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Northern Petroleum: More Drilling to Be Conducted Offshore French Guiana
Northern Petroleum Plc announces the joint venture decision to extend current drilling operations on the Guyane Maritime permit in French Guiana.
The GM-ES-3 exploration well is the second well of a four well exploration drilling campaign that commenced in 2012 to follow up the oil discovery at GM-ES-1 in 2011.
The GM-ES-2 well had exploration objectives in the major Cingulata fan system within which the original oil discovery was made in two ages of formation. GM-ES-3 has been planned to deliver exploration information in the subsidiary Priodontes fan system to the north west of the Zaedyus oil discovery.
The GM-ES-3 well intersected a 50 metres gross section of oil stained sands in the lower part of the Bradypus fan which was not a target formation at this location although it is also within the main Cingulata fan system. A 325 metres gross interval of sandstones was encountered in the targeted Priodontes fan, but these were logged with no significant hydrocarbon shows.
It has been decided by the Shell, Total, Tullow Oil and Northpet Investments Limited joint venture that this well provides a suitable location to drill deeper in a plan to penetrate the full post Atlantic rift sequence. The duration of this additional drilling will depend upon results from the formations encountered.
“This information may prove crucial to a fuller understanding of the exploration potential of this very large licensed area. Although this extension may cause a small delay to the further wells in this exploration programme, the earlier the deeper formations are examined, the better the advantages to be gained from its use in the second part of the drilling programme and aid efforts towards discovering more oil,” said NorthernPetroleum in a press release.
The well is now targeted to reach a final depth of 6438 meters subject to operational factors.
Derek Musgrove, Managing Director of Northern stated: “Following the oil discoveries of GM-ES-1 in 2011, the task before us was to explore the licence to ascertain its wider potential. Whilst the sand package in the primary target proved not to have significant hydrocarbons at this location, the oil staining encountered in the Bradypus fan is encouraging of the broader active hydrocarbon systems and potential.
“Northern supports this fuller exploration approach to this well. It is likely to provide Partners with further geological data imperative to gaining further understanding of the complex geology in this area”
To read more on the Joint Venture’s operations in French Guiana click here.
Total Extends Drilling Contract for Pacific Scirocco Drillship
Drilling contractor Pacific Drilling S.A. has announced that Total S.A. has elected to exercise a one-year option to extend the firm contract term for the Pacific Scirocco to January 2015.
The contract provides for a further option, to be exercised at the client’s discretion by April 7, 2014, which could result in two additional years of contract term at a higher dayrate.
Related: Pacific Scirocco Drillship Begins Work in Nigeria
The additional one year term increases the drillship’s backlog by approximately $180 million, bringing the company’s total contract backlog as of April 9, 2013, to approximately $3.4 billion. The additional extension for two years would add a further $364 million backlog if exercised.
The Pacific Scirocco is capable of operating in water depths of up to 12,000 feet and drilling wells 40,000 feet deep.
UH to open first subsea engineering masters program in 2013
Molly Ryan
Reporter- Houston Business Journal
The University of Houston has plans to offer the fist subsea engineering graduate program in the U.S.
The local university recently said the Texas Higher Education Coordinating Board approved the school’s proposal to offer a graduate subsea engineering program. The program, which is expected to begin in the fall of 2013, will complement the school’s existing subsea engineering certification program.
Worldwide Field Development News Sep 22 – Sep 28, 2012
This week the SubseaIQ team added 1 new projects and updated 8 projects. You can see all the updates made over any time period via the Project Update History search. The latest offshore field develoment news and activities are listed below for your convenience.
Mediterranean
Possible Progress for Gaza Marine
Sep 25, 2012 – The Israeli Foreign Ministry released a report Sunday regarding new developments that concern the future of the Gaza Marine gas field. Gaza Marine is located roughly 18 miles off the coast of the Gaza Strip. BG, with a 90% interest, is the field operator and estimates reserves of around 1 Tcf. Due to Israeli-Palestinian relations, development of the field has been on hold since two appraisal wells were drilled in 2000. The recent report indicates that Israeli and PLA officials have opened a meaningful dialogue in an effort to come to an agreement on a mutually beneficial development plan.
