Oil and gas contractor Saipem said it was not given formal notice the South Stream Offshore Pipeline contract would be scrapped. Russia said the 40 billion euro pipeline link to Europe was to be dropped due to tension between the European Union and Moscow over the crisis in Ukraine.
President Vladimir Putin said Russia scrapped a proposed $45 billion Black Sea pipeline to carry gas to Europe, the latest sign economic ties with the European Union are breaking down as the Ukraine crisis persists. Shelving the South Stream project ensures pipelines through Ukraine will remain vital supply links to Europe for years to come. The route under the Black Sea would have offered Russia’s OAO Gazprom a more direct path to feed the continent’s gas needs, a plan the EU objected to because it would reduce Ukraine’s leverage against its neighbor.
Caza Oil and Gas has seen an increase in its proved developed producing reserves this year as a result of its drilling program in the Bone Spring play. PDP reserves increased 37.3% to 1,893.6 Mboe while total proved reserves decreased slightly to 4,483.4 Mboe from April 30, 2014. The high profits are said to be largely from the Bone Spring play development program in New Mexico, which has 28 production wells.
Andes Energia has seen a successful intervention operation on a well in the Vaca Formation in Argentina. The VG x-1 well on the Vega Grande oilfield in the Neuqen basin is producing oil at a rate of 80 barrels per day, without being stimulated thought hydraulic fracturing. Operations consisted of an intervention with a pressure draw-down and build-up tests performed in the interval of between 2612 and 2617 metres below ground level.
Atlantic Petroleum has made a gas discovery in its Ivory exploration well in the Norwegian Sea. The company said the 6707/10-3S well tested the westernmost segment of the Ivory structure. It is one of several prospects within the PL528 B license.
Genel Energy has been given a $30million payment from the Kurdistan Regional Government (KRG) for oil exported through the Iraq-Turkey pipeline. The company, which is headed by former BP chief executive officer Tony Hayward, said the Taq Taq field partners had received the initial award, which it described as an important “first step”. It followed months of delays which were prompted partly by Islamic State incursions into the region.
The UK oil industry, after chafing at suggestions it’s subsidized by the state, wants Chancellor of the Exchequer George Osborne to help save it from the market’s crashing prices. Osborne’s Autumn statement tomorrow, setting out tax and spending policies, is a chance for the more than 500 companies represented by Britain’s oil lobby to press for what it says is a fairer deal. In a letter sent to the chancellor last month, Oil & Gas UK said the collapse in prices comes on top of a 26% jump in unit costs for the industry last year alone. “Expect news on how the government will look to shore up investment in the North Sea,” said Sanjeev Bahl, Numis Securities Ltd.’s director of oil and gas equity research.
Ennsub has been awarded a £2million contract to build a portable Launch and Recovery System (LARS4). It has been created on behalf of Benthic to allow for further deployment capability in deep and ultra deepwater conditions and harsh environments. The LARS4 will allow mobilisation of Benthic's Portable Remotely Operated Drills (PRODs) on a wider range of vessels.
An offshore worker was airlifted to hospital last night after falling on a North Sea platform. The 64-year-old man is believed to have fallen from a ladder aboard TAQA's Eider platform, 112 miles north-east of Shetland, at 10pm.
Lord Smith of Kelvin, chair of the Smith Commission on Scottish Devolution, will appear before Holyrood’s newly-convened Devolution (Further Powers) Committee. His report recommended the UK government would remain in charge of licensing for all offshore oil and gas extraction under the proposals but Holyrood could get the power to determine if fracking goes ahead in Scotland.
West Texas Intermediate crude fell, trimming the biggest rally since August 2012 as investors weighed OPEC’s decision to let the market curb a global supply glut. Brent slid in London. Futures dropped 0.7% in New York, decreasing for the fifth time in six days. The Organization of Petroleum Exporting Countries may hold an emergency meeting in the first quarter of next year, Venezuela’s Foreign Minister Rafael Ramirez said in an interview. The group’s failure to cut output at a gathering last week bodes well for US producers, according to billionaire wildcatter Harold Hamm, a founding father of the nation’s shale boom.
North Sea production and investment will face dramatic declines if oil prices remain at current lows, a new report has warned. More than three billion barrels of oil and investment of over £80billion could be lost over the next 45 years if oil stays around the $70-a barrel price. Oil fell to a five year low - below $68 - yesterday but rebounded to just over $72 as Professor Alex Kemp and Linda Stephen of the University of Aberdeen unveiled their latest evaluation of the impact of falling oil prices on the North Sea.
Unions have warned of “radical” changes in the energy industry over the next few years, leading to job losses after German giant E.ON announced re-structuring of its business. The firm said it will focus on renewables, including wind and solar, along with distribution networks and its customer business. E.ON, one of the Big Six energy firms, said it wanted to respond to the “dramatically altered global energy markets”.
