More Than 108.4 Bcf Produced from Shah Deniz Field

- More Than 108.4 Bcf Produced from Shah Deniz Field

Monday, August 22, 2011
Knight Ridder/Tribune Business News
by E.Ismayilov, Trend News Agency, Baku, Azerbaijan

During the first half of 2011, the Azerbaijani Shah Deniz field produced about 3.07 billion cubic meters (more than 108.4 billion cubic feet) of gas and 0.8 million tonnes (6.5 million barrels) of condensate or over 17 million cubic meters of gas per day (about 600 million standard cubic feet per day) and about 35,800 barrels of condensate per day, BP reported.

In 2010, the Shah Deniz field produced about 6.9 billion cubic meters of gas and 1.9 million tons (14.7 million barrels) of condensate. Then, the average daily production at the field was 19 million cubic meters of gas and 40,000 barrels of condensate.

For the full year, it is expected to spend $169.9 million in operating expenditure and $791.6 million in capital expenditure on Shah Deniz activities. In the first half of 2011 Shah Deniz spent $ 86.8 million in operating expenditure and $298.2 million in capital expenditure.

Since the start of Shah Deniz production in late 2006 till the end of the second quarter of 2011 about 56.3 million barrels (7.13 million tonnes) of Shah Deniz condensate was exported to world markets.

Peak production from the Shah Deniz project is forecasted at over 9 billion cubic meters of gas and 50,000 barrels of condensate per day.

According to forecasts, within the second phase of the field's development gas production may be increased to 25 billion cubic meters per year.

Shah Deniz reserves are estimated at an amount of 1.2 trillion cubic meters of gas.

The contract to develop the offshore Shah Deniz field was signed June 4, 1996. Participants to the agreement are: BP (operator) -- 25.5 percent, Statoil -- 25.5 percent, NICO -- 10 percent, Total -- 10 percent, LukAgip -- 10 percent, TPAO -- 9 percent, SOCAR-10 percent.


Copyright (c) 2011, Trend News Agency (Baku, Azerbaijan)

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Aker Solutions 2Q Earnings Lower Than Expected

- Aker Solutions 2Q Earnings Lower Than Expected

Friday, August 12, 2011
Aker Solutions

Aker Solutions' operating revenues in the second quarter of 2011 were NOK 7.8 billion. Earnings before interest, tax, depreciation and amortization amounted to NOK 636 million. Order intake in the quarter was NOK 14.3 billion.

"We have a strong order intake which reflects high tendering and activity levels across all business segments. In fact, our order backlog has increased 19 percent since the beginning of the year. This is in line with our long term growth plan. However, this quarter has also provided us with some reminders about the importance of further improving our operational performance," said Øyvind Eriksen, executive chairman of Aker Solutions.

Second quarter consolidated revenues was NOK 7 809 million, compared with NOK 8 096 million in the same period in 2010. EBITDA for the second quarter of 2011 was NOK 636 million (8.1 percent EBITDA margin), compared to NOK 853 million one year ago. Profits in the quarter were negatively affected by execution challenges and the final arbitration ruling on Blind Faith.

"In the second quarter quality costs related to execution issues in Brazil alone amounted to NOK 130 million in our Subsea and Process Systems businesses. With quality and customer satisfaction as two of our top priorities, this is obviously disappointing," Eriksen said.

Order intake in the second quarter was NOK 14.3 billion. At the end of the second quarter Aker Solutions' order backlog was NOK 46 billion - an increase of NOK 5.5 billion from the previous quarter.

During the second quarter Aker Solutions concluded the structural changes outlined at the company's capital markets day in December 2010. The final step was the demerger and separation from specialized EPC contractor Kværner ASA.

"Today Aker Solutions is a pure oil service player focusing on engineering, technology, products and field-life solutions. We have a strong cash position fueled by solid earnings and gains from strategic divestments. We will convert our financial strength to capacity with the aim of facilitating further growth. However, we will also ramp up our efforts of building a stronger quality culture to further improve our day-to-day operations," said Øyvind Eriksen.

