oil review africa 5 2013

AfricaAfricaCovering Oil, Gas and Hydrocarbon Processing

www.oilreviewafrica.com

Europe m10, Ghana CD18000, Kenya Ksh200, Nigeria N330, South Africa R25, UK £7, USA $12

REGULAR FEATURES: ■ News ■ Contracts ■ Events Calendar ■ IT update ■ Company profiles ■ Products & Innovations

■ Geology - p38 ■ Gas - p40 ■ E&P - p42 ■ Technology - p52

Lukoil eyes Africanexpansion

Renewed outputgrowth for Angola

New interest in South Africa’s offshore prospects

Developing globalexpertise with a local focus

Paints and coatings

Drivers for tankerdesign

Well integrity datamanagement

Drilling fluid selection

Volume 8 Issue Five 2013

Ernest Nwapa, executive secretary,Nigerian Content Development andMonitory Board. See page 24.

Movers andshakers in Nigeria’s

oil industry

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Oil Review Africa Issue Five 2013 3

Editor’s noteTHE CHANGING GLOBAL oil market is currently putting Nigeria's oil and gassector on its toes as the country struggles to maintain its hold as the sixthexporter of oil in the world. While Nigeria’s oil production remains dominated bythe big international joint ventures, there is an emergence of a host of small butambitious indigenous companies, who are changing the look of the sector

With an anticipated additional 400,000-bpd refining and petrochemicalplant, Nigeria, no doubt is on the verge of becoming self-sufficient in meetingher domestic petroleum requirements,

Further south, Angola is readying for renewed output growth as upstreaminvestment continues to flow in and hopes rise regarding the commerciality ofits subsalt ultra-deepwater acreage; and even further south there is new interestin prospects offshore South Africa.

In this issue we are also looking at new technologies particularly at coatingsfor offshore vessels, new tanker designs and integrity data management.

Coatings provide a critical path to reducing corrosion on offshore structures.

ColumnsIndustry news and executives’ calendar 4

AnalysisAll about gas and Africa 8Gas usage is up but the pace of growth has slowed. Africa’s attractions as aninvestment location remain strong as conventional new discoveries are made.

Country FocusNigeria 18While Nigeria’s oil production remains dominated by the big international jointventures, there is change in the air. The emergence of a host of small but ambitious -and growing - indigenous companies is changing the look of the sector.

Angola 28Angola readies for renewed ouptut growth as upstream investment continues to flowin and hopes rise regarding the corrmmerciality of its subsalt ultra-deepwateracreage.

South Africa 34The oil and gas boom sweeping Africa has not bypassed South Africa completelyand international oil companies are showing greater interest, particiularly inoffshore prospects.

GeologyNews and developments 38A round-up of recent geological and geophysical activity from around the region.

E&PDevelopments 42The latest exploration and prodcution news from around the region.

TechnologyTraining 52The route to developing global expertise with a local focus.

Paints and coatings 56On board an FPSO, one of the areas of high concern for an owner is the selectionof coatings for the water ballast tanks.Cold applied vessel linings take the heat.

Ships and tankers 63All naval architects are looking to design smarter, greener, safer and cleaner ships,reducing emissions to meet stricter environmental controls.

Integrity data management 66Expro’s SafeWells well integrity management software can be used to monitorwell integrity performance, send real time reports, highlight problems and promptremedial actions.

Drilling fluid selection 69A system with improved technical performance was necessary to drill moredemanding, high angle and extended reach wells in East Africa.

Information TechnologyFrom the wellhead to the rooftop 76BP chose free space otics to provide reliable high-speed connections between itsvarious offices in Cairo.

Working on the West African GasPipeline.



Europe m10, Ghana CD18000, Kenya Ksh200, Nigeria N330, South Africa R25, UK £7, USA $12

REGULAR FEATURES: ■ News ■ Contracts ■ Events Calendar ■ IT update ■ Company profiles ■ Products & Innovations

■ Geology - p38 ■ Gas - p40 ■ E&P - p42 ■ Technology - p52

Lukoil eyes Africanexpansion

Renewed outputgrowth for Angola

New interest in South Africa’s offshore prospects

Developing globalexpertise with a local focus

Paints and coatings

Drivers for tankerdesign

Well integrity datamanagement

Drilling fluid selection

Volume 8 Issue Five 2013

Ernest Nwapa, executive secretary,Nigerian Content Development andMonitory Board. See page 24.

Movers andshakers in Nigeria’s

oil industry

Contents


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E x e c u t i v e s C a l e n d a r 2 0 1 3 / 1 4OCTOBER 2013

21-22 The Ghana Energy Local Content Forum ACCRA www.hialphaevents.com

21-22 North African Downstream Summit TUNIS www.wraconferences.com

28-30 NOCs & Governments Summit LONDON www.nocs-governments.com

NOVEMBER 20131-3 Angola Recruitment Summit LONDON www.eliteic.net

5-8 East African Local Content for the O&G Industry DAR ES SALAAM www.cwc.com

6-8 GOG 2013 ABIDJAN www.cwcgog.com

10-14 NAPE 2013 International Conference LAGOS www.nape.org.ng

18-20 8th LPG Trade Summit DOHA www.cmtevents.com

19-21 3rd Practical Nigerian Content YENAGOA www.ncipnc.com

20-23 Natural Resources Development NIAMEY www.ogtfafrica.com

20-23 16th Africa Oil Gas Mine Trade & Finance NIAMEY www.ogtfafrica.com

25-26 Angola Intl Oil & Gas Conference & Exhibition 2013 LUANDA www.aiogace.com

25-29 Africa Oil Week CAPE TOWN www.petro21.com

DECEMBER 201311-12 Pre-salt Development West Africa Congress 2013 JOHANNESBURG www.pre-salt-west-africa-2013.com

JANUARY 201421-23 Offshore West Africa ACCRA www.offshorewestafrica.com

27-28 The Africa Oil & Gas Summit LONDON www.africaoilandgassummit.com

FEBRUARY 201417-18 Floating LNG LONDON www.smi-online.co.uk

24-27 Nigeria Oil & Gas 2014 ABUJA wfww.cwcnog.com

26 Tanzania Local Content 2014 DAR ES SALAAM www.tanzania-local-content.com

MARCH 201427-28 The East Africa Oil & Gas Summit 2014 DAR ES SALAAM www.eastafrica-og.com

Readers should verify dates and location with sponsoring organisations, as this information is sometimes subject to change.

SPE OFFSHORE EUROPE 2013 inAberdeen celebrated its 40th birthdayby staging its biggest and bestconference and exhibition to date.

This year’s theme was “The Next50 Years”, representing thecontinuing success story of theindustry in terms of future production and the strong supply chain, which wasconfirmed by the scale and magnitude of this year’s event.

More than 63,000 people attended the four-day show, an increase of morethan 25 per cent on the 2011 event. A record-breaking 1,500 plus organisationswere exhibiting in the six exhibition halls which this year covered an expandedfloor space of 27,217 sq m – the equivalent of eight football pitches.

Twenty-two operating companies took stands this year, the largestrepresentation of operators ever to take part, and 262 companies wereexhibiting for the first time. The event also provided a valuable showcase forSMEs and many new young companies which had the chance to demonstratetheir innovative technologies and products to an international audience.

Vasyl Zhygalo, senior exhibition director, Reed Exhibitions, said the 40thanniversary of the event had been a fantastic success.

“Our conference and exhibition have been successful in equal measure. Therehas been an outstanding line up of top industry speakers from global operatorsand service companies and from government with standing room only at manyof the key addresses and presentations. We’ve also been overwhelmed at theresponse from exhibitors many of whom have been queuing to sign up for 2015.

SPE Offshore Europe is held every two years at Aberdeen Exhibition andConference Centre (AECC). The next event will take place 8-11 September 2015.

WEST AFRICA'S EMERGING pre-salt reservoir characteristics, salt layers, andwater depth represent major challenges to drilling, completing, and producingcommercially; but the potential to recover large carbonate reserves is immenseand worth the investment. To gain return on this investment, operators simplyneed a calculated and highly informed approach to well design to optimisedrilling and production while reducing safety risks in these substantiallychallenging plays. Marius Pika, assistant operation director, Perenco, will lead the well planningand design chapter at the Pre-Salt Development West Africa Congress 2013,examining the most effective well design in light of drilling, completions andsafety challenges to ensure optimum oil recovery.

Pre-salt development in West Africa SPE Offshore Europe looks ahead to thenext 50 years


FOLLOWING THE SUCCESS of Oil & Gas Libya 2013, plans for the sixth event inthe series - Oil & Gas Libya 2014 - are set for 12 - 15 May 2014 at the TripoliInternational Fairground under the joint patronage of Libya’s Ministry of Oil & Gasand National Oil Corporation (NOC).Confidence in Libya’s oil and gas sector has grown in line with the new wave ofoptimism which is prevalent following the recent democratic elections.The strong recovery in oil and gas production is a reflection of Libya’s energeticplans for huge economic development which is backed by long-term budgetstotalling US$500bn over the next 25 years. This will be spent on the regenerationand construction of the country’s infrastructure immediately starting with theupgrading of existing vital services such as telecommunications, power, water andtransportation, all of which are sectors vital to Libya’s oil and gas industry growth.

Libya's o&g exhibition set againststrong market recovery


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6 Oil Review Africa Issue Five 2013

OILFIELD SERVICESPROVIDER Asco has wona major contract inTanzania to further thegroup’s internationalexpansion drive.Valued at US$100mn,the three-yearagreement to providesupply base services to BG is the largest yet for Asco’s Middle Eastand Africa (MEA) division.The contract will be operated out of the East African port of Mtwaraand will employ more than 100 local people.The win comes just three years after Asco set up its MEA businessfrom an office in Oman. Euan Lockhart, head of the division, said the new contract wouldgive the company a firm foothold in East Africa.“Slowly but surely, we have been building our reputation across theregion,” he said. “This contract gives us an excellent foundationfrom which to grow our business.”In addition to BG, Asco will also provide warehousing, vesselloading, pipe yard storage and facilities management to Statoil,Petrobas and Ophir.The four operators are all involved in deep-water exploration off thecoast of Tanzania.“Asco has undergone major international expansion over the two

years and we now operate in four key regions – Americas, Europe,MEA and Australasia,” group chief executive Derek Smith said.“This contract is our largest in the MEA region, and gives us atremendous boost as we continue to build our profile and reputationin this part of the world.”

CRIPPS SEARS HAS long been associated with oil & gas, natural resources andinfrastructure recruitment in Africa and invited senior executives and HRprofessionals to attend two round table events in Lagos to discuss hot topicswithin the oil and gas industry.

