Shell Seeks Okay for 2D Survey Offshore NW Australia

- Shell Seeks Okay for 2D Survey Offshore NW Australia

Monday, September 12, 2011
Shell Australia

Shell is seeking Federal Government environmental approval for a small 2D marine seismic survey off the North West Cape.

Subject to approvals the survey is planned to have a duration of around 12 days and to take place during the period from mid-November 2011 to the end of March 2012 avoiding the humpback whale migration.

At closest point the survey will be around 25km from Ningaloo Reef. As detailed in our environmental documentation Shell has elected that the 2D seismic survey will not come within a 10km buffer zone of the Ningaloo World Heritage Area.

The seismic survey is the final work commitment for permit WA-385-P in the current term.

In July 2011 Shell received environmental approval for the Palta-1 gas exploration well in adjacent permit WA-384-P.

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EPA Seeks Comments on Drilling Air Quality

- EPA Seeks Comments on Drilling Air Quality

Tuesday, August 30, 2011
The News Herald, Panama City, Fla.
by Ali Helgoth

The Environmental Protection Agency (EPA) is accepting public comment on an air quality permit sought by a company that plans to conduct exploratory oil drilling 200 miles off the coast of Panama Cit Beach.

http://www.epa.gov/region4/air/permits/OCSPermits/ShellOCS.html

Shell Offshore applied for an Outer Continental Shelf air permit for mobilization and operation of deepwater drilling vessels and support vessels in two area lease blocks in the Gulf of Mexico, DeSoto Canyon and Lloyd Ridge.

Drilling would last about 150 days per year for five to 10 years, according to a preliminary determination issued by the EPA, which has proposed approval of the permit. Shell does not have plans to establish permanent production platforms, and if the exploration project leads to resource discoveries, additional permits would be required, according to information from the EPA.

The project is southwest of Bay County, about 160 miles southeast of the mouth of the Mississippi River.

A representative from Shell, which initially filed the permit in April 2010, could not be reached Monday for comment.

Public comment is being accepted through Sept. 19 and is limited to air quality issues. Other concerns, like those with drilling safety, the leasing process or discharge, should be directed to the Bureau of Ocean Energy Management, Regulation and Enforcement, which is the lead permitting agency for the project.

Air pollution emissions generated from the project "are primarily released from the combustion of diesel fuel in the drillships' main engines, as well as in engines that supply power for operating drilling equipment and support vessels," according to the EPA's preliminary determination.

The document states "since the project is located well away from land, the project's emissions impacts will be dispersed over a wide area with no elevated concentration levels affecting any onshore populated area."

The project isn't expected to result in job growth. According to the EPA, "the potential growth of industrial, commercial and residential sources as a result of the proposed DeSoto Canyon and Lloyd Ridge drilling exploration activities in the area just west of the proposed drilling activities is well developed. It is expected that the current infrastructure is more than adequate to support the proposed drilling activities, and no additional growth is expected."

(c)2011 The News Herald (Panama City, Fla.). Distributed by MCT Information Services.

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ONGC Videsh Seeks Producing Assets In Politically Stable Countries

- ONGC Videsh Seeks Producing Assets In Politically Stable Countries

Tuesday, August 30, 2011
Dow Jones Newswires
NEW DELHI
by Rakesh Sharma

Oil & Natural Gas Corp. (500312.BY) is seeking producing assets in politically stable countries as it seeks to cut its geographical risks, the head of the Indian explorer's overseas investment unit said Tuesday.

"We have investments in many risky countries. We would be diversifying to more stable countries like North America," Joeman Thomas, managing director of ONGC Videsh Ltd., told reporters on the sidelines of a news conference.

The social and political upheaval in the Middle East and North Africa has drastically raised the risk profile of some prolific international basins that hold substantial hydrocarbon reserves, impacting investment plans of global oil and gas explorers, ONGC said in its annual report earlier this month.

OVL holds stakes in exploration blocks in places like Libya, Syria and Sudan, which have been hit by political unrest.

Thomas said the decision on re-adjusting the portfolio was taken about two years ago. He added that the company aims to acquire producing properties over the next two to three years as it has a mandate to source 20 million tons, or 400,000 barrels a day, of crude from overseas assets by 2020.

