Panama Has an Estimated 900 Million Barrels of Oil in Two Basins

- Panama Has an Estimated 900 Million Barrels of Oil in Two Basins

Monday, September 05, 2011
OilPrice.com
by Joao Peixe

Panama’s National Energy Secretariat has announced that 900 million barrels of oil have been detected at two basins in eastern Panama, representing a potential contribution to the Panamanian Treasury of $15 billion dollars over the next two decades at current oil prices.

Panamanian Energy Secretary Juan Manuel Urriola said that the Venezuelan firm OTS conducted the geological survey and detected the oil reserves in Panama’s Garachine-Sambu and Bayano-Chucunaque-Atrato basins in Darien province, which borders Colombia.

While the quality of the deposits’ oil has yet to be determined Urriola estimated their “commercial potential” at roughly $15 billion in taxes and royalties, based on OTS projected estimate of a per-barrel price of 100 dollars over the next 20 years, MercoPress news agency reported.

OTS recommended that in the bidding process the exploratory areas in the Garachine-Sambu and Bayano-Chucunaque-Atrato basins be divided into four geographical blocks per basin.

Urriola added that a bidding process for exploration rights and for determining the deposits’ quality and volume would begin before the end of the year.

Panamanian President Ricardo Martinelli is promoting oil exploration because of Panama’s need to have its own indigenous energy resources in order to reduce the country’s dependence on oil imports, where recent high costs have caused local fuel prices to soar.

(Joao Peixe is a Deputy Editor OilPrice.com. The full article appears here.)

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Integrys Energy Group Announces Two Acquisitions

- Integrys Energy Group Announces Two Acquisitions



Sep 1, 2011

Integrys Energy Group (NYSE:TEG) announced the acquisition of two operating businesses involved in the compressed natural gas fueling business, Pinnacle CNG Systems and Trillium USA, previously owned by Wagner & Brown, Ltd.

Charlie Schrock, Integrys Chairman, President and Chief Executive Officer said, "Expansion into this business is consistent with our mission of providing customers with the best value in energy and related services. Our decision to enter this market is in response to customer needs, and this is complementary to our existing skill sets in regulated and nonregulated natural gas and electric services."

Integrys Energy has a potential upside of 2.4% based on a current price of $49.79 and an average consensus analyst price target of $51.

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Shell: Gannet Alpha Pipe Leaked in Two Places, From Same Source

- Shell: Gannet Alpha Pipe Leaked in Two Places, From Same Source

Tuesday, August 16, 2011
Dow Jones Newswires
LONDON
by Alexis Flynn

Two leaks have occurred on an undersea pipeline at Shell's Gannet Alpha platform in recent days, the Anglo-Dutch major confirmed Tuesday, but said it believed both come from the same initial source.

"The leak source remains the same. The initial release path was stopped on Thursday, however the oil found a second pathway to the sea," Shell said in a statement.

"We believe now that the flow is coming from a relief valve adjacent to the original leak and from the same source," said Shell. "Once we've confirmed this we will then develop a series of mitigation options to stop this leak. There is no new leak."

Shell said Monday it estimates 216 metric tons, or 1,300 barrels, of oil has already spilled into the sea. This would make the spill the U.K.'s largest since 2000.

Earlier Tuesday, a senior Shell executive was cited by local media as saying a second leak is continuing to spill crude into the North Sea after the main leak discovered last Wednesday was effectively stemmed.

Shell said the second leak took longer to find because of its awkward position "amid complex subsea infrastructure."

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

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Noble Adds to High-Spec Jackup Fleet with Two Newbuilds

- Noble Adds to High-Spec Jackup Fleet with Two Newbuilds

Monday, August 01, 2011
Noble Corp.

Noble has exercised options with Sembcorp Marine's subsidiary Jurong Shipyard for the construction of two additional high-specification heavy duty, harsh environment JU3000N jackup drilling rigs. This order will bring to six the total number of new jackup rigs the Company will have under construction with the Jurong Shipyard.

David W. Williams, Chairman, President and Chief Executive Officer, Noble Corporation, stated, "We continue to see a growing interest from clients for the advanced features of the JU3000N jackup design. Opportunities for these units are evident in several offshore regions, including the North Sea, Middle East and Asia. This latest rig order reflects our continuing commitment to expand our ownership of industry-leading offshore drilling technology, enabling us to address some of the most demanding well construction challenges around the world."

Total delivered costs for these latest two orders are estimated at approximately $245 million per rig, including project management, spares, and start-up costs, but excluding capitalized interest. Payment terms are consistent with the order of the four previous rigs placed with the Jurong Shipyard since December 2010: 20 percent of the construction price due at contract signing, 20 percent due at steel cutting, and the remainder due at rig delivery. The two latest orders are expected to be delivered from the shipyard during the third and fourth quarters of 2014, following which would be mobilization and acceptance testing by their respective future customers.