Project Details: Gaza Marine
S. America – Other & Carib.
CX-15 Platform Arrives at Corvina
Sep 25, 2012 – BPZ Energy’s CX-15 platform has been delivered and anchored on location at the West Corvina field. The buoyant tower and topside arrived in Peru via heavy lift vessel September 5. At this point, the tower has been ballasted down and the topsides mated to the hull. Final weld out and hook up of facilities is being completed, after which the Petrex-28 platform rig will be brought on board and assembled. The first well is expected to spud in late October.
Project Details: Corvina
Africa – West
BW Extends FPSO Contract with CNR
Sep 26, 2012 – BW Offshore announced a contract extension with CNR International (C??te d’Ivoire) SARL for the lease and operation of the FPSO Espoir Ivoirien. The firm period of the 4 year extension will carry the contract to 2Q 2017. In addition, the option period has been adjusted and could allow CNR to lease the vessel through 2Q 2036. The total contract value (including options) is $925 million, which is up from the previous contract of $250 million.
Maersk Oil Sees More Success Offshore Angola
Sep 24, 2012 – The deep waters of Block 16, offshore Angola, continue to be good to Maersk Oil and its partners. A recent production test of the Caporolo-1 exploration well flowed a maximum of 3,000 bopd on a 36/64″ choke. Caporolo-1 was drilled to 18,070 feet into a structure adjacent to, but separate from, the nearby Chissonga discovery. Drilling was done by the Ensco 5001 (DW semisub) in 4,567 feet of water. Comments from Maersk Oil indicate that further exploration and appraisal will be needed to determine if the discovery is able to be developed.
S. America – Brazil
Anadarko Cedes Interest in Brazilian Block
Sep 27, 2012 – Anadarko announced it ceded its 30% stake in Brazilian block ES-M-661, part of the BM-ES-24 concession, to operator Petrobras who now maintains a 70% interest. The company relinquished its interest in the block 6 months ago but the transaction received the Brazilian National Petroleum Agency’s approval just recently. Petrobras announced in July that the Grana Padano well, located in ES-M-661, was a heavy oil discovery. Anadarko still maintains its interest in two other blocks in the concession.
Sep 27, 2012 – Drilling at Vanco’s Canario prospect is underway. Canario is located in block BM-S-63 and is being drilled by Transocean‘s GSF Arctic 1 (mid-water semisub). The primary target is post-salt turbiditic sands of the Middle Itajai-Acu formation and is expected to be intersected at 10,498 feet. Secondary sandstones in the Upper Jureia formation are being sought as a secondary objective. Total depth for the well is projected to be 15,748 feet. Drilling is expected to take 2 ??? 3 months, at which point the rig will mobilize to the Jandaia prospect in block BM-S-71.
Project Details: Canario
Australia
Production Test Being Planned for Boreas-1
Sep 27, 2012 – Logging is currently being completed and preparations are being made to begin production testing at the Boreas-1 exploration well in Browse Basin, according to Karoon Gas Australia. To this point, interpretation of the data gathered from the well indicates the presence of net pay gas sands exhibiting good reservoir properties. The Transocean Legend (mid-water semisub) is being used to carry out the exploration drilling program which calls for a minimum of 5 wells to be drilled in the area.
Project Details: Boreas
Sep 26, 2012 – New Zealand Oil & Gas said it will drill a well at its Kakapo prospect when a suitable rig can be negotiated. Kakapo is located in Permit 51311 about 25 miles off the South Taranaki coast of New Zealand. NZOG was awarded the permit in 2009 and, based on terms, had to either relinquish the permit this week or keep it and commit to drill. As operator, NZOG has a farm-out agreement with Raisama Energy, whereby Raisama will earn a 10% stake in the permit by carrying 20% of the costs for the first well – not to exceed $3 million. A timetable for the first well is expected to be confirmed within the next 6 months.