OVL expects its share of output from overseas assets at 8.75 million tons in the current financial year through March 2012, he said.

In March this year, India's top auditor had criticized OVL over its investments and joint ventures overseas saying that the explorer wasn't able to mitigate risks and leverage the benefits from the financial strength and expertise of the joint venture partners. The auditor said that OVL needed to improve its core competence in the evaluation of investment opportunities.

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

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Mid-Con Energy Seeks Approval for IPO

- Mid-Con Energy Seeks Approval for IPO

Friday, August 26, 2011
Tulsa World, Okla.
by Rod Walton

Privately held waterflood oil producer Mid-Con Energy LP is seeking federal approval for an initial public offering as a master limited partnership.

The form S-1 registration request, filed earlier this month with the U.S. Securities and Exchange Commission, estimates a maximum of $140 million in equity from the proposed IPO. If granted, Mid-Con Energy hopes to be listed on the Nasdaq electronic exchange under the ticker symbol MCEP.

"Our management team has significant industry experience, especially with waterflood projects and, as a result, our operations focus primarily on enhancing the development of producing oil properties through waterflooding," the S-1 filing reads.

Mid-Con President Randy Olmstead founded the company seven years ago with capital from equity firm Yorktown Partners. Mid-Con's operating subsidiary, RDT Properties Inc., was started in 1986 to buy and operate mature waterflood properties.

The new partnership was incorporated last month in Delaware. Mid-Con Energy's production is focused on properties in southern and northeastern Oklahoma and Colorado.

The fields "primarily consist of mature, legacy onshore oil reservoirs with long-lived, relatively predictable production profiles and low production decline rates," the federal filing reads. More than 90 percent of Mid-Con's properties are produced under waterflood techniques, in which water is injected into the reservoir formation to displace residual oil and into adjacent production wells.

Mid-Con Energy's proved reserves totaled an estimated 7.9 million barrels of oil equivalent, most of that crude oil.

The master limited partnership structure eliminates corporate taxes on profits. The MLP is required to distribute much of its available cashflow through distributions to unitholders, who are taxed on those payouts.

Mid-Con is the fourth Tulsa energy firm to go public or announce a planned IPO in recent months. On Wednesday, Laredo Petroleum filed its own SEC papers seeking an initial public offering raising up to $450 million in equity.

Tulsa-based propane marketer NGL Energy Partners LP held its IPO earlier this year and is listed on the New York Stock Exchange.

Williams Cos. Inc. plans to set a partial IPO for its exploration and production subsidiary, WPX Energy Inc., later this year. The rest of WPX will be separated in a tax-free spinoff to Williams shareholders in 2012, according to reports.

Copyright (c) 2011 Tulsa World (Tulsa, Okla.)

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ExxonMobil Seeks to Retain Julia Leases in GOM

- ExxonMobil Seeks to Retain Julia Leases in GOM

Thursday, August 18, 2011
Rigzone Staff
by Karen Boman

ExxonMobil has filed a lawsuit against the U.S. Department of the Interior (DOI) to retain three federal offshore leases that are part of the Julia unit in the deepwater Gulf of Mexico.

The company filed the suit in the U.S. District Court in Lake Charles, La., stating that DOI has retroactively applied new legal standards in canceling the leases, departed from established agency practices, and singled out ExxonMobil for unprecedented adverse treatment. ExxonMobil also said the cancellation would prevent it from producing a reservoir believed to hold billions of barrels of oil.

ExxonMobil is operator of the Julia unit on Walker Ridge Block 627, which is comprised of Walker Ridge Blocks 584, 627, 628, 540 and 583; the first three are the original leases issued to ExxonMobil’s predecessor, Mobil Exploration and Production in 1998. The two additional leases were acquired by ExxonMobil and partner Statoil at the request of the U.S. Minerals Management Services (MMS) when it applied to develop the Julia discovery. ExxonMobil holds a 50 percent title interest in each of the leases within the Julia unit. Statoil holds the remaining 50 percent interest. ExxonMobil and Statoil announced the Julia discovery in the deepwater Gulf in January 2008.

