Recap: Worldwide Field Development News (May 25 – May 31, 2012)

This week the SubseaIQ team added 2 new projects and updated 13 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.

Europe – North Sea Statoil Secures Rig for Dagny May 31, 2012 – Statoil announced that it has awarded a contract to Maersk Drilling for new jack-up to drill the Dagny oil and gas field located on the Norwegian continental shelf in the North Sea. Statoil reported that this conventional or category C jackup is being constructed at KeppelFels in Singapore. Early this year, Statoil and its partners selected a fixed-processing platform concept, which will connect Dagny gas to the Sleipner field, while oil is transported via ship. FEED studies are currently underway to assure the quality of the selected concept prior to a final investment decision, which is expected by the end of 2012 or early 2013. Production from Dagny is expected by the end of 2016. Production drilling will begin summer of 2015 by pre-drilling through the jacket prior to installation of the platform deck the following summer. Pre-drilling will facilitate accelerated production from the Dagny field. Project Details: Dagny Premier Signs Sale Agreement for Bream May 30, 2012 – Premier announced that it has signed a sale and purchase agreement (SPA) with Skeie Energy AS to acquire a 20 percent equity interest in PL407 and a 40 percent equity interest in the adjacent PL406 license on the Norwegian Continental Shelf, subject to approval from Norwegian Authorities. This will increase Premier???s stake in the Bream project to 40 percent and the company???s operated interest in PL406 to 80 percent. Premier will pay an upfront consideration of $10 million to Skeie with further payments of up to $17.5 million contingent upon certain milestones being reached. Project sanction of the Bream development is planned for the second half of 2012. First oil is targeted for late 2015 with an initial production rate of approximately 14,000 bopd net to Premier, upon completion of the transaction. Project Details: Bream Noble Offloads Dumbarton and Lochranza to Maersk May 30, 2012 – Noble Energy, Inc. announced that it entered into an agreement with Maersk Oil North Sea Limited for the sale of its thirty percent non-operated working interest in the Dumbarton and Lochranza properties. These fields produced approximately 4,400 barrels of oil equivalent (boe) per day, net to Noble, in the first quarter of 2012. At the end of 2011, net proved reserves at Dumbarton and Lochranza were 5.6 million boe. Noble will receive $127 million, subject to customary adjustments for net cash flows between the effective date of January 1, 2012 and the closing date, which is expected before October 2012. Project Details: Dumbarton Shells Picks Ups More of Schiehallion from Hess May 30, 2012 – Hess Corporation announced it has reached agreement with Shell to sell its 15.67 percent interest in the BP-operated Schiehallion field, its associated share in the Schiehallion Floating, Production, Storage and Offloading vessel (FPSO) and the West of Shetland pipeline system. The sale is subject to regulatory approval and is expected to be completed later this year. The Schiehallion field is located on blocks 204 and 205, approximately 109 miles (175 kilometers) west of the Shetland Islands, off the Scottish coast. Hess has been a partner in the project since it was sanctioned by the UK Government in 1996. The FPSO has been in service since production began in 1998. Construction of a new FPSO is underway and is expected to start production in 2016. Project Details: Schiehallion (Quad 204) EnQuest to Farm Out 35 Percent of the Alma/Galia Development May 29, 2012 – EnQuest PLC announced an agreement in which it will farm out 35 percent of its interest in the Alma and Galia oil field developments to the Kuwait Foreign Petroleum Exploration Company (KUFPEC). Awaiting regulatory approval, the agreement stipulates that KUFPEC will invest a total of $500 million in cash, comprised KUFPEC’s pro rata share of development costs from January 1, 2012 along with up to $182 million in future contributions for past costs and development carry, in relation to EnQuest’s remaining interest in Alma/Galia. Project Details: Alma/Galia Bentley 9/3b7 Reaches Target Depth May 29, 2012 – Xcite Energy announced that well 9/3b-7 has reached its target depth of 9,377 feet. A reservoir section in excess of 2,200 feet was penetrated, with 100 percent net pay, and sand screens were run, successfully. Drilling of the second reservoir section, installation of the down-hole pump and commissioning of processing equipment will commence prior to production testing. Two, six-inch export pipelines from the Rowan Norway were successfully installed by the Polar Price. Project Details: Bentley Athena Sees First Oil May 28, 2012 – Ithaca Energy Inc. announced the successful start-up of oil production from the Athena field. The initial operations phase of the field is in line with the management’s expectations and proceeding as planned. This involves bringing production from each well online and establishing stable performance of the oil processing and water injection systems. Athena field is owned by a joint-venture partnership including the field operator, Ithaca with 22.5%, Dyas UK Limited holding 47.5%, EWE Energie with 20% and Zeus Petroleum Limited owning the remaining 10%. Project Details: Athena Tybalt Appraisal Well Fails to Impress May 28, 2012 – Valiant Petroleum plc announced that the Tybalt appraisal well 211/8c-5 has reached a total depth of 13,212 feet MD. The well penetrated a full Upper Magnus Sandstone