Project Details: Kakapo
Europe – North Sea
Romeo Spuds in the UK North Sea
Sep 24, 2012 – Noreco announced the start of drilling operations at the Romeo prospect in the UK North Sea. The exploration well is located in block 30/11c of license P1666. Romeo is a fault bound dip closure in a proven Upper Jurassic play. Primary risk to success is considered to be the trap geometry in the formation. Suncor, as operator of the license, has engaged the WilHunter (mid-water semisub) to provide drilling services. Downhole conditions are expected to be borderline HPHT so the well will be drilled as such.
Project Details: Romeo
Related articles
- Worldwide Field Development News Sep 14 – Sep 20, 2012 (mb50.wordpress.com)
- Recap: Worldwide Field Development News Jul 27 – Aug 2, 2012 (mb50.wordpress.com)
Wrecking a Nation: Oil, Dependency, and Redistribution
Here’s how the economic and political system of a nation is destroyed.
Every price increase of just a dime per gallon of gasoline at the pump extracts approximately $5 billion from the pockets of U.S. consumers over the course of a year.
On top of killing family budgets, with a dollar per gallon jump at the pumps picking our pockets of $50 billion per year, there is on the macro level an inverse relationship between the price of oil and the overall health of the economy — oil price hikes deliver less job growth, less demand for labor, more unemployment, more poverty, more inequality, more inflation, lower real income increases, and smaller advances in the standard of living.
Additionally, higher oil prices directly cause greater amounts of U.S. capital to be exported, both to pay the higher prices and to pay for the growing levels of imported oil.
In 1985, the U.S. imported 25 percent of its oil usage. Today, it’s 61 percent. And still we are placing restrictions on increases in domestic production, both for oil and other sources of energy.
A few days back, President Obama, rather than sticking around a couple hours to explain to the American people or to the U.S. Congress why we were going to war in Libya, flew off to Brazil to hand out a permit to allow deep sea oil drilling in the Gulf of Mexico to Brazil’s state-run oil company, Petrobras. Capitalist companies in America need not apply.
This particular foreign deal was an especially snug and nostalgic fit for Obama. Brazilian president Dilma Rousseff is somewhat of a Latin form of Obama’s old Weather Underground chum Bernardine Dohrn.
In earlier days, Rousseff, a former Marxist guerrilla, was charged with running with a gang of redistributionists who accumulated revolutionary capital by way of kidnapping foreign diplomats for ransom.
A top priority for Rousseff today mirrors the “spread the wealth around” objective that Obama stated to Joe the plumber.
Dohrn, just home from a trip to Cuba in 1969 where she hoped to pick up some pointers on how to impose a “classless” society on the United States, displayed her true psychopathic colors in a speech she made to the Weathermen’s “War Council.” Speaking elatedly of the murders by the Charlie Manson gang of actress Sharon Tate, coffee heiress Abigail Folger, and three other people, Dohrn proclaimed, “First they killed those pigs, then they ate dinner in the same room with them, then they even shoved a fork into the victims’ stomachs! Wild!”
That’s the fully hateful Bernardine on public display, seeing herself as a new George Washington, a revolutionary fighter for a new nation. It’s the same role, except this founding mother was in serious need of a super-sized bottle of antipsychotic drugs and a super-tight straight-jacket.
Of all the places for candidate Obama to kick off his political career in 1995 in his first run for the Illinois State Senate, he picked the living room of Bernardine Dohrn and husband Bill Ayers, co-founder of the Weather Underground and, more recently, the national vice president for curriculum studies at the American Educational Research Association.
I’d have kept up my guard when Bernardine sashayed out of the kitchen and began circulating around with the hor dourves and metal forks.
In any case, it’s no surprise that things are coming apart, especially on energy. “If somebody wants to build a coal-fired plant, they can,” pronounced Obama during the presidential campaign. “It’s just that it will bankrupt them because they’re going to be charged a huge sum for all that greenhouse gas that’s being emitted.”
