Algerian shale gas potential equal to that of U.S.

Algerian Energy Minister Youcef Yousfi revealed that his country's reserves of shale gas are equal to that of the USA, Algerian Press Service (APS) has reported.

“The initial results of the evaluation of the non-conventional gases, mainly shale gas, showed that reserves in the country are at least equal to the US reserves,” APS quoted Yousfi as saying.

Shale gas development in America has driven a multi-billion dollar scramble for assets, field development, and impacted global gas forecasts.

The minister also called all companies interested in development such type of gas and hold the necessary technical knowledge to develop these fields with the optimal conditions. “A huge reforms related to the law have been adopted with the aim to intensify prospection mainly in the offshore and the areas unknown,” he added.

In May 2011, Algeria’s state controlled energy company Sonatrach has signed a cooperation agreement with Italian company Eni, for the development of unconventional oil and gas in Algeria, with particular focus on shale gas.

"Based on previous assessments, Eni confirms the significant shale gas reserves in Algeria which Eni and Sonatrach wish to explore and develop. This will enable both companies to make important discoveries which will enhance the gas potential of the country,” Eni and Sonatrach said in their joint statement.

Cyprus launches second O&G bid round

NICOSIA - Cyprus said it has launched a second licensing round for offshore oil and gas exploration blocks despite the strong objections of Turkey.

The tender comes after U.S. company Noble Energy Inc., the only firm to be awarded acreage in the first bid round, in 2007, announced a huge discovery in Block 12, 180 kilometers off the island's south coast last year.

The find is thought to have stimulated keen international interest in the remaining 12 blocks inside the island's delineated economic zone.

After applications for the exploration permits have been evaluated, a shortlist of candidates will be drawn up and submitted to the cabinet to decide who gets final approval, according to the announcement posted on the Ministry of Commerce's website.

"The decision on the applications for this second licensing round offshore Cyprus...is expected to take place within six months from the date of submission of applications," the ministry said.

Initial data announced by President Demetris Christofias in December indicated between 5 trillion-8 trillion cubic feet of gas reserves locked beneath the sea bed in Block 12, where Noble is currently test drilling. This would be enough to meet the island's domestic energy needs for decades.

Neighbor Israel has discovered even bigger finds in its own fields close to Cyprus waters, and both countries are now discussing energy cooperation, as underlined by Thursday's visit of Israeli Prime Minister Benjamin Netanyahu.

But Turkey has protested strongly against the Cyprus government's search for offshore oil and gas, branding it "illegal." Unlike the rest of the international community, Ankara doesn't recognize the government in Nicosia, which it brands a Greek Cypriot administration. Instead, it is the only government in the world to recognize the breakaway state which Turkish Cypriot leaders declared in the north of the island in 1983.

Cyprus has voiced its determination to exercise its sovereign rights under international law to exploit energy sources.

Turkey has repeatedly called on the Cyprus government to postpone its gas exploration, saying the Greek Cypriot side has no right to explore while the island remains divided, as it excludes the Turkish Cypriot north.

Christofias says that any hydrocarbons discoveries will be used for the benefit of all Cypriots and that Turkey's own retaliatory exploration moves in the region are "outside international law."

India Official: Government may sell 5% of ONGC entirely through auction

NEW DELHI -- India's federal government may auction a 5% stake in Oil & Natural Gas Corp., a senior oil ministry official said Monday.
"Auction is favorable. We can do it quickly. there is less paperwork involved," the official, who didn't wish to be named, told reporters.
The government owns 74.14% of ONGC and plans to sell 427.77 million shares, which will trim its holding to 69.14%.
Thursday, federal Disinvestment Secretary Mohammad Haleem Khan said the government is looking at a possible follow-on offering or an auction to sell the 5% stake.
A follow-on offering is a sale of shares conducted after a company has already had an initial public offering.
The official Monday said a panel of ministers will meet later this month to decide on the share sale.
Weak markets have derailed the government's plans to raise as much as INR400 billion in the current financial year through March by selling stakes in state-run companies. The government has so far been able to raise only INR11.45 billion.
In November, the government cancelled plans for a more than $2 billion secondary sale of ONGC shares.

Total launches Hild field development in North Sea

Total, operator of the Hild license, has launched the development of this field located in the Norwegian North Sea. This development will represent an investment of US$4.2 billion (NOK 25.6 billion) and is subject to the approval of the Norwegian Ministry of Petroleum and Energy and Norwegian Parliament (Storting). Total holds a 51 % interest together with its partners Petoro (30 %) and Statoil (19 %). Hild’s reserves amount to approximately 190 million barrels of oil equivalent (boe). Production is expected to start end of 2016 and will reach 100,000 boe per day at peak.

