SNC-Lavalin said it has been appointed by Saudi Aramco to install additional facilities for a major gas processing facility in Saudi Arabia’s Eastern Province.
Under the scope of work for the multi-million dollar contract, SNC-Lavalin will construct the Arabiah condensate handling facility and sour water disposal unit project at the Wasit Gas Plant in Saudi Arabia, including the installation of process equipment as well as related civil and structural, piping, electrical and instrumentation and control systems, the company said in a statement.
The construction work is already underway with a target completion date of late 2019.
Wasit Gas Plant is one of the largest gas plants to come onstream in Saudi Arabia, and is an enabler for the Kingdom’s Vision 2030 economic roadmap, feeding into the national master gas network to meet domestic energy demand.
“SNC-Lavalin has an impressive track record of successful project delivery during our 40-years of working with Saudi Aramco and we are pleased to continue our long-term relationship on another important project,” said Christian Brown, president, oil and gas, SNC-Lavalin. “Not only does this contract further demonstrate our industry-recognised onshore construction solutions, it also emphasises our commitment to supporting Saudi Aramco’s IKTVA localization program to increase the employment and skills development of local Saudi talent.”
Eni and Sonatrach signed a series of agreements to further the companies’ jointly operated activities in Algeria.
The agreements, signed between Eni's CEO, Claudio Descalzi and Sonatrach’s chairman and general manager Abdelmoumem Ould Kaddour, include an exploration and development program in the Berkine basin, which will produce new gas reserves through optimising existing infrastructure, Eni said in a statement.
Eni and SONATRACH have also signed specific agreements to continue their collaboration in the R&D sector, initially agreed upon on Nov. 2016.
“The renewed collaboration between our companies, enshrined in today's agreements, allows Eni to make a further important step forward in a key country like Algeria and to consolidate further our strategic partnership with SONATRACH,” said Eni's CEO, Claudio Descalzi.
Eni is also planning the construction of a renewable energy laboratory and of a photovoltaic plant at the BRN production site as a step in Eni's decarbonisation process.
Eni has been present in Algeria since 1981 and currently participates in 32 mining permits with an equity production in the country of about 100,000 barrels of oil equivalent a day, which makes the company the main international player in the country.
Oil Plus Ltd, a specialist global oil and gas consultancy, said it has secured contracts worth more than $1.5 million over the past three months and has significantly expanded its footprint in the Middle East.
The company has also reported a strong start to the year with sales almost triple compared to the last quarter of 2017. Due to the surge of new business, the Newbury-based company, which employs in excess of 30 people, plans to recruit another eight over the next 12 months.
The contracts will see Oil Plus deliver reservoir souring modelling, production chemistry and iron sulfide studies for several international oil companies in Saudi Arabia, Kuwait, Brazil, Thailand and Europe, the company said.
Oil Plus new ownership and management team have achieved significant growth since it was acquired by Mark Cavanagh last year.
Since 1978, Oil Plus has worked with more than 250 upstream oil and gas companies in key disciplines of production chemistry, microbiology, specialised reservoir souring and process engineering.
“The market has been looking strong during the first four months of 2018 and although trading is still tough, we are extremely confident about the year ahead,” said Clarke Shepherd, global business development director at Oil Plus.
“We have a robust pipeline of potential projects and plans are in place to expand into new international markets as well as concentrating on areas we have proven to be successful. Over the next 12 months, we’re targeting sustained and supported growth within our core business areas and looking to expand our engineering services,” he added.
“Over the past six months we have established a number of partnerships in the Middle East which will help to drive our business forward and promote the bespoke approach we take to solving complex production issues.”
Iraq oil ministry said it has received interest from 14 international oil and gas companies to bid for exploration and development contracts, which will now be auctioned by April 25.
The ministry postponed the bidding deadline to April 25 from April 15 to give more time to the companies considering bidding for the licensing round of 11 blocks, the ministry said in a statement.
The blocks, located in border areas with Iran and Kuwait, and in offshore Gulf waters, were initially planned to be auctioned in June.
Fourteen companies were sent documents for contracts which will include exploration, development and production from an exploration block, as well as a seperate development and production contracts.
There will also be service contracts to be tendered, Iraq Oil Ministry spokesperson said in a statement.
