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Gulf of Mexico: Exxon, Statoil to Splash $4 Bln on Julia Development
Exxon Mobil Corporation is commencing development of the Julia oil field in the Gulf of Mexico, the oil giant announced yesterday in a press release.
Capital cost for the project, which is expected to begin oil production in 2016, is estimated to be more than $4 billion. The field was discovered in 2007 and is estimated to have nearly six billion barrels of resource in place.
“The development of Julia will provide a new source of domestic energy and well-paying jobs over the next several years,” said Neil W. Duffin, president of ExxonMobil Development Company. “Access to resources such as Julia will contribute to U.S. energy security for many years to come.”
The initial development phase is being designed for daily production of 34,000 barrels of oil and includes six wells with subsea tie-backs to the Jack & St. Malo production facility operated by Chevron U.S.A. Inc. Julia project front end engineering design has been completed and the engineering, procurement and construction contracts have been placed.
“Julia is one of the first large oil discoveries in the ultra-deepwater frontier of the Gulf of Mexico,” said Duffin. “This resource is located more than 30,000 feet below the ocean’s surface. Enhanced technologies will be deployed to ensure the safe and environmentally responsible development of this important energy resource.”
The Julia field comprises five leases in the ultra-deepwater Walker Ridge area of the Gulf of Mexico, 265 miles southwest of New Orleans. The blocks are WR-584, WR-627, WR-628, WR-540 and WR-583.
ExxonMobil, the operator, and Statoil Gulf of Mexico LLC each hold a 50 percent interest in the Julia unit.
Over the past decade, ExxonMobil has drilled 36 deepwater wells in the Gulf of Mexico in water ranging from 4,000 feet to 8,700 feet.
Rosneft Buys Exxon’s GoM Blocks (USA)
Neftegaz America Shelf LP (Neftegaz), an indirect independent subsidiary of Russia’s state-run oil company Rosneft, has acquired 30 percent interest in 20 deepwater exploration blocks in the Gulf of Mexico held by ExxonMobil, under an agreement signed by the two companies.
The 20 blocks have a total area of approximately 111,600 acres (450 square kilometers) in water depths ranging between 2,100 and 6,800 feet (640 and 2,070 meters). Seventeen are located in the Western Gulf of Mexico and three are in the Central Gulf of Mexico.
ExxonMobil retains 70 percent interest in the blocks and remains operator. Analysis of seismic data is under way. There is currently no production on the blocks.
Rosneft and ExxonMobil continue to implement the Strategic Cooperation Agreement signed in 2011, under which the companies and their subsidiaries plan to undertake joint exploration and development of hydrocarbon resources in Russia and other countries and to share technology and expertise. Under subsequent agreements between Neftegaz and ExxonMobil, Rosneft’s subsidiary gained the option to acquire interest in 20 blocks of its choosing from among ExxonMobil’s Gulf of Mexico exploration portfolio. The latest agreement represents the exercise of that option.
The agreement was signed by Igor I. Sechin, president of Rosneft, and Stephen M. Greenlee, president of ExxonMobil Exploration Company.
“ExxonMobil has a long history of safe oil and gas exploration in the Gulf of Mexico using state-of-the-art safety and environmental protection systems,” said Greenlee. “We look forward to working with Rosneft and its affiliates to explore these blocks using our leading-edge exploration and development technology and deepwater execution expertise.”
Sechin said, “This agreement provides Rosneft and its affiliates with access to one of the world’s most prolific basins. We believe joint efforts of our companies will ensure the most efficient development of these blocks, with application of the latest technologies and adhering to high environmental standards. Moreover, experience and knowledge acquired in the process may potentially be used when developing deepwater blocks in Russia, including in the Tuapse Trough in the Black Sea as envisaged under the Strategic Cooperation Agreement.”
ExxonMobil and Rosneft continue to implement a program of staff exchanges for technical and management employees to help strengthen the working relationships between the companies and provide valuable career development opportunities for employees of both companies.
The 20 blocks are:
Western Gulf of Mexico – Alaminos Canyon 569, 612, 613, 655, 656, 657, 698, 699, 700 and 701; East Breaks 429, 471, 472, 473 and 515; Keathley Canyon 529 and 573.