The company contends that it is allowed under the law to suspend production in their fields in recognition of the time and planning needed to tie back subsea wells to deepwater host facilities. ExxonMobil had originally filed for a suspension of production (SOP) order for the three original Julia leases in 2008, saying it needed time to determine its drilling and development program for the Julia discovery, one of several pre-Tertiary deepwater discoveries made over the past decade.

MMS told ExxonMobil it needed to include Walker Ridge Blocks 540 and 583 to promote an expedite exploration and development. The company withdrew its original SOP request with the intent of submitted a new SOP for the entire Julia unit with the additional leases. ExxonMobil and Statoil acquired the two additional leases at a cost of over $60 million days before the end of the primary term of the original Julia leases. In the meantime, it continued drilling and development plans, investing $300 million dollars on the Julia discovery and drilling two producible wells. However, MMS denied the SOP request in 2009, saying it failed to show commitment to development the discovery.

ExxonMobil said MMS did not clearly specify what ExxonMobil needed to do to receive approval of the requested SOP and supplemented its original SOP request with numerous emails and letters demonstrating its commitment to produce the Julia discovery. ExxonMobil said it also made clear that if a plan to tie-back Julia to the Jack-St. Malo host facility was deemed insufficient that it would develop the Julia discovery as a standalone alternative.

The company said that MMS had granted more than 2,200 requests for SOPs for individual leases in the Gulf from 1994 through 2008 and denied only 33 such requests, and had often granted a series of sequential SOPs for a single lease or unit, resulting in delays in production commencement for periods of longer than five years after the initial SOP was granted. ExxonMobil noted that cancellation of the leases would give DOIG the opportunity to collect millions of dollars in bonuses and royalties that it would be entitled to collect if the original Julia leases are not canceled.

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Shell Seeks Best Drilling Sites in Butler, Lawrence Gas Fields

- Shell Seeks Best Drilling Sites in Butler, Lawrence Gas Fields

Thursday, July 14, 2011
Knight Ridder/Tribune Business News
by Timothy Puko, The Pittsburgh Tribune-Review

Bill Langin is playing a giant game of Battleship in Butler and Lawrence counties, using a drill rig to plot targets in the Marcellus shale.

Langin is in charge of Appalachian exploration for Royal Dutch Shell plc, which holds the mineral rights to about 100,000 acres in the two counties and more land in northern Pennsylvania. About a year ago, Shell bought East Resources Inc. of Marshall for nearly $5 billion, and the company just finished drilling its first well in this part of the state.

Langin, 34, of Moon is not a wildcatter looking to drill in the sweetest spots he can find. His job is to drill in outlying areas, looking for data, zoning in on targets he cannot see. He asks: Where can Shell drill in its Appalachian holdings and profit?

"Sometimes (the testing) works; sometimes it doesn't. It's kind of sketchy, so the only way you can really gauge the production is once you drill a well," said Langin, a Luzerne County native and Ivy League graduate who spent most of his career working on projects in the Gulf of Mexico and off the shore of Brazil.

His team of 12 geologists and engineers does radiation testing, taking thousands of feet of core samples from underground and reviewing production data from other wells. To answer questions that data cannot, they drilled an 8,600-foot exploration well in Little Beaver, Lawrence County. Its rig is 142 feet tall, twisting thousands of feet of steel pipe into the earth. At the bottom, the well reaches out 5,000 feet sideways into the next town.

The work in this fringe area of the Marcellus shale fairway is part of escalating drilling in Butler and Lawrence counties. Shell also is tapping into the Utica shale, a gas-rich layer that is deeper and extends beyond the Marcellus formation.

Shale gas extraction in Pennsylvania remains under a spotlight, and corporations such as Shell, Exxon Mobil Corp. and Chevron Corp. moved into the region a year ago, buying big stakes. The companies have different ways of estimating potential quantities of gas, experts said.

"They're not just looking at their own land. They're evaluating all of it," said Anthony Ingraffea, professor of civil and environmental engineering at Cornell University. "Eventually it's going to be the last four or five (companies) standing, and Shell plans to be one of those."

Shell plans to bring in a drill rig dedicated to the region next year. If things go well, it could add nine more. The company will spend two to four years determining how rich the land is with gas, and whether to drill here before tapping other oil and gas fields around the world, Langin said.