What’s the end game? “Suicide Mission Accomplished”?
Ralph R. Reiland is an associate professor of economics at Robert Morris University in Pittsburgh.
Related articles
- Oil Forever! (mb50.wordpress.com)
- The Vetting: Obama, Radical Islam and the Soros Connection, Part I [Video] (johnmalcolm.me)
- New Film “The Unvetted” Exposes Obama’s Communist Cover-up (askmarion.wordpress.com)
- Smoking Gun on Obama’s Association With Karl Marx Himself (moonbattery.com)
- The Most Important Press Conference Ever Held at Any Time in U.S. History: Part I (askmarion.wordpress.com)
- The Vetting: Obama, Radical Islam and the Soros Connection, Part II [Video] (johnmalcolm.me)
- SDS Port Huron 1962 Statement may reveal much of the Obama Agenda (asktheblogster.blogspot.com)
- Judge Napolitano: Nobody Should Be Surprised About Obama’s Redistribution Comments (foxnewsinsider.com)
Hornbeck Expands OSV Newbuild Program (USA)
Hornbeck Offshore Services, Inc. announced today that it has expanded its OSV Newbuild Program #5 and has commenced a new 200 Class OSV Retrofit Program, among other recent developments.
Expansion of OSV Newbuild Program #5:
The Company has exercised the first four of its 48 options to build additional HOSMAX vessels at an aggregate incremental cost of approximately $180 million, excluding construction period interest, for vessel deliveries in the fourth quarter of 2014 and first quarter of 2015. These four new vessels will expand the Company’s fifth OSV newbuild program, which was announced in November 2011, from 16 vessels to a total of 20 U.S.-flagged HOSMAX class DP-2 new generation offshore supply vessels (“OSVs”) for its Upstream business segment.
These 20 vessels are being built at two shipyards in the United States, which qualifies them for coastwise trade in the U.S. Gulf of Mexico (“GoM”) under the Jones Act; however, the Company expects them to service the anticipated increase in deepwater and ultra-deepwater drilling activity in all three of the Company’s core geographic markets of the GoM, Brazil and Mexico. The HOSMAX class DP-2 vessel designs contemplated by this newbuild program feature three different size vessels (300, 310 and 320 feet in length) each with cargo-carrying capacities ranging from 5,650 to 6,200 deadweight tons and more than 20,000 barrels of liquid mud. The Company considers the option vessel pricing to compare favorably with all other recently announced newbuild programs for vessels of similar size and specifications.
In connection with exercising the first four shipyard options under this high-spec OSV newbuild program, the Company was able to extend the exercise dates for its 44 remaining options by approximately 60 days each without changing the favorable pricing and original delivery dates. Accordingly, the Company’s decision with respect to the exercise of the next option at each of the two shipyards is now not due until February 1, 2013 and February 19, 2013, respectively. These exercise date extensions afford the Company more time to assess market conditions before determining whether and to what extent to exercise additional options. In addition to the 20 newbuild vessels already committed that are scheduled to be placed in service on various dates between the second quarter of 2013 and the first quarter of 2015, the delivery dates for the remaining 44 vessels, if such options are exercised, will be approximately 24 to 26 months following the date of each respective option exercise, with the last potential newbuild vessel under this program (the 48th optional and 64th overall) to be delivered in January 2018. The Company currently intends to exercise all of its remaining 44 options to build additional HOSMAX class vessels should future market conditions, the pace of permitting in the GoM and its company-wide fleet complement continue to warrant their construction, providing the Company a very attractive, strategic five-year organic growth opportunity.
