Subsea Products, Remotely Operated Vehicles (ROV), and Subsea Projects. Sequentially, quarterly EPS rose on higher operating income principally from Subsea Products and Subsea Projects.

M. Kevin McEvoy, President and Chief Executive Officer, stated, "Our quarterly EPS was slightly above our guidance, and was up 21% over the first quarter of this year and 12% over the second quarter of 2013. EPS for the first half of 2014 was 16% higher than the first half of 2013. We achieved record quarterly operating income from Subsea Products, and for the first time Subsea Products operating income exceeded that of ROV.

"Our outlook for the second half of this year remains positive and unchanged overall from last quarter. Given this outlook and our year-to-date performance, we are narrowing our 2014 EPS guidance range to $3.95 to $4.05 from $3.90 to $4.10. Relative to the first half of 2014, we expect to generate higher income from each of our operating segments during the second half, led by ROV and Subsea Projects. We continue to forecast year-over-year operating income growth for all of our oilfield segments in 2014.

"Compared to the first quarter, Subsea Products operating income rose on the strength of increased revenue and profitability from tooling and subsea hardware. Subsea Products backlog at quarter end was $850 million, compared to our March 31 backlog of $894 million and $902 million one year ago. During the quarter we announced one large umbilical contract for offshore Indonesia.

"ROV operating income was essentially flat, as operating margin declined due to higher repair and maintenance expenses, unanticipated startup costs associated with placing new systems in service, and lower fleet utilization. Revenue grew on increases in days on hire and revenue per day on hire. During the quarter we put 13 new ROVs into service and retired 4. At the end of June we had 323 vehicles in our fleet, compared to 296 one year ago.
"During the second half of this year, we expect to place at least 13 new ROVs into service, and we have contracts for all of these. When these new vehicles are placed into service depends upon the actual commencement dates of new drilling rig and vessel project work. We now anticipate adding 40 or more new systems to our ROV fleet in 2014.

"Sequentially, Subsea Projects operating income increased largely as a result of adding a vessel, the Bourbon Evolution 803, to our Field Support Vessel Services contract with BP for work offshore Angola and a higher profit contribution from the Ocean Alliance in the U.S. Gulf of Mexico. The Ocean Alliance was out of service for much of the first quarter undergoing a regulatory drydock inspection. Asset Integrity operating income improved slightly due to a seasonal increase in activity in Europe and the Caspian Sea area. Advanced Technologies operating income declined due to execution issues on certain U.S. Navy and industrial projects.

"For the third quarter of 2014, we are projecting EPS of $1.10 to $1.15. We expect sequential improvements in income from all of our operating business segments, led by ROVs.

"Our liquidity and projected cash flow provide us with ample resources to invest in Oceaneering's growth. At the end of the quarter, our balance sheet reflected $103 million of cash, $80 million of debt, and $2.2 billion of equity. During the quarter we generated EBITDA of $217 million, $403 million year to date, and for 2014 we anticipate generating at least $855 million.

"In June we increased our regular quarterly cash dividend by 23% to $0.27 from $0.22 per share. This underscores our continued confidence in Oceaneering's financial strength and future business prospects.

"Looking beyond 2014, we believe that the oil and gas industry will continue its investment in deepwater projects. Deepwater remains one of the best frontiers for adding large hydrocarbon reserves with high production flow rates at relatively low finding and development costs. With our existing assets and opportunities to add new assets, we are well positioned to supply a wide range of services and products to safely support the deepwater efforts of our customers."

The first cargo has been successfully offloaded from what is expected to be Chevron's largest investment in Brazil: the offshore Papa-Terra heavy oil development in the Campos Basin.

"The first offloading at Papa-Terra represents an important milestone for the company, reinforces the progress being made by the project and highlights the success of the partnership between Chevron and Petrobras," said Les Wood, a manager with Chevron Brazil.

The Brasil Voyager, a tanker owned and operated by Chevron, was built with specific features for offloading oil from Papa-Terra.

On May 9, the Brasil Voyager, a tanker built specifically for the operation, lifted approximately 740,000 barrels of oil from Papa-Terra's floating production, storage and offloading (FPSO) vessel. The oil came from the first two production wells in the field.