The Abu Dhabi National Oil Company (ADNOC) announced its plans to unveil its detailed downstream strategy, expansion plans of the Ruwais Industrial Complex and introduce new partnership and investment opportunities at the ADNOC Downstream Investment Forum that will take place in Abu Dhabi on May 13th and 14th.
ADNOC’s downstream strategy will act as a key catalyst to Abu Dhabi’s economic and diversification plans, attracting foreign direct investment and supporting significant in country value. The company also confirmed the attendance of over 30 global CEOs and over 600 senior business leaders from various sectors.
The ADNOC Downstream Investment Forum will mark the launch of ADNOC’s new downstream strategy, which aims to take advantage of evolving energy market dynamics and the rising global demand for refined and petrochemical products. ADNOC’s new downstream strategy will enable it to become a leading, global downstream player, positioning both Abu Dhabi and the UAE as a major producer and supplier in the global refining and petrochemicals value chain.
ADNOC’s expansion and new investment in the downstream will accelerate the delivery of its 2030 strategy and create a more flexible, resilient and diverse energy business, optimising and stretching the dollar from every barrel of oil it produces, and ensuring ADNOC is fit to compete, and lead, in the new energy era.
The new strategy, which will be anchored around an unprecedented new investment and development program at the integrated Ruwais refining and petrochemicals complex, in Abu Dhabi, will build on the location’s unique strengths and advantages: increasing its range and output of high-value products, attracting new partners and technologies, driving further diversification, and acting as a major catalyst for economic development and growth in Abu Dhabi and the UAE. This new investment program will also significantly boost ADNOC’s contribution to the UAE’s In-Country Value creation initiative, including ADNOC’s strong and ongoing support of the UAE’s private sector.
This new initiative, fully in line with ADNOC’s previously expanded partnership and investment model, is expected to attract significant foreign direct investment and international investor interest due to the uniqueness, quality and scale of the new investment and partnership opportunities.
Commenting on the Downstream Investment Forum, H.E. Dr. Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, said: “We operate in an energy landscape that is evolving rapidly, and we must adapt and transform ADNOC to become a more globally integrated energy company, built for agility, high performance and resilience – a modern energy company for a new energy era.”
“We continue to work on maximising operational efficiencies and strengthening our overall performance, while maximizing value from the company’s financial resources and assets through our enhanced partnership and investment model. As a next step, we are focused on significantly expanding our downstream business – a historic, new milestone in ADNOC’s journey – to further unlock and drive more value across our portfolio.
“We have always been a long-term, reliable supplier of crude and refined products, and we will remain so, but in the future ADNOC will also look to substantially grow its downstream position to become a global player, and reliable partner, in the production, supply and trading of refined and petrochemical products,” H.E. Dr. Al Jaber added.
On day one of the forum, prominent energy market industry leaders and experts, such as Dan Yergin, Vice Chairman of IHS Markit, Patrick Pouyanné CEO of TOTAL, Vicky Hollub, CEO of Occidental Petroleum, Claudio Descalzi, CEO of ENI, Mark Garret, CEO of Borealis, Wang Yilin, Chairman of CNPC, and Dr. Abdulwahab Al-Sadoun, Secretary General, Gulf Petrochemicals and Chemicals Association, will address evolving energy trends and industry opportunities.
In addition, global figures from a diverse range of industries, including Joe Kaeser, CEO of Siemens, John Flint, CEO of HSBC, Eric Cantor, Vice Chairman of Moelis, Musabbeh Al Kaabi, CEO of Mubadala Petroleum and Petrochemicals and Badr Al-Olama, Director of Mubadala Aerospace, will discuss global supply chain trends and investment opportunities.
Alongside the panel discussions, the forum will include the unveiling and presentation of ADNOC’s new downstream strategy and expansion plans, including those of ADNOC’s Ruwais Industrial Complex – the UAE’s world scale and fully integrated refining and petrochemicals hub – which is set to become the engine of ADNOC’s downstream strategy, and a new epicentre of the global refining and petrochemicals industry.
H.E. Dr. Al Jaber said: “We are extremely pleased with the enthusiastic and global response of the attendees to our Downstream Forum. This forum will unveil not only our future plans for the business, but how new and existing partners can join us as we seek to further redefine and transform the ADNOC Group.
