Premier Oil Sees 60,000 Boepd Production in Second Half

- Premier Oil Sees 60,000 Boepd Production in Second Half

Thursday, August 25, 2011
Dow Jones Newswires
LONDON
by Iain Packham

Independent oil and gas company Premier Oil expects production to increase to around 60,000 barrels of oil equivalent a day in the second half of the year as its Chim Sao and Gajah Baru projects come on line in the next few weeks, Chief Executive Simon Lockett told Dow Jones Newswires Thursday.

First-half production averaged 36,900 barrels of oil equivalent a day, down from 46,600 in the first half of 2010 as unplanned maintenance work sapped production. Full-year production is estimated to be between 40,000 and 45,000, similar to levels in 2010.

Premier has put in place a $40 million investment program to minimize future disruptions and some of the work undertaken will actually boost production, Lockett said.

Premier said it expects second-half production to be higher than the first half as the Chim Sao project in Vietnam, which it operates, starts oil production in the next few weeks. This will be supplemented by the start of gas production at the Premier-operated Gajah Baru project in Indonesia.

Lockett said he expects production from Gajah Baru and Chim Sao will "push our production numbers up from the low end that we had in the first half of this year up to 60,0000 barrels [of oil equivalent] a day towards the back end of this year."

"That will keep us on track to deliver 75,000 barrels [of oil equivalent] a day back-end of next year and on to 100,000 barrels a day in the medium term, which is the stated target."

The company is also stepping up its exploration activities and estimates up to 20 exploration and appraisal wells will be drilled in the next 12 months, targeting around 300 million barrels of oil equivalent. It expects to drill 10 exploration wells in the second half of 2011 in Indonesia, Vietnam, Norway and the U.K.

Finance Director Tony Durrant told Dow Jones Newswires that Premier's exploration activities will cost around $250 million over 2011 and estimated that $150 million of that will be spent in the second half.

Premier said it has set itself an exploration target of achieving 200 million barrels of oil equivalent of reserve additions by 2015, of which around 75 million barrels have already been achieved.


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

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PetroVietnam to Start Output at 5 New Fields in 2nd Half

- PetroVietnam to Start Output at 5 New Fields in 2nd Half

Wednesday, July 06, 2011
Dow Jones Newswires
HANOI
by Vu Trong Khanh

State-run Vietnam Oil & Gas Group said that it is starting production at new fields in the second half of the year and beginning construction on a second refinery, as it seeks to increase production to feed its fast-growing economy.

The company, known as PetroVietnam, said it will begin producing at five oil fields, including two that are overseas. The announcement comes amid uncertainty about Vietnam's offshore program due to an increasingly bitter territorial dispute with China, which has involved Chinese harassment of Vietnamese oil prospecting activities.

PetroVietnam said it expects to begin production at Russia's Nenetsky field this month and at Dana field in Malaysia's SK305 Block in August.

Production at Te Giac Trang and the second phase of Dai Hung field will start in August, while output at Chim Sao field will begin in September, it said. The fields are between 100 kilometers and 350 kilometers off Vietnam's southern coast, an area that is far away from the area of dispute with China.

The company reported two new commercial findings in the first half, raising its proven crude oil reserves by 10.2 million metric tons.

Late last month, Vietsovpetro, a joint venture between PetroVietnam and Russia's JSC Zarubezhneft, announced that it had discovered additional oil in the Bach Ho field off Vietnam's southern coast, with tests confirming strong oil flow of 4,560 barrels a day.

Meanwhile, Malaysia's Petroliam Nasional Bhd., or Petronas, said last month that it and PetroVietnam have discovered oil offshore Vietnam, with confirmed oil flow of 5,200 barrels a day.

PetroVietnam said Wednesday that it will continue oil exploration Vietnam's continental shelf in the second half of this year, aiming to raise its proven crude oil reserves by 20 million-25 million tons in the period. It didn't say how large its current reserves are.

Meanwhile, the company said it and its partners will start building the Nghi Son oil refinery in northern Vietnam in the third quarter.

PetroVietnam said previously that it would work with Kuwait Petroleum Corp., Idemitsu Kosan and Mitsui Chemicals on the 200,000-barrel-a-day refinery in Thanh Hoa province.

PetroVietnam is targeting output of 7.8 million tons of crude oil in the January-June period, which will take its full-year output to 15 million tons, flat from last year.