Central Gulf of Mexico – Walker Ridge 629, 673 and 717.
Rosneft Buys Exxon’s GoM Blocks (USA)| Offshore Energy Today.
ExxonMobil Seeks ROV for Operations in Black Sea (Romania)
ExxonMobil Exploration and Production Romania Limited Nassau (Bahamas) is seeking for diving services using a remotely operated vehicle for a drilling programme in the Black Sea.
The objective of the framework agreement is for ExxonMobil to be able to access the resources identified as necessary for the provision of services under the contract.
Minimum and maximum operating 380 – 1,309 days of operation with mobilisation and demobilisation days are included in the tender.
The project has a value between USD8 million and USD30 million with duration of 48 months.
ExxonMobil is expecting the tenders to be submitted until November 06, 2012.
Subsea World News – ExxonMobil Seeks ROV for Operations in Black Sea (Romania).
- Rosneft, ExxonMobil to launch test drilling in Kara, Black seas (english.ruvr.ru)
Exxon, Conoco, BP and TransCanada Make Progress on Alaska LNG Project
Executives for ExxonMobil, ConocoPhillips, BP, and TransCanada submitted a letter to the Parnell administration describing their companies’ progress in advancing an Alaska liquefied natural gas (LNG) export project.
“I’m encouraged that the companies have made significant progress in advancing a project and an associated schedule for commercializing North Slope gas,” Governor Parnell said. “Clearly, they have fully shifted their efforts to an Alaska LNG project.”
The companies’ letter addresses a critical benchmark that Governor Parnell laid out in his January State of the State address, calling on the companies to harden the numbers on an LNG project and identify a project timeline by the end of the third quarter.
The letter also addresses an additional third-quarter benchmark that Governor Parnell laid out in his address, calling on the companies to complete their discussions with the Alaska Gasline Development Corporation (AGDC) on the potential to consolidate their work. In the letter, the companies said they have established a cooperative framework with AGDC to share information.
“I am also encouraged to see the significant work between AGDC, which is advancing an in-state gas project, and the Alaska Pipeline Project (APP), which is advancing an LNG export project. Deeper cooperation between these two state-backed efforts is strongly in the state’s interest,” Governor Parnell said.
Prior to the announcement, ExxonMobil, ConocoPhillips and BP had met two earlier benchmarks laid out in Governor Parnell’s State of the State address. On March 29, the state and the companies resolved the Point Thomson litigation. The following day, the companies announced their alignment “on a structured, stewardable and transparent approach with the aim to commercialize North Slope natural gas within the Alaska Gasline Inducement Act (AGIA) framework.”
Letter from the producers and TransCanada provide details on the team they have assembled and the team’s activities in developing a project, building on their previous work to commercialize North Slope gas. The documents include a project timeline and a cost range covering various stages in the project development schedule and work plan. The documents also provide new details regarding the components of an Alaska LNG project, including a liquefaction facility, gas production and storage, a large-diameter pipeline, and a gas treatment plant.
Over the past six months, more than 200 employees from the four companies have been working on managerial, technical, and commercial aspects during this phase of the project schedule, according to the letter.
Given the massive size of the North Slope conventional gas resource (35 trillion cubic feet of reserves and more than 200 trillion cubic feet of undiscovered, technically recoverable resources) and the scope of the project as described by the companies, an Alaska LNG project will be one of the largest in the world.
While the companies have been developing their LNG project design, the Parnell administration has undertaken significant outreach to Pacific Rim markets to highlight the comparative advantages of Alaska LNG exports, and to other key stakeholders, including U.S. government officials in charge of export licensing.
The most recent of these efforts was Governor Parnell’s trade mission in September to South Korea and Japan, where he discussed Alaska LNG exports with leading government and industry officials.
Exxon, Conoco, BP and TransCanada Make Progress on Alaska LNG Project LNG World News.