The Organization of Petroleum Exporting Countries said inventory overhang has shrunken to near desired levels, helped by higher demand as well as production cuts by the group’s members.
OPEC’s March production fell by 201,000 barrels per day (bpd) to 32 million bpd, it said quoting secondary sources in its monthly oil report. The figure is below the 32.6 million bpd that OPEC sees as demand for its crude for the whole of 2018.
The largest production drop came from Angola, Venezuela where production was down by 817,000 and 555,000 bpd respectively. Other producers that cut production included Algeria and Saudi Arabia. Meanwhile, UAE increased production by almost 45,000 barrels.
The Organization of the Petroleum Exporting Countries agreed with some non-OPEC members to work towards bringing down a stock overhang to a five-year average by cutting production by 1.8 million barrels per day. The agreement, which came into force at the start of January 2017, will run through 2018.
OPEC said in its monthly report oil stocks in the developed world reversed a rise in January to fall by 17.4 million barrels in February to 2.854 billion barrels, around 43 million barrels above the latest five-year average.
Stock levels are now 207 million barrels below their level in February 2017, with crude stocks in a surplus of 55 million barrels and product stocks in a deficit of 12 million. The overhang has been reduced by 294 million bpd from January 2017.
“Looking forward, a healthy global economic forecast for 2018, positive car sales data in recent months, stronger 2018 yea-on-year U.S. product consumption in January and potentially tighter global product markets are expected to boost gasoline and distillates demand ...,” OPEC said.
“High conformity levels observed by OPEC and non-OPEC producing countries ... should further enhance market stability and support crude and product markets in the months ahead.”
OPEC compliance to production was hit a record of 133 per cent in February.
Meanwhile, it said world oil demand growth for 2017 grew by 30,000 barrels to 1.65 million bpd – total world demand is now pegged at 97.07 million bpd, the report said.
World oil demand growth for 2017 was adjusted higher by around 30,000 bpd to 1.65 million bpd, mainly to account for up-to-date data in both OECD and non-OECD regions.
“Total world oil demand is now pegged at 97.07 million bpd for the year. Similarly, world oil demand growth in 2018 was revised higher by 30,000 bpd, compared to last month’s report, to now stand at 1.63 million bpd.
SDX Energy has made a gas discovery at its Ibn Yunus-1X exploration onshore well at South Disouq, Egypt.
The Ibn Yunus-1X well was drilled to a total depth of 9,068 feet and encountered 100.8 feet of net conventional natural gas pay in the Abu Madi horizon. The well came with a reservoir section that was of better quality and thicker than pre-drill expectations, the firm said in a statement.
The well will be completed as a producer in the Abu Madi section and then tested. After a successful test, it is anticipated that the well will be connected to the infrastructure located adjacent to the original SDX discovery in the basin, SD-1X, where production start-up is anticipated in the second half of 2018.
Paul Welch, president and CEO of SDX, commented: “We are extremely encouraged with today’s discovery, our second consecutive discovery at South Disouq. This highly positive drilling result further demonstrates the very significant natural gas potential thelicence holds. Combined, these two successful wells confirm our views of the subsurface geology and demonstrate that we are on course to realise the full potential of the licence. We look forward to updating shareholders on future developments at South Disouq in due course.”
SDX Energy is the operator with a 55 per cent working interest.
Saudi Aramco plans to build a US$44 billion refinery and petrochemical complex on India’s west coast with a group of Indian companies as it looks to expand its international footprint.
The Saudi national oil company signed a preliminary agreement on Wednesday with Ratnagiri Refinery and Petrochemicals (RRPC), a consortium of Indian oil companies comprising Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPC), and Hindustan Petroleum Corporation (HPC), to jointly develop and build an integrated refinery and petrochemicals complex at Ratnagiri, in the state of Maharashtra, according to a company statement.
With a processing capacity of 1.2 million barrels of crude oil per day, the refinery will be able to produce a range of refined petroleum products, including gasoline and diesel.
Saudi Aramco said it may also look to include a strategic partner to co-invest in the refinery.
