Daily Archives: April 16, 2011
OGX Makes Another Discovery in Campos Basin, Offshore Brazil
OGX Petróleo e Gás Participações S.A. (“OGX”) , the Brazilian oil and gas company responsible for the largest private sector exploratory campaign in Brazil, announced today that it has identified the presence of hydrocarbons in the Albian section of well 1-OGX-33-RJS, which is located in the BM-C-41 block, in the shallow waters of the Campos Basin. OGX holds a 100% working interest in this block.
An oil column of approximately 95 meters with approximately 42 meters of net pay has been identified in the carbonate reservoirs of the Albian section. The drilling of well OGX-33, also known as the Chimborazo prospect, was concluded at a final depth of 3,755 meters.
The OGX-33 well is situated 84 kilometers off the coast of Rio de Janeiro at a water depth of about 127 meters. The rig, Pride Venezuela, left the well on April 9, 2011. Drilling of the third extension well (OGX-42) of the Pipeline accumulation has been initiated.
ABOUT OGX
OGX Petróleo e Gás SA is focused on oil and natural gas exploration and production and is conducting the largest private sector exploratory campaign in Brazil. OGX has a diversified, high-potential portfolio, comprised of 29 exploratory blocks in the Campos, Santos, Espírito Santo, Pará-Maranhão and Parnaíba Basins, in Brazil, and 5 exploratory blocks in Colombia, in Middle Magdalena Valley, in Lower Magdalena Valley and in Cesar-Ranchería basins. The total extension area is of approximately 7,000 km² in sea and approximately 34,000 km² in land, with 21,500 km² in Brazil and 12,500 km² in Colombia. OGX relies on an experienced management team and holds a solid cash position, with approximately US$2.9 billion in cash (as of December, 2010) to fund its E&P investments and new opportunities. In June 2008, the company went public raising R$6.7 billion, the largest amount ever raised in a Brazilian primary IPO at that moment. OGX is a member of the EBX Group, an industrial group founded and under the leadership of Brazilian entrepreneur Eike F. Batista, who has a proven track record in developing new ventures in the natural resources and infrastructure sectors.
( Original Article )
Will Dodd-Frank cause flight to EU, Asian markets? Even CFTC’s Gensler has fears
By Brian Scheid
In terms of revelations, it wasn’t exactly on the level of a former FBI official’s deathbed confession that he was the Watergate conspiracy‘s Deep Throat or even Pete Rose admitting he bet on baseball.
But Commodity Futures Trading Commission Chairman Gary Gensler‘s admission this week that he is concerned that position limits and other financial reform rules could compel US market participants to flee for overseas markets was kind of a big deal for an agency head who has long painted regulatory arbitrage fears as nothing more than industry paranoia.
Industry insiders, from exchange executives to oil and natural gas lobbyists, have been claiming that US market participants were set to bolt for EU and Asian markets due to the mountain of new regulations in the Dodd-Frank Wall Street Reform and Consumer Protection Act, even before President Obama signed the legislation into law this summer.
But those fears have never been taken seriously by US financial regulators or most congressional leaders, according to Terry Duffy, executive chairman of CME Group, the parent company of NYMEX.
“I think that people really don’t believe that business will move,” Duffy said in a brief interview Wednesday. “I don’t know how seriously they’re taking it.”
The problem, Duffy said, is that this regulatory arbitrage began when US regulators simply started talking about position limits on energy commodity contracts and can already be seen in the growth of the London-traded Brent crude contract.
“In the old days [regulatory arbitrage] was kind of an idle threat, it wasn’t going to go away, everyone was afraid to leave the US, but they’re not afraid anymore,” Duffy said. “I don’t think they’re taking it into account and when you lose those products you definitely will lose jobs associated with them.”
During a Senate Banking Committee hearing on Tuesday, Gensler was asked if he feared that the new position limits regime the CFTC was considering, but the EU seems to have abandoned, could drive business overseas.
While he initially dodged the question, when Senator Pat Toomey, a Pennsylvania Republican, pressed him on it, Gensler admitted that “yes,” he was concerned about this, but said he had this fear on all the new regulations and said it just showed the need for international harmonization.
That sounds good, but Duffy pointed out that Gensler may be referring to a harmonization effort that may not be taking place.
Europe “hasn’t passed a thing,” Duffy said and Asian regulators have not done anything substantial either.
