Daily Archives: March 29, 2012

Recap: Worldwide Field Development News (Mar 23 – Mar 29, 2012)

Norway-Odfjell-Drilling-Secures-Contract-for-Drillship-under-Constuction

This week the SubseaIQ team added 2 new projects and updated 35 projects. You can see all the updates made over any time period via the Project Update History search. The latest offshore field development news and activities are listed below for your convenience.

Asia – Caspian
Kashagan Looking to Year-End to Come Online
Mar 26, 2012 – The Kashagan field is continuing to be developed in several phases with the first phase targeting first production by year-end 2012. Kashagan is located 50 miles (80 kilometers) southeast of Atyrau, and is the first large-scale offshore petroleum development in Kazakhstan.
Project Details: Kashagan Project
Australia
Roc Oil Offloads Interest in Taranaki Basin
Mar 23, 2012 – Roc Oil has withdrawn its interest from offshore exploration block PEP 52181, located in the Taranaki Basin, New Zealand. The company said it has been working to farm-down its 50 percent interest in the block to provide a more balanced equity position prior to entering into a commitment to drill an exploration well on the Kaheru prospect. “The decision to withdraw from the permit was based on the need for ROC to carefully balance expenditure and risk profiles over the coming years, as the Company enters into an intensive period of activity, especially at the Beibu Gulf project, offshore China, and the Balai Cluster Risk Service Contract, offshore Malaysia,” commented Roc’s CEO, Alan Linn in a statement.
Project Details: Kaheru
Africa – Other
BG Group Makes Fourth Gas Discovery in Tanzania
Mar 26, 2012 – BG Group hits gas pay again, offshore Tanzania, making this the fourth discovery in the area. Preliminary evaluation of well results indicate gross recoverable resources are in the range of 2.5 to 4.4 Tcf of gas. The discovery was made in Jodari-1, which is situated in a water depth of 3,770 feet (1,150 meters). The well is part of the current three-to-four well exploration program, which also includes the acquisition of 965 square miles (2,500 square kilometers) of 3D seismic data in Block 1. BG Group will now target the Mzia-1 location in Block 1, about 14 miles (23 kilometers) to the north of Jodari-1.
Project Details: Jodari
Eni Scores Again in Area 4 Offshore Mozambique
Mar 26, 2012 – Eni has made a “giant” natural gas discovery in Area 4 offshore Mozamique at the Mamba North East 1 exploration prospect. The operator said that the results of this well are of special importance since they increase the resource base of Area 4 by at least 10 Tcf of which 8 Tcf of these contained in reservoirs exclusively located in Area 4. This new discovery further improves the potential of the Mamba complex in Area 4 offshore Mozambique, now estimated to hold at least 40 Tcf of gas-in-place. Mamba North East 1 encountered a total of 787 feet (240 meters) of gas pay in multiple high-quality Oligocene and Eocene sands. It proved reservoir continuity and pressure communication with Mamba South 1 and Mamba North 1 wells. During 2012, Eni plans to drill at least another four wells in nearby structures to fully assess the upside potential of the Mamba Complex.
Project Details: Mamba South/North
S. America – Other & Carib.
Total to Appraise Zaedyus Discovery in 2012
Mar 26, 2012 – Total plans to conduct an extensive drilling campaign, in the Guyane Maritime License offshore French Guiana, and a further 3D seismic survey in 2012. The license contains the Zaedyus discovery in a water depth of 6,719 feet (2,048 meters).
Project Details: Zaedyus
Europe – East
Gazprom Conducting Engineering Studies on Shtokman
Mar 26, 2012 – Total announced that engineering studies are underway for the portion of the Shtokman project that will allow the transport of gas by pipeline through the Gazprom network (offshore development, gas pipeline and onshore gas and condensates processing facilities on the Teriberka site) and for the LNG part of the project. This will allow the export of 7.5 Mt/y of LNG from a new harbor located in Teriberka, representing approximately half of the gas produced by the first development phase. Estimated to hold 3.8 Tcm of natural gas and 37 million tons of gas condensate, Shtokman is situated in the central region of the Russian sector of the Barents Sea, about 372 miles (599 kilometers) north of the Kola Peninsula in water depths measuring 1,050 to 1,115 feet (320
Project Details: Shtokman
Europe – North Sea
Operations at North Sea Tartan Platform to Restart Soon
Mar 29, 2012 – Bridge Energy reported that the Tartan and Duart field operator, Talisman, is working to restart operations on the Tartan platform and projects production to restart at the end of March. The extended shutdown on Tartan has enabled completion of a comprehensive work scope which should increase the near term uptime of the facility, said Bridge. The increased host uptime and a period of flush production following the long shut down is expected to partly offset the delayed production volumes.
Technip to Supply Umbilicals for Cheviot Development
Mar 29, 2012 – Technip’s wholly-owned subsidiary Duco received a contract by Bluewater Industries for the Cheviot field development. The contract covers engineering, project management and fabrication of four static steel tube umbilicals, four dynamic thermoplastic umbilicals, and a thermoplastic subsea intervention valve umbilical. The total length is 7.5 miles (12 kilometers). The umbilicals will control four drill centers from a floating semisubmersible production facility. The project is scheduled for delivery in 2014.
Project Details: Cheviot
Total Believes Gas Coming from Rocks above Elgin Reservoir
