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From new production in Indonesia and China to new contracts for the Cypre and Shah Deniz projects, below is a compilation of the latest headlines in the E&P space within the past week.
3M gas field in Indonesia goes online
CNOOC Ltd. said its MDA gas field in Indonesia has begun production. The shallow-water MDA field is the largest of CNOOC’s 3M Project, and five production wells are planned.
Located in 80 m of water, 3M contains three fields with nine gas-producing wells tied back to a floating production unit (FPU). The FPU, constructed in China, has a capacity of 175 MMcf/d. When all wells are online, the 3M daily production is expected to be 127 MMcf/d. The MBH field began production in October.
HCML operates the 3M project on behalf of partners CNOOC, Cenovus and Samudra.
Calypso well encounters hydrocarbons
Neptune Energy reported finding hydrocarbons at the Calypso exploration well in the Norwegian Sea, although the find has not yet been classified as commercial because operations are at an early stage.
The Deepsea Yantai semi drilled Calypso in the Neptune-operated PL938 license.
Logs proved the presence of hydrocarbons, and Neptune is considering gathering additional data about the reservoir.
Neptune operates the license with 30% interest on behalf of partners OKEA ASA with 30%, Pandion Energy AS with 20% and Vår Energi ASA with 20%.
CNOOC’s Jinzhou 31-1 now onstream
CNOOC’s Jinzhou 31-1 gas field in the Bohai Sea has begun production through what CNOOC says is the first shallow-water christmas tree developed in China.
Located in 30 m of water in the Liaodong Bay of the Bohai, Jinzhou 31-1 features a subsea production system, a transport line, an umbilical and the shallow-water subsea tree. It produces back to the Jinzhou 25-1 south processing platform.
Jinzhou 31-1 is expected to reach peak production of 14.8 MMcf/d in 2023.
CNOOC Ltd. operates the field with 100% interest.
Duster at Gazania-1 well off South Africa
Africa Energy Corp. reported the Gazania-1 exploration well offshore South Africa failed to encounter commercial hydrocarbons although it encountered wet gas in the main target.
“This confirms an active petroleum system within the basin, but the well did not encounter commercial hydrocarbons,” Jan Maier, Africa Energy’s vice president of exploration. “Early interpretation indicates that the trapping mechanism is not effective at this location. Further technical work is required to understand the complexity of the sedimentology and to evaluate alternative viable trapping configurations in the A-J Graben.”
The company said it will log the Block 2B well in the Orange Basin before it is plugged and abandoned.
Drilled to 2,330 m total depth (TD), the well was testing the extension of oil discovered at A-J1 in 1988, Maier said.
Eco operates the block with 50% interest on behalf of Africa Energy with 27.5%, Panoro with 12.5% and Crown Energy AB with 10%.
Gato do mato FID delayed
BW Offshore announced Shell Brasil Petróleo Ltda (Shell) has delayed final investment decision (FID) on the Gato do Mato oil and gas field development offshore Brazil. Now, BW said, FID will not be made within the next 12 to 24 months.
BW expects to receive formal notification terminating the limited notice to proceed and said it will be reimbursed for costs incurred in line with the agreed terms of the LNTP.
Hess exits Libya concession
Hess has sold its 8.16% stake in the Waha concessions in Libya to TotalEnergies and ConocoPhillips. Under the deal, ConocoPhillips and TotalEnergies’ interests both increase from 16.33% to 20.41%
Contracts and company news
Subsea7 wins Cypre work
Subsea7 announced the Subsea Integration Alliance won a contract related to BP’s Cypre gas project offshore Trinidad and Tobago.
Subsea7’s portion of the contract is valued between $150 and $300 million and covers the concept and design, engineering, procurement, construction and installation of a two-phase LNG tieback to the Juniper platform through dual flexible flowlines and a manifold gathering system, along with topside upgrades.
Subsea7 will carry out design, engineering, and project management through its offices in the U.S., with offshore installation planned for 2024.
The Subsea Integration Alliance is a non-incorporated strategic global alliance between Subsea7 and OneSubsea, the subsea technologies, production, and processing business of SLB.
