Shell announces a successful exploratory well at Vicksburg in the deepwater Gulf of Mexico. The well is located 75 miles (120 kilometers) offshore in the De Soto Canyon Block 393 in 7,446 feet (2,269 meters) of water. It was drilled to a total depth of 26,385 feet (8,042 meters) and encountered more than 500 feet (152 meters) of net oil pay.
In total, the Vicksburg “A” discovery is estimated to hold potentially recoverable resources of more than 100 million barrels of oil equivalent (mmboe). It adds to the more than 500 mmboe of potentially recoverable resources that have already been discovered and appraised at the nearby Appomattox discovery. Vicksburg “A” is a separate accumulation from both Appomattox and the 2007 Vicksburg “B” discovery.
“The results of the Vicksburg well strengthen our existing deepwater Gulf of Mexico exploration portfolio and should contribute to the nearby Appomattox discovery,” said Mark Shuster, Executive Vice President Shell Upstream Americas Exploration.
Shell (the operator with a 75% interest) and Nexen, a wholly-owned subsidiary of CNOOC Limited, (25% interest), are following up the Vicksburg “A” well with a sidetrack well to test the Corinth prospect, a separate fault block from the Vicksburg discovery. Further exploration drilling targeting tie-backs to Appomattox will follow.
Press Release, July 03, 2013; Image: Shell
This week the SubseaIQ team added 2 new projects and updated 15 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.
N. America – US GOM
Oct 26, 2012 – Noble Energy expects the Ensco 8501 (UDW semisub) to be available to drill the second Gunflint appraisal well in early 2013 after it finishes exploratory drilling at the Big Bend prospect in the US Gulf of Mexico. Gunflint, situated in Mississippi Canyon Block 948, was appraised and confirmed commercial earlier in the year and represents the company’s largest Gulf of Mexico discovery to-date. The discovery well intersected several reservoirs netting more than 550 feet of high-quality pay. Gunflint is believed to hold up to 500 Mmboe.
Project Details: Gunflint (Freedom)
Oct 24, 2012 – Karoon Gas Australia believes the Boreas discovery in permit WA-315-P could be commercial based on well test results. The company feels that future production wells drilled adjacent to Boreas-1 could flow in excess of 100 MMscf/d. Results from the well will be combined with data gathered from Kronos-1, the Poseidon wells and Poseidon 3D seismic to further characterize the size and structure of the Greater Poseidon Trend. The company’s assessment of contingent resources will be independently assessed upon completion of the drilling program.
Project Details: Poseidon
Europe – North Sea
Oct 26, 2012 – The Norwegian Ministry of Petroleum and Energy granted approval to Lundin Petroleum for the Plan of Development and Operation of the Boyla field in PL 340 offshore Norway. Estimated gross reserves are roughly 21Mmboe with gross peak production of 19,000 Boepd. Boyla will be developed via a subsea tie-back to the Alvheim FPSO. Technip was awarded the field development contract and will handle construction and installation of the subsea equipment.
Project Details: Alvheim
Oct 26, 2012 – Well 34/6-2S on the Garantiana prospect offshore Norway has been drilled to a total depth of 13,287 feet by the Borgland Dolphin (mid-water semisub). The well, located in Production License 554, penetrated good quality oil-bearing reservoir rock in the Cook formation. Further analysis is needed for an accurate resource estimate but initial flow rates of 4,000 barrels per day were achieved through a 28/24-inch choke. Pending available contracted rig days, the partners in the Total-operated license may elect to drill a sidetrack well to define the oil-water contact.
Project Details: Garantiana
Shell Takes Hess’ Spot at Beryl
Oct 25, 2012 – Royal Dutch Shell and Hess Corporation have reached an agreement whereby Shell will buy Hess’ stake in the Scottish Area Gas Evacuation Pipeline and the fields that comprise the Beryl Area. Beryl is operated by Apache and is made up of 12 producing fields on the UK continental shelf northeast of Aberdeen. Hess’ net daily production from the area through the first three quarters of 2012 was about 14,000 boepd. Shell plans to extend the production life of its new assets potentially by 20 years. The $525 million deal is expected to close during the first quarter of 2013, pending regulatory approval.