Shell continues to lease land in Butler and Lawrence counties, adding about 30,000 acres to the 70,000 it bought from East last year, Langin said. Its big-picture exploration methods not only help the company gauge and manage holdings, but help its officials to decide where to lease land, said Badie Morsi, director of the University of Pittsburgh's Petroleum Engineering Program.

It's difficult to determine how much gas the Marcellus shale will produce in a given location. Pressure and natural fractures vary, Morsi said, meaning drillers can only approximate reserves.

"It's very difficult to make generalizations," Morsi said. "It depends upon your luck. You're shooting in the dark at 10,000 feet. It's not a known thing where you go in and grab it."

It's common for multinational corporations such as Shell to take the time for advance work, Morsi said. If they drill edge areas first, the production there can indicate how much gas is inside the circle, he said.

That helps companies to plan efficiently for infrastructure costs, such as pipelines and compressor and processing stations, Langin said. They know the gas is there, but they must figure out how much is there and how hard it is to extract -- then they can determine how high gas prices must be before drilling would be profitable.

Texas-based Range Resources also has holdings in Butler County. It tapped the first successful Marcellus well more than six years ago in Washington County, and being first on the scene brought competitive advantages, spokesman Matt Pitzarella said.

Instead of expanding in new territory, the company is concentrating on Washington and Lycoming counties, where shale formations hold gas and other marketable resources, Pitzarella said.

Range touts research from global financial services firm Morgan Stanley that says those Marcellus areas could turn a 10 percent initial profit, even with natural gas prices as low as $3 per million British thermal units (Btus) on the New York Mercantile Exchange. Natural gas futures for August delivery closed Friday at $4.2 per million Btus.

"It's not that we don't like those areas (north of Pittsburgh), but we're focused on where we believe our highest rate of return is," Pitzarella said.


Copyright (c) 2011, The Pittsburgh Tribune-Review

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Gold Oil Seeks Farm-In Candidates Offshore Peru

- Gold Oil Seeks Farm-In Candidates Offshore Peru

Monday, July 11, 2011
Gold Oil plc

Gold Oil provided the following update on its operations on Block Z34, offshore Peru.

On July 4, 2011 Gold Oil signed a definitive agreement with BGP Geoexplorer PTE Ltd for the acquisition of a marine 3D seismic survey over Block Z34 offshore Peru. The survey has been extended and is now planned to be in excess of 800 sq km over both the southern and northern part of the license area. This survey comprises the first phase of 3D seismic over the license. Depending on the results of the seismic interpretation further seismic may be required, particularly in the northern area, to evaluate completely this large and highly prospective block.

The vessel, the BGP Pioneer, departed the port of Paita, north west Peru on 6th July having met all customs clearances and commenced operations on July 9, 2011. Given the expanded scope of the survey, data acquisition is now expected to take approximately 50 days. Following the acquisition of the survey, processing and initial interpretation is expected to take a further four months. Preliminary results and the marketing of the asset to potential farm in candidates is likely, therefore, to commence towards the end of the year.

Richard Mew, Chief Executive, commented, "It is encouraging that we have been able to secure a high quality contractor at favorable rates which has enabled the Company to expand the scope of the survey to include part of the northern area. The extended survey is designed to enhance the attractiveness of the block to potential farm in candidates and will also accelerate the full evaluation and commercialization of this very promising and prospective acreage."

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Kosmos Seeks Force Majeure on Transocean Semisub

- Kosmos Seeks Force Majeure on Transocean Semisub

Thursday, July 07, 2011
Kosmos Energy Ltd.

Kosmos Energy provided an update on the company's drilling of the Cedrela-1 exploration well offshore the Republic of Ghana. The Transocean Marianas semisubmersible drilling rig, under contract to another operator in Ghana, was expected to arrive at the Cedrela-1 well location on the West Cape Three Points Block on or about July 10 to commence drilling Kosmos' Cedrela-1 well near the block's southern boundary. The rig was rendered temporarily inoperable following a reported anchor-handling incident on the Offshore Cape Three Points Block, which is east of the Kosmos-operated West Cape Three Points Block. The incident occurred while preparations were being made to move the rig from the other operator's block to the Cedrela-1 well location.