Mar 29, 2012 – Total may have confirmed the source of the gas leak at its Elgin platform in the Norwegian sector of the North Sea. The firm insists that the still-alight flare on the platform does not pose any immediate risk. After reports early Thursday morning that Total had a “good idea” of the source of the gas leak on its Elgin platform, a spokesperson for the firm told Rigzone: “We believe the hydrocarbons are coming from a rock formation above the reservoir at a depth of 4,000 meters [13,120 feet].” On Wednesday evening, Total released a press statement explaining the situation regarding the flare on the Elgin platform. “The flare is an integral part of the platform’s safety system. In an emergency, it is used to safely evacuate all the gas from the platform. During the incident, it performed this task perfectly, allowing everyone to evacuate safely,” said Total. “The flare is still lit because when the platform is shut down and de-pressurised in an emergency, it cannot be fully purged as done in a controlled shutdown. This is perfectly normal. Some liquids do remain in the system and these liquids are now evaporating. As these liquids evaporate, the flow of hydrocarbons to the flare will exhaust itself and the flare should burn out.”
Project Details: Elgin/Franklin
Sevan Marine to Perform Study of Skrugard/Havis Development
Mar 29, 2012 – Statoil has awarded Sevan Marine a study of the potential application of a Sevan FPSO for the company???s Skrugard/Havis development in the Barents Sea. The study will be performed from April 2012 to May 2013 and will be focused on further development of the Sevan FPSO as basis for future preferred concept.
Project Details: Skrugard
NPD Gives Faroe Approval to Drill Clapton Prospect
Mar 27, 2012 – The Norwegian Petroleum Directorate has granted Faroe Petroleum a drilling permit for wellbore 2/8-18. The well will be drilled from the Maersk Guardian (350??? ILC) jackup in Production License 440 S. Well 2/8-18 S is the first exploration well to be drilled in the production license.
Project Details: Clapton
Aker to Deliver Subsea Connection System for Draugen Project
Mar 27, 2012 – Aker Solutions received a contract from Shell to deliver subsea connection systems for the Draugen field on the Norwegian Continental Shelf. The scope of work includes the delivery of complete tie-in connection systems for production flowlines and umbilicals for the expansion of the Draugen field. Management, engineering and procurement of the connection systems will be performed at Aker Solutions’ head office in Fornebu, Norway. Equipment deliveries will be made from 2012 to 2013.
Project Details: Draugen
Fogelberg Sits Idle as Consortium Mulls Development Options
Mar 27, 2012 – Faroe Petroleum reported that the Fogelberg consortium is mulling development plans for the discovery. The discovery is close to the Asgard production and transportation system but it???s currently at maximum levels and the timing of the Fogelberg project therefore remains uncertain. Oil industry groups have several ongoing initiatives to de-bottleneck the gas export system and bring forward new developments in the area. Discovered in 2010, Fogelberg is estimated to contain approximately 3 to 15 MMcm of recoverable oil equivalent.
Project Details: Fogelberg
Glenlivet Discovery Moving Towards Field Development Plan Submission
Mar 27, 2012 – The partners in the Glenlivet discovery are working to mature the project towards concept selection and Field Development plan submission. The field could become a significant part of the new planned UK west of Shetland gas gathering system, which is being installed by Total as part of the Laggan and Tormore gas field development. Glenlivet is situated approximately 19 miles (31 kilometers) from the proposed Laggan and Tormore gas export pipeline to Sullom Voe in the Shetland Islands. Glenlivet was discovered in 2009 when the well encountered gas pay in the Paleocene sandstone.
Project Details: Glenlivet
Det norske to Commence Development Drilling on Jette Field
Mar 27, 2012 – Det norske received consent to use the Transocean Barents (UDW semisub) to drill the Jette field. A plan for development and operation for Jette was approved in February 2012. Det norske will develop the field with a seabed facility tied into the Jotun field. Jette???s planned production start is during the first quarter of 2013. The water depth of the site is 417 feet (127 meters). Drilling is expected to commence during the second quarter of 2012 and last about 155 days.
Project Details: Jette (Jetta)
Statoil, Det norske Pen Pre-Unit Agreement for Johan Sverdrup Development
Mar 27, 2012 – Statoil and partners have signed a pre-unit agreement regarding the Johan Sverdrup discovery in the Norwegian sector of the North Sea. According to the agreement, the owners of production licenses 265 and 501 will cooperate in the planning of the Johan Sverdrup field towards an investment decision and submission of the Plan for Development and Operation (PDO). Statoil has been appointed as the working operator. The work will form the basis for developing and establishing the best field solution for Johan Sverdrup. An agreement for the development and operational phase will be signed between the licensees ahead of the submission of the PDO to Norway’s Ministry of Petroleum and Energy.
Project Details: Johan Sverdrup
Apache Lines Up Rig to Drill Tryfan Prospect
Mar 27, 2012 – Apache has signed a letter of intent for the Borgsten Dolphin (mid-water semisub) to drill the Tryfan prospect. Tryfan is an Eocene channelized sand play in the UK Northern North Sea which benefits from a strong seismic amplitude response. Tryfan has gross prospective resources estimated internally by Valiant to be 24 MMboe.
Project Details: Tryfan
Valiant Spuds Tybalt Appraisal Well
Mar 27, 2012 – Valiant Petroleum has commenced drilling on the Tybalt appraisal well in the UK sector of the North Sea. The work program, which includes a well and a contingent test, is designed to prove commercially exploitable volumes via a nearby infrastructure which includes the Magnus fields and the Dons Area complex. Tybalt is an Upper Jurassic discovery originally made by Valiant in 2010 with gross resources estimated at Valiant to be 7 MMbbls. The well is being drilled by the Borgsten Dolphin (mid-water semisub) rig and is expected to take 35-40 days to complete.
