Hess Bids High to Extend Utica Footprint

- Hess Bids High to Extend Utica Footprint

Wednesday, September 07, 2011
Hess Corp.

Hess has entered into an agreement with CONSOL Energy Inc. to acquire a 50 percent interest in CONSOL's nearly 200,000 acres in the Utica Shale in eastern Ohio for aggregate payments of $593 million.

"We are delighted with our entry into the Utica Shale, which enables us to build a strategic acreage position in an emerging unconventional play in the United States," said John Hess, Chairman and CEO of Hess Corporation. "We believe that this acquisition offers significant potential for future growth in reserves and production with most of the land either owned in fee or held by production with high net revenue interests. We are honored to partner with CONSOL, which has a long history and an excellent safety and operating record in the Appalachian basin. We believe that together our companies will build a profitable business and deliver important economic benefits for the residents of eastern Ohio."

Hess will pay CONSOL $59 million at closing, which is expected in October, and $534 million in the form of a 50 percent drilling carry of certain CONSOL working interest obligations over a five year period. The joint exploration and development plan calls for Hess to operate approximately 80,000 acres in Jefferson, Harrison, Guernsey and Belmont counties while CONSOL will operate approximately 120,000 acres elsewhere in eastern Ohio, including Portage, Tuscarawas, Mahoning and Noble counties. Appraisal drilling is expected to commence in the fourth quarter.

Oil & Gas Post

Promote Your Page Too
LINK

US Senator Pressures Regulators to Extend Drilling Leases

- US Senator Pressures Regulators to Extend Drilling Leases

Wednesday, August 03, 2011
Dow Jones Newswires
WASHINGTON
by Tennille Tracy

Sen. David Vitter (R., La.) is trying to pressure the Obama administration into extending hundreds of oil-drilling leases in the Gulf of Mexico.

In an announcement Wednesday, Vitter said he would block the nomination of a top official to the U.S. Interior Department until the department extends drilling leases set to expire this year.

Vitter contends the Interior Department adopted policies in the wake of the Deepwater Horizon oil spill that hampered drilling activity. As a result, he says companies should be allowed to operate for more time on their existing leases.

Vitter says there are more than 300 offshore leases in the Gulf of Mexico that are set to expire this year.

"If these leases are allowed to expire, they will revert to the federal government, killing jobs and cutting off potential revenue from exploration and production," Vitter said in a statement.

A spokesman for the Interior Department called the senator's move "perplexing" because the department has already taken steps to grant lease extensions. In June, for example, the Interior Department outlined a basic set of the criteria under which it would grant extensions.

"Sen. Vitter's request is perplexing, and we expect that he will lift his hold since we took action on this a month-and-a-half ago," spokesman Adam Fletcher said.

Vitter has been one of the most vocal critics of the administration's decision to impose a temporary ban on deepwater drilling in the wake of the oil spill. He has also complained about the pace of new permitting in the months since the ban was lifted in October.

Earlier this year, Vitter blocked the nomination of Daniel Ashe as director of the Fish and Wildlife Service until the Interior Department issued 15 deepwater exploration well permits. Vitter has since lifted his hold and Ashe has been confirmed to the post.

This time around, the senator is putting a hold on the nomination of Rebecca Wodder to become the assistant secretary for fish, wildlife and parks at the Interior Department.

Copyright (c) 2011 Dow Jones & Company, Inc.

Oil & Gas Post

Promote Your Page Too
LINK

BHP Billiton Bids High to Extend US Shale Footprint

- BHP Billiton Bids High to Extend US Shale Footprint

Friday, July 15, 2011
BHP Billiton plc

BHP Billiton and Petrohawk have entered into a definitive agreement for BHP Billiton to acquire Petrohawk for US $38.75 per share by means of an all-cash tender offer for all of the issued and outstanding shares of Petrohawk, representing a total equity value of approximately US $12.1 billion and a total enterprise value of approximately US $15.1 billion, including the assumption of net debt. The Petrohawk board of directors has unanimously recommended to Petrohawk shareholders that they accept the offer.