Kosmos has delivered a force majeure notice to the government of Ghana and the Ghana National Petroleum Corporation due to the delay in the rig's scheduled arrival at the Cedrela-1 well location. As a result, Kosmos has begun a search for a substitute drilling rig and intends to drill the Cedrela-1 well when either the Transocean Marianas or an alternative rig becomes available. The company has the necessary approvals to drill the Cedrela-1 well and anticipates that a rig will be available soon.

Kosmos is the operator of the West Cape Three Points Block in which the company holds a 30.875% interest. An affiliate of Anadarko Petroleum Corporation has a 30.875% interest; an affiliate of Tullow Oil plc has a 22.896% interest; E.O. Group Limited has a 3.5% interest; Sabre Oil & Gas Holdings Limited has a 1.854% interest; and the Ghana National Petroleum Corporation has a 10% carried interest.

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Cooper Seeks New Managing Director

- Cooper Seeks New Managing Director

Wednesday, June 15, 2011
Cooper Energy Ltd.

Mr. Scott has indicated his desire to hand over the reins of the Company and the Board of Cooper Energy has resolved to seek a new Managing Director to take the Company to the next growth level.

Mr. Scott will step down as the Managing Director and Director of Cooper Energy and all subsidiaries and will continue in a staff position to assist the Company to maintain its course during the search for a new Managing Director. Upon a new Managing Director being located, Mr. Scott will serve out his contractual notice period of six months and handover the responsibilities of running the Company to
the new Managing Director. The Board has initiated the search for a suitable replacement.

Mr. Michael Scott, current Managing Director, commenced with Cooper Energy on February 4, 2004. At that time the Company was an emerging Cooper Basin producer with 3 oil wells producing 600 barrels of oil per day and six exploration blocks in the Cooper Basin in South Australia. The Company now has ten oil fields with an oil production capacity in excess of 1,500 barrels of oil per day in Australia and Indonesia and a deep international exploration and appraisal/development portfolio across Australia, Indonesia, Tunisia, Poland and Romania. The Board thanks Mr. Scott for his contribution to the Company over the last seven and a half years.

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Commissioner Seeks to Complete Rule-Making on Fracturing Bill a Year Early

- Commissioner Seeks to Complete Rule-Making on Fracturing Bill a Year Early

Friday, June 03, 2011
Rigzone Staff

Texas Railroad Commissioner (TRC) David Porter said would push the Railroad Commission (RRC) to complete the entire rule-making process requiring disclosure of chemicals used in hydraulic fracturing a year ahead of the deadline set in recent legislation.

The Texas Legislature on May 31 sent a bill to Governor Rick Perry on requiring the RRC to write disclosure rules for hazardous chemicals by July 1, 2012. The bill requires the RRC to complete rule-making for all other chemicals used in the process by July 1, 2013.

"In order for Texans to maintain confidence in the oil and gas industry, it is important for us to get this done as quickly as possible," said Porter. "Hydraulic fracturing has been an economic driver for Texas, creating hundreds of thousands of jobs and adding billions of dollars to local economies. We are currently seeing record activity in the Eagle Ford Shale due to hydraulic fracturing which is why I am creating a task force to study these very issues. We need to assure the public that hydraulic fracturing is safe and responsible – and has been for the past sixty years – and we need to do it now."

The RRC will begin the rule-making process at its next open conference this month and will hold open meetings throughout the state in coming months to garner public comment.

Porter said the agency may increase the number of members on TRC's newly formed Eagle Ford shale task force from the original plan for between 15 to 18 members due to the quality of applications. TRC is reviewing applications now and hopes to have selected all members of the voluntary task force, which will include a mix of energy industry members, local environmental groups, elected officials and landowners in the Eagle Ford shale area of South Texas, by the end of June.

TRC decided to form the Eagle Ford shale task force to head off the perception and communication problems encountered with the Barnett shale gas drilling boom hit Texas. "We're trying to be proactive, not reactive," Porter said.

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McKinley Seeks to Keep Marcellus Jobs in W.Va.

- McKinley Seeks to Keep Marcellus Jobs in W.Va.