Project Details: Tybalt
Ithaca Increases Stake in Carna Discovery
Mar 26, 2012 – Ithaca Energy has agreed to take over operatorship and increase its working interest in the Carna discovery, located in the UK sector of the North Sea. The transaction with Centrica North Sea Gas Limited increases the company’s working interest in the Carna discovery to a material level from 16 to 32 percent. Carna straddles Blocks 43/21b and 43/22c in a water depth of 177 feet (54 meters). The discovery was made in early 2009 when a gas column in excess of 1490 feet TVD (true vertical depth) and net pay of 127 feet TVD was encountered in well 43/21b- 5Z. The well tested gas at a gross stabilized rate of 8.8 Mmcf/d on a 48/64th choke from a vertical well penetrating the Carboniferous. The Company has agreed to a work program with all of the Joint Venture partners to accelerate development studies of the Carna discovery and, if appropriate to submit a field development plan for approval to the Department of Energy and Climate Change before the end of 2012.
Project Details: Carna
Total Closes Elgin/Franklin Production
Mar 26, 2012 – Total has shut down oil and gas production at its Elgin/Franklin platform in the North Sea following an ongoing gas leak. The firm confirmed that all 238 personnel on the platform have been accounted for and that an aerial surveillance flight has been scheduled to inspect a sheen reported in the vicinity of the platform. Production started from Elgin in March 2001, and Franklin began producing in August 2001. Peak production for hub facility is 280,000 boepd, or 175,000 bpd of condensate and 547.4 MMcf/d (15.5 MMcm/d) of gas.
Project Details: Elgin/Franklin
Lundin Completes, Tests Johan Sverdrup Appraisal Well
Mar 26, 2012 – Lundin Petroleum announced that the Johan Sverdup appraisal well 16/2-11 encountered a 177-foot (54-meter) gross oil column in Upper and Middle Jurassic sandstone reservoir in an oil-down-to situation. A comprehensive logging and coring program was successfully completed as well as a production test in the previously untested Middle Jurassic reservoir. The data from this first well in the 2012 PL501 appraisal program confirmed good reservoir properties. This is in line with the earlier Johan Sverdup wells where the Upper Jurassic reservoir was of excellent quality with a high net to gross ratio. A full scale production test (DST) in the Middle Jurassic reservoir to investigate its flow properties resulted in flow rates, in excess of 2,700 bopd through a restricted 40/64 choke, with good reservoir properties indicating a lateral continuous reservoir. Lundin will now sidetrack the well towards the east to investigate the lateral thickness and property variations of the Jurassic reservoir as well as establish an oil water contact to investigate the possibility of a deeper oil-water-contact in this area.
Project Details: Johan Sverdrup
BP Spuds North Uist
Mar 26, 2012 – BP has commenced exploratory drilling on the North Uist prospect in the UK sector of the North Sea. The well has several reservoir objectives, the most significant of which is North Uist at the Upper Jurassic level. The well will also test the edge of the Cardhu prospect where sandstones of Paleocene age may be present. The Stena Carron (DW drillship) is drilling the well in 4,236 feet (1,291 meters) of water.
Project Details: North Uist
Statoil Gets Govt Nod to Drill Top Holes on Stjerne Field
Mar 26, 2012 – Statoil received consent to drill top holes in development well 30/9-22 on the Stjerne, formerly Katla, field. The plan for development and operation of Stjerne was approved by the Storting in September 2011. Stjerne was later included in the Oseberg Sor field and will be subsea tied-back to the Oseberg Sor platform. The consent applies to drilling of four top holes on the following wells: 30/9-M-11 H, 30/9-M-12 H, 30/9-M-13 H and 30.9-M-14 H. The water depth of the site is about 338 meters (103 meters).
Project Details: Oseberg Center
Technip Receives Subsea Contract for Quad 204 Project
Mar 26, 2012 – Technip received a contract from BP to develop the subsea infrastructure for the Quad 204 project in the UK sector of the North Sea. The Quad 204 project involves replacing the existing Schiehallion production facility with a new purpose built FPSO and installing extensive new subsea infrastructure. This major redevelopment will enable the potential recovery of an additional 450 million barrels of resource and extend production through 2035. The awarded contract includes the removal of the existing Schiehallion FPSO and mooring system; recovery of all existing flexible risers and dynamic umbilical systems; positioning and installing a new FPSO and associated mooring system and anchor piles; supply and installation of 21 dynamic flexible risers; installation of four static and dynamic umbilicals; coating, welding and installation of 13 steel pipelines, totaling 31 miles (50 kilometers); supply and install numerous flexible jumpers; installation of various manifolds, jumpers and infrastructure associated with the field development. Offshore work is slated to begin in 2013.
Project Details: Schiehallion (Quad 204)
Barryroe Proves to be More than a One-Hit Wonder
Mar 23, 2012 – Providence Resources has further flow tested the Barryroe discovery offshore southern Ireland. After an additional 17-foot thick net gas-bearing section was perforated to test the potential of the upper part of the sandstone section, highly productive flow rates of 7 MMcf/d and 1,350 bopd were measured. Providence added that a preliminary modeling of the pressure data indicates that a co-mingled flow rate of 17 MMcf/d and 3,350 bopd at a flowing well-head pressure of around 500 pounds per square inch is achievable. Well suspension operations are now complete and the GSF Arctic III (mid-water semisub) rig will now be demobilized to the UK.
Project Details: Barryroe
Statoil Hits Oil Pay Near Oseberg