Marathon oil has made a discovery at its Harir Block in the Kurdistan region of Iraq. The company said it had hit oil and gas in its Jisik-1 exploration well. The site, 40 miles northeast of Erbil, was drilled to a total depth of 15,000 feet and oil and gas was noted in an extensive gross interval in both the Jurassic and Triassic reservoirs.
The decline in oil prices could have a substantial adverse effect on the oil and gas industry in the UKCS (UK continental shelf) a leading industry expert has warned. Research by Professor Alex Kemp and Linda Stephen from the Aberdeen University has found that if the current drop in price continues, there will be reduced investment and production. Using economic modelling, the pair highlighted two scenarios which reflect investment screening prices.
An Austrian energy group has drawn its first oil from a drilling campaign in New Zealand. OMV said that well MR-8A, which is part of the Maari redevelopment drilling campaign, has an estimated production capacity of 4,500 barrels of oil per day. The firm will invest €205million in the campaign which has five drills producing new reservoirs.
According to CanOils’ new report The Canadian Oil Sands Outlook 2015 the Canadian oil sands industry looks set to have capacity to produce over 3million barrels per day by the end of next year, with production likely to approach 2.5million bpd. Of these figures, a higher portion than ever will be controlled by non-Canadian operators, with the trend of greater influence year-on-year by internationally-held companies continuing into the coming year. Assuming all scheduled new projects and expansions actually come onstream by December 31, next year will see a 16.6% increase in overall production capacity compared with this year.
CNOOC has started production from gas fields in the South China sea. CNOOC said its Panyu 34-1/35-1/35-2 project, which is located in the Pearl River Mouth Basin of the South China Sea, was producing 21 million cubic feet of natural gas per day. The project consists of the three gas fields with a water depth in the range of between 195-338 meters.
Dragon Oil has ditched its £492million takeover bid for Petroceltic. The move would have seen the company potentially benefit from Petroceltic assets in North Africa and Kurdistan. However, Dragon Oil said it no longer intends to make an offer on the back of “prevailing market conditions”.
Last month at PETEX in London, the hunt for shale gas resources in the UK was a hot topic and among the companies offering their expertise and wares at the show was CGG, currently being stalked by fellow French group Technip, and US energy services giant Baker Hughes, which arch rival Halliburton ha made a $35billion bid for. While companies such as these cannot easily answer the social and political questions, or indeed even wish to engage that way, they can contribute to the debate on technical feasibility and potential. And both Baker and CGG are well equipped to do this. Firstly, and according to CGG, we in Europe and not just the UK have the opportunity to benefit from the latest developments in North America. Integrated workflows, which bring together a broad range of geoscience data, have shown great potential for the comprehensive reservoir characterisation required to optimise drilling and completion activities in heterogeneous unconventional resource plays.
BG Group has revised the salary package for its new chief executive Helge Lund following a backlash from shareholders. Mr Lund, who has been likened to Real Madrid and Portuguese footballer Cristiano Ronaldo because of his superstar status in the global oil and gas industry, was set to get a £12million “golden hello” in shares and the chance to earn £13.5million a year if he hits performance targets. Mr Lund’s share award has been cut from £10million to £4.7million.
In May, Transocean revealed a plan to hive off its eight North Sea midwater rigs into a spin-off company to be called Caledonia Offshore Drilling to be based in Aberdeen. The offshore drilling assets scheduled to move across to Caledonia included the Sedco 704, Sedco 711, Sedco 712, Sedco 714, Transocean John Shaw, Transocean Prospect, GSF Arctic III and JW McLean. While the company has pressed ahead with creating the subsidiary, plans for full separation have been sunk by the slump in oil prices and the impact of that on its performance.
Barely half a year after being spun-off as a separate business by Noble Corporation, Paragon Offshore has pounced on Prospector Offshore Drilling, taking control by buying up more than 55% of its stock. News of the acquisition broke on November 17, with Paragon planning to sweep up remaining shares via a mandatory offer. However, within hours of the announcement, it appears to have gained control of nearly 90% of stock. On November 24, Paragon called for an extraordinary general meeting of shareholders, based on the fact that it owned 89.99% of its quarry’s shares.
Plunging prices at the pumps have failed to arrest the slide in petrol purchasing. Petrol sales in October 2014 fell when compared with October 2013 despite pump prices falling more than 8p a litre over the 12-month period, Government figures highlighted today by the AA showed. The statistics also showed that petrol sales for the first 10 months of this year have fallen 20% compared with the same period five years ago.
Maven Capital Partners has sold its stake in an Aberdeen firm it backed in a £10million deal five years ago. A group of private investors has bought out Maven's stake in oil and gas control systems firm, EFC Group. The sum was undisclosed but Maven said it generated a 3.8x multiple return for its client funds on the deal.