- Alaska gas line project could cost $65B or more (jsonline.com)
- Parnell in Asia, touting Alaska natural gas (juneauempire.com)
- Alaska Sees Asia Driving Annual $20 Billion Via Pipeline – Bloomberg (bloomberg.com)
- Alaska cozies to Asia for natural gas (upi.com)
Kiewit-Kvaerner JV Work on Exxon’s Hebron GBS in Canada
Kiewit-Kvaerner Contractors joint venture, has been authorized by ExxonMobil Canada Properties (EMCP) to proceed with work on the Hebron Project gravity based structure (GBS) project offshore Newfoundland and Labrador, Canada.
The authorization comes after the substantial completion of front end engineering and design services and awards the next phase, which includes detailed engineering, procurement and construction (EPC) related services. Kvaerner estimates its share of this work to be approximately USD 125-150 million.
Hebron is a heavy oil field estimated to have 400 – 700 million barrels of recoverable resources. The field was first discovered in 1981, and is located offshore Newfoundland and Labrador in the Jeanne d’Arc Basin 350 kilometres southeast of St. John’s, the capital of Newfoundland and Labrador. It is approximately 9 kilometres north of the Terra Nova project, 32 kilometres southeast of the Hibernia project, and 46 kilometres from the White Rose project. The water depth at Hebron is approximately 92 metres.
The Hebron field will be developed using a stand-alone concrete GBS. The GBS will consist of a reinforced concrete structure designed to withstand sea ice, icebergs, and meteorological and oceanographic conditions at the offshore Hebron Project Area. The preliminary GBS concept has a single main shaft supporting the topsides, encompassing all wells.
The Hebron co-venturers are: ExxonMobil Canada Properties (36%), Chevron Canada Resources (26.7%), Suncor Energy Inc. (22.7%), Statoil Canada (9.7%) and Nalcor Energy (4.9%).
Related articles
- Canada: WorleyParsons Wins Hebron Topsides Contract from ExxonMobil (mb50.wordpress.com)
- Layoffs hit Hebron fabrication site at Bull Arm – Nfld. & Labrador – CBC News (jobmarketmonitor.com)
- Scramble on to keep $100M Hebron contract in N.L. (cbc.ca)
Rosneft Estimates 90 Bboe in Exxon-Rosneft Projects
NEW YORK – Russian energy Czar Igor Sechin said Wednesday that U.S.-Russia economic relations still don’t reflect their full potential, but that opportunities to tap Russia’s massive oil reserves will provide opportunities for that to change.
At an event in New York describing details of Exxon Mobil Corp.‘s deal with OAO Rosneft, Sechin, who is Russia’s Deputy Prime Minister, said that “the time has come in Russia-U.S. relations for a step-up in the level of practical and real projects.”
The partnership between Exxon and Rosneft could give the companies access to about 90 billion barrels of oil equivalent in estimated resources from the Arctic Ocean and the Black Sea, Rosneft said Wednesday.
In a video presented to analysts in New York, Rosneft said that the partnership would drill its first wells at the Kara Sea in the Arctic Ocean as early as 2014-2015, with a final investment decision on full-scale development expected by 2016-2017. Sechin said that Kara Sea production is estimated to begin around 2027.
The Exxon-Rosneft deal comes in the wake of the Russian government’s efforts to step up the development of new oil production regions, especially in the Arctic. Sechin said that about 5% of oil output to come from new regions by 2020, and up to 40% by 2030.
“We recognize that the implementation of such projects will require strong and consistent support of the state,” which aims to ensure transparent terms of access to the new fields, Sechin said.
Sechin said that under new rules, tax rates were defined for different types of operational conditions. Exxon-Rosneft projects in the Kara Sea will have a royalty of 5%. Royalty levels for deepwater projects in the Black Sea will be 10%, Sechin said.
Long-term investment in offshore development is estimated to exceed $500 billion, Sechin added, creating more than 300,000 jobs.
Overall, the large scale investments needed to tap Russia’s massive oil and gas wealth provides an “enormous potential for U.S.-Russia cooperation, which ought to help us to overcome our over-politicized relationship,” he said.
Such large projects “will be welcomed and will find strong support of the Russian government,” Sechin said.
