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Titanium Explorer Drillship Starts Petrobras Contract in U.S. Gulf

The ultra-deepwater drillship, Titanium Explorer, started  its drilling contract with Brazil’s Petrobras in the U.S. Gulf of Mexico, on Friday, December 7. 

The Titanium Explorer, formerly known as the Dragonquest, owned by Vantage Drilling, is contracted for eight years.

Under the contract, Brazilian-state controlled oil company Petrobras has the right to re-locate and utilize the Titanium Explorer on a worldwide basis.  Expected revenues over the eight-year contract term, excluding revenues for mobilization of the rig and costs escalations, are approximately $1.6 billion.

The drillship is a self-propelled, dynamically positioned vessel suited for drilling in remote locations because of its mobility and large load carrying capacity. It is currently equipped for drilling in water depths up to 10,000 feet, and is designed to drill in water depths up to 12,000 feet.

Related:

Titanium Explorer Drillship to Start Petrobras Contract in December

USA: Vantage Drilling Acquires Titanium Explorer Drillship

Titanium Explorer Drillship Starts Petrobras Contract in U.S. Gulf| Offshore Energy Today.

USA: EQT Starts Pilot Program of Converting Drilling Rigs to LNG

EQT Corporation today announced the launch of a pilot program to begin converting drilling rigs to liquefied natural gas (LNG), displacing the diesel used to power equipment at the well site. This program marks the first LNG rig conversion in the Marcellus Shale and will provide a cleaner burning alternative fuel for the region’s drilling operations.

“We want to be a leader in reducing the environmental impacts related to drilling and we are proud to be the first operator in the Marcellus to launch such a program,” states Steve Schlotterbeck, President Exploration and Production for EQT. “Along with safety, protection of the environment is top-of-mind for our employees, contractors, and of course communities. We continually look for opportunities to improve our operations and displacing diesel, by introducing the use of alternatives such as LNG and field gas, is one way of doing so,” Schlotterbeck continued.

LNG is natural gas in its liquid form and from a physical property standpoint is as safe as, or safer than, using traditional fuels, such as propane or diesel. LNG, if exposed, evaporates quickly and leaves no residue on water or soil. Compared to diesel, natural gas emits between 20% and 30% less carbon dioxide and has a fraction of the emissions of nitrogen oxides, sulfur oxides, and particulates.

There are other LNG benefits, such as a reduction in fuel costs — with LNG being about 40% less expensive than diesel. The use of LNG also provides another means of reducing our dependence on foreign oil imports — with sourcing coming from various U.S. shale plays. The LNG being used for EQT’s pilot program is produced locally from Marcellus natural gas reserves.

EQT’s initial rig conversion is now operating in Northern West Virginia; and pending evaluation of the pilot program, the Company hopes to convert additional rigs in West Virginia and Pennsylvania.

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BP Starts Galapagos Development in U.S. GoM

Yesterday BP announced that on June 3, 2012 it began the initial start-up of the Galapagos development in the deepwater U.S. Gulf of Mexico, one of a series of new major upstream projects that the company expects to bring into production this year.

“The start-up of this project in the Gulf of Mexico is one of BP’s key operational milestones for 2012, one of six high-margin projects we expect to come on stream this year,” said Bob Dudley, BP group chief executive. “I expect that the operational progress we are now making will deliver increasing financial momentum for BP as we move into 2013 and 2014.”

The Galapagos development includes three deepwater fields and increases the capability of a key offshore production hub for BP. The fields – Isabela, Santiago and Santa Cruz – are being produced using subsea equipment on the floor of the Gulf. A new production flowline loop has been added to carry output to the nearby Na Kika host facility, a BP-operated platform located roughly 140 miles southeast of New Orleans in 6,500 feet of water.

The Na Kika facility, with a production capacity of 130,000 barrels of oil equivalent per day, has been modified to handle output from the three fields. Full ramp-up of the project is expected around the end of June.

“The Galapagos development marks another significant step forward for BP in the Gulf of Mexico, and reflects the potential we continue to see in this world-class basin, now and in the future,” said James Dupree, Regional President of BP’s U.S. Gulf of Mexico business.

BP’s overall interest in the three-block area that includes the fields comprising the Galapagos project is about 56 per cent. Noble Energy, Inc., Red Willow Offshore, LLC, and Houston Energy, L.P., are co-owners. BP is the operator of the Isabela field, while Noble Energy operates the Santiago and Santa Cruz fields.

The Galapagos development required the installation of new subsea infrastructure, production risers, topsides as well as other modifications.

BP expects to invest at least $4 billion a year on oil and gas development in the Gulf of Mexico over the next 10 years, following its strategy of focusing investment and future growth around the company’s strengths, including deepwater exploration and development.

“BP’s continuing investment in the Gulf of Mexico is yet another example of our commitment to the U.S. economy and energy security,” Dudley added. “This investment, along with our ongoing commitment to the Gulf Coast region, demonstrates the importance of the U.S. to BP’s long term strategy.”

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Ocean Rig Corcovado Starts Drilling Offshore Brazil

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Ocean Rig UDW Inc., a global provider of offshore deepwater drilling services, today announced that on May 15, 2012,  its Ocean Rig Corcovado drillship completed the general testing of equipment as required by Brazil’s oil giant Petrobras.

The drillship has now commenced revenue-generating drilling operations in Brazil. The Ocean Rig Corcovado will stay with Petrobras for three years on a contract worth approximately $650 million.

This is the second Ocean Rig’s drillship under a contract with Brazil’s state controlled Petrobras. The company’s Ocean Rig Mykonos drillship had started drilling offshore Brazil in March this year under a similar contract.

Ocean Rig’s drillships are based upon the Saipem 10K design, and built by a proven shipyard, Samsung Heavy Industries. They are a successful and well proven design complete with full dual derrick enhancements to ensure optimal operational efficiency.

The company owns and  operates 9 offshore ultra deepwater drilling units, comprising of 2 ultra deepwater semisubmersible drilling rigs and 7 ultra deepwater drillships, 3 of which remain to be delivered to the company during 2013.

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Petrobras: Production Starts at Cascade Field (USA)

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Brazil’s Petrobras announced that, on February 25, 2012, production started at Cascade Field, U.S. Gulf of Mexico. The Cascade 4 well is connected to the FPSO BW Pioneer, located approximately 250 kilometers of coast of Louisiana in water depth of 2500 meters.

The BW Pioneer is the first FPSO to produce oil and gas industry in the U.S. Gulf of Mexico, and is capable of processing 80,000 barrels of oil per day. The ship has a disconnectable mooring system that allows moving to sheltered areas during hurricanes and storms.

Petrobras is the first company to develop an oilfield in the Gulf of Mexico with the use of a FPSO model already successfully applied systematically in Brazil.

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