Oct 25, 2012 – Exploration of the Wintershall-operated Asha/Noor prospect in the Norwegian North Sea has commenced on board the Bredford Dolphin (mid-water semisub). Well 16/1-16 is being drilled in 370 feet of water on the western edge of the Utsira High area and is targeting four reservoirs assumed to be Upper Jurassic sandstones. In addition, the well has the potential to appraise the neighboring Ivar Aasen and Apollo discoveries. If the reservoirs are deemed commercially viable the prospect could be developed via the Grane Field processing facilities.
Project Details: Noor
Nexen Spuds Polecat Appraisal
Oct 24, 2012 – Atlantic Petroleum announced the commencement of appraisal drilling at the Polecat prospect in UK license P1100. Well 20/4a-11 is being drilled in 370 feet of water by the Transocean GSF Arctic III (mid-water semisub) in the vicinity of the Ettrick and Blackbird fields. The well is targeting Upper Jurassic reservoirs and is expected to take 50 days to reach total depth. Nexen and Atlantic Petroleum hold 80% and 20% stakes respectively while Nexen maintains operatorship of the license.
Oct 23, 2012 – JV partner Antrim Energy announced positive initial results from the Contender well 211/21-N94 in the UK North Sea. Drilling took place on the TAQA Bratani-operated North Cormorant platform and reached a total depth of 16,903 feet. Preliminary results suggest a net oil pay in excess of 60 feet was encountered in the Tarbert member of the Jurassic Brent sandstones. Ongoing testing has revealed greater than expected porosity and hydrocarbon saturation. If Contender is determined to be commercial, it will be developed from North Cormorant under the name Cormorant East.
Project Details: Falcon
Oct 23, 2012 – Shell received consent from the UK government to proceed with the development of the Fram field in the UK sector of the North Sea. The development, one of the largest to be approved in five years, is expected to contribute 35,000 Boepd to the country’s production with a field life of 20 to 30 years. Although Shell is the operator, JV partner Esso Exploration & Production UK is the major equity holder with a 68% interest. Fram was discovered in 1969 and is unrelated to the Norwegian field of the same name. The gas condensate field is located in blocks 29/3a and 29/8c in roughly 300 feet of water.
Project Details: Fram
Oct 22, 2012 – Sterling Resources announced a delay in production start-up at the Breagh field in the UK North Sea. Late design completion, rework of certain systems and late material deliveries combined to cause construction delays which have pushed the anticipated start-up date to the end of 1Q 2013. Breagh Phase 1 development costs have risen to $825 million which is 1.4 percent above initial estimates. Development drilling at the field has not been hampered by the construction delays. The first three wells will be flow-tested before the end of the year. A fourth well is expected to come on stream once field production is established.
Project Details: Breagh
Oct 23, 2012 – GeoGlobal Resources received disappointing results from the Sara-1 well offshore Israel. Approximately 321 feet of high quality reservoir sands were encountered but proved to be wet without commercial quantities of hydrocarbons. Logging runs provided evidence that gas had once migrated through the system. The Noble Homer Ferrington (DW semisub) drilled the well to a total vertical depth of 12,887 feet and is in the process of plugging and abandoning the well before being released. Data collected during the operation will be used to refine the geologic model of the area and to further evaluate other possible targets within the license.
Oct 23, 2012 – The partners in the Leviathan gas field offshore Israel are taking bids to add an international partner to the group to help distribute field development costs. Being offered is up to a 30% stake in the field. Sources indicate Australia’s Woodside Petroleum and Russia’s Gazprom are likely finalists in the bidding round. Leviathan holds an estimated 17 trillion cubic feet of gas and is expected to be brought into production in 2017. The bidding round is due to end in the coming month.
