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.

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

ZEiTECS completes first commercial rigless retrieval of cable deployed ESP

ZEiTECS has announced the world’s first rigless installation and retrieval of the NAUTILUS ESP, a cable-deployed electric submersible pump system (ESP), in a customer well in West Texas.

The system was deployed on December 19, 2013, and ran for 139 days until planned shutdown on May 7; the system was retrieved successfully on May 9.

The ESP was retrieved using ZEiTECS’ Launch and Recovery System (LARS). LARS is a compact, rigless injector-based system that eliminates the need for a rig or heavy coiled tubing unit to replace failed ESPs.

The NAUTILUS ESP system was deployed on a high-strength DC coaxial cable and converts DC power to AC power downhole to drive any standard inverted ESP. The system was set at 2,600 ft. and retrieved in only 40 minutes using the LARS, at an average rate of 65 ft. per minute.

The rigless ESP operation was completed using a 400 series Baker Hughes inverted ESP deployed inside 5.5” tubing, producing 900 bbl of fluid per day. The NAUTILUS ESP system can be used as a permanent production system, as well as a temporary well intervention system for well testing and well clean-up purposes.

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

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.

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

Weatherford introduces Katy, Texas rod pump facility

In response to growing demand for artificial lift solutions in the North American shale plays, Weatherford has built a 354,000 sq-ft manufacturing facility and world-class training center on a 174-acre site in the suburban area west of Houston.

The new plant is currently producing 120 rod pump units per month, with the capacity to manufacture as many as 800 units per month. The plant employs 135 employees, but the company projects to fill 335 positions by year end.

“We use lean manufacturing techniques and cutting-edge robotics technology to increase operational efficiency, which includes machining, fabrication, painting, and assembly,” explained Karl Sakocius, Sr. Marketing Manager, during a media tour. “Our Katy facility delivers American-made rod pumping units to the market. We are the only original equipment manufacturer to engineer, service, repair, and refurbish pumping units.”

The Weatherford manufacturing facility features banks of advanced numerically controlled machine tools and includes a robotic welding unit. A systematic, single-piece flow process?as opposed to the traditional process of batching and sub-optimizing by department?reduces the amount of inventory in the plant, which reduces the potential for accidents. Emissions within the plant are minimized through the use of trolleys and conveyor systems instead of forklifts.

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