Country and regional managers in addition to country HR and regional HRprofessionals from investing exploration and production and service companiesin Nigeria were invited to attend the forums.

The key themes discussed during these talks were:6 The challenges to growth and the challenges of resourcing indigenous players.6 Human capacity development challenges to comply with local content laws.6 PIB challenges.6 Attracting new investment to the Nigerian oil and gas industry.6 Security and community issues in Oil producing areas and it's implication

on production.

The forums were very well attended by individuals from both operator andservice company organisations headquartered both in Nigeria and those outsideof Africa investing in to Nigeria.

Mike Cripps, managing partner commented: "It is so exciting for us to beable to contribute at the front end of energy, natural resources andinfrastructure developments and to be able bring companies together who facecommon challenges and share ideas to create solutions".

The forum closed with many of the attendees agreeing that meeting withother members of the same industry was a useful exercise and looking forwardto the next forum due to be held, again in Nigeria, very soon.

The next HR Nigeria Networking Forum will take place in November 2013.

GHANA’S PRESIDENT, JOHN Dramani Mahama, has named finance and energyspecialist Alexander Mould as head of the state-run Ghana National PetroleumCorporation (GNPC), according to a report.The appointment of Mould, who was director of downstream regulator NationalPetroleum Authority, takes immediate effect, energy ministry spokesmanEdward Bawa told Reuters.Mould replaces Nana Asafu-Adjaye, who served for five years as managingdirector of the GNPC, which holds a 13.6 per cent stake in the West Africannation's flagship Jubilee offshore field.No reasons were given for Asafu-Adjaye's departure, the news wire said.Ghana became an oil producer in December 2010 with reserves at the Jubilee

field estimated at up to onebillion barrels. It expectsfull-year 2013 production of95,000 bpd.Tullow Oil, Kosmos Energyand Anadarko Petroleumare some of the otherpartners at the Jubilee field.Between 1985 and 1994Mould was an adviser at theGNPC in charge ofmarketing. He hadpreviously worked atStandard Chartered Bankand Union Bank ofSwitzerland in New York.

Ghana names new oil minister

LLOYD’S REGISTER (LR) has announced a significant investment in globalservices company Senergy to create an industry-leading offering - from thereservoir to refinery and beyond.

The deal will see LR and Senergy provide a unique and comprehensiveportfolio of services to the upstream sectors of exploration, production andtransportation through to refinery and beyond.

The combined business will also provide a life of field services frominception to decommissioning and offer unparalleled opportunities fortechnical and consulting staff to work with leaders in the industry byproviding cutting edge services to customers.

Senergy will continue to operate as an independent company for threeyears, by which time LR will have acquired the balance of its shares.However, Senergy will become a member of the Lloyds Register Group andwill work with LR to provide a broad service portfolio to the oil and gas andbroader energy market. LR will have representation on the board of Senergy.

LR provides independent assurance and expert advice to companiesoperating high-risk, capital-intensive assets in the energy and transportationsectors. Helping clients to ensure the quality of construction and operation ofcritical infrastructure, from ships and oil platforms to power plants and trains,it also provides business assurance services it helps companies manage theirsystems and risks across a wide range of sectors.

Formed in 2005, Senergy applies expertise and technology to assist thedevelopment and management of oil and gas fields and alternative energyprojects. Its suite of core technical services centre on subsurface, wellengineering and operations, site survey and geo-engineering, facilitiesdevelopment solutions and power engineering which are complemented bysoftware and training products.

John Wishart, energy director at Lloyd’s Register said: “Theinvestment in Senergy further expands our range of technical assuranceservices to the oil and gas sector, building on the complementarycapabilities we have built up through the acquisitions of WestEngineering, ModuSpec, ODS, and Scandpower. The combined entity isnow the industry’s leading provider in supporting safe operations in thediscovery of new energy resources.”

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Lloyds Register to acquire SenergyAsco secures US$100mn deal in Tanzania


Alexander Mould.

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7Oil Review Africa Issue Five 2013

DEEPWATER DRILLING AND performanceimprovement specialist Exceed hasestablished new companies in Canada andGhana on the back of recent contract wins andis in the process of setting up entities inAngola and the Middle East. Exceed established an impressive track recordas a performance improvement specialist beforediversifying to launch the industry’s first projectmanagement team to focus solely on drillingprojects in deepwater. The last 12 months have

involved growth and diversification of both theperformance improvement and deepwaterdivisions of the company in response tointernational client demand.The investment in a new enterprise in Ghana isdriven by a high degree of confidence in thegrowth of the region following theannouncement of the TEN deepwater fielddevelopment offshore Ghana and otheremerging opportunities in the Gulf of Guinea.With an initial investment of circa

US$100,000, Ghana is a strategic decision forExceed while offering a business-friendlyoperating environment.Whilst establishing an international footprint,Exceed’s Performance Improvement divisionhas also branched out into new arenas. Worksecured recently by the division includes theTalisman Sinopec project on a North Seaplatform and supporting a world firstdeepwater rigless well stimulation campaignfor a Ghana-based client.

NORWEGIAN GROUP AGR has secured a contractwith Svenska to deliver well management servicesfor the Swedish oil company's drilling campaignoffshore Guinea Bissau.

The contract involves provision of full wellmanagement and associated services, includingdrilling engineering and planning, supply chainmanagement and operations support for the drillingcampaign on Svenska's operated shallow waterblocks 2 and 5A licences, otherwise known asSinapa and Esperanca.

Starting during the final quarter of this year, theprogramme is for a minimum of one firm well withthe option of two additional exploration wellsdependant on results (rig contract allowing).

The sequence length could therefore range from45 days (dry hole case) to up to 180 days. This willbe further clarified once the rig contract is tenderedand the rig available is known.

Jan Hagen, vice presient of Svenska said: “Thisprogramme shows Svenska’s continuing commitmentas operator with its co-venturers to maintain activelevels of exploration offshore Guinea Bissau.”

Ian Burdis, vp UK and West Africa, said of theaward: "AGR is pleased to be working with Svenskaon this exciting project.

"This is an important award and in conjunctionwith other recent contract wins, strengthens AGR'sposition as the premier provider of well managementand associated services in North and West Africa."

The Svenska project is the latest in a number oflong-term contracts secured by AGR, which isenjoying growing world-wide demand for its wellmanagement services.

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AGR Well Management winsaward in Guinea Bissau


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EE NERGY DATA COMPILED by BP* shows that the rateof growth of global gas consumption is falling. But theworld’s reliance on conventional supplies from bothNorth and sub-Saharan Africa remains a key feature of avitally important business nevertheless.

Part of the reason for the rise in all-formsenergy consumption slowing to just over 1.8 percent last year was that most prices remained high,despite the increase in diversity of sources,including unconventional gas. Huge low-cost USshale supplies were of course the principal newfeature impacting on the business, but any price-lowering effect from this elsewhere, including herein Africa where power generation is so gas-dependant and other commercialisation difficult,remains to be seen.

However local suppliers, dealing in theconventional piped and liquefied forms of what isstill the world’s favourite fuel, need to be awarethat regional trends in gas use are continuing todiverge significantly. Natural gas provided justunder one-quarter of the world’s traded energy lastyear, the multinational says. All the net growth inglobal all-forms consumption took place in the‘emerging’ economies; in fact China and Indiaalone accounted for nearly 90 per cent. OECDconsumption dropped by 1.2 per cent while that ofthe emerging economies, some African onesincluded, grew by 4.2 points.

The net result was that both consumption (andtherefore output) reached record levels for allhydrocarbons in 2012. So prices for natural gas rosewith oil in both Europe and Asia despite thegrowing impact of all that low-cost hydraulically-fractured fuel being used in North America, whichcontinues to remain (almost) entirely in physicalterms within that fortunate continent.

The bottom line is therefore that the outlook forAfrican suppliers in general continues to remainexcellent despite the USA’s shale-gas windfall. Andthe prospects for the independents-led East of thiskey energy-exporting region look particularly good.However the time-honoured index-linking ofinternational gas and oil prices may be coming underthreat as the size of the resource base expands.

After their 2nd Summit Meeting in Moscow inJuly the Gas Exporting Countries Forum said theyintended to “Uphold the fundamental role of long-term gas contracts and continue to support gaspricing based on oil/oil products indexation.” GECFincludes Algeria, Equatorial Guinea, Egypt, Libyaand Nigeria as members.

In detail, global use of gas grew by 2.2 per centin 2012, with Africa, North America and above all

China and Japan heading the continuing upwardtrend. But at the same time any increase ininternational trade, by both pipeline and gas carrier,was exceptionally weak at just 0.1 per cent year-on-year. And global business in liquefied naturalgas in volume terms fell for the very first time ever,by 0.9 per cent.

“LNG’s share of global gas trade declinedslightly to 31.7 per cent” the BP report says; a bigfall in European imports being almost entirelyresponsible. The implications for Africa of thisdisturbing trend, where liquefaction is so often seenas the optimal means of commercialising vastquantities of otherwise stranded gas, exacerbated byambitious developments in Australia, are disturbing.

Huge growth in global gas resourcesThe massive growth in global gas resources hasfilled the media headlines throughout the year,almost entirely because of unconventionalactivity in general and the expected impact of thenewly-commercialised technology of hydraulicfracturing in particular.

The scale of reserves is a different matter. So it

is only in North America that shale gas can reallybe fully and accurately accounted for in theequation as yet; elsewhere it remains largely acase of “who knows and who allows?” And if thisnew form of gas (which will bring necessaryonshore processing adaptations with it) is found inthe sort of quantities that are being talked aboutnow (more than doubling world reserves) it isanything but certain how much can be actuallyexploited commercially.

And for most of Africa the unconventionalresource situation remains unknown; the excitingrecent discoveries on the Indian Ocean fringe beingall about conventional supplies in relatively shallowwaters that will be relatively easy to develop bynon-members of the IOCs club.

Therefore outside North America the impact ofthe so-called “fracking revolution” remains to beseen even though so much is being heard about it.But potential gas exporters without long-termsupply contracts in the bag do need to keep theireyes on the ball.

On the global production front the main newshas been the USA’s 4.7 per cent increase last year;globally growth was a mere 1.9 per cent. Someother countries did even better, such as SaudiArabia (11.1 per cent, mostly conventional). Buthere in Africa the increase was only 2.1 points, andmost of this was accounted for by the rebound insupplies from Libya alone. In the region’s biggestsingle gas-producing nation (Algeria) outputactually fell. The Nigerian industry didexceptionally well to push up its marketing of

Massive offshore gas discoveries in East Africa are catapulting theregion into a major player in the global energy arena.

