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    Premier Oil Gain $147M from Asset Sales (Monday, 22 December 2014)

    1 Jan 1970, 12:00 am
    Premier Oil, a UK-based independent oil and gas company has completed two previously announced asset sales worth $147.5 million in Total.Premier has completed the sale of its non-operated interests in the producing Scott, Telford and Rochelle fields to MOL Group for a cash consideration of $130 million before interim period adjustments. MOL has assumed the liabilities for future abandonment costs.Premier has also completed the sale of its 30 per cent stake in PL359, offshore Norway, which contains the Luno II discovery, to Lundin for $17.5 million plus working capital adjustments.Source: www.offshoreenergytoday.comPlease leave comments and feedback below

    Rosneft Pays $7B Part of TNK-BP Loan (Monday, 22 December 2014)

    1 Jan 1970, 12:00 am
    Russian oil company Rosneft has repaid part of a loan taken to pay for the acquisition of TNK-BP. Rosneft has said that on Monday, December 22, it paid around $7 billion to lenders.According to the company, the overall amount paid throughout the year totaled $24 billion, in full accordance with the credit agreement.Rosneft in 2012 bought TNK-BP, then third largest oil company in Russia for around $56 billion. The deal was described as the second largest oil industry acquisition in history. The largest oil deal ever is the one from 1998, when Exxon Corp. bought Mobil Corp. for $80 billion.According to Reuters, Rosneft is due to pay a second loan of $6.9 billion in February 2015.Rosneft Head Igor Sechin said that: “To service its debt the Company does not need to enter the currency market, because it generates enough foreign currency earnings. Surplus balances are used on the market, in such a manner.Worth noting, Rosneft is one of three oil companies banned from raising cash in Western banks, due to sanctions imposed against Russia for its involvement in the Ukraine crisis.The U.S. Treasury also in September added Rosneft boss Sechin to a list of Russian officials banned from entering the U.S.At the time the Treasury said that sanctions imposed against Sechin do not include Rosneft as a company.Source: www.offshoreenergytoday.comPlease leave comments and feedback below

    Falling Oil Prices Call for Faster Reform (Monday, 22 December 2014)

    1 Jan 1970, 12:00 am
    In light of falling oil prices, which were at a five-year low last week, Oil & Gas UK has called for the government’s reform to the oil and gas fiscal regime to be accelerated. To remind, George Osborne, the UK Chancellor of Exchequer, recently presented the Autumn Statement to the Parliament where he promised that the government will shortly set out major reforms to the oil and gas fiscal regime, to make sure that the UK Continental Shelf continues to attract investments.The Chancellor’s announcement that the ‘vital’ UK offshore oil and gas industry is to see an immediate reduction of two percentage points in its tax rate, was lauded by the Oil & Gas UK as “an important first step towards improving the fiscal competitiveness of the UK North Sea.”Oil & Gas UK’s economics and commercial director, Mike Tholen commented:“The UK oil and gas industry is facing a serious challenge. The falling oil price is affecting activity across the UK North Sea and companies are having to take hard decisions in light of this challenging business environment.“To sustain the economic benefits the industry has provided for many decades, Oil & Gas UK believes that urgent action is needed to deliver the programme of fiscal change by the 2015 Budget and we are committed to work closely with by HM Treasury to do so. In parallel, there needs to be swift implementation of the Wood Review recommendations whilst industry concentrates on addressing the costs and efficiency of its operations across the North Sea.” Image: Davie StuartSource: www.offshoreenergytoday.comPlease leave comments and feedback below

    Statoil Recommissions Scarabeo 5 (Monday, 22 December 2014)

    1 Jan 1970, 12:00 am
    Statoil has received consent from the Petroleum Safety Authority (PSA) Norway to use Scarabeo 5 for plugging and production drilling in the Norwegian Sea.Statoil is the operator of the Kristin field, which is in blocks 6406/2 and 6506/11 at Haltenbanken in the Norwegian Sea.Statoil will plug well 6406/2-R-4 BHT2 permanently and simultaneously drill a new production well as a sidetrack from the well being plugged. The new production well will be designated 6406/2-R-4-CH.The PSA says that the water depth at the site is 355 metres and the combined activities are estimated to last 138 days.The PSA has now granted Statoil consent to use the Scarabeo 5 semi-submersible drilling rig for these activities.Scarabeo 5 is a type ME 4500 semi-submersible drilling rig and was built at the Fincantieri Shipyard in Genoa, Italy in 1990. It is operated by Saipem Norwegian Branch (Saipem), registered in the Bahamas and classified by ABS.Scarabeo 5 was issued with an Acknowledgement of Compliance (AoC) by the PSA in May 2003.To remind, Statoil suspended Scarabeo 5’s contract in July this year due to “overcapacity in its rig portfolio”. At the time, the company announced its plans to recommission the rig after the turn of the year.Source: www.offshoreenergytoday.comPlease leave comments and feedback below