The Friede & Goldman JU3000N design is an enhanced evolution of the JU2000E design and represents the latest generation of high-specification jackup drilling rig with greater capacities and capabilities than most existing units. The rigs, which are approximately 231 feet in length and 270 feet in breadth, will have the capability to operate in water depths up to 400 feet and drill to depths of 30,000 feet. The rigs will each have a seventy-five foot cantilever, 2.5 million pounds of hook load capacity, a high-capacity mud circulating system, and a 15,000 psi blowout preventer system. The units are capable of off-line pipe handling and offer accommodations for up to 150 people.

In addition to six newbuild jackup projects, Noble has seven ultra-deepwater drillships under construction, three of which are scheduled to be delivered later this year. The Company continues to evaluate an option it has with Hyundai Heavy Industries Co. Ltd. for the construction of an additional ultra-deepwater drillship that expires on August 31, 2011, with delivery taking place in the second half of 2014.

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ConocoPhillips to Divide into Two Companies

- ConocoPhillips to Divide into Two Companies

Thursday, July 14, 2011
ConocoPhillips

Consistent with ConocoPhillips' previously stated strategies and focus on value creation for its shareholders, ConocoPhillips' board of directors has approved pursuing the separation of the company's Refining & Marketing and Exploration & Production businesses into two stand-alone, publicly traded corporations via a tax-free spin of the refining and marketing business to ConocoPhillips shareholders.

Following the completion of the proposed separation, ConocoPhillips will be a large and geographically diverse pure-play exploration and production company with strong returns and investment opportunities. The company's strategy of enhancing returns on capital through developing new resources, growing reserves and production per share, continuing the asset sale program and increasing shareholder distributions will not change.

As a separate company, the Refining and Marketing business of ConocoPhillips will be a leading pure-play independent refiner with a competitive and diverse set of assets. In addition to executing the company's initiatives to improve downstream returns through portfolio rationalization and other operating efficiencies, the new downstream company will be able to further position its portfolio by pursuing transactions and investments across the value chain. Under the contemplated plan, both companies will be well positioned with financial strength and flexibility and experienced management teams committed to continued value creation.

"Consistent with our strategy to create industry-leading shareholder value, we have concluded that two independent companies focused on their respective industries will be better positioned to pursue their individually focused business strategies," said Jim Mulva, chairman and chief executive officer. "Both companies will continue to benefit from the size and scale of their significant high-quality asset bases and free cash flow generation, allowing them to invest and create shareholder value in a changing environment."

The separation of the companies is expected to be completed in the first half of 2012. Upon completion of the separation, Mulva intends to retire. Until that point, he will continue to serve as ConocoPhillips' CEO and lead the separation efforts. The work to determine the detailed allocation of assets and liabilities, the management and governance of the companies, and the mechanics of completing the separation will begin immediately. Further details will be disclosed as they are determined over the next several months.

The contemplated separation of ConocoPhillips into two companies does not require a shareholder vote. The separation is subject to market conditions, customary regulatory approvals, the receipt of an affirmative IRS ruling, the execution of separation and intercompany agreements, and final board approval.

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SeaBird Awards Two 2D Contracts

- SeaBird Awards Two 2D Contracts

Friday, June 17, 2011
SeaBird Exploration plc

SeaBird reported that two new 2D contracts have been awarded.

The Aquila Explorer has been awarded two LOI's for surveys of combined 4,600 line km in Indonesia for approximately two months work prior to her previously announced contract on May 6. The vessel will now be working in direct continuation until mid September 2011.

The Hawk Explorer after completing her scheduled dry-dock in Las Palmas will mobilize to Mediterranean Sea where she will commence a 1,500 line km survey until mid July 2011.

The combined contract values for these contracts are approximately USD 5 million.

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El Paso to Spin-Off into Two Companies

- El Paso to Spin-Off into Two Companies

Tuesday, May 24, 2011
El Paso Corp.

El Paso Corp. announced that its Board of Directors has granted initial approval of a plan to separate the company into two publicly traded businesses by year end 2011.

Following the completion of the proposed spin-off, El Paso Corporation will be comprised of El Paso's Pipeline Group, its Midstream Group, and its general and limited partner interests in El Paso Pipeline Partners, L.P. (NYSE: EPB). It will be the premier pipeline company in North America, uniquely integrated in the major U.S. supply and market regions. With a planned 2012 annual dividend of $0.60 per share and a targeted low double-digit dividend growth rate, it is positioned to be a very attractive corporate yield investment. As a separate publicly traded company, El Paso's exploration & production business is well positioned to compete with the industry's leading independent producers. It has more than 10 years of low-risk, repeatable drilling inventory to fuel its future growth. Current positions in the Eagle Ford and Wolfcamp shales and the Altamont field are expected to provide a profitable and rapidly growing oil production profile.