Tuesday, May 31, 2011
Knight Ridder/Tribune Business News

Rep. David B. McKinley, RW.Wa., posted on Facebook last week that he is co-sponsoring legislation from Rep. Mark S. Critz, D-Pa., to augment on-the-job training programs for the Marcellus shale industry.

HR 1396 amends the Workforce Investment Act of 1998 to require the U.S. secretary of labor to make discretionary grants to local areas for adult on-the-job training or dislocated worker on-the-job training at worksites directly related to the exploration, production and transportation of natural gas from the Marcellus shale formation.

"Discovery of Marcellus shale has already created hundreds of jobs in northern West Virginia and we must protect those jobs for West Virginians," McKinley said. "We have seen our local hotels to capacity with out-of-state workers doing the same job that our workforce could handle with the proper training. The resources our state naturally has should be used for the benefit of the people from our state. ... We must do everything we can to get our state back to work and this piece of legislation is a step in the right direction for achieving that goal."

The posting notes that McKinley is also a founding member of the bipartisan Congressional Marcellus Shale Caucus, devoted to discussing how to best harness the economic development and energy independence potential of Shale gas production while providing reasonable protections for landowners and the environment.

Copyright (c) 2011, The Dominion Post, Morgantown, W.Va.

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Schilling Seeks to Reach New Depths in ROV Technology

- Schilling Seeks to Reach New Depths in ROV Technology

Friday, May 20, 2011
Rigzone Staff
by Karen Boman

Demand for remotely operated vehicles (ROVs) in the offshore oil and gas industry, which uses ROVs for well drilling and development, production facility construction and inspection, repair and maintenance, will continue to grow as strong oil prices and the global economy recovery spur worldwide exploration and development efforts.

Since its establishment in 1985, Schilling Robotics has primarily focused on ROV development for the oil and gas industry. The company's slogan, "So Deep, No One Comes Remotely Close," sums up the company's aim of expanding the technical capabilities of ROVs.

The evolution of subsea systems from mostly static to more dynamic and complex mean that ROVs must be capable of performing complex tasks, said Tyler Schilling, CEO and founder and Schilling Robotics. This evolution has occurred as exploration and production efforts move further in the world's deepwater regions.

Last year, the company launched its Heady Duty (HD) ROV system that can accommodate specific needs of the inspection, maintenance and repair, drill support and medium-duty construction markets. Schilling won the Offshore Technology Conference (OTC) Spotlight on Technology award for its HD ROV, which is rated for 13,123 feet (4,000 m) to allow for more effective remote deepwater intervention.

Development of this ROV was driven by Schilling's goal of wanting an ROV that could conduct service and repair activities in less than an hour. "Changing out a pump on a conventional hydraulic power unit can take three to six hours to do properly, and is expensive, with the most expensive as much as $9 a second to operate," Schilling said. "Being able to eliminate a three to five hour repair operation is a huge savings for our customers." Schilling said efforts are underway to map these technologies for fast service and repair for Schilling's UHD ROV model.

The Davis, California-based company has been collaborating with FMC Technologies to improve remote intervention of subsea equipment. Schilling accepted an investment from FMC in the company last year because "the direction we believe remote intervention needs should go in are related," said Schilling. While Schilling conducted all the development work on its HD ROV, input from FMC helped Schilling better understand the requirements that oil and gas companies have for ROV technology.

As part of this collaboration, Schilling has been working to developing an ROV system in which the camera and other equipment will target visual aids that FMC has installed on its subsea equipment panels. This allows the ROV system to do automatic work on the panels. Developing ROVs and subsea equipment together makes for more efficient and effective subsea intervention operations, Schilling said. "We believe further extensions of this technology will have ROVs capable of reading codes from those symbols and knowing what the characteristics of those underwater devices. This means that operators will not need to keep track of quite as much specification information. Information will be automatically retrieved, not unlike bar coding at the store that tells the cash register what item you're scanning."

This joint development is a new practice within the energy industry, but if we can cut the time it takes to do a single activity, it would really help customers, Schilling said. "It's not uncommon to have a circumstance in which an ROV can't actually perform the activity intended by the sea floor equipment designer, so operators have to improvise offshore to get a task done," Schilling said. "We're trying to bring about circumstances in which the ROV and the subsea floor equipment are designed together."