“Investing in India is a key part of our company’s global downstream strategy, and another milestone in our growing relationship with India,” said Saudi Aramco president and CEO Amin H. Nasser, adding that the launch of Aramco Asia’s New Delhi office last year came with a mandate to expand international portfolio in the key economic growth region.
The Ratnagiri Refinery and Petrochemicals will rank among the largest world refining and petrochemicals projects and will be designed to meet India’s fast-growing fuels and petrochemicals demand, Saudi Aramco said in the statement, adding the project cost is estimated at around $44 billion.
The refinery will also provide feedstock for the integrated petrochemical complex, which will be capable of producing approximately 18 million tons per annum of petrochemical production.
A pre-feasibility study for the refinery has been completed and the parties are now finalising the project’s overall configuration. Following the signing of the MOU, the parties will extend their collaboration to discuss the formation of a joint venture that would provide for joint ownership, control, and management of the project.
In addition to the refinery, cracker and downstream petrochemical facilities, the project will include associated facilities such as a logistics, crude oil and product storage terminals, raw water supply, as well as centralised and shared utilities.
Saudi Arabia’s oil giant Saudi Aramco signed deals with French companies worth about US$3 billion as part of its business growth strategy.
Agreements with French companies included: a purchase agreement for wellhead and surface control equipment with TechnipFMC; a purchase agreement to manage the installed base of process automation system and remote terminal units with Schneider and wastewater treatment agreements with Veolia and Dassur and another with Suez and Dassur, according to a Saudi Aramco statement.
Separate from a $9 billion petrochemical complex deal with Total, Saudi Aramco also signed an agreement with the French oil giant for a follow-up feasibility study of jointly acquiring a retail service station network in Saudi Arabia.
Additionally, cultural enhancement agreements were signed with Institut Du Monde Arabe (Arab World Institute) and with Centre Pompidou.
Aramco agreed on commercial collaborations with French companies at the Saudi-French CEO Forum held in Paris this week, which coincided with the official visit to France by HRH Crown Prince Mohammed bin Salman.
“Saudi Aramco has a massive and highly ambitious investment program over the next decade which is part of our portfolio expansion aspiration,” said Saudi Aramco president and CEO Amin H. Nasser. “This includes a number of mega world scale projects where French businesses can play a major role in providing the strategic mix of technical capabilities and innovation which would create the desired synergy which will be beneficial to the company but also to the Kingdom.”
“The strengths of French businesses and industry can play a role in Saudi Aramco’ business plan including in our diversification and expansion strategies underscored by the framework of Vision 2030,” he added.
Abu Dhabi’s state-oil firm ADNOC on Tuesday launched its first ever competitive exploration and production bid round for six onshore and offshore blocks.
The six blocks open for bidding, two of which are offshore and four are onshore, comprise an area of almost 30,000 km2, ADNOC said in a statement.
The successful bidders will enter into agreements granting exploration rights and, provided defined targets are achieved in the exploration phase, be granted the opportunity to develop and produce any discoveries with ADNOC, under terms that will be set out in the bidding package, ADNOC said.
Dr Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO said: “The launch of these large new licensing blocks is an important step for Abu Dhabi and ADNOC as we develop and apply new strategies to realize the full potential of our resources, maximise value through competitive bidding and accelerate the exploration and development of new commercial opportunities.”
The closing date for the receipt of bids will be in October, after which ADNOC will evaluate the bids, using the criteria set out in the bidding instructions, and the SPC will award the successful bidders. The first bid round is planned to conclude this year.
Dr Al Jaber added: "In addition, partners will have the opportunity, alongside ADNOC, to develop and benefit from any discoveries throughout their lifecycle. This is a great commercial opportunity for partners to grow with us, as we leverage the future potential of our nation’s resources."
The licensing announcement comes after ADNOC restructured its offshore oil and gas blocks and expanded its partner-base with new 40-year concessions finalised in recent weeks.
ADNOC’s licensing strategy looks at unlocking new opportunities and maximising value from its hydrocarbon resources. It is also consistent with ADNOC’s approach to expanding its strategic partnerships across all areas of its business.
“This approach is central to our expanded partnership strategy, which aims to introduce new opportunities as we broaden and diversify our partnership base. It is a new and different approach for ADNOC that is a win-win for ADNOC and its potential partners,” Dr Al Jaber said.
