Daily Archives: April 12, 2011

Oil shale reserves can turn Israel into major world producer.

March 21, 2011 11:54AM

Ian King From: The Times

THE JOKE has been told by generations of Jews, most famously Golda Meir, the former prime minister of Israel: ‘Why did Moses lead us to the one place in the Middle East without oil?’

But an updated version may be required if Harold Vinegar and his colleagues get their way. Dr Vinegar, the former chief scientist of Royal Dutch Shell, is at the centre of an ambitious project to turn Israel into one of the world’s leading oil producers.

Israel Energy Initiatives, where Dr Vinegar is chief scientist, is working on projects to extract oil and natural gas from oil shale from a 238sq km area of the Shfela Basin, to the south and west of Jerusalem.

Oil shale mining is often frowned upon, not least by the environmental lobby, as a dirty process that is both energy and water-intensive. IEI believes that its technique will be cleaner than that of other operators because the oil will be separated from the shale rock up to 300m beneath the ground. Water will be a by-product of the process rather than being consumed by it in large volumes.

According to Dr Vinegar, Israel has the second-biggest oil shale deposits in the world, outside the US: “We estimate that there is the equivalent of 250 billion barrels of oil here. To put that in context, there are proven reserves of 260 billion barrels of oil in Saudi Arabia.”

The marginal cost of production, IEI estimates, will be between $US35 and $US40 per barrel. This, Dr Vinegar points out, is cheaper than the $US60 or so per barrel that it costs to extract crude from inhospitable locations such as the Arctic, and compares with $US30-$US40 per barrel in some of the deepwater oilfields off the coast of Brazil.

“These Israeli deposits have been known about, but have never been listed before. It was previously assumed there was not the technology to deal with it.”

According to Dr Vinegar, IEI, which is owned by the American telecoms group IDT Corp, hopes to begin production on a commercial basis by the end of the decade, with a view to producing 50,000 barrels per day at the outset. This would be a fraction of the 270,000bpd consumed daily by Israel, but would be a significant step towards making the country energy-independent.

Dr Vinegar estimates that, with one barrel of oil comprising 42 gallons, each tonne of oil shale contains approximately 25gallons.The extraction process involves heating the rock underground, using electric heaters, to approximately 325C, the level at which the carbon-carbon bonds in the rock start to “crack”. The oil produced by the process is light and easily refined to a range of products, including naphtha, jet fuel and diesel.

The project is attracting serious interest from outside investors. In November, 2010, an 11 per cent stake in Genie Oil & Gas, the division of IDC that is the parent company of IEI, was acquired for $US11m ($11.05m) by Jacob Rothschild, the banker, and Rupert Murdoch, chairman of News Corporation, parent company of The Times. Genie’s advisory board includes heavyweight figures such as Michael Steinhardt, the hedge fund investor, and Dick Cheney, the former US vice-president.

Dr Vinegar said that an appraisal now under way would be followed by an 18-month pilot stage. Among the issues this will address will be concerns raised by environmental groups, including an examination of IEI’s claims that the process does not require excessive use of water or energy. Reassurance will also be sought that a local aquifer, which is several hundred metres below the shale deposits, will not be contaminated by the work.

Assuming that these early stages are completed successfully, a demonstration phase would then take place over three to four years, during which the work completed in the pilot phase would be continued on a larger scale. Only then would the commercial operations begin. Dr Vinegar said that, by this stage, up to 1000 people would be employed on the project, many of them specialist engineers from outside Israel.

He added: “Funding is not needed for the pilot and demonstration, although once we were getting to 50,000 barrels per day, we would want to have a partner. We have been approached by all the majors.”

Dr Vinegar said that the project still faced a number of hurdles: “There is a geological risk: Is the resource there? What is the risk to the aquifer? We have no doubts here, and in particular that the resource is there and is of good quality, but the pilot can prove these things.

“Then there is the technological risk: Can we drill long horizontal wells and can the heaters be placed in them? And can they last?

“And finally there is the economic risk, what the price of oil does. But I think the price is going to continue rising, to the extent that, by 2030, we will be at around $US200 per barrel.”