Member (UMSM) section, comprising 844 feet gross, with 316 feet of net sand. Two hundred and ten feet of core was successfully recovered from this interval. Initial interpretation indicates that the hydrocarbon saturations recorded throughout the section were broadly similar to the 211/8c-4z discovery well drilled in 2010. Despite similar porosities, recorded permeabilities in the current well registered lower than most expectations. Moveable hydrocarbons were not detected during reservoir testing. Test points located in the lower part of the UMSM recovered water, while stations towards the top of the interval were tight. Valiant Petroleum and its partners at the Tybalt field are suspending the well. Additional technical analyses will be necessary to determine the size of and any potential in the Tybalt accumulation. Tybalt is operated by Valiant Petroleum, which holds 60 percent interest in the field. Agora Oil and Gas AS, a fully-owned subsidiary of Cairn Energy PLC owns the remaining 40 percent interest. Project Details: Tybalt Asia – SouthEast Production Starts in Terang Gas Field May 26, 2012 – Kangean Energy Indonesia Ltd. announced that commercial production from the Terang gas field began on May 26, 2012. Terang gas field is located offshore, approximately 56 miles (90 kilometers) north of Bali Island in water approximately 214 feet (90 meters) deep and is part of the TSB gas field complex, which is composed of Terang, Sirasun and Batur gas fields. The produced gas will be first gathered in FPU, supplied through the East Java Gas pipeline and then sold. Philipino Government Approves Extension for Exploration of SC55 May 25, 2012 – Otto Energy announced that the Philippines Department of Energy (DOE) approved an extension to the current Exploration Sub-Phase 4 of SC55 by 12 months. Sub-Phase 4, which began Aug. 5, 2011 has been extended to Aug. 5, 2013 and retains the commitment to drill one well under the current work program. Sub-Phase 5 has the same well commitment and runs from Aug. 5, 2013 until Aug. 5, 2014. The extension was requested by Otto’s JV partner and operator of SC55 for the purpose of securing an appropriate ultra deepwater rig equipped with the required well control equipment to ensure safe drilling operations. No specific date for commencement of drilling operations in SC55 can be determined until a rig is secured. Current availability of such niche rigs is limited and was a factor in the decision to grant the extension for Sub-Phase 4. Project Details: Cinco Africa – West Post Logging Results for Gazelle-P3 ST May 30, 2012 – Rialto Energy has disclosed preliminary results from the well log analysis for the Gazelle-P3 ST development well located at permit CI-202 offshore Cote D’Ivoire. The well encountered all expected reservoirs at the Gazelle Field along with a new exploration objective. Rialto is reviewing operational options, including a possible side-track to relocate the development well at a location where it will be suspended as a producer. A secondary objective of the possible side-track will further appraise, potentially test and suspend the UC3 reservoir. A primary gas reservoir in Gazelle was found to be gas bearing at the Gazelle-P3 ST well, where it was encountered 656 feet (200 meters) deeper than the lowest known gas from the earlier IVCO 21 well on Block CI-202. Two high quality PVT samples were taken for use in the Gazelle FEED study. The Condor exploration prospect was encountered with good gas shows however results indicated a low permeability gas reservoir at this location. A follow-up well to fully evaluate the prospect will be drilled as part of Rialto???s next phase in the drilling program planned for early-mid 2013. A 246 foot (75 meter) TVD gross reservoir package of high-quality sand was encountered at the base of the Gazelle-P3 ST Well. Drill cuttings exhibited shows and the logs indicated the sands to be water bearing with possible residual oil saturations. Recently acquired 3D data will be used to identify new prospects in the Gazelle/Condor Area with a view to future exploration activity. A decision as to whether to drill a side-track to the Gazelle-P3 ST well to further appraise the UC1 and UC3 reservoir is forthcoming. Once drilling is completed on Gazelle P-3 ST, a six well template will be set prior to spudding the Gazelle P-4 well. The Chouette exploration well will begin at the completion of the Gazelle P-4 well. Project Details: Gazelle Australia Boreas-1 BOP Pressure Testing Complete May 25, 2012 – Karoon Gas Australia Ltd reported that the Boreas-1 exploration well completed pressure testing of the surface blowout preventors (BOP). Since the last report, the 12-1/4??? hole section was drilled from 12,822 to 13,153 feet (3,908 meters to 4,009 meters), 9-5/8??? casing was run and cemented, and the BOP and marine riser were pulled from the well. The BOPs were then serviced. The Transocean Legend (mid-water semisub) will begin drilling the 8-1/2??? hole section early next week. Boreas-1 is located approximately 2.5 miles (4 kilometers) south of Poseidon-1 in WA-315-P on a large tilted fault block which is part of the of the north-east trending structural high of the greater Poseidon structure. The objective of the well is to test the extent, presence and quality of reservoirs within the Boreas-1 fault block. ConocoPhillips is the operator of the jointly held WA-314-P, WA-315-P and WA-398-P Browse Basin permits, which contain the previously announced Poseidon and Kronos gas discoveries. Karoon Gas Australia Ltd holds 40% of the permit WA-315-P and WA-398-P and 90% of permit WA-314-P. Project Details: Boreas