Mar 23, 2012 – Statoil has made a small oil discovery in PL053 production license in the Norwegian sector of the North Sea. The consortium is in the process of concluding drilling operations in exploratory well 30/6-28S. The well, drilled by the COSLPioneer (mid-water semisub), proved an oil column of around 40 feet (12 meters) in the Statfjord formation. The estimated volume of the discovery is in the range of 12 to 18 MMbbl of recoverable oil equivalents. Statoil said the find is located beneath the Oseberg field and is a good candidate to be connected to the Oseberg production facilities. The oil discovery lies in the Crimp prospect, which was the secondary target for exploration well 30/6-28S. The primary target was the Crux prospect that Statoil earlier defined as a high-impact gas opportunity. With the Crux prospect Statoil tested a hypothesis for the existence of a separate gas-filled structure underlying the Oseberg field. However, the Crux prospect did not contain hydrocarbons.
Project Details: Oseberg Center
S. America – Brazil
Waimea, Waikiki to be Declared Commercial in 2012
Mar 23, 2012 – Dow Jones Newswires reported that OGX plans to declare the Waimea and Waikiki offshore oil fields commercial in 2012. The Waimea field, which came online in January, will be commercially declared in the second quarter; and Waikiki will also receive a similar declaration some time this year. The operator plans to submit a development plan for Waimea to Brazil’s National Petroleum Agency, or ANP, in the second quarter. Upon approval, additional wells will be connected to the OSX-1 FPSO. Waimea is currently producing about 12,500 bopd from a single production well, with output expected to reach 40,000 to 50,000 bopd by the end of 2012. Increased output is set to come from two additional production wells that will be connected this year, with engineering studies underway to gauge the feasibility of adding a fourth production well. Furthermore, OGX plans to bring Waikiki online in 2013. The operator stated two FPSOs, OSX-2 and OSX-3, are about 30 percent complete and construction is continuing at a Singapore shipyard.
N. America – US GOM
McMoRan Updates Flow Testing Ops at Davy Jones Well
Mar 29, 2012 – McMoRan is continuing to flow test the Davy Jones No. 1 well on Block 230 at South Marsh Island. As previously reported, McMoRan saw positive pressure response from the Wilcox “D” sand which was perforated on March 24, 2012. On March 26, 2012, the operator attempted to perforate the Wilcox “C” sand. As the perforating gun was being removed from the hole, the well began to flow. When the gun was brought to the surface, it was determined that the gun did not fire in the Wilcox “C” sand from what appears to be a simple disconnection of the detonator cord. The company plans to use a new perforating gun to complete the testing of the Wilcox “C” sand. Currently, the test is ongoing from only the Wilcox “D” sand, which resulted in the flare shown in the exhibit attached. The flow from the “D” sand is being affected by considerable debris in the 5-inch liner, from what McMoRan believes to be residual drilling fluid from drilling of the well. Results of a clean flow test, as opposed to the current test hampered by debris, will be announced as further progress is achieved and flow rates are measurable. McMoRan will provide updates as completion operations progress.
Project Details: Davy Jones
Africa – West
Total Acquires 3D Data Offshore Cote d’Ivoire
Mar 26, 2012 – Total has commenced exploration work on its CI-100 license offshore Cote d’Ivoire. The company acquired 247,105 acres (1,000 square kilometers) of 3D seismic data at the end of 2011, which completed the 3D coverage of the entire block. Initial exploratory drilling is planned for the end of 2011. Spanning more than 494,211 acres (2,000 square kilometers), the CI-100 block is located about 62 miles (100 kilometers) southeast of Abidjan in water depths ranging from 4,921 to 10,171 feet (1,500 to 3,100 meters).
Total Moves Forward with CLOV Development
Mar 26, 2012 – Total reported that the CLOV development is progressing as planned with start-up slated for 2014. The CLOV project is located on Block 17 offshore Angola. Total’s Angolan subsidiary, Total E&P Angola, is the operator of Angolan Block 17 with a 40 percent interest. Partners in the license include Statoil with a 23.33 percent interest, Esso Exploration Angola with a 20 percent interest and BP Exploration Angola with a 16.67 percent interest.
Project Details: CLOV
Total to Further Develop Moho-Bilondo Project
Mar 26, 2012 – Total reported that the drilling of two appraisal wells, Bilondo Marine 2 and 3, drilled at year-end 2010 in the southern portion of the Moho Bilondo field confirmed an additional growth potential as an extension of existing facilities. Studies are underway for the development of these additional reserves. The development of these resources in the northern portion of the field, the potential of which was bolstered by appraisal and exploration wells drilled in 2008 and 2009, is also being examined (Moho North project). The field is currently producing nearly 90,000 bopd from 13 subsea wells tied into a floating production unit. The oil is exported to the onshore Djeno terminal. Total operates the license, holding a 53.5 percent interest; Chevron holds 31.5 percent; and Societe Nationale des Petroles du Congo holds 15 percent.
Project Details: Moho-Bilondo
African Petroleum Contracts Rig for Two-Well Program
Mar 23, 2012 – African Petroleum reported that the Narina-1 well reached a total depth of 15,912 feet (4,850 meters) in a water depth of 3,750 feet (1,143 meters). The well encountered a total of 105 feet (32 meters) net oil pay in two different reservoirs including a Turonian submarine fan and an Albian zone. The prospective size of the Turonian reservoir is 61,776 acres (250 square kilometers) based on 3D seismic interpretation but will need to be confirmed through an upcoming appraisal drilling campaign. The operator has secured the Eirik Raude (UDW semisub) for a two-well program with the option for a third well. Drilling is expected to commence in the second half of 2012.
Project Details: Narina