"We believe that the creation of these two stand-alone public companies will result in significant and sustainable value creation," said Doug Foshee, chairman, president, and chief executive officer of El Paso Corporation. "With the completion of what was an $8 billion pipeline backlog, the elevation of our E&P business to one of the top independent producers, outstanding leadership and employees in each of our businesses, and the accelerated improvement of our balance sheet, we are ready to take this important step."

El Paso plans to complete a separation by year end with a tax-free spinoff of its E&P company. The planned separation is subject to market, regulatory, tax, final approval by the company's Board of Directors and other customary conditions.

Benefits

El Paso believes that there are material benefits to the stand-alone companies from a separation:

• Greater management focus on distinct business strategies
• Credit enhancing to El Paso Corporation
• Greater flexibility to grow businesses supported by separate equity currencies
• Independent capital structures and credit profiles, which provide a lower cost of capital
• Improved capital markets access
• Increased flexibility and efficiency in capital allocation

Ongoing Management of El Paso Corporation

The seasoned management of El Paso Corporation is in place. Doug Foshee will remain chairman & chief executive officer of the company.

Management of Exploration & Production Company

Brent Smolik will be named as chief executive officer and Dane Whitehead will become the chief financial officer. Doug Foshee will become the non-executive chairman.

Transaction Approvals

The spin-off of the E&P company will be structured as a pro rata distribution of the shares of the exploration and production company to the El Paso shareholders of record. The transaction will not require shareholder approval. El Paso plans to seek a tax ruling from the Internal Revenue Service regarding the tax-free nature of the spin-off for both the company and its shareholders.

Financial & Legal Advisors

Goldman, Sachs & Co. is serving as the financial advisor to El Paso, and Wachtell, Lipton, Rosen & Katz is serving as El Paso's legal advisor.

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Two Large Directional Drilling Sites Proposed in Greeley

- Two Large Directional Drilling Sites Proposed in Greeley

Tuesday, May 24, 2011
Greely Tribune, Colorado
by Sharon Dunn, Greeley Tribune, Colo.

Two new oil and gas well projects that would involve dozens of new wells are being proposed within Greeley's city limits now that directional drilling methods have basically been proven and commodity prices are cooperating.

These drilling projects come in a much larger scale than typical vertical drilling, with several wells proposed from one site.

"This is the changing face of the oil and gas industry, with more directional drilling," said Brandon Gossard, a planner with the city of Greeley. "We seem to be getting more applications for directional than otherwise.

"Only recently has that technology been reliable and cost effective to the point where a lot of bigger players have started to use the directional drilling platforms more and more often," Gossard said.

Greeley residents may remember letters from Mineral Resources they got earlier in the year, seeking permission to drill beneath their properties. Some of those letters relate to two projects under consideration this week:

• The Bestway Gravel Pit site off of 4th Street and 35th Avenue, where the company has proposed drilling 40 wells. Residents will get to sound off on the project at a neighborhood meeting Wednesday.
• The Island Grove site off of 11th Avenue across from Island Grove Regional Park, where the company has proposed drilling 22 wells. The Greeley Planning Commission is considering this project Tuesday. Neither project would need Greeley City Council approval, but ultimate planning commission decisions could be appealed to the council within 10 days of a decision.

Copyright (c) 2011, Greeley Tribune, Colo.

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Bering Preps for Remediation of Two Tx. Wells

- Bering Preps for Remediation of Two Tx. Wells

Wednesday, May 18, 2011
Bering Exploration Inc.

Bering will begin the remediation of an initial two wells on its recent joint venture on 1,000 acres located in Central Texas. Bering will equally share the expenses required to remediate and develop this prospect with its JV partner and expects to begin the initial two well remediation within the next couple of weeks. There are 50 new well locations and an existing 50 well bores that could potentially be rehabilitated and brought back into production. The company will initially target the Eagle Ford and Austin Chalk formations.

Bering recently announced that drilling operations have begun on its Gulf Coast prospect with potential gross revenue valued at $29 million over the life of the prospect. Additionally, Bering announced that it will initially drill four test wells on its Eagle Ford shale play in Central Texas targeting $11 million in gross potential reserves and will utilize the results to help with the design and development of a more in depth drilling program for the remaining 116 potential well locations targeting gross potential reserves of more than $300 million. The figures above are based upon the current price of oil and gas and assume all wells are drilled and successful.

"We believe that this is an excellent opportunity to quickly establish production and cash flow," stated Steven Plumb, VP of Finance of Bering. "We hope that these initial two wells provide us the results that will enable us to expand our remediation efforts to the entire field."

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