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Obama and Energy: Collected Cartoons

From Investors.com

From The Week

From The Week

From Solid Principles

From Conservative Daily News

Editor’s Note: Above is a collection of political cartoons taking President Obama to task for his energy policies.

From Slate

Souece: Energy Tribune- Obama and Energy: Collected Cartoons.

LNG EXPORT: U.S. Gas Exports Put on Back Burner

By TENNILLE TRACY

The Obama administration is telling Japan and other allied countries they will have to wait before moving forward on plans to buy American natural gas, people involved in the talks said.

A dramatic increase in U.S. natural-gas production has led several U.S. companies, including Sempra Energy SRE +0.23% and Dominion Resources Inc., D +0.15% to seek permits from the Department of Energy to export gas to countries that lack free-trade agreements with the U.S. Exxon Mobil Corp. XOM -0.73% Chief Executive Rex Tillerson said Wednesday his company was looking at exporting from the U.S. Gulf Coast and Canada.

Sempra and Dominion are working with Japanese partners that want to import the gas as their country looks for new power sources. The U.S. currently exports relatively small amounts of natural gas via pipelines to Canada and Mexico, but a wave of recent export proposals marks the first time in decades that companies have sought to liquefy U.S. gas and transport it overseas.

But exports have become a hot-button topic for some lawmakers in Washington and have highlighted uncertainty about what kind of energy power the U.S. wants to become as companies unearth huge supplies of natural gas in shale rock.

“We are going to have to answer some basic questions about our role as a producer,” Michael Levi, a senior fellow at the Council on Foreign Relations, said. “The fact that some of these debates have been so difficult stems from their novelty.”

Japan’s prime minister raised the gas-export issue with President Barack Obama at an April 30 meeting, one of several occasions on which Tokyo has pushed the administration.

But the U.S. has told Japan, a leading military ally in the Pacific, it will have to wait, in large part because of the political sensitivities, participants in the talks said.

“I think it’s going to require more people taking a look at it,” an administration official said, adding, “We’re very sympathetic to Japan. They’re in a very difficult situation.”

Following the disaster at its Fukushima Daiichi nuclear plant last year, Japan pulled the plug on all of its nuclear reactors, forcing it to replace a power source that generated about 30% of its electricity. The government is studying whether to restart some of the reactors, but nuclear power is likely to play a smaller role in five or 10 years.