The Company expects the aggregate cost of the first 20 vessels committed under this potential 64-vessel construction program, including the four option vessels announced today, to be approximately $900 million, excluding construction period interest. At June 30, 2012, the Company had a cash balance of approximately $392 million and added net cash proceeds of approximately $266 million to the balance sheet from its 1.500% convertible notes offering, which closed on August 13, 2012. Together with cash on-hand and available capacity under its currently undrawn $300 million revolving credit facility, and based on the key assumptions outlined in the Company’s August 3, 2012 earnings release, the Company expects to generate sufficient cash flow from operations to cover all of its growth capital expenditures for the first 20 HOSMAX vessels under construction, all of the capital costs related to its new six-vessel 200 class OSV retrofit program discussed below, the planned retirement of its 1.625% convertible notes in November 2013, and all of its annually recurring cash debt service, maintenance capital expenditures and cash income taxes for the remainder of fiscal 2012 and for the full duration of the currently committed 20-vessel HOSMAX newbuild program.
In summary, the Company’s fifth OSV newbuild program now consists of vessel construction contracts with two domestic shipyards to build four HOSMAX 300 class OSVs, six HOSMAX 310 class OSVs (up two from the previously announced four), and ten HOSMAX 320 class OSVs (up two from the previously announced eight).
Based on the above schedule of projected vessel in-service dates, the Company expects to own and operate 51, 56, 69 and 71 new generation OSVs as of December 31, 2012, 2013, 2014 and 2015, respectively. These vessel additions result in a projected average new generation OSV fleet complement of 51.0, 52.2, 63.0 and 70.9 vessels for the fiscal years 2012, 2013, 2014 and 2015, respectively. The aggregate cost of the Company’s fifth OSV newbuild program, excluding construction period interest, is expected as noted above to be approximately $900.0 million, of which $242.2 million, $429.8 million, $178.5 million and $6.9 million is expected to be incurred in 2012, 2013, 2014 and 2015, respectively. From the inception of this program through June 30, 2012, the Company had incurred $120.4 million, or 13.4%, of total expected project costs, including $41.0 million that was spent during the second quarter of 2012.
Commencement of 200 Class OSV Retrofit Program:
In addition to the expansion of its HOSMAX newbuild program, the Company has decided to move forward on a new retrofit program that will upgrade and stretch six of its 200 class DP-1 new generation OSVs converting them into 240 class DP-2 OSVs. The vessels the Company has committed to this program are six of its ten Super 200 class DP-1 vessels, four of which are the vessels that recently completed two-year charters with Petrobras in Brazil. These new generation OSVs were built in 1999 and 2000 and were acquired by the Company in 2007. Due to their 56-foot wide beams, the planned 40-foot mid-body extensions and DP-upgrades are expected to add approximately 600 tons to the vessels’ 2,250 tons of current deadweight capacity and roughly double the vessels’ current liquid-mud capacity to approximately 8,000 barrels. The Company is now in the process of finalizing negotiations with a domestic shipyard it has selected and expects to enter into a definitive contract in the very near future. Based on preliminary estimates, the Company expects the yard to complete two of the six vessels in each of the following redelivery months: May 2013, August 2013 and December 2013, respectively.
The project costs for these discretionary vessel modifications are expected to be approximately $50.0 million, in the aggregate, and the Company expects to incur approximately 762 vessel-days of aggregate commercial downtime for the six vessels (127 vessel-days each), as follows:
Other than a modest amount of cash outlays and commercial downtime in the third and fourth quarters of 2012, this retrofit program is not expected to materially impact the Company’s financial results for fiscal 2012. However, upon completion of this program in 2013, the Company expects the newly retrofitted 240 class DP-2 vessels to command higher dayrates, higher margins and higher returns-on-invested-capital than they would have as 200 class DP-1 vessels, such that the Company anticipates a cash-on-cash pay-back of its additional capital investment within approximately 2.5 years. Given the market’s preference for high-spec DP-2 vessels and the Company’s relatively low pro forma net book value for its retrofitted vessels compared to the construction costs of comparable newbuilds in the market today, the Company should be even more competitive in meeting customers’ demand for high-spec vessels at very attractive relative economics.