The bottom line is thereforethat the outlook for African

suppliers in general continuesto remain excellent despitethe USA’s shale-gas windfall.

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Gas usage is up but the pace of growth has slowed. Africa’s attractions as an investmentlocation remain strong as conventional new discoveries are made.

All about gas

and Africa


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Energizing a refinery to protect

its most valuable resources.

People.

Follow the Charge »

Safe, dependable power is critical to a successful refi nery operation. Equally critical is the safety of the crews working in these highly powered environments.

That’s why Valero, a leading manufacturer of petrochemical products, made personnel safety a top priority when they chose to upgrade one of their more complex, 24/7 process refi neries. And they chose Eaton to help.

Valero demanded proven arc-preventative motor control center technology to lower the probability of electrical shock and reduce incident arc fl ash energy during

maintenance. Eaton rose to the challenge.

For this critical project, Valero chose Eaton’s FlashGard® motor control centers (MCC). The fi rst MCC designed specifi cally to prevent arc fl ash. Unlike conventional designs, FlashGard allows for closed-door maintenance operations. Providing a much-needed barrier to protect personnel and equipment from the dangers of arc fl ash.

The heavy power capabilities and safety systems needed to fuel tomorrow’s world, calls for solutions today. Eaton is already there.

eaton.eu/followthecharge/m4

©2013 Eaton. All rights reserved.

S02 ORA 5 2013 News_Layout 1 22/10/2013 15:05

associated and non-associated supplies by 6.2 percent in volume terms.

This country is now amongst the world’s fivelargest national producers of LNG and a veryexperienced player in an increasingly fraughtbusiness. It has proved reserves of more than180tcf and perhaps a further 500-600 waiting inthe wings. Less than 20 per cent of its annualoutput is used domestically, even though only ahopelessly-inadequate 4GW of electric power iscurrently available. Enough gas is thought to beavailable to increase this to 5GW by the end of theyear, with an optimistic ceiling of 10GW beingaimed at within 2015/16.

Abuja’s Gas Master PlanUnder Abuja’s Gas Master Plan of 2008 gas-basedindustrialisation targets are being pursued at thesame time as power generation, at such secureand dedicated locations as the brand-newOgidingbe Industrial Park in Delta State. Around2,000 cars are already reported to be runningaround the southern states with new-form

compressed natural gas in their tanks, believed tobe a first within the region. This is a major growthtrend in the US automotive market right now, andgas-powered ocean-going container vessels areunderstood to be on the way.

Elsewhere, consumption-wise there were somemajor individual changes seen in 2012, most ofwhich (such as in South America) have notinfluenced business here in Africa at all. Howeverthe 11-point increase in gas processing for localuse in Algeria surprised some, although it doesseem to be a logical commercial response to thegeneral weakening in volume terms of the gasmarket in Europe. Gas use in this nearby region(including Eurasia), the world’s largest consuminggroup, was down by 2.3 per cent.

Japan’s 10.3 per cent increase was inevitablya standalone case, almost entirely due to thefall in output of nuclear-generated electricity.LNG traders dealing with Asia did particularlywell out of this development, with supplies fromNigeria alone more than doubling to 6.5bn cu mover the 2011 level. This was by far the largest

component of Africa’s liquefied gas trade lastyear, exceeding Algeria’s individual shipments toFrance and Spain on which the whole businesswas founded in the first place.

One of the features of the gas market is thatit is very high cost, both to develop initially andto supply after that. In Qatar-pursuing Australiacosts are rising fastest of all, and this isproviding opportunities for Africa’s traditionalsuppliers, and to the potential nimblenewcomers who have the resources of all thosehandy oil-/gasfield service companies (and insome cases Chinese NOCs) to rely on.

But gas has become increasingly importantto the supermajors too, and the competition isgoing to be tough if the major consuminggroups manage to break that long-assumedlinkage with the international cost of oil. Africais likely to be one of the key battlegrounds forbuilding profits. ■

* ‘BP Statistical Review of World Energy June2013’; www.bp.com/statisticalreview

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2H OFFSHORE, AN Acteon company, has beenappointed by Tullow Oil as lead riser engineeringconsultancy for the delivery of the flexible risersystem for its Tweneboa, Enyenra and Ntomme(TEN) field development, offshore Ghana. The TEN development is located in the DeepwaterTano block, approximately 30 km to the west ofthe Jubilee field and lies in water depths rangingbetween 1,000 metres and 1,800 metres.The development will consist of oil and gasproduction wells, water injection wells and gas injection wells. Production will be gathered throughsubsea manifolds and flexible risers to a FPSO. 2H will ensure the riser engineering design complieswith ISO 13628-2 and provide recommendations on riser optimisation, installation and overallassurance that the risers meet the project Basis of Design (BOD) and specification. “We are delighted to have the opportunity to work with Tullow Oil in leading an integratedriser engineering team to deliver the flexible riser system for the TEN development,” said 2Hdirector, Hanh Ha. “Our in-depth knowledge and experience with flexible risers will enable usto develop and optimise the system to meet the project’s combined challenges of deepwater, complex subsea bathometry and aggressive delivery schedule.”

BARDEX CORPORATION HAS won a contractfrom South Korea's Hyundai Heavy Industries(HHI) for a BOP (blowout preventer) cage anddrilling riser skidding system for operation onthe Moho Nord TLP (tension leg platform)which HHI is building for Total for operationoffshore Congo-Brazzaville."The Bardex skidding system comprises twohydraulic gripper jacks each of 75 tonnespush-pull capacity powered by a 30 hp(horsepower) hydraulic power unit, approvedfor use in ATEX Zone 1 hazardous area,"Bardex said.HHI reported earlier this year that it hadclinched the US$700mn order for a TLP fromTotal. The company will carry outengineering, procurement, supply,construction and commissioning of the TLPto be deployed in Moho Nord field, 80 km offthe Republic of Congo's coast.

THE GAS & OIL Technologies Implementing Agreement (GOT IA), thenewest such agreement within the International Energy Agency’s (IEA)technology network, was launched recently in New York. The GOT IA willcreate a global dialogue, leading to a strategic vision; it will addresstechnology gaps, business cases and roadmaps, as well as incentivesand other technology drivers leading to safer and more sustainabledevelopment and use of the world’s natural gas and oil resources.In making the announcement, Jostein Dahl Karlsen, chairman of theIEA’s Working Party on Fossil Fuels and the chairman of the newimplementing agreement said, “Following the unconventional gasrevolution in the United States, gas and oil technology has become akey driver at the heart of world energy developments. Therefore, theglobal gas and oil community has a growing role to play in internationalconcerted action responding to the major challenges facing energydevelopments in the 21st century. The Gas & Oil Technologies

Implementing Agreement stands ready to work with multilateralorganisations, governments, industry, research institutions, academiaand non-government organizations to support innovation that movesthe world toward a more sustainable, efficient and affordable energyfuture for all.”The executive committee of the GOT IA selected GE Oil & Gas as theoperating agent of the new agreement to provide administrative andsecretariat duties.Markus Becker, global government affairs and policy leader for GE Oil &Gas said, “Technology is the key to providing the world secure, abundantand affordable gas and oil resources in a safe and sustainable manner.At GE Oil & Gas, we believe that addressing the technology gaps,regulatory and policy drivers in a collaborative and open manner willlead to outcomes that support the optimum development and use ofthose hydrocarbon resources.”

Bardex wins contract forMoho Nord TLP

New technology agreement within IEA

2H Offshore joins Tullow team for TEN project

S02 ORA 5 2013 News_Layout 1 22/10/2013 15:05

S03 ORA 5 2013 Analysis_Layout 1 22/10/2013 15:08


IIT IS THE nature of the energy businessesthat online applications for new positionsare now the norm. Technicians and otherprofessionals are usually too busy or

remotely located to use any other means. Andskilled personnel move around the world rapidly,rarely being available for face-to-face interviewsexcept by local agencies.

Dealing efficiently with the conventional e-mailapplication is covered here. Some recruiters gofurther and delve into the world of socialnetworking to corroborate and fill out the details.This is generally not advised. First, there may beunwanted legal implications. Second, many goodapplicants for new positions work in countrieswhere social networking is strictly controlled, oreven banned altogether; particularly in the MiddleEast. Not relying on the system at all means that alevel playing field is created.

Never overlook substance in CVOnline agencies tell job applicants repeatedly toensure their cv or resumé is as perfect as possible.Sometimes the result is that presentation takesprecedence over substance. And what they often failto point out is that most applications are ‘scanned’quickly on screen (just 10 seconds or so) andrejected immediately; only a selected few go on tothe next stage and are read thoroughly. That’s whenthe covering letter (essential) is inspected too.

So, in the absence of an application form, theskilled recruiter knows to look out for thefollowing features:6 Conventional presentation as an attached Word

document in .doc or .docx format; beware offancy material within time-consuming pdf’swhich suggests an unprofessional approach. Tidylayout is always good, with bullet points used toseparate short sentences containing onlyrelevant information. Photographs are notappropriate unless asked for.

6 Just two pages that present the essential datain a logical sequence, which varies from countryto country (usually nationality/contactdetails/training/work experience with the latestmost fully outlined first in thesequence/personal background data). Thereshould be no surplus words.

6 Keywords such as conventional terms forpreviously-held standard job descriptions (andcountry locations) presented early within eachsection, as this shows that the applicant knowshow rapid filtering works, relying heavily on theuse of conventional search terms.

6 A brief personal statement which shows what anambitious applicant could bring to thisindividual vacancy, separating them positivelyfrom the rest. Many applicants send preciselythe same details for all positions. The coveringletter should display this attention to detail too.

6 Pay particular attention to spelling, but makeallowances for the fact that many will not beusing their first language. Linguistic abilities arealways an asset.

6 Consistency matters! Has the applicantexplained any (long) employment gaps? Doesthe document ‘hold up’ (ie, do different sectionscomplement one another)?

6 Some recruiters say that a few relevant numbershelp, eg, a record of how the applicantperformed previously. Obviously for a technicalposition this is hard to justify, but even a noteabout size of work team helps. Such data tendsto be memorable because it is tangible. If itbacks up a claimed achievement, all the better.

6 Supply of references is inappropriate at theinitial online application stage, butwillingness/ability to supply them is vital (oftenstated in the covering letter, which shouldalways be retained).