"Our growth plans are ambitious and we need qualified people to meet these objectives. In the first half of 2011 we have hired almost 1 200 new colleagues worldwide. I am pleased to see that so many new colleagues share our technology vision and company values," adds Eriksen.

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Pennsylvania Shale Gas Output to More Than Double This Year - Study

- Pennsylvania Shale Gas Output to More Than Double This Year - Study

Thursday, July 21, 2011
Dow Jones Newswires
HOUSTON
by Ryan Dezember

Natural gas production from Pennsylvania's Marcellus Shale should reach the equivalent of 3.5 billion cubic feet per day this year, more than double 2010's output, according to new research by a trio of Pennsylvania State University professors.

The study, released Wednesday, further estimates that production in the state from the deeply-buried rock formation will rise to the equivalent of 6.7 billion cubic feet per day in 2012 and 17.5 bcfe in 2020.

That level of production would make the Pennsylvania basin the largest supplier of natural gas in the U.S., able to meet about 25% of the country's demand, said Kathryn Klaber, who heads the Marcellus Shale Coalition, an oil and gas industry advocacy group.

The Marcellus Shale underlies parts of several Mid-Atlantic and Midwestern states but production is centered in Pennsylvania.

In 2010 1,405 wells were drilled there, yielding the equivalent of 1.3 billion cubic feet of gas per day, according to the study. The professors, who obtained data from producers through the advocacy group, said that 2,300 wells are planned to be drilled this year and forecast that the number will steadily rise to about 2,500 a year by 2020.

While producers have focused on Pennsylvania with some forays into Ohio and West Virginia, several are eying an expansion into New York.

Many initially believed that southwest Pennsylvania held the most productive fields. But a string of recently drilled wells in northern Pennsylvania have made exploration in New York -- where a ban on hydraulic fracturing, the controversial technique needed to crack open the energy-bearing rock, was recently lifted -- more attractive.

Twenty-four of Pennsylvania's 25 highest producing wells are in counties that border New York, according to the Pennsylvania Department of Environmental Protection.

In May, Houston-based Cabot Oil & Gas said two of its wells in that border area are producing nearly 30 million cubic feet of natural gas per day -- significantly more than any previous Pennsylvania wells.

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

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Chevron Exec: East Europe Shale Development Slower Than In US

- Chevron Exec: East Europe Shale Development Slower Than In US

Wednesday, June 29, 2011
Dow Jones Newswires
MOSCOW
by Jacob Gronholt-Pedersen

U.S. oil major Chevron is optimistic about the geological potential at recently acquired shale acreage in Eastern Europe, but says lack of infrastructure and a poor regulatory environment will slow down the development.

Unconventional gas sources such as shale gas, which has shaken up the U.S. gas market in the past two years, have also caught the interest of major players in Eastern Europe.

"It's not easy to replicate the shale gas developments we saw in the U.S.," Jay Pryor, Chevron Vice President in charge of global business development, told Dow Jones Newswires in an interview.

The U.S. oil major has acquired shale gas acreage in Poland, Bulgaria and Romania.

"We certainly think the reservoir potential is there, but it will take a little longer to develop," Pryor said.

"The regulatory environment as well as the infrastructure, including pipelines and service work necessary to drill the wells, just isn't as developed (as in the U.S.)," he added.

Shale gas and oil are being produced using relatively new technologies such as hydraulic fracturing, which involves injecting a mixture of water, sand and chemicals underground at high pressures to release oil from hydrocarbon deposits.

In recent years, these technologies have unlocked shale oil and gas that weren't previously accessible, leading to a boom in new wells across the U.S. and flooding the market with natural gas. In 2009, the U.S. surpassed Russia as the world's biggest gas producer in 2009.

Most of the attention is in the U.S. around accomplished shale basins in North Dakota and Texas. Following a $3.2 billion acquisition of gas producer Atlas Energy in the beginning of the year, Chevron last month acquired the rights to 228,000 acres in the Marcellus Shale.

"We expect others are to be found around the world, and we are certainly looking for them," said Pryor.