“We passed Dodd-Frank and they didn’t do anything,” Duffy said.
Foreign regulators “are telling our regulators whatever they want to hear, but they are not going to act until we implement a law that they think they can take advantage of,” Duffy said. “I strongly believe that other jurisdictions around the world are watching the US to see what kind of mistakes they’re going to make and then they’re going to capitalize on that and hurt our financial services industry.”
( Original Article )
100 tons of readiness
Centerpiece of $1 billion spill containment system awaits the call to action
If BP’s Macondo well blowout happened today, oil companies say they would be far better prepared to respond than they were a year ago. One reason sits in an out-of-the-way fabrication yard in northwest Houston.
Here, nearly nine months after the idea was hatched, the Marine Well Containment Co.’s $1 billion oil spill-containment system is ready to go — and, with any luck, will never have to be used.
On Friday, the company allowed reporters for the first time to get an up-close look at the centerpiece of the system, a giant well-capping stack with the capacity to collect 60,000 barrels a day of oil from a leaking well in 8,000 feet of water.
Standing 30 feet tall and weighing 100 tons, the capping stack is designed to be lowered on top of a runaway well. The goal is shutting it in or, if that can’t be done safely, collecting and routing the oil to ships above.
In that way, it is very similar to the piece of equipment that ultimately halted oil gushing from Macondo – in mile-deep waters 40 miles off the coast of Louisiana – but not before it bled more than 4.9 million barrels of oil into the Gulf of Mexico over 87 days.
Marty Massey, CEO of the Marine Well Containment Co., or MWCC, said by contrast its new system can be trucked from Houston and on location at a well site in the Gulf of Mexico “in a matter of days.”
“The bottom line in all of this is the Marine Well Containment Co. is prepared and ready to go,” Massey told reporters in a briefing at a Trendsetter Engineering yard, where the capping stack was developed and will be stored.
The Interior Department now requires oil companies to prove they have access to spill-containment equipment, able to withstand even worst-case blowout scenarios, as a condition of winning a permit to drill in the deep-water Gulf of Mexico.
Two systems
So far, two systems have emerged that pass the test, the one by MWCC and another by Helix Energy Solutions. Both companies are based in Houston.
“The most significant thing that’s happened in the last year is the confirmation in the ability to cap and contain a well if something was to go wrong,” said Marvin Odum, head of U.S. operations for Shell, one of the largest leaseholders in the Gulf, in an interview.
Of the 10 deep-water drilling permits regulators have approved since the spill, four rely on the MWCC system to meet spill-fighting requirements and the others Helix.
The Helix system, also to operate in 8,000 feet of water and collect 55,000 barrels of oil per day, incorporates equipment used in plugging the Macondo well.
Helix CEO Owen Kratz said last week his company’s system could be able to contain a Macondo-like well in 10 to 17 days, versus the time needed to stop Macondo.
“We’re working on getting that done,” Kratz said. “That’s a matter not of technology but of refining the communications and procedures to make it happen a little more smoothly. We’re being a little conservative at the 10 to 17 days.”
Nonprofit company
The MWCC is a nonprofit company formed in July by Exxon Mobil Corp., Chevron Corp., Shell and ConocoPhillips, each of which pledged $250 million to develop a system for the Gulf. Since then, six more oil companies have joined as members: BP, Apache Corp., Statoil, BHP Billiton, Hess Corp. and Anadarko Petroleum Corp.
Massey said all 10 members hold an equal stake and are dividing the initial $1 billion outlay to build the system. But non-member companies may also pay a fee to use the system.
“We’re open to all Gulf of Mexico operators,” Massey said.
Both MWCC and Helix are also developing higher-capacity systems that can operate in deeper water depths.
The MWCC capping stack took more than two months to build and drew heavily on lessons from the frenzied Macondo well-plugging effort, Massey said.
It is flexible enough to be installed atop a well’s blowout preventer – the towering stack of shut-off valves that sits on a well head on the sea floor – or directly on a well head if the blowout preventer stack is damaged and needs to be removed.
Once in place, robot submarines slowly close well-sealing rams in the capping stack. Four other outlet points are closed off, two at a time, as crews above monitor well pressures to avoid risk of rupture. At that point, the well could either be considered shut in and temporarily secure or the operator may decide it is safer to produce oil from the well through the outlet points. Once the well is deemed secure, crews would then work to permanently seal the well.
( Original Article )