The transaction would provide BHP Billiton with operated positions in the three world class resource plays of the Eagle Ford and Haynesville shales, and the Permian Basin. Petrohawk's assets cover approximately 1,000,000 net acres in Texas and Louisiana, with estimated 2011 net production of approximately 950 million cubic feet equivalent per day (MMcfe/d), or 158 thousand barrels of oil equivalent per day (Mboe/d). At year-end 2010, Petrohawk reported proved reserves of 3.4 trillion cubic feet of natural gas equivalent (Tcfe). The company has a current non-proved resources base of 32 Tcfe for a total risked resource base of 35 Tcfe. Petrohawk reported gross assets of US $8.2 billion as at 31 March 2011 and US $390 million of profit before tax for the year ended 31 December 2010.

BHP Billiton CEO, Marius Kloppers, said the acquisition was a natural fit with BHP Billiton's strategy.

"The proposed acquisition of Petrohawk is consistent with our well defined, upstream, Tier 1 strategy and provides us with even greater exposure to the world's largest energy market, while also broadening our geographic and customer spread. Importantly, our offer and the associated substantial premium represent a unique opportunity for Petrohawk shareholders and recognize the growth opportunities embedded in its portfolio immediately.”

BHP Billiton Petroleum Chief Executive, J. Michael Yeager, said the Petrohawk acquisition would add high quality growth to the company.

"Petrohawk has a focused portfolio of three world class onshore natural gas and liquids rich shale assets. With over a decade of significant investment and volume growth ahead, this transaction would build on our recent acquisition of the Fayetteville shale in Arkansas and provides the potential to more than double our existing resource base. Following completion of the Petrohawk transaction, BHP Billiton Petroleum will be on track to deliver a compound annual production growth rate of more than 10 per cent for the remainder of the decade as we accelerate our shale development program and leverage our strategic capability in the deep water.

"Importantly, BHP Billiton would retain Petrohawk's sizable U.S. based workforce, which has been at the forefront of the technological innovation that brought about the economic viability of U.S. shales. We look forward to extending our dedication to safeguarding the environment and the communities where we operate and continuing our commitment to safe and responsible operating practices across all of our shale gas plays, including the world-class assets that Petrohawk would bring to our portfolio."

Petrohawk CEO, Floyd Wilson, stated, "We believe these premium oil and natural gas assets would benefit significantly by residing within a larger entity that can employ more capital intensity to accelerate their realized value. We are excited to see this transaction completed and to be part of the BHP Billiton organization."

The tender offer is expected to commence by July 25, 2011. The acquisition is subject to the terms and conditions set forth in the merger agreement, including a condition that at least a majority of the outstanding Petrohawk shares are tendered, that the waiting period under the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, has expired or been terminated and that clearance is obtained from the Committee on Foreign Investment in the United States, and other customary conditions. If the tender offer is completed, un-tendered shares of Petrohawk will be converted into the right to receive the same US $38.75 per share price paid in the tender offer. The transaction is to be financed from existing cash resources and a new credit facility and is not subject to any financing contingency. The transaction is expected to close in the third quarter of 2011.

BHP Billiton has engaged Barclays Capital and Scotia Waterous as financial advisors in connection with this Offer. Its legal advisors are Sullivan & Cromwell LLP and Morgan, Lewis & Bockius LLP in the United States. Barclays Capital will act as Dealer Manager for the offer. Petrohawk has engaged Goldman Sachs as its financial advisor in connection to this Offer. Its legal advisor is Simpson Thacher & Bartlett LLP.

Oil & Gas Post

Promote Your Page Too
LINK

ADX: Tunisian Govt Agrees to Extend Chorbane Permit

ADX: Tunisian Govt Agrees to Extend Chorbane Permit

Wednesday, May 11, 2011
ADX Energy Limited

ADX Energy Limited on Wednesday announced that the Tunisian authorities (Comite Consultatif des Hydrocarbures) have agreed to the extension of the current exploration period for the Chorbane permit by one year to the 12th of July 2012.

The Chorbane exploration permit contains the Sidi Dhaher prospect. All site preparations to drill the Sidi Dhaher exploration well have been completed and a ready to drill status has been achieved.

The Tunisian authorities (Ministry of Industry and Technology) have informed the Company during recent meetings in Tunis that the drilling of the Sidi Dhaher well is a priority and the required level of government authority supervision to ensure safe mobilization and efficient drilling operations will be provided. ADX anticipates that the appropriate measures for road clearance, traffic control and road safety will be available shortly.

ADX will continue to prepare for the drilling of the Sidi Dhaher well and provide a further update when a scheduled mobilization date is determined.

