US Gulf of Mexico lease sale generates nearly $121m in high bids

19 november | leases

The Bureau of Ocean Energy Management in the US has announced that Gulf of Mexico lease sale 256 has generated nearly $121m in high bids for 93 tracts, covering around 79 million acres in federal waters.

The figure is significantly higher compared to the previous oil and gas lease sale in March that received $93m in high bids.

A total of 23 companies submitted $135.5m worth of bids in the latest auction, which was also the last oil and gas lease sale under the current US administration.

Lease sale 256 featured 14,862 unleased blocks located in the western, central and eastern planning areas of the Gulf of Mexico in water depths ranging from 3m to 3,400m.

Shell Offshore placed high bids for 21 tracts, followed by EnVen Energy Ventures with 13. BP and Chevron units placed high bids for ten tracts each.

The highest bid was nearly $12m for a block in the Walker Ridge area. It was placed by divisions of Equinor and Repsol, Reuters reported.

The sale was scheduled in August but was postponed to November to carry out additional analyses of the oil and gas industry following the Covid-19 crisis.

19 november | survey

TGS commences 3D seismic survey project offshore Argentina

Geoscience data company TGS has commenced a 3D seismic survey project in offshore Argentina.

Originally announced in August, the Malvinas 3D programme involves acquiring 5,000km² of data. The company has deployed BGP vessel Prospector for the work.

The project is scheduled to be completed in the first quarter of next year. Once complete, the total coverage in the area will increase to 18,000km².

TGS also announced two new projects in offshore Brazil.

The first project is the Espirito Santo 3D survey, for which the company will utilise the COSL vessel HYSY720. This Dual Azimuth survey will cover a 1,400km² area in the Espirito Santo.

The acquisition is expected to be completed by the end of next year first quarter.

The other project involves 7,000km 2D Survey in the Pelotas Basin during the first quarter of 2021. The project will deliver depth imaged products in early Q3 2021, during the 17th Brazil license round.

The new data set will strengthen the existing coverage and will help in improving prospect mapping.

18 november | production

Equinor raises production capacity at North Sea’s Johan Sverdrup field

Equinor has announced that it will raise production capacity at its Johan Sverdrup field by 500,000 barrels per day (bpd) by the end of this year.

The latest production capacity will bring the total to around 60,000 barrels more than the ‘original basis’ when the field came online.

The Johan Sverdrup field began production in 2019 with an estimated output capacity of 440,000bpd.

It is located 150km off the Norwegian coast in the North Sea. It is being developed in two phases, with the first phase coming online in October 2019. The second phase will begin production in the fourth quarter of 2022.

The field is operated by Equinor (42.6%), alongside Lundin Norway (20%), Petoro (17.36%), Aker BP (11.57%), and Total (8.44%).

Equinor Norway development and production senior vice-president Jez Averty said: “For the second time since the start-up the plant is able to increase its daily capacity. As Johan Sverdrup is a field with high profitability and low CO₂ emissions, a production rise is great news.

“The field has low operating costs, providing revenue for the companies and Norwegian society, even in periods with low prices.”

18 november | production

PetroVietnam reportedly produces first gas from Sao Vang-Dai Nguyet field

Vietnam’s state-run company PetroVietnam Gas has reportedly started gas production from the Sao Vang-Dai Nguyet (SVDN) gas and condensate development project offshore Vietnam.

The SVDN development project is located in Blocks 05-1b and 05-1c in the Nam Con Son Basi off the coast of Vietnam. It is 350km south-east of the Ho Chi Minh City.

The news on first gas production comes as Vietnam struggles ‘to maintain its oil and gas production’, Reuters reported. The South East Asian country also relies more on imports.

As per the estimates, the field’s gas output stands at 1.5 billion cubic metres (bcm) of gas per annum. This is equivalent to 15% of the total gas output produced by the country last year.

Japanese petroleum company Idemitsu Kosan operates the Sao Vang-Dai Nguyet field and owns 43.08% stake in it. Other partners include Teikoku Oil (36.92%) and PetroVietnam (20%).

16 november | operations

NPD permits Equinor to start work on Snorre field expansion

The Norwegian Petroleum Directorate (NPD) has given consent to oil major Equinor and its partners to proceed with work on the Snorre field expansion in the North Sea.

The Snorre field expansion comprises six subsea templates, all of them tied into Snorre A.

According to NPD, 24 new wells will be drilled, with 13 of them as production wells. The remaining 11 wells will be water-alternating gas injectors.

The recoverable reserves at the Snorre field expansion were calculated at about 195 million barrels in the ‘amended plan for development and operation’.

Snorre is an oil and gas field in the Tampen area in the southern part of the Norwegian Sea. It was discovered in 1979 and has been producing since August 1992.

The Snorre expansion (SEP) project is a proposed expansion of the Snorre field located in blocks 34/4 and 34/7 of the Tampen area, approximately 200km west of Florø in the Norwegian North Sea.

Equinor operates and owns 33.28% stake in the Snorre field. Other partners include Petoro (30%), DEA Norge AS (8.57%), ExxonMobil Exploration and Production Norway (17.45%), Idemitsu Petroleum Norge (9.6%), and Point Resources (1.1%).

16 november | production

Aker BP and partners start production from Norway’s Ærfugl Phase 1

Oil and gas firm Aker BP and its partners have announced the commencement of production from the Ærfugl field phase 1 in the Norwegian Sea.