Copyright (c) 2012 Dow Jones & Company, Inc.
Related articles
- Rosneft-Exxon deal: the gains and challenges (rt.com)
- Exxon Mobil To Grow Deal With Rosneft – Reuters (247wallst.com)
Exxon, Conoco and BP Plan Alaska LNG Exports
ExxonMobil, ConocoPhillips, BP and TransCanada, through its participation in the Alaska Pipeline Project, announced that they are working together on the next generation of resource development in Alaska.
The four companies have agreed on a work plan aimed at commercializing North Slope natural gas resources within an Alaska Gasline Inducement Act (AGIA) framework. Because of a rapidly evolving global market, large-scale liquefied natural gas (LNG) exports from south-central Alaska will be assessed as an alternative to a natural gas pipeline through Alberta.
“Commercializing Alaska natural gas resources will not be easy. There are many challenges and issues that must be resolved, and we cannot do it alone. Unprecedented commitments of capital for gas development will require competitive and stable fiscal terms with the State of Alaska first be established,” the CEOs of ExxonMobil, ConocoPhillips and BP wrote in a joint letter to Governor Sean Parnell.
The producing companies support meaningful Alaska tax reform, such as the legislation introduced by Governor Parnell, which will encourage increased investment and establish an economic foundation for further commercialization of North Slope resources.
With Point Thomson legal issues now settled, the producers are moving forward with the initial development phase of the Point Thomson project. Alaska’s North Slope holds more than 35 trillion cubic feet of discovered natural gas, and Point Thomson is a strategic investment to position Alaska gas commercialization.
Related articles
- Alaska Governor, BP, Conoco and Exxon Discuss LNG Export (mb50.wordpress.com)
- Alaska champions $40bn pipeline plan (mb50.wordpress.com)
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- Alaska export plan collapses (mb50.wordpress.com)
- Alaska Natural Gas Pipeline Back on Front Burner (BP, XOM, COP) (247wallst.com)
Aker Solutions to Design World’s Largest Spar Platform for Statoil
Aker Solutions has been awarded a FEED (front-end engineering and design) contract from Statoil to design the world’s largest Spar platform for the Aasta Hansteen field development in the Norwegian Sea.
With a total hull length of 193 meters and a draught of 170 meters, the Aasta Hansteen (formerly named Luva) Spar platform will be the largest of its kind. A Spar platform is a cylinder shaped floating offshore installation. Aasta Hansteen will be the first Spar platform on the Norwegian continental shelf (NCS), and also the world’s first Spar platform with condensate storage capacity – a so called Belly-Spar.
The Belly-Spar concept is an exclusive Aker Solutions design. The ‘belly’ refers to the increased diameter on part of the circular shaped hull, where the condensate storage tanks are located. This gives the Aker Solutions’ Belly-Spar its characteristic shape.
Henning Østvig, head of Front-End & Technology in Aker Solutions says: “The Aasta Hansteen Spar will be the first production platform on the NCS with steel catenary risers. With a water depth of 1300 meters, this is probably the only riser technology that can meet the challenges on the Aasta Hansteen field”.
The steel catenary risers are made of self-supporting steel pipes in a bow shape between the platform and the seabed. The shape helps the risers compensate for the motions on the floating facility.
Innovation
“The Belly-Spar concept is a result of the innovative spirit and culture among our engineers, who have come up with the right solutions for the challenging conditions on the Aasta Hansteen field,” says Valborg Lundegaard, head of Engineering business area in Aker Solutions.
The mooring system for Aasta Hansteen Spar platform consists of a set of polyester lines. “There are currently no installations on the NCS with polyester mooring. Aasta Hansteen may be the first, and it will definitely be operating in the deepest water,” says Henning Østvig.
The FEED study will be completed in the third quarter of 2012. The contract value is undisclosed.
Aasta Hansteen
The field was discovered in 1997 and lies 300km offshore in the Vøring area. The licence partners are Statoil (75 per cent), ExxonMobil (15 per cent) and ConocoPhillips (10 per cent).
Aker Solutions’ contract party is Aker Engineering & Technology AS.
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