Blog Archives
Worldwide Field Development News May 3 – May 9, 2014
| This week the SubseaIQ team added 6 new projects and updated 29 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. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 8, 2014 – Apache’s U.S. Gulf of Mexico subsidiary elected to sell off its minority interest in the Lucius and Heidelberg developments to a subsidiary of Freeport-McMoRan Copper & Gold Inc. for $1.4 billion. The deal also includes 11 primary term deepwater exploration blocks. Apache combined its deepwater and shelf technical teams in an effort to focus on subsalt and exploration opportunities in water less than 1,000 feet deep. Apache is divesting an 11.7% interest in Lucius and a 12.5% interest in Heidelberg. Its interest in the 11 primary term blocks range from 16.67% to 60%. The transaction is subject to customary closing conditions and is expected to close by June 30. None of Apache’s producing operations are involved in the sale.InterMoor Completes IRIS Installation and Recovery for Apache in Gulf of Mexico, USA
InterMoor, an Acteon company, has completed an installation and recovery project for Apache Deepwater LLC (Apache) in Mississippi Canyon Block 148, Well 5 in the Gulf of Mexico.
The work scope included the overboard, wet transfer, deployment and recovery of a 30-ton interchangeable riserless intervention system (IRIS) owned by Blue Ocean Technologies. InterMoor undertook the work in water approximately 168 meters deep from Cal Dive’s Uncle John semisubmersible vessel.
InterMoor delivered the project using its compensated anchor handler subsea installation system (CASIM) which reduces heave motions relative to vessel motions. CASIM units are pre-charged at the surface to deliver the needed heave compensation for the load at depth. InterMoor’s proprietary CASIM method requires less deck space and demands fewer deck operations than the traditional buoy-based heave-compensated landing system. The company also provided the associated rigging equipment and a technician to help facilitate the subsea compensation.
“Apache selected InterMoor for this project on the basis of our service record, the fact that we had the necessary equipment available and because of our experience in subsea operations of this kind,” said InterMoor project manager Jacob Heikes. “Although we have used CASIM to deploy and recover many types of subsea equipment, this is the first time that we have used CASIM for IRIS deployment and recovery, and the project’s success shows that this proven installation method is suitable for a wide range of subsea equipment.”
Corpus Christi, TX: Apache to Add CNG Gas Fuelling Dispensers at Midland Stripes Stores
Stripes LLC, a subsidiary of Susser Holdings Corporation announced it is partnering with Apache Corporation to add natural gas fueling dispensers at selected Stripes® convenience store locations.
Initially, compressed natural gas (CNG) fueling capability will be available at two Stripes locations in the Midland, Texas area.
Steve DeSutter, Stripes President and CEO – Retail, said, “Adding natural gas to our conventional motor fuel products reinforces our mission to give Stripes customers what they want at a great price in our convenient store locations.
“We certainly see the role of natural gas in our energy future, and we are looking forward to participating as it evolves as a viable alternative transportation fuel. We plan to evaluate the results of our pilot project in West Texas, and if it is successful, we expect to gradually roll out CNG fueling capabilities in other Stripes markets,” DeSutter said.
Steve Farris, Apache’s Chairman and Chief Executive Officer, said: “Natural gas discovered and produced in the United States is a smart alternative to conventional fuels. It’s cheaper, cleaner, and abundant.
“We use it for our fleet cars and trucks with great results, lowering operating costs and reducing our environmental footprint. Partnering with Stripes provides our fleet and other CNG users with a more convenient fueling experience as well as access to their stores and other amenities.”
Today compressed natural gas is priced 30% to 40% lower than gasoline or diesel on a gallonequivalent basis, which means a big savings at the pump. According to industry experts, natural gas is kinder to the environment by reducing vehicle exhaust emissions, and because of our nation’s abundant natural gas reserves, it represents a more secure American energy supply. According to the Department of Energy Clean Cities Alternative Fuel Pricing Report and the Institute of Energy Research, known domestic resources could satisfy the nation’s needs for more than 100 years.
Apache to Add Gas Fuelling Dispensers at Stripes Stores, USA LNG World News.
Apache Inks Suriname PSC
Apache Corporation today signed a production sharing contract (PSC) with Suriname’s oil company Staatsolie for offshore block 53. located in the territorial waters of the South American country.
The contract, divided into exploration, development and production phases, is valid for approximately 30 years. The parties have agreed to a minimum working program for the exploration phase, which includes geological surveys and exploration drilling. Apache will take full responsibility for all costs during the exploration phase.
If a commercial find has been made and brought into production, Apache will receive reimbursement for such costs. The contract offers Staatsolie the opportunity for a stake in the development phase of up to 20 percent.