"This is a significant milestone for the Papa-Terra project," said Kelly Hartshorn, managing director of Chevron's Latin America business unit. "This project will make a positive impact on Chevron's future growth target, and I am proud of the Chevron Brazil team for their efforts to get us to this successful point in the field's development."

The Brasil Voyager is expected to offload around 950,000 barrels of crude from Papa-Terra every 40 days.

"The Brasil Voyager is now bringing cargo to the market, including providing supply to the Pascagoula Refinery, and we look forward to its return to the Papa-Terra Field for the next Chevron shipment," Wood said.

On May 12, production began from a third well at Papa-Terra. Two additional wells are expected to start producing to the FPSO in 2014.

The Papa-Terra Field lies in approximately 3,900 feet (1,189 m) of water. The project includes the FPSO as well Brazil's first tension-leg well platform (TLWP), which was installed in the field in April. Heavier-oil production wells will lead to the platform while lighter-oil production wells will tie back to the FPSO. First oil from the TLWP is expected later this year.

The project has a planned daily capacity of 140,000 barrels of crude oil and 35 million cubic feet of natural gas

Heerema Marine Contractors (HMC) has selected Kongsberg Maritime's K-Sim Offshore simulation platform to enhance crane operator training and the safe, efficient implementation of heavy lift operations. With the contract signed on May 21st 2014, delivery of what will become the world's most advanced offshore heavy lift crane simulator is planned for September 2015. It will be installed at a new simulation center in the HMC Academy at the company's HQ in Leiden, the Netherlands.

As a leading international offshore oil and gas marine contractor specializing in transporting, installing and removing offshore facilities, HMC's requirement when selecting its simulation partner was to develop a system that could train the most competent crane operators and conduct detailed pre-mission training for heavy-lift projects. To meet these requirements, Kongsberg Maritime will develop a unique simulator based on the K-Sim Offshore platform, which is already in use at several high-profile offshore training facilities worldwide.

"In addition to the technical capabilities of the K-Sim Offshore Simulator, especially including its high-level hydrodynamics, it was important to find a simulator supplier that we could work closely with on such an extensive project," comments Catina Geselschap, Project manager at the HMC Academy. "Kongsberg Maritime demonstrates not only the technical competence to deliver such a complex and sophisticated simulator, but also an open approach that encouraged dialogue and a willingness to find a solution working in close cooperation with Heerema."

The Kongsberg Maritime scope of supply includes two offshore crane operator domes and a DNV Class A bridge with K-Sim DP simulator, which is based on the same Kongsberg Maritime K-Pos DP systems used on Heerema's vessels. To achieve highly realistic training, the K-Sim Offshore simulator will feature detailed models of three HMC deepwater construction vessels; Thialf (Semi-Sub), Balder (Semi-Sub) and Aegir, in addition to several barges (including H-851) and a supply vessel.

Supporting Heerema's plans to use the simulator for project planning, testing & verification, Kongsberg Maritime is also developing a set of library objects and models of offshore installations and equipment used for simulating specific heavy lift projects; such as lifting Jackets, top sides and subsea templates from barge to vessel or from vessel and overboard. Also included in the delivery is an extensive instructor and debrief system, and two deck operator trainers (deck position simulator) designed to train for communication and teamwork between the crane operator and deck operators.

"Heerema is pushing limits with real operations and the K-Sim Offshore simulator project will push limits within training for heavy-lift applications," says Harald Kluken, Area Sales Manager, Kongsberg Maritime Simulation. "As our most advanced offshore heavy lift crane simulator to date, this project will take the K-Sim Offshore simulator platform a great step forwards in regards to engineering and pre-simulation for complex heavy lift operations."

McDermott International, Inc. (NYSE: MDR) ("McDermott") has announced that one of its subsidiaries was awarded a contract to provide transportation and installation services to Walter Oil & Gas Corporation ("Walter") for the Megalodon platform destined for South Timbalier Block 311 in the Gulf of Mexico. The project is expected to be included in McDermott's third quarter 2014 backlog.

The McDermott heavy-lift vessel, Derrick Barge 50, will install the Megalodon platform in 391 feet of water, over an existing well site in the Gulf of Mexico. (Photo: Business Wire)

"McDermott is pleased to work again for Walter to support its drilling and production activities," said Dominic Savarino, Vice President and General Manager, Americas. "This project supports our goal to maximize our asset utilization between large contracts through short term transportation and installation work."