T1200 Trenching Unit Nearing Completion in the UK

Helix Currents

Left: Seen here is the outer shell of the T1200 ROV Trenching and Burial Unit which is set for delivery to Canyon Offshore, Helix ESG’s subsea robotics unit, by summer 2012. Right: A computer animation of a completed T1200.

Helix ESG’s latest seabed trenching unit, the T1200, is in the final stages of construction at a Perry Slingsby Systems Remotely Operated Vehicle (ROV) plant in the UK.

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Total sends fire-fighting ships near N.Sea gas leak

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By Oleg Vukmanovic and Muriel Boselli
LONDON/PARIS | Thu Mar 29, 2012 9:08am EDT

(Reuters) – France’s Total sent fire-fighting ships to wait near the scene of a gas leak from its North Sea Elgin platform, which has created fears a large gas cloud could explode.

The company said the gas was originating thousands of meters below the sea bed, which engineers said might mean that a relief well – one possible option to stop the leak – could take months to drill.

“The leak is from a (gas) well that was plugged one year ago and from a rock formation in about 4,000 meters depth,” a company spokeswoman in Aberdeen said on Thursday.

A flare needed to relieve pressure in the platform by purging excess gas has continued to burn less than 100 meters from the leak, and engineers said changes in wind and weather could lead to an explosion.

“The wind is pushing the gas cloud in the opposite direction (from the platform). At this time, the circumstances are rather favorable,” Jacques-Emmanuel Saulnier, head of communication at Total said in an interview published on Total’s website.

“A gas cloud is always a fire hazard,” he added.

Total kept two fire-fighting ships in a state of readiness outside a two-mile exclusion zone, which was set up to protect marine traffic, a Total spokeswoman said.

The company has also brought in a robot vessel, not yet deployed, to scan the sea bed for signs of spillage, she said.

Total has not yet found a way to stop the gas leak. A team of international engineers assembled by the embattled French oil company are drawing up plans to tackle the leak and prevent the flare from coming into contact with the gas cloud, the spokeswoman said.

