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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Devon sells non-core U.S. assets to Linn Energy for $2.3 bn

Devon Energy Corporation has entered into a definitive agreement to sell all of its non-core U.S. oil and gas properties to Linn Energy for $2.3 billion, or approximately $1.8 billion after tax.

The agreement covers Devon’s remaining assets targeted for divestiture and includes properties in the Rockies, onshore Gulf Coast, and Mid-Continent regions of the U.S.

“With the sale of our remaining non-core assets, the portfolio transformation that we announced late last year is now complete,” said John Richels, president and CEO of Devon. “In a short period of time we transformed our portfolio through three significant steps: the accretive Eagle Ford entry, the innovative creation of EnLink Midstream, and the sale of our non-core properties. The sale of Canadian and U.S. non-core properties over the past few months has generated in excess of $5 billion of proceeds at an accretive multiple of nearly 7 times 2013 EBITDA.”

“Devon is now concentrated in some of the most attractive North America resource plays, with liquids expected to approach 60% of our production by year-end and multi-year oil production growth projected to be in excess of 20%,” said Richels.

Devon’s production from these non-core U.S. assets is currently 275 million cubic feet of gas equivalent per day, of which approximately 80% is natural gas. At December 31, 2013, proved reserves associated with these properties amounted to 1.242 Tcf of gas equivalent. EBITDA accompanying these assets totaled $350 million in 2013.

The transaction is subject to customary terms and conditions and is expected to close in the third quarter of 2014, with an effective date of April 1, 2014.

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GDI is awarded long term contracts by QP for two new land rigs

Gulf Drilling International(GDI), reported that it has been awarded two new contracts by Qatar Petroleum(QP) for the provision of drilling rig services. The new contracts will cover services to be performed by two new land rigs (GDI-7 and GDI-8) that GDI is in the process of acquiring from a rig builder based in the United States. Each contract will have a term of five years and the combined value of both contracts is 297 billion.

The two new land rigs (GDI-7 and GDI-8) are being custom designed according to QP’s specifications. GDI-8 will be GDI’s largest land rig, and at 3000HP, it will have the capability of drilling deeper wells and executing extended reach wells to a much greater distance. The new land rigs will also come with a number of ancillary assets that are required to support these operations including water well rigs, mobile cranes, trucks and trailers. The total investment is being financed from a local bank on competitive terms.

Construction of the two new land rigs will soon commence and the rigs are expected to be received, mobilized from the United States and placed into service during the second half of 2015. GDI’s onshore base camp, workshop, storage yards, warehouses and accommodation facilities are also being expanded to accommodate these new operations.

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Beach Energy has taken a 20% interest in an exploration permit at the offshore Otway basin in Tasmanian waters

Beach Energy  has executed a binding sale and purchase agreement (“SPA”) for the purchase of a 20% interest in the T/49P offshore exploration permit in the  Otway Basin from 3D Oil.

In addition to this, Beach and 3D Oil have established a new joint venture by executing a joint operating agreement (“JOA”). Under the terms of the SPA, Beach will pay 3D Oil $3 million in cash with 3D Oil to remain as operator under the JOA. It is anticipated that the joint venture will commence a 755 sq km seismic acquisition program within the next twelve months, with timing subject to regulatory approvals. This work is the major commitment required to be undertaken in the initial exploration phase of the permit, with the Transaction subject to the usual government and regulatory approvals.

The T/49P permit, located approximately 20 km to the west of King Island, is 4,960 sq km in size with water depths of around 100 m. Adjacent to the permit are the Geographe and Thylacine gas fields, of which Thylacine is the largest field discovered in the Otway Basin to date.

The Transaction builds on Beach’s current position in the onshore Otway Basin, which services both South Australia and Victoria in terms of gas supply.

In relation to Beach’s onshore activity, the second well of a two well exploration program on the South Australian side of the onshore Otway Basin, Bungaloo-1, recently reached total depth. Initial observations from Bungaloo-1, and the first well in the program, Jolly-1, indicate good exploration potential for gas and liquids in both shallow conventional structural traps as well as deeper targets within these wells. Follow up analysis is being undertaken to confirm these initial observations, with a priority focus on the conventional potential within the permits operated by Beach.

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Fugro strengthens Africa presence with Geofor buy

Fugro has completed the acquisition of the Geofor Group based in Libreville (Gabon), Douala (Cameroon), Pointe Noire (Republic of Congo) and São Tomé City (São Tomé) to strengthen its presence in the Central Africa region and the French speaking African countries. In addition to its longer established offices, Geofor has significant working experience in Niger, Chad and Equatorial Guinea.

Geofor is an onshore/nearshore geotechnical company, which delivers drilling services and has highly specialized engineers and geologists in the fields of geotechnical consulting, hydrology, and land survey.

The company was established in 1989 and has over 25 years of experience working in most countries in Africa. The client base includes major oil and gas companies and key mining clients. In addition, Geofor is active in infrastructure and water supply projects.

Providing useful resources, articles and writings on crude oil, other petroleum products, energy and gas. By Mega Billion Corporation BLCO seller, Nigeria, online.