6 Finally, use your instincts but back up therejection of an 7/10 scorer with a second look!

And remember that an applicant who managesto fill the gap between modesty and bragging isusually worth considering seriously.A case in point about online recruiting arises

from Nigeria’s long-awaited Petroleum Industry Bill,which is expected to completely overhaul the oiland gas sector in sub-Saharan Africa’s mostimportant producing country.

The renewed focus will be on increasing thesourcing of local content, most importantly ofskilled staff; this is already well under wayfollowing the recent implementation of theNigerian Content Act.

Restructuring of the industries themselves, and ofthe fiscal regime, will increase substantially the needfor staff who have to be hired (or at least initiallyfiltered) by electronic means as NNPC and itscomponents become “clear commercial entities.”

Search for Nigerian staff looks costlyThese will cover oil, gas and national assetmanagement activities with partial deregulationdownstream; at least one will be a joint venturewith a foreign partner so duplication of tasks seemslikely. Therefore the costly search for more Nigerianstaff looks certain to increase. Fortunately this isalready one of SSA’s most online-capable countries.

In addition the PIB will obligate all IOCs operatingin the country to hire and train more Nigerians and totake on a greater number of local contractors.

It all adds up to a predictable increase in thenumber of online applications which will have to behandled by the commercial entities themselves,and the many jobsearch agencies they employ.Effective e-mailing will help oil the wheels. ■

The PIB will obligate all IOCsoperating in the country to

hire and train more Nigerians.

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E-mail is the standard method of approach within the O&G industries these days. We look at the best ways to use it in the initial filtering stage.

Online

recruitment


S03 ORA 5 2013 Analysis_Layout 1 22/10/2013 15:08

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S04 ORA 5 2013 Lukoil_Layout 1 22/10/2013 15:15


FFOLLOWING ITS RECENT announcementsabout the plans to increase its presencein the Middle East region in the comingyears, the company has also declared

that the Western Africa region will also continue tobe among the priority regions for its further foreigndevelopment in the long-term.

Implementation of African projects will takeplace as part of Lukoil’s global strategy for thedevelopment of shelf projects. According to VagitAlekperov, head of the company, by 2021 thecompany plans to invest US$11bn in theimplementation of its offshore projects, withparticular attention to be paid to Africa and Brazil.At the same time none of these funds will beinvested in the development of the domestic shelfin the Arctic region, which, in accordance with theRussian legislation, still remains the monopoly ofstate-owned companies, such as Rosneft.

At present the development in West Africaremains in the list of three most important areas ofthe company’s international expansion in thecoming years, along with the West Qurna-2 projectin Iraq and some projects in Uzbekistan.

According to Yegor Sobolev, head of departmentof strategic management of Lukoil Overseas,Lukoil’s operator of foreign projects, the companyestimates the volume of hydrocarbon reserves inthe Western Africa is currently at least four billiontons of oil equivalent, being located on eightblocks. According to the company’s estimates,successful operations in Western Africa in the longterm will allow it to increase total volume of oilproduction by about 10 per cent.

He also added that already this year thecompany plans to drill three wells in Côte d'Ivoireand one well in Sierra Leone.

In the case of Côte d'Ivoire, the companyconsiders this country as top-priority for itsfurther development in the African continent.This is reflected by its latest moves. In June thisyear Lukoil acquired 65 per cent stake from theprivate Nigerian company Taleveras Energy in theCI-504 project on the Côte d'Ivoire offshore inthe Gulf of Guinea.

The project involves exploration, developmentand production on the block. Among the otherparticipants of the project are also Taleveras withthe 25 per cent stake, and the Petroci Holding with10 per cent.

The CI-504 block is located close to the existingBaobab field, while its area is estimated at 399 sqkm. From the south, CI-504 it shares a border withCI-205 block, which is also operated by Lukoil. At

the same time, in additon to these blocks, theRussian company currently remains the operator ofCI-101 and CI-401 blocks of the country’s shelf.

Lukoil has been operating on the Côte d'Ivoireshelf since 2006 after signing an agreement withthe US Vanco Energy to acquire 63.33 per cent ofthe CI-101 and CI-401 blocks.

The production of the first oil on the Côted'Ivoire shelf by Lukoil officially occurred at the endof 2011 on the CI-401 block. This year thecompany is going to spend about US$400mn ondrilling of exploratory wells near the newlydiscovered reserves. According to the company, theresources of the CI-401 block are estimated at5.6bn barrels. The volume of reserves of otherblocks have not been determined.

Lukoil hopes that further development of theCôte d'Ivoire shelf will be associated with discoveryof high quality sandstones, containing high-gravityoil and gas condensate.

Plans to speed E&P activitiesLukoil plans to speed its exploratory and productionactivities in Côte d'Ivoire, as the country’sgovernment has recently expressed itsdissatisfaction, regarding the regular delays in thedevelopment of its shelf projects, even threateningrevocating of licenses in case of further delays.

At the same time, in addition to Côted'Ivoire, Lukoil plans to accelerate its expansionin other African countries, and in particularGhana and Sierra Leone.

In the case of Ghana, the company plans tocontinue development of the Block Cape ThreePoints Deep Water (CTPDW), a stake in which wasacquired by it on July 2006. At present its sharein the project amounts to 56.66 per cent, with28,34 per cent owned by PanAtlantic (formerlyVanco), while the remaining 15 per cent is ownedby the state-owned GNPC.

Under the terms of the contract thedevelopment of the block will take place in twostages - exploration and development. In 2010-2011 several promising oil and gas fields werediscovered, as a result of drilling three deep-waterexploration wells. A new stage of explorationdrilling is planned for late 2013.

More active development in EgyptAt the same time Lukoil is ready for more activedevelopment in Egypt, as part of the local long-term Meleiha project, which is one of the first

Lukoil spud its first well in an undrilled portion of a deep-water

block off Sierra Leone with the Erik Raude.

According to the company’sestimates, successful

operations in Western Africain the long term will allow itto increase total volume ofoil production by about 10

per cent.

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Amid the steadily falling production in the domestic market, Russian Lukoil is continuingaccelerating its foreign expansion.

Russian Lukoil

eyes African expansion



foreign projects of the Russian company. It enteredinto the project as part of the Russian-Italian jointventure Lukagip in 1995. Currently, the share ofLukoil in the venture is 24 per cent. Otherparticipants of the Meleiha project are Eni (56 percent) and Mitsui (20 per cent). Proven oil reservesin the block are estimated at more than 30mn boe.

According to Lukoil plans, during the next fewyears, the company will focus on the developmentof several oil fields in Egypt, which have beendiscovered in recent years, among which are theNorth and Gavaher Nada (2007), Arcadia (2010),Emery Deep ( 2012) and North Rose (2013).

Finally, in Sierra Leone Lukoil currently remainsthe operator of the SL-5-11 project, which is adeep-water block and part of a Sierra Leone -Liberia geological basin, and where several large oilfields have been discovered in recent years. Lukoilacquired its 49 per cent stake in the project in July2011 from Oranto Petroleum.

As part of the 30 years’ contract, the companyplans to drill one exploration well this year, whichwill requre investments in the volume of up toUS$100mn. Drilling is scheduled to begin inAugust 2013. The amount of investments in thenext phase of exploration works will depend on theresults of drilling.

According to Andrew Kuzyayev, head of LukoilOverseas, this year the company plans to investabout US$600mn in the implementation of itsprojects in Western Africa.

West African region remains promisingAccording to Gregory Birge, a senior analyst ofInvestkafe, one of Russia’s leading analyst andresearch agencies in the field of oil and gas, despiteLukoil’s mixed results of exploratory drilling in theregion, the Western African region remains verypromising for the company, in terms of furtherincrease of production in the near future.

According to his predictions, in case of further

major discoveries (comparable to Ghana’s Jubileefield and Côte d'Ivoire’s Baobab) Lukoil maysignificantly increase production at the westernAfrican shelf already in 2015-2016, while its dailyproduction in the continent may reach the level of70,000-80,000 barrels.

At the same time analysts also warn thatdespite big potential of the Western African regionfor Lukoil, the company must take into account notonly geological risks, associated with thedevelopment of African fields, but also geopoliticalthreats. In 2011 Lukoil was forced to stopoperations in Côte d'Ivoire for a certain period oftime due to the destabilisation of the geopoliticalsituation in the country, which resulted insignificant losses to the company. Currently thepolitical situation in the majority of western Africanstates remains unstable, which poses a threat tothe company’s business in the region.

Another concern may be related to high costs ofimplementation of local projects. For example,French Total recently estimated its total costs forthe development of its oil filelds in Congo at aboutUS$1bn, due to their big depth and high prices forthe rental of drilling vessels.

However, despite this, Lukoil’s management

believes that Africa will remain in the list of theworld’s most priority regions for the company’sforeign development both in case of oil and gas inthe coming years, as the situation in the domesticRussian market remains unfavourable. The latterreflected by the lack of new promising oil fields, aswell as an inability to get access to the Russianshelf, despite the company’s numerous attempts inrecent years to get this right. According toKuzyayev, the company also believes that furtherexpansion in the region will take place through thestrengthening of co-operation with local players,which will be in the form of joint ventures andalliances.

Interestingly, several months ago Lukoilattempted to attract Rosneft, another Russianleading oil company and its main rival for the jointdevelopment of the African continental shelf.Lukoil made an official proposal to Rosneft toexchange part of its African assets on Rosneftoffshore projects in the Russian Arctic.

However this offer was declined by Rosneft, as,according to sources in the latter, it has moreattractive options for exchange and in particularthose, which involve sharing of assets with its USpartner ExxonMobil. Another reason for rejectionwas Lukoil’s partial participation in its Africanprojects and the fact that the company does nothave 100 per cent interest in any of these projects.

At the same time, instead of co-operation with itsmain rival Lukoil, there is a possibility that Rosneftmay enter the African continent in partnership withItalian Eni. At the end of last year Rosneft announcedits plans to build a pipeline in Africa, with the aim ofsupplying fuel to Zimbabwe, Zambia, Malawi andBotswana. It has also not ruled out the possibility ofparticipation in development projects in the regionwith Eni and in particular in Mozambique.

According to sources in Rosneft, Mozambique isa very promising region, but more in terms of gasproduction. For example, Eni stated that gasreserves at its projects in the country reach twotrillion cu m. ■


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Lukoil and Vanco have entered into contracts to drill four wells in CTPDW block, including two exploration wells onnew structures and two appraisal wells on the Dzata structure.

Further expansion in theregion will take place

through the strengtheningof co-operation with

local players.