Project Details: Leviathan
Oct 22, 2012 – NSAI released an independent resource report covering the Adira Energy-owned Samuel License offshore Israel. The report indicates P50 estimates of 65.8 MMbbl of oil and 65.8 Bcf of gas in four structures within the license. “The initial well will target the Cretaceous section which is estimated to contain almost 38 million barrels of prospective oil equivalent,” CEO Jeffrey Walter said. Samuel comprises an area of 223 square miles in waters up to 330 feet deep.
Project Details: Samuel
Asia – SouthEast
Oct 25, 2012 – Salamander Energy’s Bualuang Bravo Platform construction project is on track to finish on time and within budget. The platform’s jacket has been fabricated and is en route to the Bualuang field where it will be positioned. Topside installation will begin shortly thereafter. Thai Nippon Steel was awarded the construction contract for the 16-slot platform in 1Q 2011. Through the Bravo platform, Salamander plans to double the amount of horizontal production wells currently in use and feels that production will increase from the current level of 11,500 bopd to 15,000 bopd in 2013. The Atwood Mako (400′ ILC) is scheduled to begin development drilling from the platform at the end of November.
Project Details: Bualuang
ROC Announces Successful Balai Cluster Appraisal
Oct 24, 2012 – Appraisal drilling activities at the Bentara-2 well in the Balai Cluster SFRSC have come to a stop upon reaching a total vertical depth of 9,038 feet. BC Petroleum was incorporated to manage the Balai Cluster Small Field Risk Service Contract and is comprised of ROC (48%), Dialog Group (32%) and Petronas (20%). Early results indicated and estimated net hydrocarbon pay in excess of 328 feet across a total interval of 2,132 feet. The well will now be cased and completed in preparation for well testing. Appraisal drilling is the first phase in pre-development of the license and is scheduled to take 18 months to execute. If pre-development is completed successfully the partners in BC Petroleum will submit a field development plan and work towards bringing the Balai Cluster into production.
S. America – Brazil
Oct 24, 2012 – Statoil, together with partner Sinochem, has completed drilling an appraisal well at the Peregrino South prospect offshore Brazil. Well 3-STAT-8-RJS intersected approximately 278 feet of high-quality oil-saturated sandstone reservoir in the Carapebus formation. Goals of the operation were to validate previous volume estimates and establish an optimal development plan. The joint venture will use the positive results from the appraisal to guide the Peregrino Phase II development.
Project Details: Peregrino
- Worldwide Field Development News Oct 13 – Oct 19, 2012 (mb50.wordpress.com)
- Worldwide Field Development News Oct 9 – Oct 15, 2012 (mb50.wordpress.com)
- Worldwide Field Development News Sep 22 – Sep 28, 2012 (mb50.wordpress.com)
- Worldwide Field Development News Sep 29 – Oct 5, 2012 (mb50.wordpress.com)
CNOOC Limited and Nexen Inc. announced that they have entered into a definitive agreement under which CNOOC Limited will acquire all of the outstanding common shares of Nexen for US$27.50 per share in cash.
The purchase price represents a premium of 61% to the closing price of Nexen’s common shares on the NYSE on July 20, 2012, and a premium of 66% to Nexen’s 20 trading-day volume-weighted average share price. Total cash consideration of approximately US$15.1 billion will be paid for Nexen’s common and preferred shares, and Nexen’s current debt of approximately US$4.3 billion will remain outstanding. The transaction, which will be completed by way of a plan of arrangement, is expected to close in the fourth quarter of 2012.