McDermott will provide all materials and equipment to transport and install the six-pile platform in 391 feet of water, over an existing well site. The heavy-lift Derrick Barge 50 will perform a side-lift of the 3,300-ton jacket and set the 2,100

Asset Guardian Solutions Ltd (AGSL), which specializes in protecting companies' process critical software assets, announced that it has been awarded a key contract by a major North Sea operator in Aberdeen, Scotland.

The contract requires AGSL to provide Asset Guardian, a process software management tool that helps to secure the integrity of process software and the mission critical processes that it controls.

Protecting integrity of process critical software on North Sea assets

AGSL will install Asset Guardian software on all of the operator's assets in the North Sea. Asset Guardian software provides a multifaceted, single point solution to manage the process control software it uses to operate these assets. It also ensures that the company complies with all relevant regulatory standards and government directives on process critical systems, such as IEC61508, 61511, ISO 9001, CPNI and HSE KP4 among others.

By using Asset Guardian, the operator will operate with a single secure repository in which all software and data for its North Sea assets is stored. By doing so, critical information is centralized, providing authorized personnel – both onshore and offshore - with access to one source of data, dramatically enhancing workflow.

In addition to preventing unauthorized access to process software, Asset Guardian makes it possible to retrieve back-up files and data required to update or replace system software that has been corrupted or failed, quickly and efficiently. As a result, negative impact upon production is dramatically reduced.

Improving communications enhances operations

Because these assets operate in the rugged, often stormy North Sea, communication links between the assets and onshore cannot always be relied upon. "To address this, we are also providing AGSync, a software solution that we developed especially for the oil and gas industry that makes it possible to synchronize data and files between locations," said Sam Mackay, Managing Director of AGSL.

In addition to providing Asset Guardian software, AGSL will also assist this customer with the migration of files and data from existing systems into Asset Guardian and provide full training to both Users and system Administrators using the recently launched Asset Guardian Computer Based Training (CBT) program.

Since 2007, AGSL has been supplying the oil and gas industry with the Asset Guardian toolset. The award of this contract follows on the heels of several others, including those from Woodside, Inpex, Stena Drilling, BP, Marathon, and nuclear energy provider EDF Energy

Shell has announces its third major discovery in the Norphlet play in the deep waters of the Gulf of Mexico with the successful Rydberg exploration well. After more than 10 years of exploration activities in the Eastern Gulf of Mexico, Shell continues to lead industry in exploring this Jurassic play.

"The Rydberg discovery builds upon our leadership position in the Eastern Gulf of Mexico and its proximity to our other discoveries in the area make Rydberg particularly exciting." said Marvin Odum, Shell Upstream Americas Director. "These successes represent the emergence of another hub for Shell's deep-water activities that should generate shareholder value."

The Rydberg well is located 75 miles (120 kilometres) offshore in the Mississippi Canyon Block 525 in 7,479 feet (2,280 metres) of water. It was drilled to a total depth of 26,371 feet (8,038 metres) and encountered more than 400 feet (122 metres) of net oil pay.

Shell is completing the full evaluation of the well results but expects the resource base to be approximately 100 million barrels of oil equivalent. Together with the Appomattox and Vicksburg discoveries, this brings the total potential Norphlet discoveries to over 700 million barrels of oil equivalent.

This is the first discovery for the partnership of Shell (operator, interest 57.2%), Ecopetrol America Inc. (28.5%) and Nexen (14.3%), a wholly-owned affiliate of CNOOC Limited. The discovery is within 10 miles (16 kilometres) of the planned Appomattox development and the 2013 Vicksburg discovery (Shell, operator, 75% and Nexen, 25%).

Shell and Nexen are following up the Rydberg discovery with an exploratory well at Gettysburg, located in Desoto Canyon Block 398 which is also within 10 miles (16 kilometres) of the planned Appomattox Development.