“In addition, as we begin to expand our downstream portfolio, the new licensing blocks reinforce our long term production growth ambitions and builds on our successful legacy as a leading upstream player. This is a rare and exciting opportunity, for both existing and new partners, in a secure and stable investment environment.”
The UAE is the world’s seventh largest oil producer, with about 96 per cent of its reserves within the emirate of Abu Dhabi. Located in one of the world’s largest hydrocarbon super-basins, there remains undiscovered and undeveloped potential in the numerous stacked reservoirs.
Based on existing data from detailed petroleum system studies, seismic surveys, log files and core samples from hundreds of appraisal wells, estimates suggest these new blocks hold multiple billion barrels of oil and multiple trillion cubic feet of natural gas.
Some of the blocks already have discoveries, and within the combined area there are 310 targeted reservoirs from 110 prospects and leads. In addition to the country’s conventional oil and gas accumulations, some of the offered blocks also contain significant unconventional resource potential.
Dr Al Jaber added during the press conference "Our estimates suggest that these new blocks contain substantial amounts of hydrocarbons."
ADNOC has established a dedicated website – www.adnoc.ae/Block-Bid – where the company provides information on the blocks and which has a portal where interested bidders can register to participate, subject to a strict prequalification process undertaken by ADNOC.
The website also provides details of a global roadshow of technical and commercial information on the new blocks. After the roadshow, bidders will confirm their participation through an Expression of Interest and will be able to purchase a comprehensive data package on the six blocks. The data package will include full bidding instructions and regional geological information, in addition to well and seismic data, in both raw and interpreted form, on all six blocks.
Registration is open to companies with suitable expertise and technology that can contribute to accelerating the exploration and development of new conventional and unconventional hydrocarbon opportunities in Abu Dhabi.
Saudi Aramco and Total agreed to build a US$9 billion petrochemical complex next to an existing refinery in Saudi Arabia's Jubail region, in a move to expand the country's production capacity while reducing dependency on crude oil sales.
The companies signed a preliminary deal to build a mixed-feed steam cracker with a capacity of 1.5 million tons per year of ethylene and invest around $5 billion, Total said Aramco said in a joint-statement. The cracker will feed other petrochemical and specialty chemical plants that will see $4 billion invested by third party investors.
The two partners are planning to start the front-end engineering and design (FEED) in the third quarter of 2018, the statement said.
In total, $9 billion will be invested in the project which will produce more than 2.7 million metric tons of high value chemicals, the companies said.
The complex will be integrated downstream of the SATORP refinery, a joint venture between Saudi Aramco and Total in Jubail, whose capacity increased from 400,000-barrel-per-day at its start-up in 2014 to 440,000-barrel-per-day today, in a move designed to fully exploit operational synergies.
The deal was signed during the official visit to Paris by Crown Prince of Saudi Arabia, HRH Mohammed bin Salman.
“The agreement deepens the exemplary relationship enjoyed by our two companies over many decades. It is one that has evolved from a standard buyer-seller arrangement to one imbued with common interests to further develop and diversify our businesses,” said Amin H. Nasser, president and CEO of Saudi Aramco.
“Our joint venture SATORP is a remarkably successful model of industry partnership and we are keen to build on this success to further underpin Saudi Aramco’s strategy to expand its capacity in the chemicals sector by 2030.”
“This project illustrates our strategy of maximising the integration of our large refining and petrochemical platforms and of expanding our petrochemical operations from low-cost feedstock, to take advantage of the fast growing Asian polymer market," said Patrick Pouyanné, Chairman and CEO of Total.
“Furthermore, this project will enable us to strengthen our ties with Saudi Aramco, with whom we successfully operate our biggest and most efficient refinery in the world. Finally, it will contribute to the Vision 2030 of the Kingdom by creating 8,000 jobs and bringing in new high-added-value technologies.”
BP sanctioned the second phase of Oman's giant Khazzan field, Ghazeer, which will add 500 million cubic feet of gas a day to its production following a final investment decision (FID) to develop the project.
Together with its partner, the Oman Oil Company Exploration & Production, BP confirmed that the Ghazeer project in Oman’s Block 61 is expected to come on stream in 2021, BP said in a statement.