“The Hild field development is an important milestone for Total in Norway, made possible thanks to significant technological progress. Innovation has opened up new opportunities for Total offshore Norway, where we will continue to invest annually an average of US$2 billion within the next five years. Norway will remain in the coming years as one of the largest contributors to Group production” said Patrice de Viviès, Senior Vice President Northern Europe, Exploration-Production.

The stand-alone development, in a water depth of 115 meters, accesses separate gas/condensate and oil reservoirs. It includes the installation of an integrated wellhead, production and accommodation platform. Processed gas will be exported to St Fergus in the UK via a new link to the existing Frigg UK Pipeline (FUKA). Liquids will be sent to a dedicated storage vessel where water is separated for reinjection, and oil will be exported via shuttle tankers.

The Group strives to minimize its environmental footprint as part of its concern for sustainable development. Therefore Hild’s power needs will be supplied from the Norwegian mainland electrical grid via a new 170 kilometres long cable, the world’s longest alternating current (AC) power line from shore to an offshore platform. This technical solution is in line with the Norwegian authorities’ longstanding objective to curb CO2 emissions from offshore activities. The cable will also incorporate fibre optic links allowing the offshore facilities to be monitored and controlled from Total’s operation centre in Stavanger.

In Norway, as in all countries where Total is present, the Group is committed to the safety of the people working on its projects. Development of Hild project will be carried out in line with this key value.

Noble Energy announces new significant discovery in Levant basin offshore Israel

HOUSTON -- Noble Energy, Inc. announced a natural gas discovery at the Tanin prospect offshore Israel.  The discovery well was drilled to a depth of 18,212 feet and encountered approximately 130 feet of gross natural gas pay in high-quality lower Miocene sands.  The Tanin well is located in the Alon A license, approximately 13 miles northwest of the Tamar field, and in 5,100 feet of water.  Discovered gross resources are estimated to range between 0.9 and 1.4 Tcf with a gross mean of 1.2 Tcf.  This discovery de-risks other prospects located in the vicinity of Tanin.

The Tanin discovery is the sixth consecutive field discovery for Noble Energy and its partners in the Levant Basin.  Four of the discovered fields have estimated gross mean resource sizes of over 1 Tcf.  Including Tanin, total discovered gross mean resources in the Levant Basin are now estimated to be approximately 35 Tcf.

Noble Energy is the operator of the Alon A license with a 47.06 percent interest.  Co-owners are Avner Oil and Delek Drilling each with a 26.47 percent interest.

GE O&G wins $1 billion Ichthys LNG project

GE Oil & Gas has received contracts totaling more than $1 billion to supply a wide range of equipment and services for the Ichthys liquefied natural gas (LNG) project in Australia. A joint venture between INPEX (operator) and Total, the Ichthys LNG project includes one of the world's largest LNG facilities and is based on an estimated 40 years of gas and condensate reserves from the Browse Basin offshore Western Australia.

The Ichthys LNG Project is a joint venture between INPEX (76 percent, the operator) and Total (24 percent). Gas from the Ichthys Field, in the Browse Basin approximately 124 miles (200 kilometers) offshore of Western Australia, will undergo preliminary processing offshore to remove water and extract condensate. The gas will then be exported to onshore processing facilities in Darwin via an 889-km subsea pipeline. The Ichthys LNG Project is expected to produce 8.4 million tons of LNG and 1.6 million tons of LPG per annum, along with approximately 100,000 barrels of condensate per day at peak.

GE will provide rotating equipment, including gas turbines and compressors, for a new Ichthys LNG plant at Blaydin Point, near Darwin in Australia's Northern Territory, and associated floating production storage and offloading and a central processing facility (CPF) located in the Browse Basin offshore Western Australia. In addition, GE will supply subsea production systems for the offshore portion of the project as well as subsea connectors for a 552-mile (889 kilometer) pipeline that will carry the gas produced from a CPF to the new LNG plant in Darwin. GE announced the award of the contract at the 2012 GE Oil & Gas Annual Meeting being held Jan. 30-31 in Florence, Italy.

The scope of GE's supply includes four Frame 7EA Gas Turbines and eight MR/PR Compressors for the LNG plant; 10 PGT25+G4 gas turbines and 10 compressors for upstream facilities; and 22 subsea production trees, five off-subsea manifolds, an integrated subsea control system and a 42-inch trunk line connection system. The equipment will be shipped by 2014 and INPEX expects to start producing LNG by the end of 2016.