• The Jurassic-period Norphlet play is a geological formation that extends from onshore to the deep waters of the Eastern Gulf of Mexico.
• Appomattox (Shell 80%, Nexen 20%) is currently in the define phase of development and is moving forward with engineering design for the floating production system, subsea infrastructure and wells.
• The drillship Noble Globetrotter I drilled the Rydberg well and is currently repositioning to drill the Gettysburg exploratory well.
• The Gulf of Mexico is a major production area in the USA, accounting for almost 50% of Shell's oil and gas production in the country and almost 180 thousand boe per day in 2013.
Download fact sheet 'Shell and the Norphlet play' (July 2014) (PDF, 168 KB)

The board of directors of Aker Solutions ASA ("Aker Solutions") has in accordance with the strategy disclosed April 30 resolved to propose to the company's shareholders that Aker Solutions be split into two companies. The board has also determined to write down the value of some assets in the Aker Oilfield Services unit of Akastor, one of two companies that will emerge from the separation.

Aker Solutions Holding ASA ("New Aker Solutions") - a subsidiary of Aker Solutions ASA established for the purposes of the demerger and which will apply for listing of its shares on the Oslo Stock Exchange - will through the proposed demerger assume Aker Solutions' activities in the following areas of operation: Subsea (SUB), Umbilicals (UMB), Maintenance, Modifications and Operations (MMO) and Engineering (ENG). New Aker Solutions will operate under the Aker Solutions name from the first day of listing.

From the first day of listing of New Aker Solutions, the existing Aker Solutions ASA will change its name to Akastor ASA to form the Akastor Group together with the other subsidiaries that have not been transferred to New Aker Solutions. The Akastor Group will, among other things, continue Aker Solutions' activities mainly related to Drilling Technologies, Process Systems, Surface Products and Aker Oilfield Services, as well as Business Solutions, some financial assets and real estate.

On completion of the demerger, consideration shares in New Aker Solutions will be issued to the shareholders of Aker Solutions. Each share in Aker Solutions will give the right to one consideration share in New Aker Solutions. The consideration shares will constitute 100 percent of the outstanding shares in New Aker Solutions as of completion of the demerger.

The demerger is subject to approval by the shareholders of Aker Solutions at the Extraordinary General Meeting to be held on August 12, 2014, and depends, among other things, on the approval of the application to list New Aker Solutions shares on the Oslo Stock Exchange.

Based on external and internal valuations, the board of Aker Solutions determined an allocation of Aker Solutions' share capital so that 35.2 percent of the share capital would be allocated to Aker Solutions (to be renamed Akastor) and 64.8 percent to New Aker Solutions. This is in accordance with the allocation of net values between the two companies as a consequence of the demerger. The allocation is mainly based on internal and external evaluations of future cash flow and also takes into account the businesses' risks and prospects. Aker Solutions has as part of the demerger plan adopted an interim balance sheet that is included in the demerger plan.

The board determined to recognize impairments and a provision, which are reflected in the above-mentioned valuation, of about NOK 1.6 billion on some assets and goodwill of the Aker Oilfield Services unit of Akastor. The value of Aker Oilfield Services' investments in the Skandi Aker and Aker Wayfarer vessels will be written down and a provision will be made on future leasing commitments for the Aker Wayfarer vessel. The goodwill value of the business area Oilfield Services and Marine Assets (OMA), which Aker Oilfield Services belongs to, will also be written down.

The impairments and provision are based on revised business cases after the cancelation in June by Total in Angola of a two-year contract for the Skandi Aker vessel, as well as a generally weaker market that has created uncertainty about the value of the vessel and the goodwill value of OMA. An impairment charge of NOK 664 million will be taken on the Skandi Aker and NOK 306 million on the goodwill value of OMA. An impairment charge and onerous lease provision totaling NOK 662 million will also be taken on the Aker Wayfarer as some prior investments in the vessel have little or no value based on recently revised business cases and the current market outlook.

The after-tax effect of the impairments and provision is expected to be about NOK 1.3 billion. Most of the Aker Wayfarer impairment and provision will impact earnings before interest, taxes, depreciation and amortization (EBITDA). The Skandi Aker and OMA goodwill impairments will impact earnings before interest and taxes (EBIT). The impairments and provision, as well as other financial consequences of the demerger, will be incorporated in the second-quarter 2014 results disclosed July 17 by Aker Solutions.

The impairments and provision will have no effect on the new Aker Solutions since OMA will become part of Akastor. There will be no cash effect, no adverse impact on future funding through covenants and no consequences for the separation of Aker Solutions.