Drilling on three development wells is already underway, with initial construction work also in progress at Khazzan to accommodate a third gas train.
“Following the successful startup of Khazzan, we are pleased to announce the sanction of Ghazeer, BP’s first project FID of 2018,” said Yousuf Al Ojaili, president of BP Oman.
“Through the transfer of industry-leading skills and technology from BP’s global portfolio, we look forward to further developing this gas field that is expected to support Oman’s energy needs for many decades to come.”
The approval for Ghazeer follows the successful start-up of Khazzan’s first phase of development in September 2017. One of BP’s seven major projects for last year, it is now producing at design capacity of around 1 billion cubic feet of gas a day (bcf/d) and around 35,000 barrels a day of condensate
Together, the Khazzan and Ghazeer developments are expected to deliver total production of 10.5 trillion cubic feet of gas and around 350 million barrels of condensate through until the end of the concession in 2043.
Element Materials Technology (Element) said it secured a contract with ENGIE Fabricom to undertake pipe induction bend testing for a heavy oil development program in Kuwait.
Element Antwerp, metallics laboratory in Belgium, will conduct mechanical testing (tensile tests, impact tests, hardness tests), alongside metallurgical testing (microscopic examinations) on all sections of ENGIE Fabricom pipe induction bends. Testing at Element Amsterdam laboratory will include oil and gas corrosion testing services such as hydrogen induced cracking (HIC) and sulphite stress cracking (SCC), Element said in a statement.
The laboratories will initially conduct information tests and assess that bending parameters are correct so the customer can use the calibration test results in production. Materials are examined for precipitation of the material microstructure and on parameters such as tensile strength, impact toughness and hardness.
Rod Martin, EVP for Oil & Gas at Element, said: “Our state-of-the-art technology and expertise ensures that customer infrastructure assets are safe and will deploy as expected in the field. The materials science capability at our Antwerp laboratory and sour service corrosion testing in Amsterdam helps our customers to reduce future risk of damage to pipelines and provide assurance on performance and safety.”
Fuel retailer ADNOC Distribution’s shareholders approved an AED 735 million (AED 5.88 fils per share) dividend payment at the company’s first Annual General Meeting (AGM).
The dividend was approved following a report of the company’s performance, which highlighted the significant achievements the company made in 2017, ADNOC said in a statement.
ADNOC Distribution listed on the Abu Dhabi Securities Exchange (ADX) on December 8th 2017 and shares were priced at AED 2.50, giving the company a market capitalisation of approximately AED 31.3 billion at the time of listing.
“The IPO and recently announced fourth quarter and 2017 full year results illustrate that ADNOC Distribution is in a strong financial position, with an enhanced level of profitability, healthy margins and significant opportunities for future growth,” Dr Sultan Ahmed Al Jaber, ADNOC Distribution Board Chairman and ADNOC Group CEO said in a statement.
“The targeted dividend payout ratio we announced last November puts us near the top of major listed companies in the region, and we are determined to reward you, our shareholders, for believing and trusting in us,” he said, adding that the announced dividend was in-line with plans.
ADNOC Distribution in 2017 launched 24 new stations in the UAE, and announced plans to open 13 new stations in 2018, including for the first time in Dubai, where construction has started on three stations.
ADNOC is a 90 per cent shareholder in ADNOC Distribution. “ADNOC is fully committed to the success of ADNOC Distribution and we will continue to leverage all resources at our disposal to ensure its continued success and growth,” Dr Al Jaber added.
OMV said it will sign a US$1.5 billion deal with ADNOC for the final interest in offshore fields the Abu Dhabi state oil company is offering to foreign investors.
The deal will see OMV acquire a 20 per cent interest in the concessions for the Satah Al Razboot, with satellite fields Bin Nasher and Al Bateel, along with Umm Lulu as well as the associated infrastructure.
The agreement is expected to be signed by the end of April, OMV said in a statement.
ADNOC in February signed a 40-year deal with CEPSA for the other 20 per cent interest in the same concession (Sarb and Umm Lulu), while retaining a 60 per cent interest and operatorship.
The other two offshore concessions Lower Zakum and Umm Shaif & Nasr were finalised last month with international oil companies Total, Eni, CNPC, Inpex and an ONGC-led consortium.