    Transocean Drops Seven Rigs (Sunday, 21 December 2014)

    1 Jan 1970, 12:00 am
    Transocean, one of the world’s largest offshore drilling contractors, has issued its monthly Fleet Update Summary according to which it plans to scrap seven lower-specification deepwater and midwater floaters.The company intends to scrap the following rigs: Sedco 710, Sovereign Explorer, Sedco 700, Sedco 601, J.W. McLean, GSF Arctic I, and Falcon 100. These rigs are classified as held for sale.Related to the scrapping of these rigs, the company says it expects its fourth quarter 2014 results to include an estimated non cash charge of $100 million to $140 million, net of taxes.According to the report, including four previously disclosed rigs (Sedneth 701, Sedco 703, Sedco 709, and C. K. Rhein, Jr.), Transocean has already or intends to scrap a total of 11 lower-specification floaters.Furthermore, Transocean says that additional rigs may be identified as candidates for scrapping as the company continues to evaluate the long-term competitiveness of its fleet.New contracts and changes to existingIn addition, Transocean’s report includes several new contracts and contracts extensions. The total value of new contracts since the November 18, 2014 Fleet Update Summary is approximately $453 million.– GSF Development Driller I – Awarded a two year contract in Angola at a dayrate of $382,000 ($279 million estimated backlog). The rig was previously idle.– Jack Bates – Customer exercised a nine month option in Australia at a dayrate of $370,000 ($101 million estimated backlog). The rig’s prior dayrate was $420,000.– Dhirubhai Deepwater KG2 – Awarded a five month contract extension in India at a dayrate of $395,000 ($59 million estimated backlog). The rig’s prior dayrate was $510,000.– Sedco Express – Awarded a 45 day contract in Nigeria at a dayrate of $300,000 ($14 million estimated backlog). The rig was previously idle.– The Deepwater Pathfinder, Deepwater Expedition, GSF Explorer, and Discoverer Seven Seas, are idle.Source: www.offshoreenergytoday.comPlease leave feedback and comments below

    North Sea oil summit announced by Aberdeen City Council (Sunday, 21 December 2014)

    1 Jan 1970, 12:00 am
    A summit to bring together governments, trade unions and industry bodies to look at the challenges facing the North Sea oil industry has been announced.Jenny Laing, leader of Aberdeen City Council, said a "strategic plan" was needed to save jobs in the north east of Scotland as the price of oil continues to fall.Labour has called on Nicola Sturgeon and David Cameron to attend the summit.It comes after a warning that the UK's oil industry is in "crisis". On Thursday, Robin Allan, chairman of the independent explorers' association Brindex, told the BBC that the industry was "close to collapse".He claimed almost no new projects in the North Sea were profitable with oil below $60 a barrel.However, Sir Ian Wood, another leading industry figure, said Mr allan's warning was "well over the top and far too dramatic".Sir Ian predicted conditions would begin to recover next year. 'Undermine confidence' Labour councillor Ms Laing said Aberdeen was the oil capital of Europe and as such it was her job, as leader of the city council, to work with the governments in Edinburgh and Westminster and the oil industry to ensure jobs in the city were protected and companies remained based there.She said. "I have today instructed Angela Scott, our chief executive, to arrange a summit between senior politicians, government officials, industry representatives, trade unions, and local politicians."The aim will be to ensure an agreement to develop a strategic plan to ensure job losses are either avoided or kept to a minimum."It must concern us all that the price of oil has dropped so heavily in such a short space of time and we need to agree a strategy to deal with fluctuations that undermine confidence in the North Sea."Ms Laing said the council chief executive would write to various politicians within both the UK and Scottish governments, as well as UK Oil and Gas, other industry leaders and trade unions to encourage them to take part in the summit.Scottish Labour has pledged to send its new leader Jim Murphy.A Scottish government spokesman said it was continuing to do all that it can to support Scotland's oil and gas sector.He added: "As we have long said, what the industry requires is a stable predictable fiscal regime, and that substantial tax incentives are needed to achieve the objective of maximising recovery."Unless the UK government acts to bring in further measures, the likelihood is some fields will cease production early."Source: BBC News

    BP Denied Valhall QP Life Extension (Friday, 19 December 2014)