However, there are significant hurdles to further development of shale deposits both in the U.S. and globally. After years of rapid growth, shale gas producers have begun to bump into cost constraints and particularly environmental concerns about water contamination during the drilling process.

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

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Saipem Secures More Than $1B in E&C Offshore Contracts

- Saipem Secures More Than $1B in E&C Offshore Contracts

Monday, June 13, 2011
Saipem SpA

Saipem has been awarded new E&C Offshore contracts in Egypt, in the North Sea and in Russia, worth in excess of $1 billion.

In Egypt, Burullus Gas Company awarded Saipem the EPIC contract for new subsea developments in the area of the West Delta Deep Marine Concession, located about 90 kilometers offshore the Northwest Nile delta, at water depths between 400 and 1,000 meters.

The development encompasses the engineering, procurement, construction and installation of a total of seven new subsea wellheads and relevant infrastructures, umbilicals and flowlines.

Saipem has already carried out two earlier phases of the West Delta Deep Marine Concession's subsea development. The work will be connected to existing infrastructure. The offshore activities will be carried out mainly by the highly-specialized vessel, Saipem FDS.

Saipem has also been awarded contracts to operate in the Norwegian and British sectors of the North Sea, mainly relevant to the deployment of the Saipem 7000 vessel for platform transportation and installation, and to the deployment of the Castoro 7 vessel for the installation of subsea pipeline and structures.

Among these contracts, some are EPIC and, in addition to the activities mentioned above, include engineering and procurement phases.

Offshore activities will be performed in different periods during summer 2012 and 2013.

In Russia, Caspian Pipeline Consortium (CPC) awarded Saipem the contract for the expansion of the structures relevant to the CPC marine export terminal, near Yuhznaya Ozereyevka on the Black Sea shores in the Krasnodar region of the Russian Federation.

The development includes the engineering, procurement and installation of a new offshore export pipeline for hydrocarbon transportation which will have a diameter of 42 inches and a length of about 5 kilometers and for the installation of a new offshore mooring system for hydrocarbon export. Offshore activities will be carried out during the second half of 2012 by the S355 vessel.

Furthermore, Saipem has agreed to increase the scope of its work on existing contracts in the Caspian sea and the Gulf of Mexico.

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SSGC: Pakistan's Estimated Gas Reserves Higher Than Expected

- SSGC: Pakistan's Estimated Gas Reserves Higher Than Expected

Monday, May 23, 2011
Asia Pulse Pte Ltd.

Pakistan holds an estimated 33 trillion cubic feet (tcf) of tight-gas reserves, higher than the existing estimated 27 tcf in the country, said the deputy managing director of operations of Sui Southern Gas Company (SSGC) Syed Hassan Nawab.

Nawab made the comment addressing the 7th International POGEE Conference 2011 for Oil and Gas and Energy Industry at the Karachi Expo Center on Wednesday. Joint Secretary Ministry of Petroleum and Natural Resources Raashid Bashir Maser was the chairman of the session.

Referring to a report of Pakistan Petroleum Exploration and Production Companies Association (PPEPCA), Nawab said the country will have sufficient natural gas if tight gas is explored with the help of advanced technology. He pointed out that the government has prepared the draft policy for tight gas and it is currently with the Council of Common Interest (CCI) and this will be approved soon.

Quoting some of the incentives in the draft tight gas policy, he said that investors will be offered 40 percent premium on the current gas price for exploring tight gas. Similarly, 50 percent premium will be offered on current gas price to investors if they commission their project by December 2011.

Hassan Nawab said that Pakistan can also produce gas from Thar coal with the help of underground coal gasification (UCG) technology. There is a potential to produce 35 tcf of coalbed methane from Thar coal, he noted.

He said that the availability of natural gas can be enhanced through import of liquefied natural gas (LNG) from neighboring countries like Qatar and Iran-through 3rd party arrangements. He said the country has a very large network of pipelines and the importer of LNG can pump this gas to their buyers in upcountry destinations.

(C) 2011 Asia Pulse Pte Ltd.