All the previous contracts were effective early March – the date when ADNOC’s previous 40-year concessions expired.
Shell said it has completed the sale of its Oman unit and asset to IndianOil’s Singapore arm for US$329 million as part of its $30 billion divestment strategy to make the business more resilient.
Shell Exploration and Production Oman Limited (SEPOL) held a 17 per cent participating interest in the Mukhaizna Production Sharing Agreement in Oman, which will be owned by IOCL Singapore PTE, a subsidiary of Indian Oil Corporation Limited (IndianOil).
The remaining 83 per cent in Mukhaizna is owned by Occidental Mukhaizna LLC (45 per cent), Oman Oil Company S.A.O.C (20 per cent), Liwa Energy Limited (15 per cent), Total E & P Oman (2 per cent) and Partex (Oman) Corporation (1 per cent). Occidental Mukhaizna LLC is the operator of the Mukhaizna asset.
This acquisition includes the marketing rights for entitlement oil. The effective date of the transaction is 1st January 2017, Shell said in a statement.
Shell Oman country chair, Chris Breeze said “We are pleased to assist the entry of IndianOil, an integrated energy company with activities in oil, gas, petrochemicals and one of India’s largest companies, into the upstream sector in Oman. Shell remains fully committed to Oman’s energy future and is actively seeking to make further investments in the country.”
Shell said its decision to divest continues to be driven by the company’s strategy to sell non-core assets or companies to re-shape Shell into a simpler, more resilient and focused company.
Saudi Aramco signed agreements with Honeywell UOP and TechnipFM valued at $US8-10 billion for expanding chemical production and potentially building a complex along the U.S. Gulf coast.
State-oil giant Aramco signed a memorandum of understanding with TechnipFMC for its U.S. refinery unit Motiva Enterprises that will evaluate the use of its mixed-feed ethylene production technologies in the U.S, Saudi Aramco said in a statement.
A separate MoU with Honeywell UOP will assess the use of aromatics extraction and production technologies for benzene and paraxylene for development of a potential complex along the U.S. Gulf
Coast, Aramco said.
The MOUs are a first step in Motiva’s expansion into petrochemicals. Final investment decisions on these projects are not expected to be made until 2019 and are dependent on strong economics, competitive incentives, and regulatory support, Aramco said.
The signing in Houston was timed to coincide with the official visit to the United States by HRH Crown Prince Mohammed bin Salman of Saudi Arabia.
“For more than 85 years the Kingdom of Saudi Arabia and the United States have enjoyed a mutually beneficial relationship based upon the strong legacy and longstanding foundation established by the leaders of both nations,” said Saudi Aramco President & CEO Amin H. Nasser.
“We are especially honoured for His Royal Highness to witness the signing of MoUs and announcements that further strengthens Aramco’s commitment to supporting U.S. economic growth and development through Downstream investments while also significantly investing in exploration and production technologies and innovative solutions aligned with Saudi Vision 2030 that will serve both our nations over the long term,” he added.
The Crown Prince’s visit to Houston included a number of engagements and activities driven by Saudi Aramco, such as a tour of the company’s Houston R&D Centre where he was briefed on the latest upstream technology and innovation focusing on discovery and recovery of conventional and unconventional resources. It is the company’s largest research centre outside Saudi Arabia.
Bahrain’s National Oil and Gas Authority (NOGA) said the Kingdom’s major discovery has estimate reserves of 81.5 billion barrels of tight oil located in the Khalij al Bahrain basin and deep gas reserves of 13.7 trillion cubic feet.
The country’s largest oil discovery in decades is off the West coast in shallow water. Separately, deep gas has also been discovered in two accumulations below Bahrain field, Bahrain News Agency said in a statement quoting government officials.
“Independent appraisals have confirmed NOGA’s find of highly significant quantities of oil in-place for the Khalij Al Bahrain, with tight oil amounting to at least 80 billion barrels, and deep gas reserves in the region of 10-20 trillion cubic feet,” Bahrain’s Minister of Oil, Shaikh Mohammed bin Khalifa Al Khalifa said. The independent appraisals come DeGolyer and MacNaughton and Haliburton.
