Falklands Project Finance Under Review
Finance under review for Sea Lion project offshore the Falklands
Rockhopper Energy says front-end engineering and design is progressing for Phase 1 of the Sea Lion oil field development in the offshore North Falkland basin.
This year, the focus has been on the commercial, fiscal, and financing elements of the project.
Various contractors have expressed interest in providing funding for the project and the company hopes to reach agreement in principle on key terms soon with the operator Premier Oil, with a view to sanctioning the project during 2018.
Discussions also continue with potential providers of export credit finance.
Elsewhere, Rockhopper expects an arbitral tribunal to be established this summer to handle its proceedings against the Republic of Italy. This followed the Italian government’s decision not to renew Rockhopper’s license (and proposed development) for the Ombrina Mare oil field in the Adriatic Sea.
Rockhopper is claiming the decision breaches the Energy Charter Treaty, and plans to seek damages on the basis of lost profits.
Kenya Oil Blocks in Spotlight
Chariot Oil & Gas has issued a resource/exploration update concerning blocks 2312 and 2412A offshore Namibia.
In February 2016, the company and partners AziNam, NAMCOR, and Ignitus completed acquisition of a 2,600-sq km (1,004-sq mi) 3D seismic survey.
This targeted leads identified in the northwestern area of the two Central blocks following a 2D survey the previous year.
The 3D data was processed with 3,500 sq km (1,351 sq mi) of legacy 3D seismic, with both depth migration and inversion products calibrated using results from the nearby Wingat-1 and Murombe-1 wells.
Chariot has identified five new dip-closed structural prospects in Upper Cretaceous deepwaterturbidite reservoirs (as penetrated in Murombe-1). Hydrocarbon charge appears to come from the proven Aptian marine source rocks identified in both that well and Wingat-1.
Netherland Sewell and Associates (NSAI) estimates resources for each prospect in the range of 283-459 MMbbl. Each of the prospects has two or more targets, and NSAI assesses the Probability of Geologic Success at up to 29%.
On behalf of the partners, Chariot has begun preparations for drilling during the second half of 2018 by conducting an environmental impact assessment over these prospects.
In addition, it is looking for a suitable drilling rig, long-lead items such as wellheads and tubulars, auxiliary services and a logistic base for well services, supplies, helicopters, and medivac.
The company’s in-house team will manage the initial scope of work, supported by Robert Mwanachilenga, country manager and senior staff drilling engineer. He worked on Chariot’s deepwater Tapir South-1 well in 2012.
Namibia’s government has also granted a one-year license extension to Chariot and its partners in the PEL 71 license in the South of Walvis offshore basin
Statoil Outlines Technology Strategy
Statoil has updated its technology strategy, which focuses on safety, high value creation, and low carbon.
The new technology strategy increases the company’s research on CO2 reduction and digital solutions.
The strategy focuses on five technology directions:
Optimize production from existing and near-field resources
Low-carbon solutions for oil and gas
Discover and develop frontier and deepwater areas
Unlock low-recovery reservoirs
Develop renewable energy opportunities.
All directions build on digitalization, innovation, and multidisciplinary solutions.
MargarethØvrum, executive vice president for Technology, Projects and Drilling, said: “Statoil wants to be in the forefront of the development in the oil and gas industry. Technology and innovation are vital to finding more resources and developing projects, while at the same time reducing costs and CO2 emissions.”
In 2020, Statoil said that it will spend 25% of its research funds on CO2 reductions and new energy solutions. In order to reduce emissions from oil and gas activities, efforts are being made to develop electrification technologies, reduce emissions from turbines offshore, and reduce energy consumption for new fields.
.---Reliance, BP sanction India Gas Project
BP and Reliance Industries Ltd. (RIL) have sanctioned development of the R-Series deepwater gas fields in block KGD6 offshore eastern India.
The R-Series (D34) project is a dry gas development in water depths of more than 2,000 m (6,562 ft), about 70 km (43 mi) offshore. The fields will be developed as a subsea tieback to the existing control and riser platform off block KGD6. The project is expected to produce up to 12 MMcm/d (425 MMcf/d), coming onstream in 2020.
This is the first of three planned projects in block KGD6 that are expected to be developed in an integrated manner, producing from about 3 tcf of discovered gas resources.
RIL and BP plan to submit development plans for the next two projects for government approval before the end of the year.
Development of the three projects, with total investment of about INR 40,000 crore ($6 billion), is expected to bring a total about 30-35 MMcm/d (1 bcf/d) of new domestic gas production onstream, phased over 2020-2022.
India consumes more than 5 bcf/d of natural gas and aspires to double gas consumption by 2022. Gas production from the integrated development is expected to help reduce India’s import dependence and amount to more than 10% of the country’s projected gas demand in 2022.
New Zealand Platform to Undergo Repair
Average oil production from the Maari and Manaia fields offshore New Zealand stabilized at around 10,000 b/d at the end of 1Q, according to partner Cue Energy.
This followed a maintenance shutdown at the start of the year, with production resuming on Jan. 12.
Preparations continue for a permanent repair to the Maari wellhead platform’s horizontal strut crack, identified in late 2016. The program will likely be performed soon.
In the Santos-operated Sampang PSC in the Madura Strait offshore Indonesia (Cue 15%), production from the Oyong field should switch to gas only during 3Q.
This measure should extend the life of the Oyong and Wortel fields to 2020 or beyond, Cue says.