    1 Jan 1970, 12:00 am
    The Petroleum Safety Authority Norway (PSA) has turned down an application from BP Norge AS for consent to extend the operating life of the quarters platform (QP) on the Valhall field.BP currently has permission to use Valhall QP for accommodation until December 31, 2014, and applied to the PSA for consent to extend this date to December 31, 2017.The PSA says that uncertainties are present in the analyses used by BP as a basis for its application to extend the operating life of Valhall QP. The PSA has accordingly refused consent for continued use of the facility for accommodation.BackgroundValhall QP was taken into use on the field in 1980. According to the plan for development and operation (PDO) of Valhall, the design life of this installation was 20 years.In order to continue using an offshore facility beyond its original design life, the operator must apply to the PSA for consent to an extension. The operator must then assess whether the facility has and can maintain its technical and operational integrity for the period of extended use covered by the application.BP has applied for consent to extend the operating life of Valhall QP as an accommodation facility on several previous occasions.– 2007 – Consent was given to extend its operating life to 30 September 2010.– 2010 – Consent was given to extend its operating life to 1 September 2012.– 2012 – Consent was given to extend its operating life to 31 December 2014.According to the PSA, these applications were primarily justified by the need for accommodation capacity on the field until the new Valhall PH process and hotel platform became operational, and for preparing and executing well work on Valhall DP. The PH facility became operational in January 2013.SubsidenceMany years of oil and gas production mean that the Valhall reservoir has become compressed and the seabed has subsided. This subsidence means that the base of the topside on Valhall QP is nearer the sea surface than before, and no longer satisfies the air-gap requirements, the PSA explains.Furthermore, Valhall QP fails to meet the requirements for surviving a 100-year wave in occupied condition. BP accordingly has procedures in place for destaffing when high waves are forecast.Current statusThe present consent expires on December 31, 2014. BP has applied for consent to continue using Valhall QP as a quarters platform until December 31, 2017 and thereafter as an end platform for escape and evacuation until it goes out of service.BP wants to continue operating the facility with a destaffing procedure for high waves, and will also shut it down from 20 December to 15 February in order to avoid one of the months with the greatest probability of high waves, and which experience has shown to be when destaffing is most frequent.UncertaintyThe PSA has commissioned a team of experts from Sintef, Marintek, the Norwegian University of Science and Technology (NTNU) and external technical specialists. The reports from this work have been passed to BP.On the basis of this work, the PSA notes that it has made BP aware of uncertainties related to the analyses used by the company as a basis for its application to extend the use of Valhall QP.In particular, the PSA has challenged the following:– 100-year wave – height of the wave crest. In the PSA’s view, BP underestimates the crest, which means in turn that wave loads are underestimated in BP’s analyses.- Load from steep waves. BP’s analyses assume that the wave forms are symmetrical. In reality, they are asymmetrical where their crests are displaced in the direction of wave motion. Taking this effect into account increases wave loads.- Acceptance limit for ultimate limit state. The PSA says it considers the analysis method used by BP to be inadequate (a combination of ulimate limit state (ULS) and accident limit state (ALS), where ULS loads are analysed in relation to the requirements for ALS.- Determination of destaffing level. The assessments made by BP also influence the determination of possible destaffing criteria in connection with bad weather.A technical dialogue has been conducted with BP on regulatory requirements, the latest knowledge, and uncertainties related particularly to these considerations. The PSA says that the company has expressed understanding for its arguments, but has chosen not to include identified uncertainties in the basis for its consent application. It thereby stands by the conclusions from its original analyses. In the PSA’s view, these considerations must be taken into account in order to comply with the regulatory requirements for load-bearing structures.Decision“BP is denied consent for continued operation of Valhall QP as an accommodation facility.“In its analyses, BP has failed to define realistic acceptance criteria for non-linear analyses. The PSA considers that BP has underestimated the wave crest heights and the loads from steep waves. When determining destaffing criteria, BP has failed to take account of higher-order waves and area effects. The PSA cannot therefore see that the requirements for analyses and for taking account of new knowledge and uncertainty, as specified in sections 16 and 17 of the management regulations on general requirements for analyses and on risk analyses and emergency preparedness assessments respectively.“Based on the information provided by BP, the PSA cannot see that Valhall meets an acceptable level of safety which finds expression in the requirements for load-bearing structures as specified in section 56 of the facilities regulations on load-bearing structures and maritime systems, with guidelines, see also section 11 on load/actions, load/action effects and resistance, with guidelines.”Source: www.offshoreenergytoday.comPlease leave comments and feedback below

    Eni Bags Three Permits off Portugal (Friday, 19 December 2014)

    1 Jan 1970, 12:00 am
    Italy’s Eni has finalised with Petrogal, a wholly owned subsidiary of the Portuguese company Galp Energia, the farm in agreement for the acquisition of a 70% stake and operatorship of the three permits off Portugal.According to Eni’s press release, the permits are Gamba, Santola and Lavagante.The agreement will guarantee the exploration rights for an unexplored area of 9,100 square kilometers in offshore Portugal.The exploration permits were awarded to Petrogal in 2007 by the Portuguese State.Eni says that the agreement is part of Eni’s strategy aimed at diversifying and expanding its exploration portfolio.Eni recently started production of first oil from the West Hub Development Project in Block 15/06 in the Angolan Deep Offshore.Source: www.offshoreenergytoday.comPlease leave comments and feedback below

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