Prospectively, the Company will report the projected cash outlays for its 200 Class OSV Retrofit Program under the caption “Maintenance and Other Capital Expenditures,” rather than “Growth Capital Expenditures.” Accordingly, the following figures will update and supersede the forward-looking guidance the Company provided in its earnings release on August 3, 2012. The Company now expects maintenance capital expenditures and other capital expenditures to be approximately $58.2 million and $17.4 million, respectively, for the full-year 2012. The Company now expects maintenance capital expenditures and other capital expenditures to be approximately $39.2 million and $50.0 million, respectively, for fiscal 2013, with the cash outlays relating to the 200 Class OSV Retrofit Program included in the latter category. For fiscal 2014, the Company expects that its annually recurring maintenance capital expenditure and other capital expenditure budget, in the aggregate, for its company-wide fleet of vessels will range between $45.0 million and $55.0 million.
GAAP Treatment of Recently Issued 1.500% Convertible Notes:
In accordance with ASC 470-20, convertible debt that may be wholly or partially settled in cash is required to be separated into a liability and an equity component, such that interest expense reflects the issuer’s nonconvertible debt interest rate. Upon issuance, a non-cash original issue discount (“OID”) is recognized as a decrease in debt and an increase in equity. The debt component accretes up to the principal amount over the expected term of the debt. ASC 470-20 does not affect the actual aggregate principal amount of the convertible notes that the Company is required to repay, nor does it impact the actual amount of cash coupon that the Company is required to pay with respect to the convertible notes.
On August 13, 2012, the Company closed on the issuance of $300 million in aggregate principal amount of 1.500% convertible senior notes due 2019 (the “1.500% convertible notes”). The Company’s estimated nonconvertible debt interest rate on such date was 5.75%, based on indicative market quotes for the Company’s publicly traded 5.875% senior notes due 2020. Therefore, as of the date of issuance of the 1.500% convertible notes and in accordance with the GAAP treatment described above, the Company recognized $73.3 million of non-cash OID, which decreased the book carrying value of the 1.500% convertible notes and increased the Company’s additional paid-in-capital equity account by a like amount. Such non-cash OID will be amortized through interest expense over the seven-year life of the 1.500% convertible notes. Accordingly, while the incremental annual run-rate of cash interest expense for the 1.500% convertible notes will be a constant $4.5 million, the gross book interest expense for such notes for financial reporting purposes will vary from year-to-year. The initial annual run-rate of GAAP interest expense for such notes is expected to be approximately $13.3 million. However, GAAP interest expense is expected to fluctuate based on the levels of capitalized construction period interest.
Due to changes in the timing of certain cash interest payment dates associated with the Company’s recent retirement of its 6.125% senior notes in March and April 2012, the issuance of its 5.875% senior notes in March 2012, and the issuance of its 1.500% convertible notes in August 2012, aggregate annual cash debt service for the full fiscal-year 2012 is expected to be $42.2 million. However, inclusive of the planned redemption of its 1.625% convertible notes in November 2013, the Company expects to incur aggregate annual cash debt service for the full fiscal-year 2013 in the amount of $52.3 million, excluding any cash interest expense related to potential revolver draws. Commencing with fiscal 2014 and beyond, the Company’s aggregate annual run-rate of cash debt service should revert to $48.0 million, excluding any cash interest expense related to potential revolver draws.
Hurricane Isaac Update:
The Company experienced no damage to any of its vessels as a result of Hurricane Isaac, including those currently under construction or in drydock at various GoM shipyards, although such yards may claim force majeure delays that may have occurred as a result of the storm. In addition, Hurricane Isaac did not result in customer cancellations of any pre-storm spot or term vessel charters. The Company’s new generation Upstream fleet continues to operate in-line with its pre-storm utilization guidance reported on August 3, 2012, which remains subject to, and primarily driven by, the pace of permitting in the GoM. No physical damage related to Hurricane Isaac occurred to the Company’s corporate headquarters in Covington, LA, which remains fully operational with all electrical power, Internet connectivity and telecommunications service. In addition, HOS Port, the Company’s logistics shore-base in Port Fourchon, LA, is fully operational.