To that, there can be added a fourth potential risk for the project: whether it is capable of overcoming criticism from the environmental lobby to win popular support. This, perhaps, is the greatest challenge facing Dr Vinegar and his colleagues.

( Original Article )


Tanzania Puts Off Offshore Bidding Round for 2012

Tanzania’s fourth deep offshore bidding round has been postponed to next year to allow it to offer new blocks discovered by a latest seismic survey, a state-run agency said on Tuesday.

The bidding round, which was initially scheduled for this month will now take place at a yet to be determined date next year, and include new blocks, the state-run Tanzania Petroleum Development Corporation (TPDC) said in a statement.

Tanzania has made significant commercial discoveries of natural gas, but is yet to strike oil.

“The government … regrets to announce the postponement of the 4th deep offshore bidding round. The round was planned to be launched in April 2011.

“The round has been postponed to give more time for preparations. This will include proper demarcation of new blocks using additional new seismic data.”

The government had intended to offer the bids for 13 deep offshore blocks located around 1,200 and 3,000 metres below sea, but the TPDC is now inviting bids for onshore exploration on the northern side of Lake Tanganyika, which Tanzania shares with three other African countries — Burundi, Democratic Republic of the Congo (DRC) and Zambia.

The deadline for submission of bids for the Tanzanian side of the Lake Tanganyika north area is June 7, 2011, at 07:00 GMT.

“We are still collecting more data from deep-sea areas that’s why we had to postpone the fourth round,” George Ngwale, TPDC’s acting Director of Explorations, told Reuters.

“Several other licences held by some companies are also scheduled to be released after the expiry of their four-year terms so these will also be offered to bidders,” he said.

“The new round will be offered in 2012. I can’t specify the exact date and number of blocks to be offered because we are currently compiling data on the available exploration areas.”

Prospectors are studying east Africa afresh as insecurity in other parts of the continent and increasing energy nationalism elsewhere push them to seek new sources.

Gas discoveries in Tanzania, and oil discoveries on the border between Uganda and Congo have peaked interest in the region, which had been largely overlooked.

Tanzania has licensed at least 17 international companies exploring for both offshore and onshore energy sources in the country, the region’s second-largest economy.

Among the firms that hold exploration blocks in Tanzania are Oslo-listed Artumas Group Inc (AGI), France’s Maurel & Prom, Norway’s Statoil, Royal Dutch Shell and Ras al-Khaimah Gas Commission of United Arab Emirates.

By Fumbuka Ng’wanakilala (Reuters)

( Original Article )


Singapore: Keppel Enters FPSO Upgrade Contract with Petrofac


Keppel Shipyard announces it has secured a fast-track project for the upgrading of a FPSO vessel from Petrofac International (UAE) LLC, a subsidiary of Petrofac. The upgrading of the ex-FPSO East Fortune includes refurbishment and life extension works, engineering, fabricating, installing and integrating new topside process modules, upgrading of spread mooring and auxiliary support systems.

Work has commenced in 1Q 2011. Designated for an oil and gas field offshore Peninsular Malaysia, this FPSO facility will be able to handle both oil and gas production.

Keppel O&M, a wholly-owned subsidiary of Keppel Corporation Limited, is a leader in offshore rig design, repair and construction, ship repair and conversion and specialised shipbuilding. Its near market, near customer strategy is bolstered by a global network of 20 yards in the Asia Pacific, Gulf of Mexico, Brazil, the Caspian Sea, Middle East and the North Sea regions. Integrating the experience and expertise of its yards worldwide, the group aims to be the provider of choice and partner for solutions for the offshore and marine industry.

As earlier announced, Keppel has also entered contract with SBM offshore for the construction of new multi-purpose dive support construction vessel.

Mr Nelson Yeo, Managing Director (Marine) of Keppel O&M, said, “These new contracts reflect the confidence of our customers in the capabilities of the Keppel O&M group. We are proud of the solid partnerships built with faithful customers who turn to our yards worldwide for their fleet expansion and upgrading needs.