AFRICA OILFIELD LOGISTICS' 49 per cent-owned subsidiary Ardan Risk & Support Services hassigned a contract with Weatherford Drilling International to provide camp management,catering and medical support to its 120 person camp in Turkana, Kenya.Ardan has won a number of contracts with international oil & gas, drilling, engineering andexploration companies operating in East Africa, and is advancing its strategy of becoming theleading provider of support services and logistics in Africa.Africa Oilfield director Andrew Groves said: "Ardan continues to build its reputation as thepremier support services and logistics company in the East African region and is rapidly growingits client list, particularly with leading international oil & gas and associated engineeringcompanies including, Africa Oil Corp, Global Geophysical, Tullow Oil and BGP Seismic.

Africa Oilfield unit inks deal with Weatherford


SGS as the world’s leading inspection, verification, testing and Certification Company, we provide competitive advantage, drive sustainability and deliver trust. Recognised as the global benchmark for quality and integrity, we employ over 70,000 people and operate a network of more than 1,350 offices and laboratories around the world. We are continually pushing ourselves to deliver innovative services and solutions that help our customers move their businesses forward.

SGS have their operations established in Nigeria since 1957, we have a local content workforce of over 90% indigenous Nigerians and we are fully committed to “The Nigerian Content Policy” as promulgated by The Federal Government of Nigeria. SGS Inspection Services Nigeria Limited board of directors consists of 50% Nigerian nationals and the Company has 50% Nigerian shareholding.

S05 ORA 5 2013 Nigeria_Layout 1 22/10/2013 15:19


Production track record: Conoil Producing LtdConoil Producing is one of Nigeria’s largesthomegrown oil firms, with both domestic andforeign assets. The company is the operator of sixNiger Delta blocks and has established a solid trackrecord as a producer through three main hubs, OML136, OML 59 and OML 103, working alongside elitepartners such as Total. It also holds a 25 per centequity stake in a block in the highly prospectiveNigeria São Tomé & Principe Joint DevelopmentZone (JDZ) (Block 4).

Into the big leagues: Oando Energy ResourcesWith a stock market listing in Toronto, OandoEnergy Resources is one of Nigeria’s better knownoil companies abroad. It is currently targeting theacquisition of the local assets of ConocoPhillips.The US group agreed last year to sell its onshoreassets after 46 years of operation in Nigeria toOando for US$1.79bn. The deal will catapult Oandointo one of the nation’s biggest producers.Conoco’s fields were producing around 43,000 bpdlast year and have proven reserves of 213mnbarrels of oil equivalent.

An emerging producer: Amni InternationalPetroleum DevelopmentTwenty-years-old this year, Amni International isworking with French oil giant Total to exploit gasreserves from the IMA field, where it recentlyinstalled a newer and bigger FSO (floating storageand offloading) vessel. It is also a partner in theproducing Okoro/Setu fields with UK-listed Afrenplc, where development work is ongoing. Averagegross production here is about 17,815 bpd, withAmni holding a 50 per cent interest.

A regional focus: Atlas Oranto PetroleumInternational Ltd A privately owned, independent Nigerian oilcompany based in Lagos, Atlas Petroleum waslaunched more than a decade ago by its owner andchairman, entrepreneur Prince Arthur Eze. Thecompany has established a pool of upstreaminterests in the West African region, includingEquatorial Guinea, the Côte d’Ivoire as well asNigeria and works with a number of notabletechnical partners.

Deepwater investor: Dangote Equity EnergyResourcesThe oil and gas arm of Nigeria’s powerful DangoteGroup, Dangote Equity Energy Resources is astrategic investor in a number of upstream oil and

gas projects. In Nigeria, this includes a smallinterest in Block 315 partnering Statoil andPetrobras. It also holds equity in two blocks(Blocks 1 and 3) in the Nigeria São Tomé &Principe Joint Development Zone (JDZ).Downstream, the group is at an advanced stage ofproject development for a huge refinery. It alsoholds interests in power generation.

Stepping on the gas: Emerald EnergyResources LtdEmerald Energy is the operator of block OML 141 -a large under explored license area in the prolificNiger Delta with five identified prospects - which itwas awarded back in 2000. Things are now movingfast for the Lagos-based company afterinternational partner Oryx joined the OML 141project team in 2011. Emerald now retains a 33per cent stake in the block, with another local firm,Amni International, also a partner. Oryx has been

on the fund raising trail this year to help financethe development of the block. Seismic acquisitionis planned for the latter part of this year, with awell to follow.

Agbami rights: Famfa OilFounded in 1991, Famfa Ltd - later re-named FamfaOil - was incorporated in September 1991 andassigned the leasehold rights to block OPL 216 twoyears later. In 1999, drillers discovered the giantAgbami field. Now in production, the field hasestimated in place reserves of up to two billionbarrels of crude oil. The block sits approximately350 km south east of lagos and 110 km offfshoreNigeria in the central Niger Delta.

Onshore and offshore: Sahara Energy FieldThe upstream exploration arm of the Sahara Group,which boasts a span of energy interests. Since itbegan operations in 2004, Sahara Energy Field hascompiled a portfolio of domestic projects: OPL 274western onshore Niger Delta; OPL 286 in deepwaterNigeria; OPL 284 in deepwater Nigeria; and theTsekelewu marginal field (OML 40).

A true pioneer: Dubri Oil CompanyNigeria’s first indigenous oil producer, Dubri Oil is areal industry pioneer. Founded in 1987, the

Nigeria has an abundance of natural resources, especially hydrocarbons.

Things are now moving fastfor Emerald Energy Resources

after international partnerOryx joined the OML 141

project team.

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While Nigeria’s oil production remains dominated by the big international joint ventures,there is change in the air. The emergence of a host of small but ambitious - and growing- indigenous companies is changing the look of the sector. Here’s a round-up of who’swho in Nigeria’s fast-changing oil and gas industry.

Movers and shakers in Nigeria’s

oil industry 2013



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privately owned Lagos company operates blockOML 96, where it has now been producing for morethan 25 years. Oil is treated at the company's GeleGele flow station and barged down the Osse Riverto Chevron's Escravos terminal for export. Dubri Oilwas also the first private Nigerian company to spudits own exploration well which led to the discoveryof the Ovia field.

Pan-African focus: Afren plcUK-listed Afren plc has emerged as one of Nigeria’sfastest-growing producers in recent years. It hasproduction from various fields including Ebok andOkoro/Setu, plus a host of other explorationprojects. Average gross production at Ebok isaround 33,884 bpd, while at Okoro/Setu it isaround 17,815 bpd. The company holds a 50 percent stake in each, alongside indigenous partners.Afren is also active across the wider African region.

Elcrest joint venture: Starcrest Nigeria Energy Ltd A subsidiary of the Chrome Group of companies,Starcrest Nigeria Energy is focused on the Gulf ofGuinea, predominantly Nigeria. Most significantly, itis a partner with UK-listed Eland Oil & Gas in a jointventure company, Elcrest Exploration andProduction (Nigeria) Limited. Elcrest has anagreement to acquire a 45 per cent of an onshorelease OML 40 from SPDC, a block that hasproduction history, booked developed andundeveloped reserves, infrastructure for productionand export for 30,000 bpd. Starcrest holds 55 percent of Elcrest shares, with the rest is held by Eland.

OML30 update: Shoreline Natural Resources In the last few months since the first interview with‘Oil and Gas Review Africa’, Shoreline NaturalResources can be said to be on a positive track.

The company has seen an increase inproduction, with an average of 45,000 barrels nowbeing produced on a daily basis. This it associateswith the introduction of some of its short andmedium term work programme activities havingkicked in; an example of this would be theintroduction of some new gas-lift compressors tothe asset, to improve oil recovery.

Within the fourth quarter of this year, Shorelineexpects more capital investment leading to afurther increase in production by the end of 2013.

Another milestone reached is in its financingstructure. Previously it was funded using a short-term bridge finance loan. This has now beenreplaced by a long-term reserved based lendingfacility (RBL), involving a consortium of local andinternational banks.

All in all the company is still very excited aboutOML30, its continued prospects, and any possibleopportunities that it may bring. Its goal is still todevelop not only this asset, but also nurture andbuild Shoreline Natural Resources into one oflargest oil and gas companies out of Nigeriaworking into Africa.

African ambition: South Atlantic PetroleumOne of Nigeria’s ambitious new breed of explorers,SAPETRO now has an upstream footprint that spansboth sides of Africa. After cutting its teeth in WestAfrica - with a slice of production from Nigeria’s largeoffshore Akpo field - the company has now joined thegreat gas search in eastern Africa with explorationrights in ever popular Mozambique. SAPETRO holdsinterests in deepwater Nigerian blocks OML 130 andOPL 246, where its partners include Total, Petrobrasand the China National Offshore Oil Corporation(CNOOC). The Akpo field has produced more than220mn barrels of condensate to date. ■


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One of Nigeria’s ambitiousnew breed of explorers,SAPETRO now has an

upstream footprint that spansboth sides of Africa.


The state concern: Nigerian National Petroleum Corporation

With a stake in most of the country’s big oil fields, NNPC is perhaps the single mostimportant producer in Nigeria. The state-owned company holds equity in all of the large oilproducing joint ventures, alongside international partners like Shell, Chevron and Total. NNPCis active both upstream and downstream through a network of subsidiary firms. The companyis in a state of flux, however, with the government keen to transition this huge organisationinto a more open and commercial entity, emulating the success of overseas state oilconcerns such as Statoil (Norway) or Petrobras (Brazil).

Shell Petroleum Development Company ofNigeria LtdThe largest of the NNPC joint ventures, SPDC isled by Shell. Other partners include Elf (Total) andAgip. It has the largest acreage position inNigeria from which it is capable of producing asmuch as one million bpd. Most of the company'soperations are concentrated in the Niger Deltaand adjoining shallow offshore areas. Civil unrestin the Delta area in recent times has meant someinfrastructure and production has been closed inintermittently. SPDC has more than 6,000 km ofpipelines and more than 1,000 producing wells.

Chevron Nigeria LtdChevron is the third-largest oil producer in Nigeriaand one of its largest investors, spending morethan US$3bn annually. Chevron Nigeria has assetson land, swamp and near-offshore concessionscovering approximately 8,900 sq km in the NigerDelta region. The US company holds a 40 per centstake in the joint venture with NNPC holding thebalance. Chevron also has extensive interests indeepwater Nigeria. The Agbami field is one of thecountry’s largest deepwater discoveries; it also hasan interest in the Usan deepwater project.