Block 53 is located at approximately 130 kilometers off the northwest coast of Paramaribo. The exploration period under the contract is divided into two phases with a combined investment of approximately US$230 million. The duration of the first phase is scheduled for three years with an optional second phase of two and a half years. In addition to a large 3D seismic survey, two wells will be drilled in the first phase with a third well to be drilled in the optional second phase. The production sharing contract explicitly deals with inspection, safety and the environment. There are also special provisions for employment of local cadre, training, social programs and the dismantling of facilities at the end of operations.
Ecopetrol Updates on US GoM Parmer Propect
Ecopetrol S.A., through its affiliate Ecopetrol America Inc., provided the results of the Parmer Prospect, deepwater Gulf of Mexico.
The Parmer prospect #1 is located on Green Canyon 867, at a depth of 18,900 ft (5,760 meters), which allowed for several pressure readings and the collection of several fluid samples from Miocene sands. The data indicate a column of approximately 240 ft (73 meters) of net condensate-rich gas pay, as prospect as one of 40 ft (12 meters) of net oil pay. In the coming months, Ecopetrol and its partners will reprocess 3-D seismic data and determine a comprehensive delimitation and development plan according to these results.
The two Parmer leases (GC 823 and GC 867) are located within the Green Canyon protraction area, at a depth of approximately 4,200 ft (1,280 meters) underwater. Each covers an area of 5,760 acres (23.3 square kilometers) and is located approximately 143 miles (230 km) from Louisiana.
Ecopetrol America has a 30% interest in the Parmer Prospect. Its partners are Stone Energy, and Apache that is the prospect’s operator.
The Parmer discovery is Ecopetrol’s second deepwater discovery in the Gulf of Mexico, one of the regions with the highest oil hydrocarbon potential in the world.
The results are expected to assist in Ecopetrol S.A.’s strategy to attain a production level of 1.0 million clean barrels of oil equivalent a day by 2015, and 1.3 million clean barrels by 2020.
Related articles
- GoM Lease Sale: Apache Expands Presence in Gulf of Mexico (mb50.wordpress.com)
- Colombia’s Ecopetrol, U.S. Find Oil in Gulf of Mexico (hispanicallyspeakingnews.com)
USA: Apache Finds Huge Shale Gas Reserves in Liard Basin
Apache Corp. has found a huge amount (up to 48 trillion cubic feet) of natural gas in its Liard Basin properties in northeastern BC. All of the gas is targeted to ship to a proposed LNG plant which should be built at Kitimat, according to Refinery News.
As the company says, it is the best unconventional gas discovery in North America. They have rights to drill 430,000 acres within the region.
Because of the low gas price, it is expected that the drilling plans in the Liard region could be very slow.
Related articles
- No relief for natural gas producers as Apache’s Kitimat plant delayed (mb50.wordpress.com)
- Apache discovers massive shale gas field in B.C. (business.financialpost.com)
- Apache discovers huge gas reservoir in northern B.C. (calgaryherald.com)
GoM Lease Sale: Apache Expands Presence in Gulf of Mexico
Apache Corporation announced it was the high bidder on 90 shelf and deep water blocks in the Central Gulf of Mexico offshore lease sale held by the Bureau of Ocean Energy Management (BOEM) in New Orleans.
Of the 56 companies submitting bids for Gulf of Mexico acreage, Apache Corp. was ranked No. 1 overall for its 61 high bids on the shelf, while Apache Deepwater LLC, the company’s deep water arm, was ranked No. 4 overall with 29 high bids.
The sum of the combined high bids was nearly $96 million gross.
“We’re excited about these blocks and our expanding presence in the Gulf of Mexico,” said G. Steven Farris, Apache chairman and chief executive officer. “The Gulf of Mexico is integral to Apache’s long-term growth. The shelf provides some of the best margins, highest returns and most free cash flow, and the deep water has some of the best exploration potential of any region in our global portfolio.”
Bidding on acreage in the shelf was focused on areas where Apache is acquiring proprietary seismic data, along with moderate to deep exploration prospects based on recently acquired and reprocessed seismic data. Successful deep water bids were focused on Pliocene and Miocene trends where Apache has acquired a significant seismic data base. Deep water bid partners included Stone Energy, Samson, Noble, Repsol, Nexen and Ecopetrol.
“This was a very robust lease sale with premium acreage,” said Jon Jeppesen, executive vice president of Apache’s Gulf of Mexico regions. “These blocks strengthen our position on the shelf and in the deep water. In both areas, Apache has the fiscal wherewithal, technical prowess and experience to capture the value of these opportunities.”