Since the Macondo oil spill in the Gulf of Mexico last year, which brought ROV and other offshore work in the region to a halt, Schilling has seen its customers wanting accessories for ROVs that allow them to deliver fluids, and that can override a blowout preventer at a much higher rate. While the BOP is typically actuated from the drilling rig, an ROV can be used as a backup if remotely closing it fails. The ROV will fly over the BOP with a hot stab, plug the hot stab into a panel, causing it to close.

One general trend Schilling sees for ROVs is greater degree of automation, or intent interface, for ROVs. "Rather than an operator pushing all the little buttons to make this complicated machine work, they tell the machine what they intend to do, and the machine takes care of the rest," Schilling said.

This trend has led Schilling to focus on making machines easy to use as their use in offshore oil and gas grows. The company has developed a method to simplify hot stabs, which are used to power hydraulic tools, transfer fluid, perform chemical injections, and to monitor pressure, in which a robot arm on the ROV places a hot stab in a receptacle on a subsea tree.

Schilling also has developed a stationkeeping system for its UHD and HD ROVs to automatically position an ROV; before that, ROVs had to be controlled manually, meaning an ROV pilot would have to monitor the ROV's position in relation to a Christmas tree and issue corrective commands through a joystick. Now, a computer monitors the ROVs' position, allowing the pilot to focus on the job he or she is getting paid for, which is getting quality video, Schilling said..

Additionally, the company has developed a wrist-mounted camera to allow ROV pilots to perform closer inspection tasks. This product is available to any customer who buys a manipulator from Schilling.

Breakthroughs in silicon and software technology enabled the evolution of cars, and Schilling believes the adaptation of more silicon and software in subsea equipment and ROVs will help the oil and gas industry take advantage of the efficiencies of productivity. However, the cost of packaging electronics for use in the ocean is huge, and many times more expensive than in other industries. Serviceability of parts, which is expensive, is another hurdle.

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Kuwait seeks to import Iraqi gas in Shell deal

Kuwait seeks to import Iraqi gas in Shell deal

Apr 11, 2011
Tamsin Carlisle

Kuwait is seeking to import gas from Iraq through a deal with Royal Dutch Shell.
The emirate burns large volumes of oil in its power plants as it has insufficient supplies of cleaner-burning gas.

It has contracts with Shell for summer imports of liquefied natural gas (LNG) and for a complex project to exploit deep gasfields near its border with Iraq, but that project will take years to develop.

In the meantime, Kuwait is seeking to boost imports, some of which may come from the vast gas resources of its neighbour.

"Kuwait is not negotiating with the Iraqi government in this regard, but with international oil companies in Iraq that are developing oil and gas fields there," the Kuwaiti newspaper Al Jarida has reported, citing a source in the state gas industry.

The emirate was hoping to secure a deal for Iraqi gas to start being delivered within the next 12 to 18 months, the official said.

"It is likely that the Kuwaitis have approached Shell, which is in the final stages of negotiating an associated gas-gathering and monetisation joint venture with state-owned South Gas Company in Iraq and Japan's Mitsubishi," said Samuel Ciszuk, the senior Middle East energy analyst at IHS Global Insight.

The much delayed Shell-led venture would gather large gas volumes produced from southern Iraq's big oilfields. The gas there is now being flared, or burnt off.

The priority use for the gas is to fuel Iraq's electricity sector but surplus may be available for export in the first few years of the project while power plants are built.

Shell has suggested temporary exports through a proposed floating LNG terminal it could build within 18 months of signing a contract.

"The Iraqis and Shell might in the end prefer the flexibility of LNG over piping gas to Kuwait," Mr Ciszuk suggested.

At an oil and gas summit in Kuwait last week, Mohammed Hussain, the deputy chairman of Kuwait Oil Company (KOC), said gas supply had become a critical issue for Kuwait and KOC had a long-term plan to nearly quadruple gas output to 4 billion cubic feet a day by 2030.

But LNG imports to Kuwait, which began in 2009, would continue to be needed for some time before the emirate could sufficiently boost its domestic gas output, said Hashim al Rifai, the managing director of planning at Kuwait Petroleum Corporation, the parent of KOC.
The imports have come from as far away as Sakhalin Island in Russia.