Mobil Producing NigeriaMPN and partner NNPC operate over 90 offshoreplatforms comprising about 300 producing wellswith a capacity of over 550,000 bpd of crude,condensate and natural gas liquids (NGL). Mobilholds a 40 per cent stake in the venture, andNNPC 60 per cent. A series of projects couldincrease the current average production to aboveone million bpd. These include the East AreaAdditional Oil Recovery project which marks amajor investment in a mature operation toextend field life, increase recovery and eliminatenon-routine gas flaring by injecting produced gas.

Nigeria Agip Oil CompanyThis joint venture, in which NNPC maintains a 60per cent stake, is operated by Agip (part of Italy’sEni group). The US’ Phillips Petroleum is anotherpartner with 20 per cent. The JV produces mostlyfrom small onshore fields. It too has been affectedby production disruptions from attacks, spills andoil theft. Earlier this year, it suspended activities atsome of its swamp fields in Bayelsa state afterlosing about 7,000 bpd daily to oil thieves.

Total (E&P) Nigeria LtdA joint venture between NNPC (60 per cent) andTotal of France (40 per cent). Originally called ElfPetroleum Nigeria, this joint venture changed itsname in 2008 in the wake of Total’s acquisitionof French rival Elf Acquitaine. Total's currentupstream operated production of over 250,000boepd in Nigeria comes from both onshore andoffshore blocks (OMLs 58, 99, 100, 102 and130). Total’s current thrust is the deep offshoreblocks OPL 222 (Uka, Uran and OPL 246) whichare also being developed on a systematic basis.

The joint ventures



NNIGERIA HAS AN abundance of natural resources, especiallyhydrocarbons. It is the 10th largest oil producer in the world, thethird largest in Africa and the most prolific oil producer in sub-Saharan Africa.

The Nigerian economy is largely dependent on oil, which supplies 95 percent of its foreign exchange earnings.

To discuss the opportunities and challenges in the sector, the Nigerian GasAssociation (NGA) at its yearly general meeting, brought stakeholders togetherto deliberate on several issues, such as the Petroleum Industry Bill (PIB), gasflaring and others.

Presenting the perspectives of the Oil Producers Trade Section of the LagosChamber of Commerce and Industry on the opportunities, challenges, and theway forward for the gas industry in Nigeria, its chairman, Mark Ward, describedNigeria as a nation with big ambitions.

According to him, Nigeria aspires to be one of the top 20 economies in theworld by 2020 by developing a large, diversified, sustainable and competitiveeconomy. “Nigeria certainly has the potential to achieve this. The nation isalready delivering significant economic growth. Over the last decade, theeconomy has grown by more than eight per cent year on year, unfortunately,this growth has only benefited a narrow segment of its people. But, with thelargest population in sub-Saharan Africa and abundant natural and agriculturalresources, Nigeria has an opportunity to broaden its economic base,” he added.

Ward noted that Nigeria’s economy was not growing and diversifying fastenough to reduce poverty and unemployment for its fast growing population.“Unfortunately unemployment has increased from 12 per cent in 2006 to 24per cent in 2011. Additionally, with around 80 per cent of the government’sbudget dependent on oil revenues, Nigeria is vulnerable to an oil priceshock”, he added.

He pointed out that accelerated and diversified economic growth wascritical for Nigeria to meet its vision. “A major step in the direction ofdiversification will be to build on the potential of Nigeria’s enormous gasreserves to power change”.

He added: “Nigeria is an emerging gas super-power, with the world’s ninthlargest gas reserves. We believe these reserves can bring growth anddiversification to Nigeria through more power generation, more gas-basedindustrial activity such as fertiliser plants, to boost agriculture and high valueexports to bring revenue to the nation.

He said though the country has made some progress, the achievementswere only a fraction of the potential and of what must be achieved to supportNigeria’s vision 2020.

He noted: “In terms of power generation, Nigeria has one of the lowestpower consumption levels per person in the world – even when compared tosimilar emerging economies. Regrettably, the nation has only moved from3GW in 1999 to 3.5GW generation today against a need for 40 GW by 2020.This shows that immediate and dramatic action is needed to help the nationachieve its goals.

“What upstream activity is needed to support these goals? Nigeria needs toproduce seven bcf of gas per day to meet these 2020 targets – the equivalentof 14 times the Utorogu gas plants. Today we produce less than one bcf to thedomestic market from the largest gas reserves in Africa”.

The deputy director in charge of Gas Development at the Department ofPetroleum Resources (DPR), Okpara Orjiakor, who represented the DPR director,George Osahon, said that the International Oil Companies (IOCs) weredeliberately undermining the PIB to make excessive profits and urged them not

to go to the National Assembly to oppose the passage of the bill.Group executive director in charge of gas and power at the Nigerian

National Petroleum Corporation (NNPC), Dr David Ige, said the greatestchallenge facing gas development in the country was the domination of the gasbusiness by four or five IOCs, saying this dominance accounted for the currenttension over the PIB.

He said about 90 per cent of the country’s gas reserve was concentrated inthe hands of these IOCs.

According to him, such oligopolistic arrangement where oil majors, whowere primarily centred around oil or export gas sit on the country’s gasreserves has created tension because the IOCs want the PIB to approach gas atthe same level as oil.

PIB must make gas equally competitiveHe said the two products were different commodities, stressing that the PIBseeks to make gas equally competitive.

Ige defended the separation of the gas business from the oil business in thePIB, saying that globally, consuming nations are moving away from linking gasprice to oil price.

“The task today is to delink the price of crude oil from the price of gasbecause there is a lot of distortion in the price of oil. So, when you use the price ofoil to determine the price of gas, you will introduce a lot of inefficiencies,” he said.

Ige said the country’s projection for gas was the most aggressive projectionanywhere in the world, adding that if the country achieves this projection by2017/2018, the combined production of gas in Nigeria would translate to anequivalent of 1.5mn bopd.

He said if the country achieves four to five billion cfd domestic utilisationof gas by 2018, Nigeria would be at par with South Korea in terms of domesticgas consumption. ■

Nigeria loses N735m daily to gas flaring

Nigeria aspires to be one of the top 20economies in the world by 2020 by

developing a large, diversified, sustainableand competitive economy.

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22

Nigeria is an emerging gas super-power, with the world’s ninth largest gas reserves, butthe nation needs to produce seven bcfd of gas to meet the 2020 target of being one ofthe top 20 economies in the world.

Opportunities, challenges in Nigeria’s

petroleum industry



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S06 ORA 5 2013 Nigeria News_Layout 1 22/10/2013 15:23


CAMACENERGY HASan encouragingnews updatefollowing itsQ1 13 net lossof US$3.8mn.The US-basedexploration andproductioncompanyowned by Nigerian business man, Dr Kase Lawal, has been informedby its partner, Allied Energy Plc that drilling operations at the Oyo-7well commenced on 9 September, 2013 using Transocean’s Sedneth701 drilling rig.The drilling of the pilot hole to assess shallow hazards around theOyo-7 location was successfully completed. The rig is beingpositioned over the actual Oyo-7 location after which drillingoperations will continue.Oyo-7 is expected to both significantly increase oil production fromthe currently producing reservoir and de-risk much of the unriskedresource potential in the field. Oyo, the first deepwater discovery inNigeria, has been online since December 2009.The company’s principal assets include interests in OML 120 andOML 121, offshore oil and gas leases in deep water Nigeria, whichinclude the currently producing Oyo Oilfield. The company says it iscurrently pursuing further additions to its exploration portfolio in Eastand West Africa and was recently shortlisted in the Chevron sale.

AT THE UNITED Kingdom Investment programme inAberdeen, executive secretary, Nigerian ContentDevelopment and Monitory Board (NCDMB), ErnestNwapa said that the Nigerian government wascommitted to the local content policy, whose focusareas are job creation, training and domiciliation oftechnical capacity and also development offacilities and infrastructure. He said there was acase for a strong linkage between manufacturingand the oil and gas industry as there is sub-optimalutilisation of locally-made goods. He said that theyhave adopted a two-pronged approach to stimulatea manufacturing culture and enhance the use ofmade-in-Nigeria goods

Nwapa stated: “We want to change Nigeria’svalue chain to domesticate a number oftechnologies in Nigeria. Most oil producingcountries have learned from experience but not inthe case with Nigeria. We are looking for partnersthat would help in technology transfer in the oiland gas industry. Investors must be ready todomesticate some equipment in our oil and gasindustry. We have set up industrial parks to helpwith the local content development. Most investorswere focusing on getting revenues from Nigeriawithout adding value to the country.

“It is not just about revenue, but adding value tothe system in such a way that it will be a win-winsituation. An equipment component manufacturing

company is now a pre-requisite for companiescoming to invest in Nigeria’s oil and gas industry.The country has no plan to endanger foreigninvestments but manufacturing of components willbe a pre-requisite for government to support. It willbe a pre-requisite for local content certification.”

He said that Bayelsa and Imo states had madeland available for indigenous equipmentmanufacturers to promote the local content policy.

According him, Shell has agreed to build a jettyworth US$10mn in Bayelsa, next to a pilot pipe millproject for steel piping.

“We are trying to organise a standard training todevelop skills for host communities in the Niger

Delta. We have contacted a company to help withthe supervision of the training programme. We areequally partnering PETAN to organise industrialtraining. Every PETAN member must have aninternship programme for the people trained fromthe host communities. We are also encouraginginternational oil companies to fund Nigerianuniversities to engage in research and development.”

According to him, Nigeria spends US$4bn onmarine vessels to export the country’s crude, andthat the local content board is encouraging theforeign companies to partner some Nigeriancompanies to sell off some of their equities.

General manager, Shell PetroleumDevelopment Company (SPDC), Igo Weli, said Shellwas collaborating with the Original EquipmentManufacturers (OEM), since June 2012, adding thatthese companies were ready to establishmanufacturing facilities in Nigeria.

According to him, the SPDC contractor fund isto complement the Nigerian Content fund, and thatfour Nigerian banks have agreed to guarantee a softloan to local contractors. “We are working withPETAN in respect of technology development andwe are ready to give long-term projects of 15 to 20years. We are trying to encourage researchdevelopment in Nigerian universities. We arealready working with the Universities of Ibadan andPort Harcourt on drilling mud solution”, he said.

Transocean’s Sedneth 701.

A COMPANY RUN by Africa's richest man received a loan toward aUS$9bn project that will give Nigeria its largest oil refinery andpetrochemical and fertiliser complex, reducing the country's relianceon international markets.Aliko Dangote, president of Dangote Group, signed a loan worthUS$3.3bn from 12 Nigerian and international banks toward the projectwhich will be built in Nigeria's southwest."At the completion of these projects we expect Nigeria to become notonly self-sufficient in fertiliser and refined petroleum products butindeed to become recognised as a leading exporter of these products,"Dangote said at the recent signing.Nigeria is Africa's biggest oil producer, and is a top supplier of crudeto the US, but the West African country has to import most of its fuelbecause of decrepit refineries unable to meet the nation's demand forgasoline due to years of mismanagement and sabotage.The 400,000 bpd oil refinery and complex will become operational by2016, the company said. The plant will also produce 2.8mn tonnes ofurea for fertilising crops and to produce polypropylene, used to makeplastics. Dangote said the company is still seeking an additionalUS$2.5bn in development funds to augment the US$3.5bn of its ownequity put into the project. The US$3.3bn loan deal was led byStandard Chartered and Nigeria's Guaranty Trust Bank.NUPENG (Nigeria Union of Petroleum & Natural Gas Workers) saidthe refinery would go a long way to ending the perennial scarcity ofpetroleum products and put an end to the current massiveimportation of products.While commending the Dangote for the project, the union called onother private investors and the multinational oil companies to take acue from him, especially 18 firms that were granted licences toestablish refineries under the Obasanjo regime and have not made anymove to live up to expectations.

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Nigerian government was committed to the local content policy

Tycoon plans Nigeria’s largest oil refineryCAMAC starts drilling at Oyo-7


Ernest Nwapa.



SEAWOLF OILFIELD SERVICES Ltd was established in April 2007, with theobjective of providing drilling and drilling-related oilfield services in the WestAfrican oil and gas market.

The company’s entry strategy was hinged on market entry through Nigeria,which contributes approximately 50 per cent of the West African drilling anddrilling-related services market. SeaWolf’s entry into the Nigerian market waspremised on the Nigerian Content Initiative driven by the NNPC.

The company's mission is to be the contractor of choice for safe,environmentally responsible, operationally efficient, high specification, drillingservices in West Africa.

SeaWolf operates the most modern and effective fleet of jack-up drillingunits - including two new builds - Oritsetimeyin and Onome, that can operate in91 m of water depth, to a rated drilling depth of 7,600 m - and Delta Queen,which can access multiple wells on a platform, without ever having to move.

In 2012 SeaWolf signed a US$140mn contract to provide its premiumcantilever jack-up rig, 'JU Oritsetimeyin' to ExxonMobil for two years, startingthe third quarter of 2013, following a refit to meet ExxonMobil’s safety,environment and operational requirements. SeaWolf described the contract itsigned with ExxonMobile as ‘testament to how far indigenous players havecome in the ownership and operation of offshore oilfield assets’.

The two other rigs - JU Onome and JU Delta Queen - were signed to AddaxPetroleum and Conoil Producing respectively.

FOUNDED AND INCORPORATED by High Chief (Dr) OB Lulu-Briggs in 1992,Moni Pulo Ltd (MPL) represents a creative response to the Nigeriangovernment's initiative to promote indigenous participation in the nation’s oiland gas industry. With its head office in Port Harcourt, Rivers State and branchoffices in Lagos and London, MPL is a private, fully indigenous E&P company.Over the years, MPL has acquired an enviable reputation as one of the mostsuccessful indigenous oil and gas explorers and producers in Nigeria.A trailblazer in the area of local content, Moni Pulo has developed itsoperational efficiency to international standards and has acquired expertise asthe sole operator of its asset, OML 114. This is blessed with substantial gasreserves, and negotiations are at an advanced stage with leading internationalcompanies on the way forward for actualising the organisation's gasmonetisation plan. The company has also acquired three new blocks - OPL 239in Ondo State, OPL234 in Abia/Ibom and OPL in Cross River /Akwa Ibom states.MPL has gone a long way to ensure compliance with the Nigeriangovernment’s gas flare out policy. Produced associated gas currently beingflared will be re-injected into a dedicated reservoir for storage. An injector wellfor this purpose has been drilled and completed. Gas compression facilities willbe commissioned in the first quarter of 2010. The re-injection will continue until the time when the gas master plan of thecompany is ready for implementation.Recently Moni Pulo signed a seismic contract with Sinopec ChangjiangEngineering Services Ltd for the development of the Northern Area of OML 114.

Mono Puli: a trailblazer in local content

Nigerian Operators:Addax Petroleum:

Addax Petroleum Development Nigeria LtdAddax Petroleum Exploration Nigeria LtdAddax Oil and Gas Nigeria Ltd

Chevron:Chevron Nigeria Ltd - CNLChevronTexacoTexaco Overseas Nigeria Petroleum Company

Ltd - TOPCONStar Deep Water Petroleum LtdTexaco Nigeria Outer ShelfChevronTexaco Nigeria Deepwater ‘E’ LtdChevronTexaco Nigeria Deepwater ‘A’ Ltd

Eni-Agip:Nigerian Agip Oil Company Ltd - NAOCNigerian Agip Energy - NAENigerian Agip Exploration

ExxonMobil:Mobil Producing Nigeria Ltd - MPNUEsso Exploration and Production Nigeria Ltd - EEPNEsso Exploration and Production Nigeria

Deepwater WestShell:

Shell Petroleum Development Company of Nigeria Ltd - SPDC

Shell Nigeria Exploration and Production Company Ltd - SNEPCO

Shell Nigeria UltradeepShell Nigeria Exploration Properties Alpha Ltd

Total:Elf Petroleum Nigeria Ltd - EPNLTotal Upstream Nigeria Ltd

Independants and Local Operators:Allied Energy Resources Nigeria Ltd - CAMACAmni International Petroleum Development

Company Ltd - AMNI Cavendish Petroleum Nigeria Ltd

China National Offshore Oil Corporation - CNOOC China National Petroleum Corporation - CNPCConoco Energy Nigeria Ltd - CENLConoco Exploration and Production Nigeria Ltd -

CEPNLConoil Producing LtdDubri Oil Company LtdEmeral Energy Resources LtdExpress Petroleum and Gas Company LtdKNOC Nigerian East Oil Company Limited -

Korea National Oil CoKNOC Nigerian West Oil Company Limited -

Korea National Oil CoMoni Pulo Ltd MPLNiger Delta Petroleum Resources LtdNigerian National Petroleum Corporation -

NNPCNigerian Petroleum Development Company Ltd

- NPDC Noreast Petroleum Nigeria LtdOcean Energy Nigeria Inc - DEVONOil and Natural Gas Corp Ltd Mittal Energy -

ONGC Mittal EnergyOil and Natural Gas Corporation Ltd Videsh -

NGC VideshOranto Atlas Petroleum International LtdOriental Energy Resources LtdPan Ocean Oil Corporation Nigeria Ltd -

PANOCO Peak Petroleum Industries Nigeria LtdPetroleo Brasileiro Nigeria Ltd - PETROBRASStatoil Nigeria Ltd Summit Oil International LtdSunlink Petroleum LtdYinka Folawiyo Petroleum Company Ltd

Marginal Fields Operators:AfrenAfrican Oil & GasAngus Energy (USA)Associated Oil & Gas Services LtdBayelsa Oil CorporationBicta Energy and Management System LtdBritania-U Nigeria LtdChorus Energy LtdDel-Sigma Petroleum Nigeria LtdEnergia Company LtdEurafric Energy LtdExcel Exploration and Production ServicesExileFrontier Oil LtdGeo EnergyGoland Petroleum Development Corporation LtdGuarantee Petroleum CorporationHardy Oil Nigeria Ltd Independent EnergyMart ResourcesMidwestern Oil & Gas CorporationMillenium Oil & Gas LtdMorris Petroleum LtdMovido E & PNetwork E & POando plcOwena Oil & Gas LtdPillar Oil LtdPlatform Petroleum Corporation LtdPrime Energy Resources LtdSahara Energy Field LtdSogenal LtdSuffolk Petroleum Services LtdSuntrustUniversal Energy Resources LtdWalter Smith Petroman Oil Ltd

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Breaking the monopoly of foreign players indrilling rig business

List of Nigerian operators



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S07 ORA 5 2013 Angola_Layout 1 22/10/2013 15:31


AANGOLA’S CRUDE OUTPUT has fluctuatedrather steadily between 1.6-1.7mn bpdin the past few years, despite constantofficial statements that growth past the

two million bpd mark was just around the corner.The temporary plateau has proven hard to moveaway from, being caused by project delays in theface of an overheating Angolan project environment,resulting in skill shortages and spiralling costs. Asproject bottlenecks built up in the developmentphases, it was only a question of time beforeexploration spending too was impacted and thewhole development pace in the country’s buoyantoil and gas industry started to slow down. Angola’sproblem was and is however not as deeply structuralor intractable as some other hydrocarbon producerswith high hope of growth, like for instance Iraq, orNigeria. From an oil industry perspective, contractterms and the political will to, within reason, attractinvestment, remain attractive and the country is notplagued by the security or political risks besetting somany other large-scale oil producers in Africa andthe Middle East. Project overload and cost inflationare of course very serious problems; ultimately theyare however of a passing character.

Recognising this, Asian crude buyers have beenquick to snap up Angolan cargoes over the past fewyears, as US imports of Angolan grades havedeclined. Obviously, Angola had a definitivegeographic benefit over other West Africanexporters, being closer to Asia than Nigeria and theother Gulf of Guinea producers. Angolan crudeshave in particular become popular with China,where they have been well situated, quality-wise, tobe attractive to many of the existing refineries. Ithas been a very fortunate confluence of events forAngola, as the decline in US imports stemmingfrom its shale oil revolution happened at the sametime as the need for Chinese buyers to look furtherafield for relatively heavy crudes the like ofAngola’s. Other African producers, most notablyNigeria and Algeria, have fared worse, being too farfrom Asian markets and selling too light grades tolook as attractive, given the higher shipping costs.Consequentially their differentials to benchmarkcrudes came under significant pressure in the pasttwo years. Still, despite the fundamental merits ofgeography and buyers’ crude preferences, Angola’sunderlying position as a comparably stable futuregrowth area has no doubt proven yet anotherattraction to Asian clients looking for new suppliers.

