EP Passes Resolution on Tougher Offshore Drilling Regulations

- EP Passes Resolution on Tougher Offshore Drilling Regulations

Tuesday, September 13, 2011
Rigzone Staff
by Karen Boman

The European Parliament (EP) on Sept. 13 passed a resolution that would only allow development of oil and gas fields offshore Europe if companies have prepared an adequate emergency plan and has sufficient funds to repair possible damage to the environment.

According to the resolution, passed with 602 votes in favor, 64 against and 13 abstaining, site-specific plans for drilling, which would also require approval by the relevant member state before operation begins, would better protect the environment. The resolution is a means of influencing new draft legislation to be tabled by the European Commission this autumn.

"These emergency plans should identify potential hazards, assess pollution sources and effects and outline a response strategy in the even of an accident," according to a statement by the European Parliament.

The resolution also calls for a provision requiring oil and gas operators to show in the licensing procedure that they have sufficient funds to repair any harm done to the environment as a result of their activities. It also has been suggested that the scope of the polluter pays principle and strict liability should be extended to cover all damage done to marine waters and biodiversity.

While members of European Parliament are unsure if establishing a regulator for all offshore operations would be bring enough value to justify diverting "scarce" regulatory resources from national authorities, they agree that the European Maritime Safety Agency should coordinate responses in the event of an accident.

Parliament also proposes that whistleblowers be protected, enabling employees to declare any security breaches or risks anonymously with fear of harassment.

The resolution is in response to a Commission consultation paper issued last October in the aftermath of the Macondo oil spill in the Gulf of Mexico in April 2010. It also follows on from an European Parliament resolution in October 2010 on European Union action on oil exploration and extraction in Europe.

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Salamander Sees Gas Shows at Thai Well

Salamander Sees Gas Shows at Thai Well

Friday, April 15, 2011
Salamander Energy plc

Salamander provided the following update on its Thai drilling operations in Block L15/50, onshore Northeast Thailand, and Block B8/38, Gulf of Thailand.

Dao Ruang-2 well, Block L15/50

Dao Ruang-2 ("DR-2") drilling operations at the Dao Ruang-2 location have been completed. Following an openhole drill stem test ("DST") the well failed to flow at a sustained commercial rate and is in the process of being temporarily suspended for potential re-entry at a later date. Drilling now moves to the second location of the two well program, as originally planned, targeting an independent fault network in the structure.

The DR-2 well was drilled to a depth of 2,212 meters true vertical depth sub-sea ("m TVDSS") into the eastern flank of the Dao Ruang structure, targeting a swarm of faults and fractures identified from high resolution 3D seismic. The well intersected a number of fracture zones with associated gas shows and experienced gas influx associated with a fault system around 1,840 m TVDSS. Gas shows were seen all the way to TD, with no sign of water, demonstrating a significant gas column in the Dao Ruang structure.

An openhole DST was undertaken across an interval between 1,008 - 2,211 m TVDSS. The section was tested following an acid wash, however only sub-commercial flow rates were recorded, indicating very low permeability formation and a limited open, connected fracture network at the DR-2 location.

The MB Century 26 rig will now be mobilized to the Dao Ruang-3 ("DR-3") drilling location. The DR-3 well will target a separate fracture set on the northern flank of the Dao Ruang structure with a different orientation to those seen in DR-2, providing a greater chance of encountering an open fracture network and an opportunity to test at a commercial flow rate.

The DR-3 well will be drilled to a planned depth of 1,900 m TVDSS and is expected to spud within the next 8 days. The well is forecast to take 45 days to drill on a dry hole basis.

Salamander has a 50% interest in, and is operator of, Block L15/50.

James Menzies, Chief Executive Officer of Salamander Energy, said, "While it is disappointing that we did not encounter commercial gas at our first Dao Ruang location, it is clear from drilling that there is a significant gas column in the structure. The two well program was originally designed to target two independent fault networks in different orientations, and we expect to spud the second well in a matter of days."

Tullow Sells Uganda Stake to Total, CNOOC for $2.9B

Tullow Sells Uganda Stake to Total, CNOOC for $2.9B

Wednesday, March 30, 2011
Tullow Oil plc

Tullow has signed Sale and Purchase Agreements (SPAs) with CNOOC and Total in respect of the sale of a one third interest to each party of the interests Tullow holds in Exploration Areas 1, 2 and 3A in Uganda. Tullow will retain a one third interest. The terms of the transactions include a total cash consideration payable to Tullow of US $2.9 billion.

With the signing of these SPAs, a key condition of the Memorandum of Understanding (MoU) agreed between Tullow, the Government of Uganda (GoU) and the Uganda Revenue Authority (URA) on March 15, 2011, has been satisfied. The next step is for Tullow to make certain tax related payments to the GoU, on receipt of which all relevant consents become final and the other provisions of the MoU become effective.

Under the MoU, Tullow and its new Partners, CNOOC and Total, have been granted new licenses over EA-1 and an onshore area of EA-3A and the partnership's rights to develop the Kingfisher discovery have been confirmed. A clear plan for the resolution of tax disputes on the various asset sales has been agreed by the GoU, the URA and Tullow.

Tullow and its Partners will now reactivate the significant program of exploration and appraisal drilling and progress their development plans for the basin which they will jointly present to the Government of Uganda for approval.

Commenting, Aidan Heavey, Chief Executive, said, "These agreements have secured the future of oil production in Uganda. Tullow, its partners and the Government of Uganda will now agree a development plan for the Lake Albert Rift Basin with a target of delivering production of at least 200,000 bopd and potentially much more as we continue to explore and appraise the basin. We are looking forward to working with CNOOC and Total, and continuing our strong relationship with the Government to bring the benefits of the oil to the people of Uganda."