“Looking ahead, I am confident that we will continue to strengthen the mutual trust and partnership with SBM Offshore and Petrofac with Keppel’s commitment to quality and reliability.”

About Keppel O&M

Keppel O&M, a wholly-owned subsidiary of Keppel Corporation Limited, is a leader in offshore rig design, repair and construction, ship repair and conversion and specialised shipbuilding. Its near market, near customer strategy is bolstered by a global network of 20 yards in the Asia Pacific, Gulf of Mexico, Brazil, the Caspian Sea, Middle East and the North Sea regions. Integrating the experience and expertise of its yards worldwide, the group aims to be the provider of choice and partner for solutions for the offshore and marine industry.

( Original Article )


Polarcus’ Arctic Operating Procedures Get Official Recognition from DNV in Finland


Polarcus Limited  announces that the Company has today received a Statement of Qualification from Det Norske Veritas (DNV) to qualify Polarcus’ Arctic operating procedures according to industry best practice and relevant standards. The Statement of Qualification was presented to Polarcus at the 7th Annual Arctic Shipping Summit in Helsinki, Finland.

The Arctic poses demanding challenges to marine seismic operations. Environmental conditions stress the ship, equipment and crew, limit the window for seismic operations, and pose dangers to in-water seismic equipment. To mitigate these risks in order to safeguard life, property and the environment, Polarcus, with assistance from DNV, has developed a wide-ranging set of Arctic-specific operating procedures.

Commenting on the achievement, Rolf Rønningen, CEO Polarcus, said: “We believe that the environmental, health and safety concerns associated with working in the Arctic demand the very highest level of commitment from companies operating in this pristine and often challenging frontier. Consequently we have collaborated with DNV over the past year to develop a comprehensive set of Arctic procedures to cater for the unique hazards associated with operating a seismic vessel in these waters. We are very proud therefore to receive this Statement of Qualification today from such a prestigious organization as DNV.”

Christian Fjell, DNV Project Manager said: “Polarcus’ active cooperation and input provided early on in the project was extremely helpful in aligning our thoughts and objectives. Our team of experts assessed the completeness and quality of Polarcus’ Arctic operating procedures, internally designed by their team, and DNV proposed areas of improvement based on applicable conventions, regulations and standards. This project has certainly been mutually rewarding as Polarcus was able to provide significant input and reflections on our own suggestions based on their existing in-house competence in this field.”

( Original Article )


Coastal Makes Another Discovery at Bua Ban North, Offshore Thailand

Coastal Makes Another Discovery at Bua Ban North, Offshore Thailand

India: Transocean Sets New World Record in Deepwater Drilling Depth


Transocean Ltd. announced that the ultra-deepwater drillship Dhirubhai Deepwater KG2 has set what the company believes is a world record for the deepest water depth by an offshore drilling rig of 10,194 feet of water while working for Reliance Industries offshore India.

The rig, which is owned by a joint venture with Quantum Pacific Group, surpassed Transocean’s prior record of 10,011 feet of water, set in 2003 by the Discoverer Deep Seas working for Chevron in the U.S. Gulf of Mexico.

The new record comes approximately one year after the dynamically positioned Dhirubhai Deepwater KG2 was placed into service in India under a five-year drilling contract. The vessel is equipped to work in water depths of up to 12,000 feet and outfitted to construct wells up to 35,000 feet deep.

About Transocean

Transocean is the world’s largest offshore drilling contractor and the leading provider of drilling management services worldwide. With a fleet of 136 mobile offshore drilling units as well as one ultra-deepwater newbuild drillship and three high-specification jackups under construction, Transocean’s fleet is considered one of the most modern and versatile in the world due to its emphasis on technically demanding segments of the offshore drilling business. Transocean owns or operates a contract drilling fleet of 47 High-Specification Floaters (Ultra-Deepwater, Deepwater and Harsh-Environment semisubmersibles and drillships), 25 Midwater Floaters, nine High-Specification Jackups, 52 Standard Jackups and other assets utilized in the support of offshore drilling activities worldwide.

( Original Article )


%d bloggers like this: