Sunday, October 2, 2022

Gorgon LNG Train Two back online after maintenance work

The Gorgon LNG project. Image courtesy of Chevron/Facebook.

Production at Train Two of Chevron’s Gorgon LNG project has restarted after a brief outage last week.

Chevron told Reuters earlier this week that production at Train Two restarted on Sunday after a brief maintenance outage.

Chevron, the operator of the Gorgon project, told Reuters last week that production at Train Two was suspended for minor maintenance work.

LNG cargo loading from Train One was not interrupted by the maintenance work.

Construction on Train Three has been completed.

Chevron told Reuters that it is “well into start-up and commissioning” for Train Three.

The company has not yet disclosed a start-up date for Train Three.

The Gorgon LNG project has seen several outages since starting up last March.

Operations at the project’s Train One was restarted in early January after a month-long outage.

Exports from Gorgon were temporarily halted about one month after production began due to mechanical issues with the propane refrigerant circuit on Train One.

A gas leak forced Chevron to temporarily halt production at Gorgon in July 2016.

Production at Train One was briefly halted in early November for minor maintenance work.

The project is supplied from the Gorgon and Jansz-Io gas fields, located within the Greater Gorgon area, between 80 miles and 136 miles off the northwest coast of Western Australia.

The project is operated by Chevron Australia with a 47.3 percent stake.

Kosmos Energy sinks to Q4 loss

Image courtesy of Kosmos Energy.

Kosmos Energy reported a fourth quarter loss on Tuesday on lower oil revenues.

Kosmos Energy reported a net loss of $56.7 million, or a loss of $0.15 per diluted share, for the fourth quarter compared to net income of $24 million in the same period last year.

When adjusted for certain items that impact the comparability of results, the company generated an adjusted net loss of $5.6 million for the fourth quarter of 2016.

Fourth quarter 2016 oil revenues were $156 million, down from $122 million in the year-ago period.

Fourth quarter oil sales rose to 3 million barrels of oil in 2016, up from 2.8 million barrels in 2015.

Kosmos said that fourth quarter 2016 oil revenues exclude $41 million of derivative settlements.

Realized oil revenues, including the impact of the company’s hedging program, were $66.63 per barrel of oil sold in the fourth quarter of 2016 compared to $67.85 per barrel of oil sold in the year-ago quarter.

At the end of the quarter, the Kosmos was in a net underlift position of 400,000 barrels of oil.

Production expense for the fourth quarter was $44 million, or $14.75 per barrel, compared to $30 million, or $10.50 per barrel, in the fourth quarter of 2015.

Kosmos said the increase in total production expense was primarily attributable to selling its initial cargo from TEN, that included one-time startup costs associated with field commissioning.

The company said the increase on a per barrel basis was the result of higher expenses from the TEN field and the additional operating costs related to the Jubilee turret bearing issue.

Exploration expenses totaled $76 million for the fourth quarter, compared to $24 million in the same period of 2015.

During the quarter, Kosmos booked $44 million of costs associated with the stacking of the Atwood Achiever as well as $31 million in seismic and geologic and geophysical costs primarily related to Mauritania and Senegal.

Depletion and depreciation expense for the quarter was $74 million, or $25.08 per barrel, up from $15.98 per barrel in the fourth quarter of 2015.

Kosmos said the decline was “primarily attributable to realizing the first TEN lifting,” that has a higher depletion rate than Jubilee and drove the blended rate higher.

General and administrative expenses declined 8 percent year-over-year were $28 million during the fourth quarter.

Full-year general and administrative expenses were down 36 percent from 2015 thanks to cost management and reduced equity-based compensation expense.

Kosmos said fourth quarter results included a mark-to-market loss of $14 million related to the company’s oil derivative contracts.

As of the end of December, the company’s hedging position had a total mark-to-market value of $2 million.

Total capital expenditures in the fourth quarter were $88 million.

Full year capital expenditures totaled $645 million, in-line with company forecasts.

Kosmos finished the fourth quarter 2016 with $1.2 billion of liquidity and $1.1 billion of net debt.

The company’s proved net reserves at the end of 2016 were 77 million barrels of oil equivalent.

Kosmos add that its previously announced $175 million net capex budget for 2017 is unchanged, and represents more than a 75 percent reduction from its 2015 net capex.

Saudi Aramco acquires stake in Malaysia downstream project

Image courtesy of PETRONAS.

Saudi Aramco signed a share purchase agreement on Tuesday with PETRONAS for a stake in the Refinery & Petrochemical Integrated Development (RAPID) project.

The RAPID project is located in the southern Malaysian state of Johor.

Upon the completion of the transaction both partners will hold equal ownership in selected ventures and assets of the RAPID project within the Pengerang Integrated Complex (PIC).

Under the partnership, Saudi Aramco will meet most of the crude feedstock requirements for the refinery, with natural gas, power and other utilities supplied by PETRONAS.

The RAPID refinery has a capacity to refine 300,000 barrels of crude per day and produce a host of refined petroleum products, including gasoline and diesel that meets Euro 5 fuel specifications.

The project will also produce feedstock for its integrated petrochemical complex producing 3.5 million tons per annum of products.

The PIC development is almost 60 percent complete and is on track for refinery start-up in 2019.

“The PIC is one of the largest industrial developments in the region as well as PETRONAS’ largest downstream investment on a single site to date,” PETRONAS President & Group CEO Datuk Wan Zulkiflee Wan Ariffin said.

The RAPID development includes a refinery cracker and the downstream petrochemical complex.

The PIC, located on a 6,242-acre site, also includes the development of associated facilities including a co-generation plant, a LNG re-gasification terminal, a raw water supply project, a deep water terminal and centralized and shared utility facilities.

The RAPID project is part of the PIC development undertaken by PETRONAS and is positioned to be a regional downstream oil and gas industrial hub.

The PIC is part of Malaysia’s 22,000-acre Pengerang Integrated Petroleum Complex (PIPC) that is designed to boost the country’s downstream sector.

“This partnership will also bring together two organizations with strong reputation, wealth of operational experience and proven record in developing mega projects as well as having commercial networks in different markets globally,” Wan Zulkiflee said.

Shell LNG carrier damaged after collision with oil tanker in Gulf of Oman

Image courtesy of Shell.

A Shell managed LNG carrier sustained damage last week after colliding with an oil tanker in the Gulf of Oman.

According to Seatrade Maritime News, the Al Khattiya LNG carrier was damaged following a collision with an oil tanker off the eastern coast of the United Arab Emirates.

According to the Maritime Herald, the LNG carrier collided with the crude carrier Jag Laadki.

The accident reportedly occurred on Feburary 23.

Images of the vessel seen by Seatrade reportedly show a hole in the vessel’s starboard side as well as damage to the hull.

Seatrade reported that two ballast tanks aboard the LNG vessel suffered breaches during the incident and released some ballast water.

The damage sustained by the LNG carrier is not believed to haveimpacted the vessel’s seaworthiness, Maritime Herald said.

The Jag Laadki crude carrier reportedly sustained serious damages but was held at anchorage for repairs and inspection, the Maritime Herald said.

No injuries or environmental impacts have been reported.

The Al Khattiya LNG carrier is owned by Qatar’s Nakilat and managed by Royal Dutch Shell’s shipping unit Shell International Trading and Shipping Company.

Shell International Trading and Shipping Company told Seatrade on Tuesday that the Al Khattiya is “stable and remains at anchor while further checks take place,” including a detailed inspection.

U.S. drillers added three rigs last week

U.S. rig gains slowed last week but still ended the week in positive territory.

According to Baker Hughes, the number oil and gas rigs operating in the United States rose by three to 754 as of February 24, up from 502 rigs a year ago.

The oil rig count rose by five rigs to 602 rigs last week, a significant gain over the 400 oil rigs operating in the year-ago period.

The gas rig count ticked down by two rigs to 151 rigs last week compared to 102 rigs a year ago.

The directional drill count fell by three to 69 rigs compared to 47 rigs during the same period last year.

A 10 rig gain pushed the horizontal rig count up to 624 rigs compared to 397 rigs a year ago.

The vertical rig count declined to 61 rigs after a four rig loss last week but was still up from 58 rigs a year ago.

Texas posted the largest gain of all the major producing states last week after an eight rig gain.

The gain pushed Texas’s rig count up to 386 rigs compared to 231 rigs a year ago.

A two rig loss in Louisiana pulled the state’s rig count down to 49 rigs but was still two rigs above the year ago level.

Alaska’s rig count dropped to seven rigs last week after a two rig loss, down from 11 rigs a year ago.

A one rig loss in North Dakota dropped the state’s rig count down to 34 rigs compared to 36 rigs a year ago.

Wyoming’s rig count rose by one to 19 rigs last week, a significant gain from the nine rigs operating a year ago.

Rig counts in Arkansas, California, Colorado, New Mexico, Ohio, Oklahoma, Pennsylvania and Utah held steady from last week and were still above year-ago levels.

Rig counts in Kansas and West Virginia were unchanged from last week and ended the week below year-ago levels.

Drillers in the Permian Basin added three rigs last week, boosting the play’s rig count up to 306 rigs compared to 164 rigs a year ago.

The Eagle Ford Basin saw its rig count rise to 64 rigs after a three rig gain, up from 47 rigs a year ago.

Drillers in the Cana Woodford Basin boosted the play’s count up to 51 rigs after a two rig gain, up from 36 rigs a year ago.

A one rig loss in the Granite Wash Basin pulled the area’s rig count down to 12 rigs compared to nine rigs a year ago.

The Williston Basin’s rig count fell to 35 rigs last week after a one rig loss, down from 36 rigs during the same period last year.

The Haynesville Basin saw its rig count fall by one to 12 rigs last week, up from nine rigs in the year-ago period.

The Gulf of Mexico saw its rig count hold steady at 17 last week, down from 27 rigs a year ago.

Canada’s rig count rose by 10 rigs to 341 rigs last week, up from 175 rigs a year ago, after drillers added 12 oil rigs and dropped two gas rigs.

Total sells interests in mature Gabon fields for $350 million

Image courtesy of Total.

France’s Total has sold a Gabon focused affiliate and several mature fields in Gabon for $350 million.

Total said on Monday that it signed an agreement for the sale of stakes and the transfer of operatorship in various mature assets in Gabon to Perenco, an Anglo-French oil and gas company.

The transaction is subject to approval by the authorities.

The agreement includes the sale of Total’s 100 percent owned affiliate Total Participations Petrolières Gabon, that holds interests in 10 fields.

Total Gabon also announced the sale of its interests in five fields and the Rabi-Coucal-Cap Lopez pipeline network.

The total value of the transactions is around $350 million before adjustments.

The production divested by Total related to the transaction represents around 13,000 SEC barrels per day.

Following completion of the transaction, Total’s remaining upstream assets in Gabon will be held entirely through Total Gabon.

“Total remains committed to Gabon and will focus on maximizing value from its principle strategic operated assets,” Total Exploration & Production president Arnaud Breuillac said.

Petrobras approves settlements with four U.S. investors

Image courtesy of Petrobras/Facebook.

Brazil’s Petrobras has approved settlements with four U.S. investors related to an ongoing corruption investigation.

The state-owned company said on Monday that its board of directors approved the conclusion of settlements to end four individual lawsuits filed before the Federal Court of New York by New York City Employees Retirement System, Transamerica Income Shares, Inc., Internationale Kapitalanlagegesellschaft and Lord Abbett Investment Trust – Lord Abbett Short Duration Income Fund.

The terms of the settlements are confidential.

Several investor and retirement funds have filed suit against Petrobras in a bid to recoup losses that were allegedly caused by a corruption scheme tied to Petrobras contracts.

The probe, known as Operation Car Wash, has also landed several former Petrobras executives and Brazilian politicians in jail.

The four individual lawsuits were consolidated for purposes of judgment with twenty-three other individual actions and class action filed against Petrobras before the Federal Court of New York.

Including the latest agreements, Petrobras has reached  settlements in 19 individual actions from a total of 27 that were consolidated with the class action.

Petrobras had already entered into settlements to end other fifteen individual lawsuits before the Federal Court of New York that were announced in October and November of last year.

Petrobras said that, as a result of agreements reached and the stage of negotiations in progress with other plaintiffs of individual actions, the company currently expects the total amount of the provision for 2016 to be $372 million.

The company added that $364 million had already been provisioned on September 30.

Petrobras added that it can not make a reliable estimate of the outcome of the class action.

Wood Group PSN fined $9.5 million for Gulf of Mexico violations

The West Delta 32 platform. Image courtesy of the U.S. Bureau of Safety and Environmental Enforcement.

The U.S. Department of Justice (DOJ) has fined Wood Group PSN over $9 million for violations related to a 2012 offshore accident.