The shelf and deep water Gulf of Mexico currently represents 15.5 percent of Apache’s overall daily production.
Related articles
- Republicans: Obama taking too much credit for Gulf lease sale (fuelfix.com)
- USA: API Upstream Director Calls for Expanded Five-Year Offshore Plan (mb50.wordpress.com)
- Maersk Bags Gulf of Mexico Contract for Its Under-Construction Drillship (mb50.wordpress.com)
- No relief for natural gas producers as Apache’s Kitimat plant delayed (mb50.wordpress.com)
No relief for natural gas producers as Apache’s Kitimat plant delayed
Courtesy of Apache Canada Ltd.
An artist’s rendering of the proposed Kitimat Apache Canada’s LNG facility, which is now delayed for another year
Beleaguered natural gas producers in Western Canada are going to have wait a little longer for relief from severely depressed prices. Janine McArdle, the senior executive in charge of the Kitimat LNG project at Houston-based Apache Corp., said the facility’s planned startup will take an extra year as the company continues to look for firm contracts with buyers in Asia.
Apache’s proposed natural gas liquefaction plant on the northern British Columbia coast, which it owns with Encana Corp. and EOG Resource Inc., would be the first in line to ship large quantities of LNG to Asia.
The first cargo is now expected to leave Canada in 2017, a year behind the latest plans. The project has regulatory approval, but Apache needs to be sure it has a market for the gas and that the project is economic before taking a final investment decision, Ms. McArdle, senior vice-president for gas monetization at Apache, North America’s largest oil and gas independent producer, said Wednesday.
Construction of a 10-million tonnes a year plant would then take 50 to 60 months.
“We are moving as quickly as we possibly can given that Canada is new to these buyers, and we are relatively new to the buyers as Apache,” she said on the sidelines of an industry conference.
“We have been talking to multiple markets simultaneously and there is a lot of interest. I always have to remind people that these are 20, 30-year marriages. These things don’t happen overnight.”
Next in line is Royal Dutch Shell PLC’s B.C. LNG project, which is slated for startup in 2019. Shell gave the tentative go-ahead to the project last month with three Asian partners that will secure Canadian gas has customers — PetroChina, Mitsubishi Corp. and Korea Gas Corp. However, the project has yet to obtain regulatory approval.
Related
- Apache discovers massive shale gas field in B.C.
- Alberta looking at ways to expand natural gas use, including in vehicles
A handful of other projects are also in various planning stages, but they are further behind.
It’s a tense time for Western Canadian natural gas producers, who are watching closely progress on LNG facilities on the B.C. coast so they can start monetizing reserves already found and look for new ones. The facilities will enable exports to Asia and help alleviate a massive shale supply glut in North America that has depressed prices to 10-year lows.
Asian demand for LNG is expected to increase to 35 billion cubic feet a day by 2020, from 20 bcf today, said Ed Kallio, director of gas consulting at Ziff Energy Group, a Calgary-based gas forecasting firm. He expects demand to outstrip supply in Asia by 2016/2017.
The good news is that there is plenty of gas to keep the projects full. Apache announced last week that it discovered in the Liard Basin a new shale gas field containing as much as 48 trillion cubic feet of recoverable natural gas which it characterized as one of the world’s best.
The find motivates Apache to develop an alternative market for Canada, Ms. McArdle said.
It also further boosts Canada’s 500-trillion cubic feet of natural gas reserves, a number that has ballooned in recent years thanks to shale discoveries such as the Horn River, the Montney and the Cordova, all in British Columbia. To put it in context, the now-shelved Mackenzie Gas Project was underpinned by six trillion cubic feet of reserves in the Mackenzie Delta. The number seemed immense before shale gas was unlocked.
Mr. Kallio, who also spoke at the conference, said it will take a lot more than LNG exports to restore balance to the natural gas market and Western Canadian producers will be stuck in a low-price environment for several years. Demand will have to increase, and supply will come down as production of liquids-rich natural gas runs out of steam with weakening of liquids prices, as drilling promoted by land terms tapers off, and if producers do their part by being more disciplined, he said.
“We had such a rush and we had a bunch of cowboys out there, including Chesapeake [Energy Corp.] and Encana that drilled like crazy, [because] they had nice hedges on through the end of this year. But they have very little hedged next year, and that is why they are selling assets — they are selling fingers, toes, kidneys, prized assets to get the cash flows up” and hang in until the next rising market, Mr. Kallio said.
Related articles
- Shell races Apache to export LNG from Kitimat to Asia (bizjournals.com)
- Apache discovers massive shale gas field in B.C. (business.financialpost.com)
- Natural gas producers pin hopes on Asian market as prices sink (business.financialpost.com)
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