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Study More Than Doubles B.C. Gas Resources Estimate

Study More Than Doubles B.C. Gas Resources Estimate

Monday, May 09, 2011
B.C. Ministry of Energy & Mines; NEB

A new joint report on the shale-gas potential of Northeastern B.C.'s Horn River Basin more than doubles a previous assessment of gas resources within the province.

The report released by the National Energy Board (NEB) and British Columbia Ministry of Energy and Mines (BC MEM) titled "Ultimate Potential for Unconventional Natural Gas in Northeastern British Columbia's Horn River Basin" is the first publicly released probability-based resource assessment of a Canadian shale basin.

The report says the ultimate potential for marketable unconventional shale gas in the Horn River Basin is 78 trillion cubic feet (Tcf), including three Tcf of discovered resources and 75 Tcf of undiscovered resources. The Horn River Basin is part of the larger Western Canada Sedimentary Basin.

"This innovative report on shale-gas resources provides Canadians with valuable information about our energy future, particularly as it relates to the Western Canada Sedimentary Basin," said Gaetan Caron, chair of the National Energy Board.

Energy and Mines Minister Rich Coleman said, "This report should provide residents of our province with a sense of optimism about the future. B.C. is recognized for its significant shale gas reservoirs as well as for having world-class regulations."

Placing the Horn River numbers in context, the NEB currently estimates that there is 197 Tcf of conventional and unconventional natural gas remaining in the WCSB -- although this number does not take into account known but as-yet-unassessed unconventional gas resources.

The estimate of total remaining conventional and unconventional natural gas in Northeast B.C available for future demand is 109 Tcf. That includes 78 Tcf of shale gas as well as 31 Tcf of remaining natural gas resources identified in a joint assessment of conventional natural gas resources in Northeast B.C. The conventional gas assessment was released by the NEB and B.C. Ministry of Energy and Mines in 2006.

According to the new report on unconventional gas resources, the medium-case estimate of 78 Tcf for Horn River shale gas is the most realistic scenario. However, the study produced a range of numbers for shale gas potential in the Horn River Basin with the low estimate being 61 Tcf and the high being 96 Tcf.

Remaining Ultimate Potential by Province (Tcf)

The NEB is an independent federal agency that regulates several parts of Canada's energy industry. Its purpose is to promote safety and security, environmental protection, and efficient energy infrastructure and markets in the Canadian public interest, within the mandate set by Parliament in the regulation of pipelines, energy development and trade.

The B.C. Ministry of Energy and Mines manages the responsible exploration and development of British Columbia's energy sector.

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Iran Aims to Produce More Than 35 Tcf of Gas from North Pars Field

Iran Aims to Produce More Than 35 Tcf of Gas from North Pars Field

Wednesday, April 06, 2011
Knight Ridder/Tribune Business News

by  A.Yusifzade, Trend News Agency, Baku, Azerbaijan

Iran aims to produce over 35 trillion cubic feet (TCF) of gas from North Pars field for 35 years, FNA reported the Managing-Director of the South Pars Special Energy Zone (SPSEZ) Organization Seyed Pirooz Mousavi as saying.

By completion of the designed projects in the North Pars region, recoverable capacity of gas from North Pars gas field would reach 35 Tcf, Mousavi added.

The giant gas field has a significant share in Iran's prosperity and the Iranian government is resolved to develop the field, Mousavi stressed.

According to Mousavi, North Pars gas field reserves holds an estimated 57.1 trillion cubic feet of gas (some 1.63 trillion cubic meters).

Mousavi said that Kangan and Upper Dalan gas-bearing formations hold 72 percent of the field reserves and another 28 percent belongs to the Dallan gas formation.

According to the Pars Oil and Gas Company, North Pars Gas Field is one of the biggest independent gas fields of Iran. This field which was discovered in 1967, is located approx. 120 kilometers south east of Bushehr in water depths of 2 to 30 meters in the Persian Gulf.

Exploration activities started in this field in 1963 and the first exploration well was completed in 1967.The total volume of the gas in place of this field is about 58.9 TCF and the recoverable volume of sour gas is approximately 47.2 TCF.