While the discovery is significant in size, more information is needed to establish how much of the resource is commercially recoverable and its classification would pose production challenges, Tom Quinn, senior analyst, Middle East upstream, at Wood Mackenzie, said.
“A tight reservoir means a low recovery factor and only a fraction of the 80+ billion barrels is likely to be recoverable. The oil will also be technically challenging and potentially high cost to develop,” Quinn said.
Bahrain’s oil minister said Halliburton will start drilling two more appraisal wells this year in the offshore basin to evaluate how much of the oil reserves are recoverable.
Positive test well results have successfully demonstrated the productivity of the significant resource, with Schlumberger, who performed the first test well drilling and Bahrain Petroleum Company (Bapco) has already succeeded in flowing high quality oil from the wells during the testing and flow back phases, the statement said.
"Based on the core analysis carried out on several wells the formation could be classified at the edge of the conventional-unconventional type of plays," a Schlumberger spokesperson said.
The first well in the drilling programme is planned to produce in August, and over the next two years focus will be given to maximising production and commercial efficiency.
Bahrain is currently facing declining production from its onshore field – its production in 2014 was about 50,000 barrels per day, according to the latest government figures. Bahrain also receives 150,000 bpd from the Abu Sa’fah field, which is shared with Saudi Arabia. Bahrain imports crude from Saudi Arabia through a pipeline which is currently being expanded, with crude being supplied to the Sitra refinery, which is also being expanded to nearly double production capacity.
The Kingdom is also building on offshore LNG import terminal which will have an initial capacity of 4.1 billion cubic meters (bcma) with the potential to expand to 8.2 bcma.
It is likely that Bahrain will need this gas import capacity until the new discoveries come onstream, and may still require it for peak summer demand beyond, Quinn said, adding “Again, further appraisal will be required and suitable commercial terms agreed to establish if the deep gas resource is commercially viable.”
Shell said on Wednesday it has reached an agreement with the Palestine Investment Fund to sell its entire stake in the Gaza Marine licence, offshore Palestine.
The U.S oil and gas company said that the asset sale of its 90 per cent interest, completed through its affiliate BG Great Britain Limited, is part of its plan to simplify and improve the quality of its portfolio.
The company didn't disclose the value of the sale and said that the equity was transferred to the Palestine Investment Fund at the signing of the sale and purchase agreement.
Shell said that the divesting of the Gaza Marine licence will also help it to concentrate its upstream operations where the company can be most competitive and build a world-class investment case.
The Gaza Marine gas field is located 30km off the coast of the Gaza Strip, in the eastern Mediterranean Sea, at a water depth of 603 metres. The development of the Gaza field has been on hold for several years due to disputes between Israel and the Palestinians.
The Palestinian Authority awarded BG the exploration licence for the entire marine area offshore Gaza in 1999 with a 90 per cent interest. The 25-year licence provides BG with the right to explore the area, develop gas fields, and build the necessary infrastructure.
Ras Al Khaimah announced the launch of its first ever petroleum licensing round and said it will set up an authority to regulate the tendering process as the emirate looks to develop its oil and gas resources.
The licensing round offers seven contract areas, including four shallow water offshore blocks and three onshore blocks, covering almost the entire emirate,” Ras Al Khaimah (RAK) government's media office said in an emailed statement.
“The blocks on offer include highly prospective exploration opportunities, an undeveloped oil discovery, and a mature gas condensate redevelopment opportunity,” the statement said.
The emirate’s existing petroleum infrastructure includes pipelines and oil and gas processing facilities, but no upstream activity for oil or gas. Currently, industries important to RAK include building materials, manufacturing, real estate, tourism and agriculture.
The government said that it expects to receive bids in November this year for the petroleum rights, which will be governed by a new Exploration and Production Sharing Agreement, cited to be “modern and investor-friendly.” These are being supported by RAK’s national oil company, RAK Gas.
“We are encouraging international oil companies to take advantage of this rare opportunity to build their portfolios in the UAE,” said Nishant Dighe, RAK Gas CEO. “Ras Al Khaimah has significant remaining oil and gas potential within its diverse petroleum geology - in both the onshore and offshore acreage.”
Dighe said all of the offshore blocks have recently been covered by a new multiclient broadband 3D seismic survey which is available for viewing.