Some of the additions to Kuwait's domestic gas output are expected to be associated with increased oil production.


But the emirate faces an uphill battle to develop its marginal oil resources and refurbish large oilfields that were badly damaged in the First Gulf War.

EnQuest Seeks Tax Allowances to Develop Small Oilfields

EnQuest Seeks Tax Allowances to Develop Small Oilfields

Tuesday, April 05, 2011
Dow Jones Newswires

by  Iain Packham

EnQuest will look into developing small, so far commercially unviable, oil and gas fields in the North Sea if the U.K. government offers incentives to offset the U.K. tax hike on oil production, Chief Executive Amjad Bseisu said Tuesday.

Bseisu told journalists on a conference call that the firm is discussing the matter with the government, but didn't go into further detail.

EnQuest will continue to study options outside of the U.K. if the tax regime here isn't palatable, he said.

Bseisu said that one positive effect from the tax hike is that other companies are looking to sell their U.K. North Sea assets. Prices--especially where large amounts of capital are required for development --have fallen in the last few weeks, he noted.

"We will continue to look at acquisitions in the U.K. and I think we will be able to succeed in acquiring either assets or companies," the CEO said. EnQuest doesn't have any specific targets as yet, but is examining opportunities and has a lot of firepower, he added.
Bseisu said the firm has "cash flow of several hundred million and credit lines of several hundred million," and so could manage an acquisition in the half billion-to-billion dollar range quite easily.

The group's 2010 pretax profit soared to $55.8 million, from $11.0 million in 2009 and revenue rose to $583.5 million from $234.0 million, as oil and gas prices and oil and gas production levels rose significantly.

The company has raised its 2011 production target by 26% to 26,500 barrels of oil equivalent a day, after 2010 pro forma average production increased 55% to 21,074 BOE/D. Bseisu said he is confident of meeting the 2011 target organically.

EnQuest's proven-plus-probable reserves rose around 10% to 88.5 million barrels of oil equivalent.

The company has earmarked around $300 million for capital expenditure in 2011, with $250 million to go on development drilling and facilities and $50 million on exploration and appraisal. In 2010, capital expenditure was around $196.3 million on a pro forma basis.
At the end of 2010, the company had net cash of $41.4 million, after repaying $88.8 million of net debt.

Noble Energy Seeks 2nd Deep-Water Gulf Drilling Permit -CEO

Noble Energy Seeks 2nd Deep-Water Gulf Drilling Permit -CEO

Tuesday, March 29, 2011
Dow Jones Newswires

by  Ryan Dezember

 

Noble, which late last month received the first permit to drill in the Gulf of Mexico's deep waters since the deadly Deepwater Horizon disaster, is seeking permits to drill another prospect of the coast of Louisiana, Chief Executive Charles Davidson said.

"The outlook for the deep-water Gulf of Mexico is certainly much brighter today than it was a few months ago," Davidson told investors during a conference here. "We continue to see a lot of opportunities to drill in the deep-water Gulf of Mexico."

The Houston oil and gas explorer on Feb. 28 was awarded a permit to resume drilling its Santiago prospect, located in about 6,500 feet of water about 70 miles southeast of Venice, La.

Noble had been drilling the Santiago well, which it owns with BP and private explorers Red Willow Production Co. and Houston Energy Partners, when U.S. regulators shut down deep-water drilling in response to the April 20, 2010 Deepwater Horizon explosion and the subsequent oil spill.

Since giving Noble a permit, U.S. regulators have issued drilling permits for five other deep-water wells, each to a different operators. Noble officials say they expect to begin drilling the Santiago well in the next several weeks.

"We're not over the hump by any means," Davidson said. "There's going to be a lot of work to get the industry back to the full pace that it needs to be, but we're certainly taking some good steps here in the last month or so."

Noble has asked regulators to also let it begin drilling its Deep Blue prospect, which is west of Santiago and was also underway when the government halted such operations, Davison said.

"We're still working through the permitting process on Deep Blue," Davidson said.

Noble was also the first producer to win government permission to complete a well after the Deepwater Horizon disaster, and the company expects production from that well, located near Santiago, to begin late this year or early 2012. Noble's share of its output is expected to be between 7,000 and 8,000 barrels of oil per day, Davidson said.