Indicative key dates for the demerger and the listing of New Aker Solutions shares on the Oslo Stock Exchange are as follows:

• Extraordinary General Meeting of Aker Solutions where the demerger proposal will be considered: August 12, 2014
• Application for listing of New Aker Solutions' shares on the Oslo Stock Exchange: on or about August 27, 2014
• Last day of trading of the Aker Solutions' share inclusive of the right to consideration shares in New Aker Solutions: on or about September 26, 2014
• Registration of the demerger with the Norwegian Register of Business Enterprises: on or about September 26, 2014
• First day of trading in Akastor shares exclusive of the right to consideration shares in New Aker Solutions: on or about September 29, 2014
• First day of trading in New Aker Solutions shares on the Oslo Stock Exchange: on or about September 29, 2014

ABG Sundal Collier, Barclays and Carnegie will act as joint lead managers for the listing process.

As part of the process, a listing prospectus for New Aker Solutions will be prepared and published in accordance with applicable laws and regulations.

Statoil resumed oil and gas production on the Njord A platform in the Norwegian Sea on 19 July, after a major reinforcement of the platform structure. Production has been shut down since last summer.

The Njord A platform in the Norwegian Seat. (Photo: Øyvind Nesvåg)

Extensive analyses and inspections in 2013 revealed a need to reinforce the Njord A platform structure. To be on the safe side, Statoil opted to keep production shut down until the reinforcements were in place.

"We have extended Njord's lifetime by improving recovery on the field, and by finding more oil and gas in the area. The Njord A platform has been with us the entire time, and we want to make sure that the structure can withstand the loads it will be exposed to," says head of Njord operations Arve Rennemo.
The work that has been done through the winter and spring has strengthened the structure, so the platform can resume production. The work of reinforcing the structure has mainly consisted of bracing the primary beams and struts, and increasing the length of the secondary beams under the platform.

The long-range plan is to further bolster the platform to prepare it for future drilling operations and an extended lifetime on the Njord field.

"Njord A will produce oil and gas until the summer of 2016, after which it will be taken to shore for additional upgrades which will allow us to use the drilling system on board, and prepare it for many more good years of service on the Norwegian shelf," says Rennemo.

Statoil also has studies in progress to assess how the Njord area and the Haltenbanken area in the Norwegian Sea can be further developed. The Njord A platform has been in production since 1997.

Facts:

Scaffolding used in the reinforcement process. (Photo: Ole-Andreas Nylund)

Njord A - the Njord field in the Norwegian Sea was developed with a floating steel platform, Njord A, with an integrated deck with a drilling and processing facility and living quarters. Njord A started production in September 1997.

The platform was designed for an original lifetime of 16 years – to 2013. The Petroleum Safety Authority subsequently approved the technical design lifetime to 2022.

Njord was a marginal field development with strong focus on low costs and rapid execution.

The area has a substantial resource potential which could provide a basis for production beyond 2013.

Njord Future – suring the structural reinforcement project, it became clear that, even with the reinforcements implemented offshore over the past year, the Njord A platform will not be robust enough to resume drilling activity in the summer of 2014. Nor will the platform be able to produce until 2022, which is the existing technical lifetime for the installation.

The Njord Future project has therefore been initiated to ensure a long-term solution for optimal resource utilisation in the Njord area.

There are considerable remaining resources in the area, and plans are now being laid to recover these resources, either using a modified Njord A platform or through construction of a new platform.

It is natural in this context to investigate possible cooperation solutions with other recent discoveries made in the area.

Claxton Engineering Services, an Acteon company, has appointed Martin Jolley as vice president sales and commercial to spearhead its global sales and commercial strategy.

Providing leadership and vision to direct the company's sales, marketing, commercial and tendering divisions, Jolley will be based in Claxton's UK head office, overseeing commercial development aimed at expanding the business worldwide.

Jolley's appointment underlines Claxton's commitment to global expansion and growth of operations. Claxton recently secured its biggest ever riser contract – for the development of the Hanz field, offshore Norway.

Jolley, who has a master's degree in industrial economics and a degree in engineering science, was previously business development director for Camellia plc., where he was responsible for AKD Engineering Ltd and five other companies within the Camellia group.

Laura Claxton, managing director, Claxton, said, "Our ongoing aim is to extend the responsive, high-quality engineering services that we deliver in the North Sea into new markets. Martin will play a leading role in this and ensure that we deliver the same high levels of customer and market focus in Norway, South East Asia and the UAE. His experience and leadership capabilities will prove invaluable in our continuing international expansion and we are delighted to have him onboard at Claxton."