The acquisition of Nexen expands CNOOC Limited’s overseas businesses and resource base in order to deliver long-term, sustainable growth. Nexen will complement CNOOC Limited’s large offshore production footprint in China and extends CNOOC Limited’s global presence with a high-quality asset base in many of the world’s most significant producing regions – including Western Canada, the U.K. North Sea, the Gulf of Mexico and offshore Nigeria – focused on conventional oil and gas, oil sands and shale gas. In addition, Nexen management’s current mandate will be expanded to include all of CNOOC Limited’s North American and Caribbean assets.
Nexen had average production of 207 mboe/d (after royalties) in Q2 2012. In accordance with SEC rules, Nexen had 900 mmboe of proved reserves and 1,122 mmboe of probable reserves as of December 31, 2011. In addition, as of December 31, 2011, Nexen had best estimate contingent resources of 5.6 billion boe in accordance with Canadian National Instrument 51-101, predominantly in the Canadian oil sands.
The transaction will be funded by CNOOC Limited’s existing cash resources and external financing.
Mr. Wang Yilin, Chairman of CNOOC Limited said, “The acquisition reflects our strong belief in Nexen’s rich and diverse portfolio of assets and world-class management and employees. This is an exciting opportunity for us to build on our existing joint venture relationship with Nexen in Canada, and to acquire a leading international platform in the process. We strongly believe that this acquisition will create long-term value for CNOOC Limited’s shareholders.”
Commenting on the acquisition, Mr. Barry Jackson, Chairman of the Board of Nexen, said, “This transaction delivers significant and immediate value to Nexen shareholders. The Nexen Board is unanimous in its view that the transaction is in the best interest of Nexen and recommends shareholders vote in favor of the transaction.”
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.
- 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)
Nexen Inc. today reported that drilling operations are complete on the Kakuna sub-salt exploration well on Green Canyon block 504 located approximately 180 miles southwest of New Orleans in deepwater Gulf of Mexico.
The well did not encounter commercial hydrocarbons, and is now in the process of being plugged and abandoned. Kakuna was drilled to a depth of 30,300 feet at a total cost of approximately $120 million, net to Nexen ($80 million after-tax).
Nexen owns a broad inventory of exploration prospects in the Gulf of Mexico, including the sub-salt Miocene play in the central Gulf of Mexico and the Norphlet play surrounding our Appomattox discoveries.
The company’s 2012 exploration program includes approximately 15 offshore exploration and appraisal wells in the UK North Sea, West Africa and the Gulf of Mexico.
- USA: Statoil Extends Maersk Developer Contract for GoM Work (mb50.wordpress.com)
- Nexen profit hit by lower production (calgaryherald.com)
French supermajor Total, operator of Block OML138, announces the start-up of production of the offshore Usan field in Nigeria, in line with the planned schedule. Usan is the second deep offshore development operated by Total in Nigeria, coming on stream less than three years after Akpo.
Discovered in 2002, the Usan field lies around 100 kilometers off the South East Nigerian coast in water depths ranging from 750 to 850 meters. The Usan development comprises a spread moored Floating Production, Storage and Offloading (FPSO) vessel designed to process 180 000 barrels per day and with a crude storage capacity of 2 million barrels. Its size of 320 meters long and 61 meters wide makes it one of the largest vessels of this type in the world. Development involves 42 wells that are connected to the FPSO by a 70 kilometers long subsea network.
Yves-Louis Darricarrère, President Exploration-Production at Total, stated on the occasion:
“I’m particularly proud to announce start-up of this major project together with the concession holder NNPC. This project demonstrates the ability of Total, a key operator of large-scale deep offshore developments in the Gulf of Guinea, to lead ambitious projects that will contribute to increase production for the Group and for the country. Total as operator has introduced a number of technological innovations, among which is a solution that drastically reduces gas flaring and thus minimizes the project’s environmental impact. The development of Usan has involved a record 60% of local content man-hours and thus has contributed to strengthening the know-how of the Nigerian industry in the area of hydrocarbon exploitation in the deep offshore.”