The platform is currently off limits to the engineers, however, given the toxic and explosive plumes pumping out of the wellhead.

The leak started on Sunday and forced the evacuation of all 238 workers from the platform, which sits in waters less than 100 metres deep and 240 km (150 miles) off the east coast of Scotland.

PRESSSURE SEEN FOR RELIEF WELL

Total warned on Tuesday it could take six months to halt the flow of gas. The company previously stated it hoped the leak would die down from natural causes as reservoir pressure drops.

“What we know is that the leak is not coming from a well dug by Total but from a naturally occurring pocket of gas located just above one of our wells,” said Total’s Saulnier.

The depth of the non-producing reservoir that is feeding gas to the Elgin platform via compromised layers of piping suggests, however, there is more gas present rather than less, piling pressure on Total to drill a relief well, an engineer with knowledge of the matter said.

Relief drilling would require boring through 4 kilometers of rock with painstaking mathematical precision, because it must intercept the gas pocket at exactly the right point, requiring constant alterations in course, the engineer said.

The leak, one of the biggest in the North Sea for decades, could well inspire tougher safety regulation in due course, according to experts. Britain’s health and safety watchdog said it was considering launching an investigation into the incident, while union officials said the frequency of offshore safety lapses had become intolerable.

Memories are still raw in the North Sea industry of the Piper Alpha platform fire 24 years ago, which killed 167 people in the world’s deadliest offshore oil disaster and led to a major regulatory overhaul.

Total as well as UK authorities have described the expected environmental impact from the plume of gas and a spreading sheen of light oil on the water as “minimal”, although environmental experts said much of the gas “cocktail” would be either flammable or poisonous at close quarters.

Total’s shares have lost about 9 percent in the wake of the incident. They were trading at 37.63 euros at 1305 GMT.

Analysts said the French oil major could face costs of up to $10 billion if its North Sea gas leak leads to an explosion and nearly $3 billion if it takes months to fix.

However, Jefferies securities and investment bank said in a research note that data that had emerged on the spill, which “has further convinced us that the spill consequences should be less than the most pessimistic market estimates and hence that the US$9.7 billion sell-off in the stock since Monday is overdone”.

(Additional reporting by Henning Gloystein and Karolin Schaps in London and Sybille de La Hamaide in Paris; Editing by Jane Baird)

UK: Flare at Elgin Platform Could Ignite Gas Cloud, Experts Say

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The gas leak that occurred at the wellhead platform on the Total-operated Elgin field in the UK North Sea, remains ongoing, the operator reports.

The gas has been flowing since Sunday, March 25th, when Total evacuated all the personnel from the Elgin platform. The precise cause of the gas leak, that has been flowing approximately 240 km east of Aberdeen, is yet to be identified.

According to The Telegraph, experts have warned that the gas cloud which can be seen is very flammable and they described the situation as a disaster waiting to happen because the flare on the Elgin platform is still ongoing.

Total explains that the flare is an integral part of the platform’s safety system, and it is used to safely evacuate all the remaining gas from the platform.  The company says that the flare does not pose a threat, because the winds are taking the gas cloud away from the open flame.

“The wind is forecast to remain in its current direction for the coming days.  You can be assured that this is being reviewed on a constant basis and should this change any impact is being assessed.  In parallel we are investigating solutions to extinguish the flare if it does not burn out by itself.”

Elgin and Franklin are two high pressure/high temperature gas and condensate fields in the Central Graben Area of North Sea. Total E&P UK Limited owns 46.17% and is operator of both fields through its wholly-owned subsidiary EFOG and its average share of production was around 60,000 barrels of oil equivalent per day in 2011.

Elgin/Franklin facilities comprise two wellhead platforms, one on Elgin and one on Franklin and a Production/Utilities/Quarters (PUQ) platform. The PUQ is on the Elgin field and is linked to the Elgin wellhead platform by a 90-metre bridge.

Source

The Anti-Energy President

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He really meant it when he said prices would “skyrocket.”

By PETE DU PONT

Our America today is very different from the America of some years ago. Government spending is greatly increased, as is the regulation of our economy. The growing size and reach of our government is sapping our nation’s strength and independence. And our current president’s policies have been quite different from our leaders of some years ago.

One of the best examples of these public policy changes is the huge increase in government regulation in how we generate and use energy, with its negative impact on supply, its focus on financing new and inefficient energy industries, and the resulting higher costs.

The policy of the Obama administration has been not to increase the energy supplies that are so critical to our nation’s economic health, but to limit them, to increase energy prices, and to make energy more expensive.

Eliminating tax deductions for the oil and gas industries is at the top of the President’s list, which would increase the price of gasoline and home heating oil for everyone. But this fits in with the Obama administration’s overall inclination to hamper domestic production, whether through slowness in granting new permits or refusal to open new areas for exploration. In fact oil, production on federal lands was flat between 2009 to 2011, while production on nonfederal lands increased almost 7%.