The Sidi Dhaher prospect is located in the 2,428km2 large Chorbane Exploration Permit onshore central Tunisia near the port city of Sfax. It is surrounded by several producing oil fields and extensive oil and gas infrastructure.

Participant interests in the Sidi Dhaher -1 well will be as follows;

• ADX Energy Ltd 40% Operator
• Gulfsands Petroleum Plc 40%*
• XState Resources Ltd 10%*
• Verus Investments Limited 10%*

(*The respective participant interests in the Sidi Dhaher well and the Chorbane Permit are based on the completion of all farmin obligations.)

Oil & Gas Post

Promote Your Page Too

Enterprise to Extend Eagle Ford Pipeline System

Enterprise to Extend Eagle Ford Pipeline System

Tuesday, May 03, 2011
Enterprise Products Partners L.P.

Enterprise Products Partners L.P. on Tuesday announced plans to build an 80-mile extension of its 350,000 barrel per day (BPD) Eagle Ford Shale crude oil pipeline, that would allow the partnership to serve growing production areas in the southwestern portion of the play.

The Phase II project would originate in Wilson County, Texas at the terminus of the partnership's previously announced 140-mile Phase I segment, and extend to a site near Gardendale, Texas in La Salle County, where a new central delivery point (CDP) is planned for construction that will feature 500,000 barrels of storage. Phase I is on schedule to begin service by the second quarter of 2012, with Phase II set to commence operations in the first quarter of 2013. When completed, the approximately 220-mile crude oil pipeline system will provide Eagle Ford Shale producers with access to the Texas Gulf Coast refining complex through Enterprise's integrated midstream network.

The Phase II extension, which is being designed with a capacity of 200,000 BPD, is anchored by a 10-year agreement with Chesapeake Energy Marketing, Inc. ("Chesapeake"), a subsidiary of Chesapeake Energy Corp., that Enterprise also announced today. As part of the long-term contract, Chesapeake has committed to 100,000 BPD of firm crude oil transportation capacity.

"We are very pleased to expand our relationship with Chesapeake in the Eagle Ford Shale by adding crude oil transportation to the various natural gas services Enterprise is already providing under long-term contracts," said A.J. "Jim" Teague, executive vice president and chief operating officer of Enterprise's general partner. "Including the Chesapeake agreement, we now have producer commitments for nearly all of the available capacity on Enterprise's Eagle Ford crude oil pipeline, with 320,000 BPD under 10-year contracts."

With more than 2.5 million acres under lease and potentially 15,000 wells to be drilled over the production life of the Phase II service area—based on the partnership's own research and information from producers—development activity in this region of the Eagle Ford Shale is expected to remain brisk for the foreseeable future. Estimates provided by producers also suggest that up to 3 billion barrels of crude oil are recoverable in the southwestern region of the play.

The Phase II project would address the lack of pipeline infrastructure in the southwestern crude oil production region of the Eagle Ford Shale and provide shippers with access to Enterprise's Sealy, Texas delivery point. The Sealy facility interconnects with the partnership's Rancho Pipeline and feeds into Enterprise's new ECHO crude oil storage terminal being constructed at a location along the Houston Ship Channel in southeast Harris County, Texas. The pipeline options available to shippers via the terminal would provide access to more than two million BPD of refining capacity in the Houston area.

Teague further stated, "Typical of the strategy that has positioned Enterprise as a key provider of midstream services in the Eagle Ford Shale, this latest agreement leverages our existing integrated network of assets to create a cost-effective and timely solution that will allow Chesapeake to maximize the value of their production by providing access to the largest refining market in the world."

Approximately 165 rigs are presently working in the Eagle Ford Shale, which have drilled more than 1,200 wells. Current production from the play is approximately 100,000 BPD of crude oil and condensate.

Enterprise Products Partners L.P. is the largest publicly traded partnership and a leading North American provider of midstream energy services to producers and consumers of natural gas, NGLs, crude oil, refined products and petrochemicals. EPD's assets include approximately: 50,200 miles of onshore and offshore pipelines; 192 million barrels of storage capacity for NGLs, refined products and crude oil; and 27 billion cubic feet of natural gas storage capacity. Services include: natural gas transportation, gathering, processing and storage; NGL fractionation, transportation, storage, and import and export terminaling; crude oil and refined products storage, transportation and terminaling; offshore production platform; petrochemical transportation and storage; and a marine transportation business that operates primarily on the United States inland and Intracoastal Waterway systems and in the Gulf of Mexico.