ATP Reorganization Proceeding:
ATP Oil and Gas, Inc., a customer of the Company, initiated a reorganization proceeding under Chapter 11 of the United States Bankruptcy Code on August 17, 2012. As of the date of the bankruptcy filing, ATP was indebted to the Company in the amount of approximately $4.8 million. While the Company believes that its claims are secured by liens arising under law, it is too early in the proceeding to assess ATP’s plans and ability to repay the Company. ATP has indicated its plan is to reorganize and to that end has received post-petition financing. The Company will pursue all rights in the bankruptcy case in order to maximize its recovery.
Hornbeck Offshore Services, Inc. is a leading provider of technologically advanced, new generation offshore supply vessels primarily in the U.S. Gulf of Mexico and Latin America, and is a leading short-haul transporter of petroleum products through its coastwise fleet of ocean-going tugs and tank barges primarily in the northeastern U.S. and the U.S. Gulf of Mexico. Hornbeck Offshore currently owns a fleet of 80 vessels primarily serving the energy industry.
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ATP Files for Bankruptcy. Blames Drilling Moratorium (USA)
ATP Oil & Gas, a Gulf of Mexico focused operator, on Friday, August 17, filed a voluntary petition for reorganization under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas.
ATP has taken this action in order to undertake a comprehensive financial restructuring.
“ATP expects its oil and gas operations to continue in the ordinary course throughout the reorganization process and sees the reorganization as a helpful step towards deleveraging the company to position it for future development of its assets. ATP believes that the rights and protections afforded it by a court-supervised reorganization process, including the ability to access new financing, will provide ATP with the time and flexibility it needs to fully address its financial challenges and position ATP for long-term viability,” wrote ATP in a press release.
The company said that the the primary reason for the reorganization began with the Macondo well blowout in April 2010 and the imposition beginning in May 2010 of the moratoria on drilling and related activities in the Gulf of Mexico.
“These events prevented ATP from bringing to production in 2010 and in early 2011 six development wells that would have added significant production to ATP. As of the date of this filing, three of these wells are yet to be drilled. Had ATP been allowed to drill and complete these wells, ATP believes it would have provided a material production change in 2010 continuing to today. This projected increase in production should have substantially increased cash flows, shareholder value and allowed the company the ability to withstand normal operational issues experienced by owners of oil and gas properties in the Gulf of Mexico. In addition, these incremental cash flows would have mitigated or prevented the need to enter into many of the financings ATP has closed since the imposition of the moratoria—financings that require relatively high rates of return and monthly payments” said the company in a statement.
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Zarubezhneft Getting Ready for Drilling Offshore Cuba
Russia’s Zarubezhneft is getting ready to begin its oil and gas exploration campaign offshore Cuba.
Songa Mecur, the semi-submersible rig to be used for the campaign, is expected to arrive to Trinidad next week, where it will undergo preparations work before setting sail to Cuban waters.
The drilling program is expected to start in November.
Zarubezhneft in 2009 signed production sharing contracts with the communist country’s oil company Cubapetroleo for two offshore blocks located in the Cuban sector of the Gulf of Mexico. In the upcoming exploration campaign the company hopes to unlock hydrocarbons hidden in Cuba’s offshore Block L.
Cuba estimates that its offshore fields hold approximately 20 billion barrels of oil, which could, once unlocked provide a major boost to its economy.
In May this year, the Spanish oil company, Repsol, after a failed attempt to discover oil in a well offshore Cuba, decided to abandon any further offshore drilling plans in the Caribbean nation’s waters.
Earlier this week, Cubapetróleo (Cupet) informed the local media that Catoche 1X well drilling offshore Cuba was unsuccessful. The well was drilled by a consortium established by Malaysia’s Petronas and Russia’s Gazprom. The consortium then released the Scarabeo 9 rig to Venezuela’s PDVSA which will try it’s luck at the Cabo de San Antonio 1x offshore well.
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Continents of the World