MOU on 1-2 MPTA modular LNG solution
Technip Energies and Baker Hughes announced a memorandum of understanding (MOU) to jointly develop a new modularized LNG solution for the onshore market. The solution would be able to handle between 1 and 2 million tons per annum (mtpa).
Baker Hughes already offers a 1 mtpa range LNG Mid-scale Modular Solution (MMS), with a production capacity of 0.8 to 1 mtpa, while Technip Energies’ SnapLNG has a production capacity of 2 to 3 mtpa.
Baker Hughes’s plug-and-play modular MMS provides a flexible, standardized, and scalable solution for lowering the carbon footprint of the liquefaction process and faster time to LNG.
Technip Energies said its SnapLNG, a modularized compact and fully electrified solution, covers the liquefaction as well as the necessary pre-treatment and utilities units.
KBR wins Shah Deniz work
KBR reported SOCAR-KBR had won an optimization stage engineering services contract from BP Exploration (Shah Deniz) Ltd. for the Shah Deniz compression project in the Azerbaijan sector of the Caspian Sea. The project is in early pre-FID stage.
The Shah Deniz compression platform project will be the first in the Caspian region to feature crewless operations.
Under the contract, SOCAR-KBR will support optimization and provide class-3 engineering services. Scope also includes engineering to enable integration of the new platform to the existing system and provide shore power to reduce the carbon footprint in support of BP’s net-zero targets.
SOCAR-KBR is a joint venture of Azerbaijan state oil company SOCAR and KBR.
Transocean buys into new 7th-gen drillship
A Transocean Ltd. subsidiary, together with Perestroika AS and funds managed by Lime Rock Management LP, have formed a joint venture, Liquila Ventures Ltd., which has agreed to purchase a high-spec, ultradeepwater newbuild drillship.
Liquila Ventures will buy Hull 3623, the ultradeepwater newbuild drillship formerly known as West Aquila, for approximately $200 million from Daewoo Shipbuilding & Marine Engineering Co. Ltd.
Hull 3623 is a high specification, 1400 short-ton hookload, ultradeepwater drillship. This seventh-generation dual-activity drillship will have a large deck space, high load capacities, and will be dual-stack ready.
The rig is expected to be delivered in third-quarter 2023.
Saipem announces drilling contracts
Saipem has won $800 million in offshore drilling contracts in the Middle East and West Africa.
The Perro Negro 12 and Perro Negro 13 high-spec jackups were chartered for work in the Middle East. The Perro Negro 12’s contract is for five years plus two optional years while the Perro Negro 13’s contract is for three years plus one optional year. Both are scheduled to start between the third and fourth quarter of 2023. A third contract in the Middle East is a five-year extension for an existing contract for the high-spec jackup Sea Lion 7.
Sixth-generation drillship Saipem 12000 won two contracts offshore West Africa. Eni Cote d'Ivoire awarded a contract for operations offshore Ivory Coast, which are expected to start fourth-quarter 2022 and extending the current activities of the rig for about six months. Azule Energy awarded the second contract, which is for drilling, completion and testing of development and exploration wells offshore Angola in Block 15/06 operated by Eni Angola SpA. The contract will cover drilling and completing 12 firm wells, estimated to take 26 months, and include the possibility of extension for an optional term. The project is scheduled to start in 2023 in continuity with the previous works of the rig in West Africa.
2024-02-16 - Magnolia Oil & Gas plans to boost production volumes in the single digits this year, with the majority of the growth coming from the Giddings Field.
2024-02-19 - Patterson-UTI saw net income rebound from 2022 and CEO Andy Hendricks says the company is well positioned following a wave of E&P consolidations that may slow activity.
2024-02-15 - BP wants to boost its LNG portfolio to 25 mtpa by 2025 under a plan dubbed “25-by-25,” upping its portfolio by 9% compared to 2023, CEO Murray Auchincloss said during the company’s webcast with analysts.
2024-02-20 - With natural gas markets still oversupplied and commodity prices low, gas producer Chesapeake Energy plans to start cutting rigs and frac crews in March.
2024-01-31 - Hess Corp. increased its drilling activity and output from the Bakken play of North Dakota during the fourth quarter, the E&P reported in its latest earnings.