And it is not just petroleum. Mr. Obama‘s Environmental Protection Agency wants to increase regulation of coal-fueled electricity plants, which produce almost half of our electricity, so as to drive up the price of electricity and force plants to close. None of this should be surprising, for as we know, Obama’s energy secretary, Steven Chu, told The Wall Street Journal in 2008 that we must “figure out how to boost the price of gasoline to the levels in Europe.”

The president admitted that his cap-and-trade energy proposals, had they come to pass, would cause energy prices to “skyrocket” and bankrupt coal companies. In the Mr. Obama’s words, coal fired plants can be built, but if they are, “it will bankrupt them because they’re going to be charged a huge sum” for emitting the greenhouse gases.

On the other hand, the current administration is throwing money at “green” energy companies, exemplified by the failed $535 million federal loan guarantee in Solyndra. Alternative energy sources do need to be developed, but it is clear that the federal government is not a wise allocator of taxpayer dollars in this effort. These sources will never be developed to the point of affordability unless the free market is allowed to sort good technologies from bad without the skewing of investment that comes from government trying to pick winners and losers. America badly needs very different national energy policies that will increase our energy supplies, reduce the cost of energy, and get America positively moving again.

Approving the Keystone pipeline so that more energy comes into America is an important first step. The president has twice rejected congressional efforts to approve it.

We must encourage hydraulic “fracking,” of underground reserves in shale. Already there are many fracking gas efforts underway, and the government’s latest estimates of the gas available from shale are about 500 trillion cubic feet. We currently use about 24 trillion cubic feet per year, so shale gas can add around 20 years to our supply.

The Obama administration must open up more areas for exploration and production, from drilling in the Alaska National Wildlife Refuge to reducing the number of prohibited areas offshore. It simply must do what it can to speed up the permit granting process. And it must recognize that now is not the time, if there ever is a good time, to raise taxes on energy producers.

Finally, a look at the George W. Bush’s and Mr. Obama’s efforts to increase government regulation—not just in energy, but across the economy—shows the difference between the two presidents. In his first three years in office Mr. Bush put into place 28 major regulations. Mr. Obama’s three years have seen 106 major regulations. In dollar terms the Bush regulations cost $8.1 billion and Obama’s $46 billion.

So where America is and what it is doing in energy policies has changed a great deal in the past three years, mostly in a regressive direction. Energy is essential for a strong America, but the current administration seems to be doing all it can to keep us from tapping the reliable energy supplies we have right here in our country—coal, oil, and gas—and from our neighbor to the north. Instead we are being pushed towards other energy sources that are inefficient, expensive and will only provide a fraction of the energy a strong America needs.

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Texas (Laredo): Arrest of Would-Be ‘Zetas’ Shows Risk of US Military Infiltration

imageWritten by  Geoffrey Ramsey

United States drug enforcement agents have broken up a ring involving former and current US military personnel attempting to work for Mexico’s brutal Zetas drug cartel, illustrating the group’s alarming potential to penetrate the US military.

On March 24, First Lt. Kevin Corley (pictured, at left) and arrived with a three-man team at a warehouse in the border city of Laredo, Texas, armed with two semiautomatic rifles, a combat knife and a .300-caliber bolt-action rifle equipped with a scope. The men believed they had been hired by the Zetas to carry out a contracted killing and raid of a rival drug trafficking group’s storehouse, and had been called to receive the final details of the assignment.  What they didn’t know, however, was that they were targets of an elaborate sting operation organized by the US Drug Enforcement Administration.

For the past six months, Corley had been speaking with DEA agents posing as Zetas representatives, and had promised both to carry out “wet work” (a military euphemism for assassinations) for the cartel as well as equip and train Zetas members in military tactics. According to a federal indictment (.pdf), Corley claimed that his status as an active duty soldier made it easy for him to pilfer weaponry from his post in Colorado, and demonstrated this by providing the agents with bulletproof vests, training manuals and other stolen military equipment.

However, after receiving phony instructions from the undercover operatives in the warehouse, the four men found themselves surrounded by federal law enforcement officers. Although agents killed one of the suspects while attempting to make an arrest, the remaining three were taken into custody. Two other accomplices based in South Carolina were arrested in conjunction with the sting operation.

While the fact that six US citizens were so completely willing to work for the Zetas is disturbing, the most worrisome aspect of this case is the fact that all four members of the would-be “kill team” (with the exception of the individual killed by federal agents, who was a cousin of Corley’s) were either current or former members of the US military.

This is a troubling reminder that US military personnel are not immune to the kinds of incentives that lure their military counterparts in Mexico into joining the Zetas. The Zetas’ links to the Mexican military have been a trademark of the group since their early days working as the enforcement wing of the Gulf Cartel. Their original 31 founders were all ex-members of the Mexican special forces, and today the group is thought to have deeply penetrated the military in the states of Hidalgo, Chihuahua and Tabasco, as well as other parts of the country. As the drug gang’s trafficking networks have grown, they have expanded their recruitment pool to include members of security forces in Guatemala, Honduras, El Salvador and Nicaragua.