MOL to Extend Upstream Portfolio to Romania

MOL to Extend Upstream Portfolio to Romania

Wednesday, April 20, 2011
MOL

MOL has signed Concession Agreements with the Romanian National Agency for Mineral Resources for three exploration blocks. As announced on July 5, 2010, EX-1 (Voivozi), EX-5 (Adea) and EX-6 (Curtici) were awarded at the 10th Licensing Round to the consortium of MOL and Expert Petroleum. MOL is the operator of the projects, with 70% participating interest in the blocks, while Expert Petroleum holds the remaining 30%.

The blocks have a combined area of 3,434 square km and are located in the Pannonian basin, next to the Hungarian border. The exploration period is divided to a three-year initial term and an optional three-year phase. The initial work program includes 2D and 3D seismic measurements to be followed by drillings. Besides the good oil and gas potential, some of the blocks have unconventional potential as well.

The agreements are subject to the approval of the Romanian Government.

Zoltán Áldott, Executive Vice President of Exploration and Production Division commented, "We are pleased to extend our international upstream portfolio to Romania, where we have already been present as an important downstream player. We believe that we can benefit from our experience in the exploration of the Pannonian basin gathered during many decades and we look forward to commence the work as soon as practicable."

Szabolcs I. Ferencz, MOL Romania CEO added, "MOL Group has long term investment plans for Romania. Deploying upstream projects in Romania match perfectly with developing our filling stations network and logistics facilities."

Chevron Bids High to Extend Footprint in Norwegian Sea

Chevron Bids High to Extend Footprint in Norwegian Sea

Tuesday, April 19, 2011
Chevron Corp.
by SubseaIQ

Chevron Upstream Europe has successfully bid for the exploration rights in four blocks awarded in the Norwegian 21st Licensing Round.

The blocks are located in the Outer Vøring Basin in the Norwegian Sea, approximately 335 miles (540 kilometers) west of the coast of Bodø, in 6824 feet (2080 meters) of water. Chevron Norge AS has been appointed as the operator with a 40 percent equity in Production License PL598 comprising the blocks 6601/6 and 9 and 6602/4 and 7. The other participants in the blocks are ExxonMobil Exploration & Production Norway AS with 30 percent equity interest, Idemitsu Petroleum Norge AS with 10 percent equity interest and Petoro AS with 20 percent equity interest.

"Chevron is committed to building a focused portfolio of key exploration prospects worldwide," said Guy Hollingsworth, President of Chevron Europe, Eurasia and Middle East. "We view the deep waters of the Norwegian Sea as an area of significant resource potential and this acquisition advances our strategy of pursuing attractive and high-impact growth opportunities." Hollingsworth added, "This is Chevron's second award in the deep water of the Norwegian Sea and as operator, we look forward to working with our partners and bringing our technical expertise and capabilities to this high-potential area."

"Rick Cohagan, Managing Director of Chevron Upstream Europe said, "We are very pleased with the partnership which will complement the strengths of the four companies – Chevron's exploration experience from the West of Shetland and ExxonMobil, Petoro and Idemitsu's significant regional knowledge and long-term operational experience in the Norwegian Sea. We appreciate the strengthened license criteria imposed by the Ministry of Petroleum and Energy in Norway deep water operations and we will continue to apply Chevron's safety standards in all aspects of our operations."

BP, Rosneft Extend Deadline for Share Swap

BP, Rosneft Extend Deadline for Share Swap

Thursday, April 14, 2011
BP plc

BP has agreed with Rosneft to extend the deadline for completing the share swap agreement (previously announced on January 14) to May 16, 2011. The agreement between the two companies followed the April 8, decision of the arbitral tribunal to allow them to discuss extension of the deadline. This means that the share swap agreement will now not terminate on April 14, 2011.

The share swap agreement, between BP and Rosneft, together with the related Arctic Opportunity, were originally announced on January 14, 2011. Both the share swap agreement and the Arctic Opportunity remain subject to an interim injunction.

BP intends to continue with the arbitration process to obtain a final award on all outstanding issues, including whether or not the interim injunction should continue.

BP remains fully committed to TNK-BP as its primary business vehicle in Russia and fully supports its strategy and investment program, which should ensure its success for decades to come. BP also owns a 1.3% interest in Rosneft and has been exploring offshore Sakhalin for over a decade and engaging in Arctic studies.