"We have been able to confirm our strong heritage in the LNG sector, leveraging our gas turbine, compressor and subsea production technologies for many of the world's leading LNG projects, including the Ichthys subsea development," said Dan Heintzelman, CEO of GE Oil & Gas. "Our growing commitment to the LNG industry in Australia was another key factor in winning this significant award."

Among GE's recent investments in Australia is the recently opened Jandakot facility in Perth, a $100 million state-of-the-art technology and learning center that will support the training of the next generation of skilled workers in the oil and gas, energy, mining, transportation and water industries. In addition, GE Oil & Gas has established a strong position in Australia's LNG sector, providing equipment for most of the country's LNG projects including Gorgon, Wheatstone, Prelude FLNG and Queensland CSM LNG projects. According to the Australian government's Department of Resources, Energy & Tourism, the Australian LNG industry has the potential to attract up to A$60 billion in new project investment over the next 10 years.

Judge rules Transocean indemnified for Macondo spill claims

BP is required to indemnify Transocean for compensatory damages related to the Macondo oil spill, but Transocean will still be liable for punitive and civil damages related to the incident, a federal judge ruled.

U.S. District Court Judge Carl Barbier ruled that BP must indemnify Transocean for compensatory damages related to pollution that did not originate on or above the surface of the water, even if the claim is the result of Transocean's strict liability or negligence.

Transocean had asserted that BP was required to do so under their drilling contract for the Deepwater Horizon rig. BP did not contest it was required to indemnify Transocean for some claims, but disputed the scope of indemnity.

Poland's PGNiG sees natural gas output at 4.9 Bcm in 2013

WARSAW -- Polish state-controlled gas firm PGNiG SA expects to produce 4.7 billion cubic meters of natural gas this year and 4.9 billion in 2013 when it expects to double output off Norway's shore, it said in a statement Monday.
The output plan includes 4.4 billion cubic meters of gas PGNiG expects to produce each year in Poland, it added.
PGNiG also plans to produce 660,000 metric tons of crude oil this year and 1.24 million in 2013.

Shell CEO says Arctic focus on Alaska, Greenland

LONDON -- Royal Dutch Shell PLC's plans to drill for oil and gas in the Arctic region will be centered on Alaska and Greenland, though the Anglo-Dutch major is also eyeing Russia's far north as an exploration frontier, said Chief Executive Peter Voser.
"For us the focus is in Alaska and to some extent in Greenland, although in the coming years there may also be opportunities in Russia," said Voser, in an interview published on the company's website that sets out his priorities for the year ahead.
Although Shell's intention to drill in Alaska has been well-documented--the company has received the necessary clean-air permits and expects to commence operations there this summer--the renewed focus on Greenland is the latest sign that the energy giant plans to open a new exploration frontier in one of the world's last undiscovered oil and gas provinces.
Vast hydrocarbon reserves are believed to lie off the coast of Greenland. The U.S. Geological Survey estimates reserves of 31 billion barrels of oil equivalent yet to be tapped off the west coast, while another 17 billion are estimated to sit under the seabed off the island's east coast.
Shell was awarded two license blocks to explore for oil on Greenland's west coast in 2010 as part of a consortium with France's GDF Suez SA (GSZ.FR), Norway's Statoil ASA (STO) and Greenland's Nuna Oil.
Another licensing round is due to take place in 2012 and 2013, although these are for Greenland's east coast, which has a rougher climate.
In all, Greenland has issued 17 exploration licenses for its west coast, to 11 companies. Of these, 12 licenses are active, but the only company to have test-drilled in recent years is Scotland's Cairn Energy PLC (CNE.LN), although two campaigns in 2010 and 2011 failed to result in commercial discoveries. Last week, Cairn and Statoil announced plans to team up on Cairn's next phase of Arctic exploration.
However, Shell risks unleashing the wrath of environmental campaigners, who are strongly opposed to oil companies drilling in the region. They argue that a spill could be impossible to contain and risk damaging the fragile ecosystem. Cairn's two drilling campaigns were disrupted by protesters attempting to scale its vessels.
Voser acknowledged that the Arctic environment was a particularly sensitive one, but said he believed Shell could safely conduct operations there.
"Of course developing the Arctic has environmental challenges but I believe these challenges can be managed with the right approach to safety and to sustainability."
"With energy demand rising, all resources must be developed to help meet it -- including the Arctic," said Voser.
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