Until now, however, there had been no hard proof evidence that the cartel was capable of hiring US-trained military professionals to carry out its work.  These arrests show that there is a very real possibility of such a trend, no doubt sounding alarm bells for US drug enforcement agents already concerned about the prospect of “spillover violence” in the American southwest.

The case is especially relevant in light of the Federal Bureau of Investigation’s recent warnings that the US military is facing “significant criminal threat” from gangs within its ranks. In the 2011 National Gang Threat Assessment released in October, the FBI names some 50 criminal organizations that count both current and ex-soldiers among their members. The list includes the Zetas, as well as a handful of transnational street gangs such as Mara Salvatrucha (MS-13), Barrio 18 and Barrio Azteca. Although they represent only a tiny fraction of veterans and servicemen, the FBI cautions that many gang members enlist in order to “receive weapons and combat training that they may transfer back to their gang.” The report also notes an uptick in gang-related graffiti in military bases overseas.

This phenomenon is a threat not only to the US, but to other countries in the hemisphere as well. If enough members of transnational criminal organizations acquire military expertise in the US, there is a chance that they will share these skills with affiliate cells in other countries in the region, potentially giving them a leg up against local officials. As InSight Crime has pointed out, many gangs already have the organizational infrastructure in place to do so. Both of El Salvador’s largest “maras” (street gangs) got their start in US prisons, and still maintain a strong presence in major cities like Los Angeles and Washington, DC.

Despite these concerns, the US military is a long way from seeing the kind of criminal penetration that plagues the Mexican army. That all six members of the “Zetas” plot had been under surveillance for months and eventually apprehended is a testament to the success that US law enforcement has had in foiling such criminal endeavors. Even still, with the Zetas growing more and more sophisticated, the risk of infiltration grows greater, and the US military may need to step up its internal monitoring to prevent this.

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The EPA Triples Down On ‘None of the Above’ Energy Policy

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James Taylor, Contributor

Anti-energy crusaders are in a celebratory mood this week as the EPA effectively banned the construction of coal-fired power plants, and thus completed the federal government’s trifecta beat-down on affordable energy.

First, new obstacles to energy production resulted in oil production on federal lands dropping 11% in Fiscal Year 2011 vs. 2010. Second, President Obama announced earlier this year that his administration was blocking construction of the Keystone XL pipeline that would deliver large quantities of valuable oil from neighboring Canada. Third, the EPA announced this week its severe global warming restrictions on power plants.

For all the talk of an “all of the above” federal energy policy, this administration is imposing “none of the above,” unless we choose to celebrate our imminent burning of dung for fuel, like they do in the utopian economic powerhouse of Bangladesh.

Coal is our nation’s leading source of electricity for a reason; it is less expensive than all other sources except large-scale hydropower, which environmental activists had already taken off the table. By definition you cannot ban the least expensive power sources without creating a jump in electricity prices. If you have been a fan of our rapidly rising gasoline prices, you are going to love what is about to happen to our electricity prices, too.

There is at least one theoretical scenario whereby banning the construction of coal-fired power plants will only cause a modest rise in electricity prices. That scenario would occur if natural gas filled most of the void for future power plant construction and government refrained from punishing natural gas production. However, the same environmental extremists who successfully pushed for the end of new coal-fired power plants are just as adamant about shutting down natural gas production.

The EPA is already targeting natural gas production from lucrative shale formations, and is likely to soon impose unprecedented restrictions that will raise costs and throttle natural gas production. Tripling down on “none of the above” appears poised to become quadrupling down on “none of the above.”

Oh, and I forgot to mention this administration’s pulling the plug on the Yucca Mountain repository for spent nuclear fuel. Make that quintupling down on “none of the above.”

Those who claim humans are causing a global warming crisis argue that expensive energy is necessary to stop the growth in our global warming emissions. The facts, however, tell a different story.

U.S. carbon dioxide emissions have fallen since the beginning of the century, and the U.S. Energy Information Administration does not anticipate any appreciable rise in emissions for at least the next several decades. True, global emissions have risen by approximately one-third this century, but the United States has had no part in that global increase.

The reason why global carbon dioxide emissions continue to rise is nations such as China and India continue to ramp up their industrialization. China, for example, emits more carbon dioxide than the entire Western Hemisphere and is increasing its carbon dioxide emissions by an average of 10 percent per year. Even if the United States theoretically eliminated all of its emissions today, such action would be rendered moot in less than a decade merely by the corresponding increase from China.

What we are left with, even if we assume for the sake of argument that humans are causing a global warming crisis, is tremendous self-induced economic pain for absolutely no real-world environmental impact.

All of the Above is now None of the Above. Welcome to the return of “That 70s Energy Policy.”

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