That is when the U.S. natural gas could start arriving, but only if the U.S. grants permits to export terminals that would liquefy the gas for shipping across the Pacific.

Japan isn’t the only country waiting. “The requests come from everywhere,” the administration official said. Natural gas is much cheaper in the U.S. than in Europe and Asia, where the fuel’s value is often tied to the price of oil. Companies importing American gas would be able to reduce costs with contracts tied to the lower U.S. prices.

Mr. Tillerson laid out the case for exports at Exxon’s shareholder meeting Wednesday, saying they would create jobs and help the U.S. trade balance. Sen. Lisa Murkowksi, a Republican from Alaska, asked President Obama in April to expedite permits for natural-gas exports. She said exports could give Alaska a market for gas from its North Slope, which lacks a gas pipeline to the lower 48 states.

Opponents, including Rep. Ed Markey of Massachusetts and some other congressional Democrats, say the U.S. could boost its energy security by keeping its natural gas at home. Oil-and-gas entrepreneur T. Boone Pickens, in an interview, objected to the idea of selling the gas at a discount to global prices. “You’re kind of giving your own stuff away, and it’s stupid to do that,” said Mr. Pickens, who wants U.S. trucks to use natural gas.

Japanese officials said they recognized the Obama administration’s political challenges.

“It is difficult for the U.S. to say yes [to exports] because of the presidential election,” said Hirohide Hirai, director of the petroleum and natural-gas division of Japan’s economy ministry. “There won’t be any deal with any country before November.”

U.S. officials say they are weighing how exports would affect job creation, trade and the domestic price of natural gas. A price spike would hurt consumers and weaken a competitive advantage enjoyed by U.S. manufacturers that use natural gas as a raw material. An Energy Department assessment is due later this year, and an administration official said decisions will follow in a “timely manner.”

—Mitsuru Obe and Isabel Ordonez contributed to this article.

Write to Tennille Tracy at tennille.tracy@dowjones.com

Source

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Pacific Drilling Receives LoA for Pacific Sharav Drillship

Pacific Drilling S.A., a fast growing company dedicated to becoming the preferred ultra-deepwater drilling contractor, has received a letter of award for the Pacific Sharav drillship, revealed the company’s CEO Chris Becket.

CEO Chris Beckett commented on the increasing demand for ultra-deepwater units: “During the early part of 2012, demand for ultra-deepwater drillships continued to strengthen, as demonstrated by the acceleration in multi-year inquiries and contract awards with increasingly higher dayrates. We expect to see market demand exceed supply well into 2014.”

He added: “In this favorable market context, the Pacific Sharav received a letter of award from a major oil company for a long term commitment. We expect to provide more details on this commitment in the coming weeks. These positive market dynamics supported our decision to order a seventh drillship, scheduled for delivery in May 2014.”

Construction of the Pacific Sharav started in March 2012 at Samsung Heavy Industries in South Korea. Delivery of the rig is expected in September 2013. The vessel, of Samsung 12000 design, will be capable of operating in 12,000 ft water depth and equipped for 40,000 ft drilling depth. The ship will be able to accommodate a crew of 200.

Pacific Drilling’s fleet of seven ultra-deepwater drillships will, once completed, represent one of the youngest and most technologically advanced fleets in the world. The company currently operates four recently delivered drillships and has two additional drillships under construction and one on order at Samsung.

During the first quarter of 2012, the company invested $102 million in the construction of the fleet, including the initial payment for its seventh drillship.

“We estimate the remaining capital expenditures for our committed drillships at $1.6 billion,” read the company’s statement.

Source: Pacific Drilling Receives LoA for Pacific Sharav Drillship| Offshore Energy Today.

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USA: SCA’s Award for Excellence in Safety Goes to Bollinger Shipyards

Bollinger Shipyards, Inc. was awarded the 2011 “Award for Excellence in Safety” by the Shipbuilders Council of America for the seventh consecutive year. With focused efforts of continuous improvement, they also earned the 2011 SCA “Award for Improvement in Safety”.

Read more: Shipbuilding Tribune – USA: SCA’s Award for Excellence in Safety Goes to Bollinger Shipyards.

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