The Usan project has involved an unprecedented level of Nigerian local content, with over 500,000 engineering man-hours and 14 million construction and installation man-hours performed in Nigeria. FPSO construction included an offshore integration of 3,500 tons of locally fabricated structures. In addition, large-scale training and capacity building programs were put in place, raising the skills of the local workforce to the benefit of future projects.
Total’s wholly owned subsidiary Total E&P Nigeria Ltd. operates OML 138 with a 20% interest, while Nigerian National Petroleum Corporation (NNPC) is the concession holder. Total’s partners are Chevron Petroleum Nigeria Ltd. (30%), Esso E&P Nigeria (Offshore East) Ltd. (30%) and Nexen Petroleum Nigeria Ltd. (20%).
Offshore Energy Today Staff, February 24, 2012
- Total starts production at Usan field in Nigeria (marketwatch.com)
- Usan Production Will Mitigate Yemen Loss, Nexen Says (mb50.wordpress.com)
- Geopolitical stakes in Nigeria: Curious role of the IMF (mb50.wordpress.com)
CB&I reported net income for the fourth quarter of $70.5 million, versus $63.2 million in 2010. Revenue for the quarter was $1.3 billion, with new awards of $772.4 million.
For the full-year, net income was $255.0 million. CB&I’s consolidated 2011 revenue was $4.6 billion, up 25% over 2010. Cash and cash equivalents as of December 31, 2011 were $671.8 million, versus $481.7 million as of December 31, 2010.
“I’m extremely proud of our employees for delivering another year of outstanding performance,” said Philip K. Asherman, President and CEO. “Looking to the future, we expect to continue to execute our healthy backlog, leverage our unique business model to capture growth opportunities, and help our clients meet the growing global demand for energy infrastructure, which gives us strong confidence in the future of CB&I.”
New Awards for 2011 totaled $6.8 billion, reflecting the company’s ability to capitalize on its global end markets across each of its business sectors. Noteworthy 2011 awards included a $2.3 billion contract in Australia for the Gorgon project, an Oil Sands contract for Kearl in Canada, a Gas Processing award in the U.S. for Dominion, an LNG storage project in the Asia Pacific region, an Offshore award for Nexen in the North Sea, a Refinery heater award in Russia, as well as various strategic Petrochemical and Refining technology licensing awards.
- USA: Helix’s Oil & Gas Revenues Rise on High Prices and Lift in Production (mb50.wordpress.com)
- Tenneco 4Q net income rises 67 percent (mysanantonio.com)
The contract consists of the fabrication of a 6,000 tons wellhead jacket and a 6,000 tons jacket for the PUQ (Production Utilities Quarters). The construction will be executed at the Vlissingen fabrication location and is scheduled to start in February 2012. Both jackets will have a height of 130 meters with a foot print of 45 x 45 meter. It is scheduled that the jacket will be ready for transportation to Nexen’s Golden Eagle oilfield in the UK North Sea, approximately 43 miles from Aberdeen, in the 2nd quarter of 2013.
“The award of the Golden Eagle jackets contract follows the successful execution of the Buzzard PS jacket contract in 2009, which formed the basis for the mutual confidence to fabricate the wellhead and PUQ jackets in parallel for delivery by 2nd quarter 2013”, according to Remco van Gilst, VP Business Development and Sales.
Tino Vinkesteijn, CCO of Heerema Fabrication Group adds: “Securing this contract will continue to safeguard employment at our Vlissingen facility and also create additional supply-chain jobs in this region, as it will directly follows the jackets currently under construction.” Tino continues: “The continuous improvement process of our safety culture, which is called ‘Building on Safety’, is secured and carefully taken into account in the overall project planning to achieve a safe and accident free working environment. We look forward to working again with our client Nexen to accomplish a safe execution and successful completion of this project.”
- UK Gov’t Approves USD 3.3 Billion Golden Eagle Development (mb50.wordpress.com)
- Nexen’s $3.3-billion North Sea project gets approved (calgaryherald.com)