Eni producing 25,000 bopd from offshore Alaska field

Eni has achieved the important production goal of 25,000 bopd at the Nikaitchuq field, in which the company is operator with a 100% interest. The field, located offshore the North Slope of Alaska in a water depth of 3 m, holds reserves estimated at 200 MMbbl of crude oil. Nikaitchuq production, which began in January 2011, is the first operated by Eni in the Arctic.

Development of Nikaitchuq includes the drilling of wells and the construction of facilities both on land and on an artificial island built by Eni in the Beaufort Sea. The location’s extreme climate and environmental constraints required the application of Eni’s proprietary technologies and expertise to drill multilaterals horizontal wells and to build one of the most advanced production facilities in the North Slope, with maximum environmental compatibility and high operating efficiency.

Nikaitchuq horizontal wells are the most complex wells drilled by the industry to date in Alaska, with a lateral displacement that extends up to 22,000 ft. The field treatment plant is able to handle 40,000 bpd of crude oil and up to 120,000 bpd of water. Nikaitchuq production is transported through the Trans-Alaska Pipeline to be sold on the market without the need for further treatment. Eni is now working toward achieving the new production target of 30,000 bopd in the next 12 months.

In the United States, Eni owns interests in 200 leases in the Gulf of Mexico and 530 leases in unconventional plays (shale gas and shale oil) onshore Texas. In addition, Eni owns interests in 100 leases in the North Slope of Alaska, which include Nikaitchuq and 30% of the Oooguruk oil field, which has been in production since 2008. Total Eni’s daily net production is approximately 100,000 boe (75% operated).

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Denbury Resources announces executive appointments

Denbury Resources Inc., an E&P focused on EOR utilizing CO2 in the Gulf Coast and Rocky Mountain regions, has announced the appointment of Brad Kerr as senior V.P. of planning, technology, CO2 supply and pipelines. In his role, Kerr will oversee Denbury' s long-range development plan, CO2 supply and pipeline operations.

Kerr is assuming the role formerly held by Charlie Gibson, who has been appointed to the newly created position of senior V.P. of production operations. In his new role, Gibson will oversee all of Denbury' s hydrocarbon producing assets, with a focus on implementing various operational improvement initiatives and best practices across the company' s operating regions.

Kerr has 31 years of oil and gas industry experience, serving in various roles at Shell and at Exxon Mobil. His responsibilities included providing operational and technical leadership, new technology implementation, and reservoir engineering for diverse oil and gas exploration and development projects, including EOR and unconventional drilling projects in Alaska, West Texas, the Rockies, Europe, the Middle East, Africa and Asia.

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Statoil reports fire at Ohio wellsite

A fire reported on June 28 at Statoil’s onshore Eisenbarth well pad in Monroe County, Ohio has been extinguished but follow-up work is continuing.

The fire was limited to surface equipment; none of the wells have been on fire. A Statoil well inspection team on site reported yesterday, June 29, that all wells are secure and are shut-in.

All personnel working on the site were evacuated and remain safe. In addition, as a precautionary measure, residents living nearby were evacuated temporarily. There have been no reports of serious injuries to date associated with this incident.

Statoil continues to work with local, state and federal authorities to manage this incident.

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Germany to draft anti-shale fracing rules on public opposition

Germany plans to adopt regulation that will rule out shale fracing for the foreseeable future.

The government wants to ban hydraulic fracturing in shale rocks and coal beds at depths less than 3 km (1.8 miles) and prohibit all types of fracing in water protection areas, Economy Minister Sigmar Gabriel and Environment Minister Barbara Hendricks said today, July 4. The government will start drafting legislation and seek to adopt it in the second half, Hendricks told reporters today in Berlin. The rules will be re-evaluated in 2021.

Fracing is unpopular in Germany even as Chancellor Angela Merkel’s government is keen to develop domestic energy sources as it closes nuclear plants by 2022. While companies including Exxon Mobil Corp. have drilled test wells into unconventional gas reservoirs in Germany to emulate the U.S. shale-gas boom, little headway has been made because of public opposition.

The new rules, if adopted, would be “the strictest that ever existed in this respect,” the ministers said in a joint letter to the Social Democrats. “Fracing for shale and coal bed gas for economic reasons won’t be possible in Germany for the foreseeable future.”

Fracing for tight gas, which has been done in Germany since the 1960s, will remain allowed under stricter conditions for frac fluids, the ministers said. Fracing will be allowed for scientific purposes if the fluids aren’t harmful to water supplies, it said.

Not Far Enough

The rules don’t go far enough and leave “loopholes” to allow fracing at a later stage, said Julia Verlinden, energy spokeswoman for the opposition Green Party.

“If you want to prevent fracing, you don’t need science projects,” she said today in an emailed statement. “The risk to harm our ground and drinking water supplies with fracing doesn’t justify the short-term drilling for comparably little gas.”

Europe is divided into different camps on fracing. It’s backed by nations including the UK, Poland and Spain and opposed in countries such as France and Germany.

The oil and gas industry says fracing should be at least tested to keep the door open to a technology that may redraw the energy map across Europe by reducing reliance on Russia. Germany has shale gas reserves for about 10 years of full supply and “maybe much more than that,” Kurt Bock, the CEO of the world’s biggest chemical maker BASF SE, said yesterday at a conference in Berlin.

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Russia to shut Nord Stream Gas Pipe for maintenance for 11 days

Nord Stream, the world’s longest subsea natural gas pipeline, will halt the link from Russia to Germany for 11 days of planned maintenance.

The works will start June 24, 2014 and require a shutdown first of both lines and then of each pipe separately, Nord Stream said in a statement. Opal Gastransport, which carries natural gas onward from Nord Stream, said upstream maintenance would cut supply by 100% June 24-28 and 50% June 28 to July 4 in a maintenance schedule on its website dated June 2, 2014.

“The temporary interruption of supplies has been factored into the nominations of gas planned for Nord Stream to transport to downstream European partners during 2014,” the company said. “The schedule for these maintenance activities has been agreed and coordinated with Nord Stream’s upstream and downstream pipeline partners well in advance.”

An Gazprom led venture started work on Nord Stream, which ships Russian gas produced at Siberian fields directly to Germany under the Baltic Sea, in April 2010, 15 months after a pricing conflict with Ukraine interrupted transit shipments to European clients. While Gazprom halted supplies to Ukraine on June 16 this year in a comparable dispute, transit flows have thus far been unaffected.

The works will include annual maintenance of mechanical components, as well as testing of the automation system, Nord Stream said.

The 1,224 km Nord Stream pipeline can transport as much as 1.9 Tcf of gas annually, enough to meet more than 12% of the 28 nation EU’s demand. Gazprom cannot currently use the full capacity of Opal, a connecting pipeline onshore Germany, because of EU regulations requiring separate ownership of distribution and production assets.

The European Commission, the bloc’s regulator, may allow Gazprom to ship full volumes via Opal if the Ukraine situation remains unresolved and there are disruptions, Gazprom CEO Alexey Miller said June 16 in Moscow.

Gazprom, which has a monopoly on pipeline gas exports from Russia, supplies the fuel to Europe via the Yamal-Europe pipeline via Belarus and Poland and with gas from its storage facilities in the region as well as through Nord Stream and Ukraine.

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