A flurry of North Sea deals is welcome news for an industry facing ongoing challenges, Bob Ruddiman, head of energy and natural resources at legal firm Pinsent Masons, said yesterday.
Mr Ruddiman, who is based in Pinsent’s Aberdeen office, was speaking after Serica Energy revealed it had completed the acquisition of an 18% stake in the Erskine field.
He said: “The UKCS (UK continental shelf) more than most oil producing regions has had to adapt to the constraints of a lower oil price which no one could foresee.
OPEC extended its campaign to restrain rival producers by continuing to pump oil into a global supply glut.
The 12 nations kept their combined daily production target at 30 million barrels after meeting in Vienna on Friday. Crude oil fell 0.6 percent in London, extending this week’s decline to 5.9 percent.
The Organization of Petroleum Exporting Countries’ decision signals intensifying competition for market share among global producers and more pain for U.S. shale drillers, who already idled a record number of rigs. It should also keep a lid on energy costs for consumers and help keep inflation in check.
Baker Hughes international rig count for last month was 1,158, down 44 from the 1,202 counted in April.
The number was also down 192 from the 1,350 counted at the same time last year.
Schlumberger has independently evaluated the unconventional oil potential of the Horse Hill-1 well in the Weald Basin neat to Gatwick Airport.
The company, working on behalf of UK Oil & Gas, has estimated a gross overall oil in place for the Jurassic section of the well to be approximately 2.731 million barrels of oil per square mile.
London-listed UK Oil & Gas Investments previously announce the findings of a report which estimated 158million barrels per square mile could lie below the site just north of Britain's second-largest airport, much more than first thought.
Full power output has been achieved at the Westermost Rough offshore windfarm, a major renewable energy project located off the UK's east coast.
Westermost Rough is capable of generating up to 210 megawatts (MW) of electricity – enough to meet the annual electricity demands of well over 150,000 UK homes.
It is the first offshore windfarm to make commercial use of the Siemens 6MW wind turbine, with each of the 35 turbines in use taller than the Humber suspension bridge, the towers of which are 156m in height.
It is almost exactly two years since the Offshore Safety Directive 2013 (the Directive) was adopted by the EU, a move which stems from the European Commission’s concern following the Deepwater Horizon incident in April 2010 that the existing regulatory framework for offshore safety in the EU was “divergent and fragmented”.
Further, the Commission was concerned that it did not provide adequate assurance that risks from offshore accidents were minimised throughout the Union. As a result, the Directive now includes requirements on member states to ensure that operators of existing and future offshore oil & gas operations in the EU are appointed by licensees or licensing authorities.
They must also take all suitable measures to prevent major accidents in offshore oil & gas operations and prepare safety documents, including emergency response plans, corporate accident prevention policies and safety and environmental management system documents, and submit them to the relevant national competent authority.
Oil headed for the biggest weekly decline since March amid speculation OPEC will maintain its production target at Friday’s meeting in Vienna, leaving the market oversupplied.
Futures dropped as much as 1.1 percent in London, extending this week’s decline to 6 percent. Oil production is a sovereign right and shale isn’t a threat to the industry, Saudi Arabia Oil Minister Ali al-Naimi said in Vienna. His Kuwaiti counterpart said there may be a proposal for the group to raise its production limit.
Brent’s recovery from a six-year low in January has stalled as OPEC continues to pump into a global glut to force higher-cost producers to cut output. Saudi Arabia’s al-Naimi, who led a November decision not to reduce the quota, said he’s “100 percent satisfied” about the market, reported Al-Hayat, a London-based Saudi newspaper.
Serica Energy has acquired an 18% stake in the North Sea Erskine field from oil major BP.
The company said the deal was completed earlier this month, giving them a share in UK blocks 23/26a and 23/26B.
As part of the transaction 13.5million shares in Serica have been issued to BP who now hold approximately 5% of the company’s enlarged issued share capital.
Union Jack Oil has reached an agreement with Celtique Energie Petroleum to acquire an additional 10 % interest in the PEDL241 licence, which contains the North Kelsey prospect.
The company said under the terms of the agreement, Union Jack will increase its share from 10% to 20%.
The prospect is 10 kilometres to the south of the Wressle-1 discovery well in PEDL180.
Union bosses have given offshore catering companies two weeks to return to the negotiating table and hammer out a compromise on staff pay, or risk facing strike action.
The Unite union yesterday said the Caterers Offshore Trade Association (Cota) had “refused to enter into meaningful discussion” regarding its members’ earlier decision to backtrack on a 2% pay increase that had been agreed for this year.
Indonesia is seeking a long-term crude oil supply deal with Iran if trade sanctions against the Persian Gulf nation are lifted, as it talks to OPEC on rejoining the group.
The Organization of the Petroleum Exporting Countries will hold a meeting on Friday to discuss Indonesia’s request to be a member, Energy and Mineral Resources Minister Sudirman Said said in a statement.
Indonesia, a net oil importer, is also discussing crude supply and investments with the United Arab Emirates during meetings in Vienna, he said.
Green-energy technology development body Wave Energy Scotland (WES) has struck a deal allowing it to tap into expertise at Aquamarine Power, the firm behind the Oyster wave-power machine.
The three-month tie-up is known as Project Know-How and allows WES, which was established as part of Highlands and Islands Enterprise late last year at the request of the Scottish Government, to benefit from knowledge gained through the development of Oyster technology.
Airpac Bukom Oilfield Services grew profits and revenue during the year to March 31 despite an “increasingly challenging” trading climate, the Aberdeenshire firm’s owner said yesterday.