The gas reservoir is located in production licence 212 in the Norwegian part of the North Sea. It holds reserves of around 300 million barrels of oil equivalent.

The Ærfugl project comprises two development phases, which will both be tied into the existing floating production storage and offloading vessel on the nearby Skarv field. It is located about 210km west of Sandnessjøen.

Plans for development and operation of both phases were submitted to the Norwegian Ministry of Petroleum and Energy in December 2017.

Aker BP claims that the project is one of the ‘most profitable development projects’ on the Norwegian Continental Shelf.

Aker BP is the operator of the project, with an operating interest of 23.8%. Partners in the Ærfugl project include Equinor (36.2%), Wintershall DEA (28.1%), and PGNiG (11.9%).

Total investment costs for the project are around Nkr8bn ($874m).

In brief

Wärtsilä report says G20 net-zero is possible with current stimulus

Global technology company Wärtsilä has released a report that shows potential for G20 stimulus packages to accelerate energy transition towards renewable energy systems and economic recovery.

Ørsted announces acquisition of Haystack Wind project in US

Denmark-based green energy company Ørsted has announced the acquisition of the Haystack Wind project in Wayne County, Nebraska, US, with a capacity of 298MW.

Iberdrola and Fertiberia partner to invest €1.8bn in seven years

Iberdrola and Fertiberia have announced a partnership that is expected to see the installation of 800MW of green hydrogen production capacity with an investment of €1.8bn over seven years.

Statkraft to purchase renewable energy from BayWa r.e. in Spain

European renewable energy company Statkraft has signed a power purchase agreement (PPA) with BayWa r.e. in Spain for the Tordesillas solar farm. As per the ten-year PPA, BayWa r.e. will supply 100% renewable energy to Statkraft, which will be supplied to its Spanish and pan-European customers.

Nordex to supply wind turbines for 240MW wind farm in US

Wind turbine manufacturer Nordex has secured an order for 240MW wind farm located in Texas, US, from an undisclosed company.

16 november | financials

Gulfport Energy files for bankruptcy as liabilities mount to $2.5bn

US-based natural gas producer Gulfport Energy has filed for bankruptcy after a series of acquisitions over the past decade weakened its balance sheet.

The company, which filed a Chapter 11 petition in the US Bankruptcy Court for the Southern District of Texas, had a total debt of approximately $2.5bn as of 30 September.

Gulfport Energy president and CEO David M Wood said: “After working diligently to explore all strategic and financial options available, Gulfport’s Board of Directors determined that commencing a chapter 11 process is in the best interest of the company and its stakeholders.

“We expect to exit the chapter 11 process with leverage below two times and rapidly delever thereafter due to a much-improved cost structure driven by reduced legacy firm transport commitments and costs. These improvements will significantly improve our ability to generate cash flow and value for our stakeholders going forward.”

The company also signed a restructuring support agreement with more than 95% of its existing lenders under its revolving credit facility.

As part of the restructuring plans, Gulfport said that it expects to eliminate about ‘$1.25bn in funded debt’, as well as reduce annual cash interest expense.

13 november | discovery

Aker BP makes minor gas and oil discovery in Alve Nord area

Exploration and development company Aker BP has found minor volumes of oil and gas with two wells in the northern portion of the Norwegian Sea.

According to the Norwegian Petroleum Directorate (NPD), semi-submersible Deepsea Nordkapp drilled wildcat well 6607/12-4 and appraisal well 6607/12-4 A on production license (PL) 127 C.

The wells are located 7km north-east of the Alve Nord oil and gas discovery and 200km west of Brønnøysund.

Located north of the company’s Skarv field, Alve Nord discovery will start production through the Skarv FPSO.

In the primary Jurassic/Triassic target, the first well intersected an 80m gas column in the Garn, Not, as well as Ile Formations.

In the secondary target, the well ‘encountered oil in three reservoir zones in the Lange formation’.

In a press statement, NPD stated: “Preliminary estimates of the size of the gas/oil discovery in the Jurassic/Triassic are between 0.5 and one million standard cubic metres (Sm³) of recoverable oil equivalent.

“The oil discovery proven in the Lower Cretaceous is between 1Sm³ and 2.7Sm³ of recoverable oil equivalent within production licence 127 C.”

In brief

FAR to sell stake in Senegal’s RSSD project to ONGC Videsh Vankorneft

Australian oil and gas exploration firm FAR has agreed to sell its 15% stake in the $4.2bn Rufisque Offshore, Sangomar Offshore, and Sangomar Deep Offshore project project offshore Senegal.

Maersk Viking to drill exploration well offshore Brunei Darussalam

Denmark-based offshore drilling contractor Maersk Drilling has secured a contract from Brunei Shell Petroleum (BSP) to drill one deepwater exploration well.

Equinor and partners award $455m in contracts for Bacalhau field drilling

Norwegian firm Equinor, alongside partners ExxonMobil and Petrogal Brasil, has awarded drilling and well service contracts valued at about $455m.

Scarborough JV receives offers for grant of petroleum production licences

Australian firm Woodside Energy has announced that the Commonwealth and Western Australian Joint Authority have granted petroleum production licences to the Scarborough joint venture.

First production from Tyra redevelopment in North Sea delayed until 2023

Norwegian Energy Company has announced the postponement of the first production from the Tyra Redevelopment project in the Danish part of the North Sea. Due to the ongoing Covid-19 pandemic, the production has been delayed from 2022 to Q2-2023.