Claxton holds one of the largest stocks of subsea risers with a wide array of bore, pressure and complete system options. The company has also pioneered rigless well abandonment operations and has installed approximately 5,000 structural centralizers globally.

UK flowmeter specialist Litre Meter (www.litremeter.com) has launched the second in a series of oil and gas industry safety surveys that will be introduced throughout 2014.

The survey (http://tiny.cc/ped) is designed to enable manufacturers and resellers to test assertions about functionality and construction and quality of manufacture.

The new survey concentrates on the Pressure Equipment Directive (PED) and one lucky respondent will win a Kindle for taking part.

The purpose of PED is to harmonize national laws regarding the design, manufacture, testing and conformity assessment of pressure equipment and assemblies of pressure equipment. This includes pressurized storage containers, heat exchangers, steam generators, boilers, industrial piping, safety devices and pressure accessories. Such pressure equipment is widely used in the process industries including oil & gas, chemical, pharmaceutical, plastics and rubber and the food and beverage industries - all of which are key markets for Litre Meter.

Litre Meter has launched the second in its series of industry surveys on safety issues in the oil and gas sector.

All relevant equipment, plant and systems in the European Economic Area must comply with the PED. It requires the level of hazard of pressure equipment to be assessed and classified into 1 of 5 categories labelled SEP (sound engineering practice) then categories I-IV. The higher the level of hazard, the more extensive the level of quality assurance required during the design, manufacture and testing of the equipment.

Litre Meter CEO Charles Wemyss said: "There has been increased focus on safety issues in the offshore sector over recent years. We want to make sure that our manufacturing focus is on safety in relation to both the environment and industry trends.

"Issues surrounding the environment and hydrocarbon releases, asset aging and life extension drive the focus on safety. We want to be able to help in the process of recognizing hazards and reducing risk as well as help engineers take ownership of risk and asset integrity through proving assertions about the functionality and construction of instruments.

"Asset integrity management ensures that the people, systems, processes and resources that deliver integrity are in place, in use and will perform on demand over the asset's lifecycle.

"Being able to prove assertions about the manufacture and functionality of equipment are vital in this process."

Earlier this year Litre Meter conducted a survey of the use of Safety Integrity Levels (SIL) in the specification of instrumentation in the oil and gas sector. The results of that survey are published at http://tiny.cc/sil-result.

To take the PED survey visit http://tiny.cc/ped and spend just a few minutes answering the questions.

Declining North Sea production and increasingly mature assets are expected to drive demand for offshore accommodation support, with the attributed maintenance, refurbishment and shutdown work requiring additional personnel-on-board and workshop capacity. However, the harsh met ocean conditions of the northern North Sea (NNS) ultimately limit Operator choice to two types of accommodation - jackup barges and semisubs – due to the greater stability and safety offered.

Despite growing demand for semisub units, the sector is plagued by constrained global supply and limited availability, placing upward pressure on day rates. This is having a significant impact on contract costs in the NNS, with day rates typically ranging from $200-350k. Additionally, Operators are placing contracts several years in advance to ensure maintenance or construction schedules are satisfied. This is forcing Operators to seek more efficient contracting practices, either through unit sharing agreements or securing units on an annual basis.

Notably; although costs continue to rise, a key emerging trend in the floating accommodation sector is employee welfare. IOCs are using their global footprints to help drive the adoption of the 'quality equals efficiency' concept. This is now being mirrored in the NNS, where several large Operators and service contractors have identified a trend between 'spanner time' – hours worked by offshore personnel – and the quality of worker accommodation. While this may incur greater costs in terms of unit day rates, the cost advantages gained from reduced downtime and improved worker efficiency could make this increased expenditure worthwhile.

The industry is screaming for offshore accommodation capable of working in harsh conditions. Although the market will see 11 new units delivered between 2015-2016, continued growth in demand for accommodation semisubs, intensified by unit retirement, will further constrain supply. We are already seeing the market respond with new orders; however, will this be enough to offset growing demand pressures?

Murray Dormer, Douglas-Westwood London
+44 1795 574736 or This email address is being protected from spambots. You need JavaScript enabled to view it.

www.douglaswestwood.com