Reporting group results, equipment rental specialist Vp said its Kintore-based Airpac Bukom subsidiary increased operating profits to £2.8million, from £2million the year before, while revenue rose by £1.3million to £21.5million.
McDermott International has been awarded an offshore contract by Pemex for the engineering, procurement, construction and installation of the Ayastil-C replacement jacket.
The company said the value of the large brownfield award will be included in McDermott’s second quarter 2015 backlog.
McDermott International said it plans to use its in-house engineering and procurement experts Altamira fabrication yard in Mexico, Intermac 600 transportation and launch barge and heavy-lift Derrick Barge 50 vessel to complete the installation of all structures.
The head of ConocoPhillips said he expects the US tight oil boom to continue, despite low crude prices currently hitting the market.
Ryan Lance told a seminar organised by oil-producing group OPEC that technological breakthroughs would play a significant part in allowing steep reductions in costs.
Since last year OPEC has decided against cutting production to tackle the global glut which arose from a boom in US shale.
Petrofac has secured a contract worth $45million to support ONE (Oranje-Nassau Energie) on its newly acquired share of the Sean gas field.
The deal comes just a few days after the Dutch oil and gas producer announced its entry into the UK North Sea after snapping up 50% of the Sean field.
Sean is in the southern sector of the North Sea and ONE is now operator after acquiring its stake from Shell and Esso Exploration and Production UK, which each held 25%.
The remaining 50% is held by SSE E&P UK.
Energy service firm NorSea Group (UK) said yesterday it was expanding its activities to take in the “small piece” decommissioning market.
It revealed it had already secured a “major” decommissioning contract, serviced through its deepwater support base at Smith Quay in Peterhead, and was actively tendering for other opportunities in this growing sector of the market.
The Norwegian-owned firm gave no further details of the new contract, which coincides with a new senior management team being set up to lead the company’s growing activity across Scotland.
Never mind cutting output to staunch a global glut, the talk so far at this week’s OPEC summit is mostly about pumping more oil.
Iraq will increase exports this month as fighting with Islamic State militants spares its biggest-producing regions, the country’s oil minister said Wednesday.
His counterpart from Iran urged the group to make room for more output when global sanctions recede.
The prospect of more supply led BP Plc’s chief executive officer to predict price “softness” will persist.
Woodside Petroleum Ltd. is looking at becoming a partner in a potential $8.5 billion liquefied natural gas project in the US, a sign it’s setting its sights on the major leagues.
The Australian company’s initial pact with Sempra Energy to develop the Texas terminal shows it’s moving toward a model that looks more like that of energy giants Royal Dutch Shell Plc and BG Group Plc, according to UBS Group AG.
“We see our customers wanting more flexibility,” Woodside Chief Executive Officer Peter Coleman said in an interview in Paris, where he’s attending the World Gas Conference.
An ageing asset doesn’t mean unmanageable, unprofitable and inoperable.
There is still potential to be realised from the UK Continental Shelf (UKCS), despite the challenges of the current climate. In terms of oil alone, it is estimated that there are around 25billion barrels to be recovered.
Global demand for energy continues to escalate and fossil fuels will carry on contributing to the mix.
The UK Government is also committed to supporting the sector, as we have seen from the prior administration’s positive response to Sir Ian Wood’s 2014 state of the industry report.
Goldman Sachs, one of the banks at the heart of the 2008 Western financial implosion and multiple scandals and which presumes to pronounce on the fate of others, has issued a scathing commentary on the future of offshore drilling prospects.
In a note by one of its analysts Waqar Syed (plus team), Goldman tells the world that 2017 is going to be really tough.
“Industry is retiring floating rigs, but without rising demand, rig retirement will not solve the problem,” says Waqar Syed.
“Total marketed floater supply for end of 2015 stands at 280 rigs (313 total supply at the start of the year, less 31 rigs cold stacked already, less 21 rigs that we expect to be cold stacked, plus 19 scheduled newbuilds) of which 235 rigs are contracted (84%), while about 209 (74%) are currently working.
European oil majors are for the first time openly declaring interest in Iran in anticipation of a possible end to sanctions against the country over its nuclear program.
Leaders of Royal Dutch Shell Plc, BP Plc and Total SA all said Wednesday they were ready to return to the nation with the world’s second-largest natural-gas reserves and fourth-biggest oil cache, after similar comments by Italy’s Eni SpA last month.
US oil companies, constrained by the history of American sanctions against Iran dating from the 1979 Islamic revolution, are more cautious in their statements on a return. The current curbs have prevented investment in Iran for a decade.
Aker Solutions has won its first order for work in offshore Mexico.
The company secured the deal from Saipem to supply umbilicals for the Pemex-operated Lakach deepwater natural gas field.
Aker will deliver electro-hydraulic steel tube umbilicals of about 73 kilometres, which will help connect Mexico’s first subsea gas development to onshore processing facilities.
Sterling Energy has signed a deal with Tullow Oil to acquire a 13.5% interest in the production sharing contract for Block C-10 in Mauritania in west Africa.
The company will pay Tullow $50,000 to buy the stake.
The transaction will see Tullow’s share in the licence drop to 76.5%.
North Sea oil and gas companies must continue to promote the sector to young people or face a shortage of workers in the coming years, a Statoil official said yesterday.
Low oil prices have hit the industry hard with many companies forced to let staff go in order to free up funds for new projects, but Statoil appears to be taking a longer term view on employment.
The company plans to increase its Aberdeen-based headcount to 200 from 130 when it moves into a new office in Kingswells next spring, with hundreds more working offshore on its Mariner development.