The DOJ said on Thursday that Wood Group PSN was ordered to pay $9.5 million today in two separate cases related to its conduct in the Gulf of Mexico.

The DOJ ordered Wood Group PSN to pay $7 million for “falsely reporting over several years that personnel had performed safety inspections on offshore facilities in the Gulf of Mexico in the Western District of Louisiana.”

The company was also ordered to pay $1.8 million for negligently discharging oil into the Gulf of Mexico in violation of the Clean Water Act after an explosion at the West Delta 32 platform in November 2012.

Wood Group PSN was also ordered to pay $700,000 in community service to projects in the areas where the criminal conduct took place.

The West Delta 32 production facility was operated by Black Elk Energy Offshore Operations (BEE) when the incident occurred.

According to the DOJ, BEE had contracted with Wood Group PSN for individuals to man and conduct production operations at the West Delta 32 facility in early November 2012.

The DOJ said that about a week into the work Wood Group’s person-in-charge stopped issuing hot work permits and conducting all-hands safety meetings and delegated the hot work permitting to a less experienced operator.

The DOJ found that, during work conducted on November 16 of that year by Grand Isle Shipyards, an ignition occurred when  hydrocarbon vapors escaped a wet oil tank.

The ignition and subsequent explosion occurred while workers attempted to weld a piece of cut piping leading to the wet tank.

The explosion blew a dry oil tank and the wet tank into the water, the DOJ said.

A second dry tank was blown off its base and destroyed a platform crane.

Three workers were killed by the fire and explosions

Several other were seriously burned and injured.

The DOJ said that Wood Group PSN “admitted that its employees were negligent in the way they authorized hot work on West Delta 32, and that a lack of communication between personnel on the platform, including Wood Group PSN’s Person-in-Charge, Christopher Srubar, contributed to the events that caused oil to be discharged into the Gulf of Mexico in a harmful quantity.”

Co-defendants, BEE and GIS face manslaughter charges while Curtis Dantin, Christopher Srubar and Don Moss face criminal violations of the Clean Water Act .

Those cases are being heard in the Eastern District of Louisiana before Judge Jane Triche Milazzo.

BEE also faces eight felony counts of regulatory violations under the Outer Continental Shelf Lands Act, the DOJ added. 

Scottish minister ‘inundated’ with oil worker discrimination claims

A member of the Scottish Parliament said she has seen a spike in the number hiring discrimination claims made by former energy workers.

Aberdeenshire East MSP Gillian Martin told BBC that she has been “inundated with correspondence from oil and gas workers since revealing worrying evidence from constituents of job discrimination.”

Martin said she will continue taking the matter to the “highest level to raise awareness” about the issue.

One former energy worker told BBC that one firm told him they would keep his CV on file but they “did not want to waste money or time on someone that will leave.”

BBC Scotland reported earlier this month that Martin had been contacted by former energy workers flagging potential employment discrimination.

Oil & Gas UK, an industry group, found in its 2016 activity survey that cost cuts and efficiency boosts that began in 2014 reduced the number of jobs supported by the UK oil and gas sector by 15 percent.

As of the end of 2015, the UK oil and gas sector supported 375,000 jobs, according to Oil & Gas UK.

UK Oil & Gas said in its 2016 economic report that revenues across the supply chain has forced the industry to shed 120,000 jobs since oil prices began falling 2014.

Somalia president taps oil exec for prime minister post

Newly appointed Somalia prime minster Mohamed Abdullahi Mohamed. Image courtesy of kongehuset/Youtube.

Somalia’s president has appointed an executive from UK-based Soma Oil and Gas to serve as the country’s new prime minster.

According to Reuters, newly elected president Mohamed Abdullahi Mohamed selected Soma Oil and Gas executive Hassan Ali Khaire to lead the government.

UK-based Soma said on Thursday that Khaire has resigned from his post as the company’s executive director for Africa to accept the post.

Khaire resigned from Soma’s board and has relinquished all his shares in the company.

Khaire has worked with Soma since its inception in 2013.

Prior to joining Soma, he served as the Director for the Norwegian Refugee Council for Somalia and East Africa.

“Although we will miss Hassan’s wise and knowledgeable participation on the Board, we are delighted that his dedication to Somalia and his contribution to the recovery of his country is being recognized,” Soma chairman Lord Michael Howard of Lympne said.