It will sell 7.3 million tons of crude oil in the period, including 1.66 million tons to the Dung Quat refinery, which will likely produce 2.48 million tons of oil products in the second half, taking its 2011 output to 5.6 million tons, the company said.

The 130,000-barrel-a-day refinery is scheduled for a maintenance shutdown for two months starting July 15.

PetroVietnam had pretax profit of VND49.9 trillion in the January-June period, up 44% from a year earlier and meeting 68% of its full-year target, the company said.

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

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Barclays: Worldwide Spending to Pass Half Trillion Mark in 2011

- Barclays: Worldwide Spending to Pass Half Trillion Mark in 2011

Monday, June 13, 2011
Rigzone Staff
by Karen Boman

Worldwide exploration and production (E&P) spending in 2011 is expected to rise to 16 percent to $529 billion, compared with $458 billion in 2010, with strong year-over-year improvement in spending driven by large increases inside and outside North America, Barclays Capital today reported in its global E&P capital spending update.

E&P spending in North America is now forecast to be up 16.2 percent in North America and 15.5 percent outside of North America, compared with forecast increases in December 2010 of 11 percent globally, including seven percent in North America and 12 percent outside of North America. Barclays reports budgets have been revised dramatically higher in the U.S. and internationally for U.S. and European based independents, Southeast Asian companies and companies focused on the Middle East.

Spending increases this year will be led by North America, where high oil prices and the continued shift towards drilling in oil and liquids rich plays have resulted in solid growth. E&P capital spending for North America is expected to increase by 16.2 percent from $127.6 billion in 2010 to $148.3 billion in 2011.

Latin America, Europe and the Middle East are expected to be the strongest regions internationally for E&P spending. Petrobras' multi-year pre-salt development offshore Brazil and ambitious plans by Colombian state energy company Ecopetrol are driving the forecast increase in capital spending by Latin American companies, with spending in the region expected to be up 26 percent in 2011 to $65.5 billion from $52.1 billion in 2010, Barclays reported.

Spending increases of roughly 23 percent are anticipated both in Europe and the Middle East, with spending estimated at $39.9 billion this year in Europe and $22.1 billion in spending in the Middle East. India, Asia and Australia spending will be up 15 percent this year to $79.3 billion. Russian spending is expected to rise by three percent to $36.1 billion this year from 2010.

Capital expenditures for North Africa, where the "Arab Spring" of political demonstrations and civil war across the region has affected government and the economy, are anticipated to be down by over 16 percent to $25.2 billion this year due to sizable spending reductions by Egyptian General Petroleum Corp. and National Oil Corporation, as well as a reduction by Sonangol and lower spending for Nigeria National Petroleum Corp. as an election cycle concludes in Nigeria.

The U.S. continues to attract the majority of worldwide E&P spending at 21 percent; however, this percentage has continued to fall each cycle. Internationally, the India, Asia and Australia region absorbs the largest share of spending, which is being driven by large investments by Chinese national oil companies and Southeast Asian companies such as Malaysia's Petronas and Indonesia's Pertamina. In India, ONGC and Reliance are making significant investments in the region.


U.S. and European independents are stepping up spending internationally, with U.S.-based independents now forecasting international spending increases of 23 percent, up from four percent in December, while the European independents are anticipating spending growth of 23 percent versus 12 percent at the end of 2010. "We believe this is in part due to higher oil prices, higher cash flows, new exploration programs, and recent exploration success," Barclays said.

Spending among supermajors is expected to rise by 16 percent this year, led by Total, BP and Shell, compared with average spending growth of eight percent over the past five years. This increase is due to engineering and construction-related spending for several large liquefied natural gas projects, increasing Iraq spending, and increased deepwater drilling, especially in West Africa and Brazil.

While ExxonMobil remains the largest capital spender worldwide for oil and gas this year, Petrobras is quickly catching up; Petrobras and PetroChina may overtake ExxonMobil in spending in the next few years. Ninety percent of the top 20 spenders are expected to increase capital expenditures this year, with the exception of Russia-based Gazprom, which Barclays believes is primarily currency-related due to currency fluctuations in 2012, and Sonangol in Angola.

Barclays noted that the correlation between increased E&P spending and inflation-adjusted oil prices is significant, and expects a higher oil price environment to persist over the next several years driven by accelerating decline curves, continued difficulty finding and developing large reserves, increased demand in emerging markets, and tight spare capacity.

"Based on our view of a continued high oil price environment, we expect 2011 to mark the first year of multi-year double-digit spending growth internationally," Barclays said.

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