With this in mind, it is exciting to note that thetemporary production plateau at which Angola hasbeen stuck for some time now looks like it is giving

way during 2013 and 2014. The country’s twomillion bpd production target is unlikely to bereached this year, however sometime late next yearor in the first half of 2015 an output capacity justabove that level looks likely. The growth will bedriven by a few large deepwater projects comingonstream or ramping up this year and next, chiefamong them the BP-led PSVM venture. PSVM, orPlutão, Saturno, Venus and Marte, is a technicallychallenging ultra-deepwater development showingthe way for how Angola’s increasing sub-salt ultra-deepwater reserves could be tapped in the not-too-distant future. PSVM came onstream late last yearand will at its peak produce 157,000 bpd of crude.Unlike previous developments in Angola’sdeepwater blocks 15, 17 and 18, the Block 31PSVM project lacked one large dominatingdiscovery which in its own right made developmentcommercial. Instead, the four planet-nameddiscoveries span a length of 34 km at the most.Having a relatively similar size, each being belowwhat would be considered attractive to develop

given the challenge involved, the project onlystarted to make sense when the developingconsortium (operator BP 26.67 per cent, Angola’sNOC Sonangol 45 per cent, Sinopec 15 per centand Statoil 13.33 per cent) chose to look at thefield as one cluster instead of four differentuncommercial reservoirs. Recent strides indeepwater technology naturally made certain thischange of perception was possible.

PSVN now produces crude wholly throughunderwater installations, all linking up to onesingle floating production, storage and offloading(FPSO) vessel. Located at a depth of around 2,000metres, the US$14bn project is truly setting anexample in subsea engineering, which is raising thehopes that the discoveries that have started beingmade in Angola’s ultra-deepwater subsalt acreage,particularly in the Kwanza and Banguela basins,will be possible to monetise even if new elephant-sized fields are not found.

Angola’s offshore mirrors Brazil’sIt has for some years now been held true thatAngola’s extended offshore mirrors Brazil’s, whichshould mean similarly significant reserves of crudein subsalt reservoirs. The expected similarity stemsfrom Africa and Latin America having been joined atone time, and the seabed now separating the twocontinents being created at the same time, when

Angola’s PSVM offshore project cameon stream earlier this year.

PSVN now produces crudewholly through underwaterinstallations, all linking up to

one single FPSO vessel.

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Angola readies for renewed output growth as upstream investment continues to flow inand hopes rise regarding the commerciality of its subsalt ultra-deepwater acreage. Costinflation could prove a headache, however, and it has raised the crude price floor Angolanproducers require, considerably. Samuel Ciszuk reports.

Renewed output growth

for Angola



the landmasses drifted apart. While it is too early tocome to a final conclusion whether the two sidesactually mirror each other resource-wise,discoveries on both sides so far seem to give thetheory credence. Sub-salt exploration in Brazil ismuch more advanced, but is set to accelerate inAngola, with several wells set to be spuddedbetween this year and up to 2015. Exploration ofthe reservoir rocks located below a 2,000 metresalt layer in water depths of more than 2,000metres is however a costly undertaking. Explorershence have an eye on what potential developmentcould cost from the outset, before even spuddingtheir wildcat well.

So far, few exploration programmes in the twosubsalt basins have progressed far, since Denmark’sMaersk Oil, with partners Svenska PetroleumExploration and Sonangol announced their virgindiscovery in the Kwanza basin with the Azul-1 wellin January 2012. A recent sub-salt discoveryoffshore Gabon by France’s Total has added furtherto excitement in the wider region, although newsearly September that Total also scored a sub-saltgas discovery sent shares of its partners Cobalt andMarathon – both at the time with Angolan sub-salt

interests – tumbling, demonstrating how strongconcerns over commerciality investors have. Morecertain knowledge about the Angolan sub-salt’scommerciality is still awaiting the explorationprogrammes starting this year and next.

Angola LNG offers marketing possibilitiesGas discoveries and the fears over theiruncommerciality, is an interesting aspect, giventhat Angola’s first LNG venture, Angola LNG, cameonstream in June this year, following an 18 monthdelay. The project offers a marketing option forAngola’s associated and non-associated gas,providing an avenue to improve the commercialityof otherwise marginally profitable oil fields. Indeed,the PSVM project is a case in point, allowing thedevelopment to start selling its associated gas tothe liquefaction plant, making sure that the BP-ledventure simultaneously can cut its flaring. Yet,concerns over high liquefaction costs and worriesover potentially weakening LNG prices in thecoming years are evident, as seen in the marketreaction to Gabon’s pre-salt gas discovery. For allthe question marks over medium and long-term oilprices, oil remains far more likely to pay for thevast exploration and development costs associatedwith Angola’s output growth.

A major challengeThis touches on one of the main challenges to arenewed Angolan oil boom and brings us back tothe problems of the country’s inflated project costs.Should the oil price - currently supported by thelarge-scale outage in Libya and the considerablepolitical risks in Syria, Egypt, Iraq, and to some

extent Iran – start to fall back in the medium term,as risks ease off and the global supply growth ledby the US shale oil boom continues, the expensiveAngolan projects could be at risk. Among a growingnumber of oil industry economists, speaking ofpeak oil demand has become en vogue, meaningthat oil demand in developed economies hasentered permanent decline, while oil demandgrowth rates in developing countries like China andIndia might not return to the peak growth ratesseen in the past decade (although they likely willremain high for yet some time).

Simplified, the peak oil demand is seen as theresult of “a second oil price shock” in the run up to2008 and again in 2011-2013, as present andplanned gains in fuel efficiency, energy efficiencyand a switch to renewables in one way or anotherrepresent a permanent switch away fromyesterday’s oil dependence.

Whether or not the argument holds trueremains to be seen, but it shows that concern inthe industry might be switching from a concernover insufficient supply (or at least concerns oversupply bottlenecks) to concerns over large parts ofthe global market being in a perpetual state ofshrinkage. Should this be right and the shale oilboom in the US continue, there is a risk that themost expensive subsalt exploration projects inAngola, already suffering from considerable costinflation, could be axed before other relativelyexpensive projects, like the US shale oil. In the USeconomics of scale already exist.

Hence, the novel subsea field clusterdevelopment approach brought by the PSVMproject could have been a very timely project justas the exploration starts getting underway, settingan example of how to keep costs down by tyingnumbers of separate fields together in all-subseadevelopments. It might raise the attraction of theAngolan play a bit further and help to at leastsomewhat contain fears of continued skill shortagesand spiralling costs. After all, Angola is not the onlyhydrocarbon geography grappling with thisproblem, which even is besetting the US onshoreamid its feverish boom. Then again, all the fear ofthe industry having to adjust to a significantly loweroil price in the years ahead could well become amoot point, as the stability of Libya and the levelsof political risk in the overall Middle East show nosign of improving. Indeed, that underlines one ofthe key attractions of Angola - its relative stabilityin a rather unstable wider region. ■


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BP's PSVM floating production storage and offloading (FPSO) oil vessel, 180 km off the coast of Angola.

The PSVM project could be avery timely project setting anexample of how to keep costs

down by tying numbers ofseparate fields together in all-subsea developments.


GE OIL & GAS and the Angolan group GLS Holding have formed a jointventure, GE-GLS Oil & Gas Angola Ltd, to better support Angola’s rapidlygrowing oil and gas sector.As part of the agreement, which received the approval of Angola’sNational Agency for Private Investment (ANIP), the companies areplanning a proposed initial investment of US$175mn to build a newmanufacturing facility in Soyo, in the province of Zaire, that will supplysubsea equipment to the oil and gas industry in Angola.Dr Eugenio Neto, president and CEO of GLS Holding, and vp of the newJV, said: "GE-GLS Oil & Gas Angola Ltd intends to support thedevelopment of Angola, bringing new manufacturing and industrial

technologies to the country and creating hundreds of jobs directly andindirectly. The investment represents an important contribution to thecountry’s "Made in Angola" initiative and, consequently, for thecontinued growth of Angola’s oil and gas industry. It will be a greatasset to Angola’s petroleum sector and the country and its first prioritywill be to meet domestic demand in Angola.” The new manufacturingfacility will start operating in two years.”“The purpose of this investment is to provide the country with newproduction capacities, including high-tech subsea production equipment,that will create added value and technological knowledge,” said MarcoCaccavale, general manager of GE Oil & Gas for sub-Saharan Africa.

GE Oil & Gas forms JV with GLS Holdings to support rapid growth in Angola’s energy sector



TWMA, THE LEADER inintegrated drilling andenvironmental solutions for theinternational onshore andoffshore oil and gas industry, hasbecome the first company to beawarded an offshore processingcontract in Angola.The agreement, worth up toUS$35mn, will see TWMApioneer the concept of offshoreprocessing in this rapidlydeveloping but environmentallysensitive frontier, through thedesign, installation andoperation of tailored solutionson-board a new-build drillship tosupport a major global operator’sdrilling campaign.Underlining TWMA’s globalgrowth plans, this latest contractwith duration of up to fiveyears - will see the company

establish a new onshore supportfacility in Luanda and isexpected to generate up to 50new jobs in Aberdeen andAngola by the end of the year.Ian McGillivray, global salesexecutive at TWMA, said: “As newand frontier energy regions aroundthe world develop, it is criticalthat operators are aware of thediffering environmental legislationand standards, and as suchcarefully plan how they intend todeal with drill cuttings andassociated materials.“This is an exciting project forTWMA and will see us operate for

the first time in a country wherethere is an evolving environmentalpolicy regarding the treatmentand disposal of drill cuttings. As aresult we are engineering ourproven solutions into a new-buildrig design to recycle drill cuttingsand fluids at source.”TWMA is currently working withclients in the UK, Norway, Egypt,Cameroon, Abu Dhabi, Canadaand the United States; treatingand recycling in excess of100,000 tonnes of drill cuttingsand associated fluids annually.“Having assisted operators in theirglobal drilling campaigns for manyyears our innovative solutions haveearned the trust of the industry andare capable of meeting even themost stringent environmentalregulations,” added Rob O’Neill,sales director at TWMA.

TOTAL'S PAZFLOR FLOATING production,storage and offloading unit (FPSO), as big asmost US aircraft carriers, is what Louis Bon, theproject's director, calls the tip of the iceberg.That's because the "biggest part of thedevelopment is subsea and you don't seeit," said Bon at OTC 2013. Below themassive ship is more than 260 km ofpipeline and control lines that snake acrossthe seabed. About 2,000 metric tonnes ofequipment rest on the seabed."It's a huge investment, US$9bn, and it is inparticular an offshore platform that uses newtechnology and equipment, specificallydesigned, engineered and qualified for theproject," he said.At OTC 2013 Total was honoured with theDistinguished Achievement Award forCompanies for its Pazflor project. The prestigiousaward is awarded annually to the company thathas advanced deepwater oil expertise andtechnology as part of a major project.It is now more than two years that Pazflor hasreached the maximum operating capacity andis proceeding as planned, which proves thereliability and robustness of the technologythat we have for that development.The platform operates offshore Angola indepths of up to 1,200 metres. Productionaverages 220,000 bpd and more than 45mnbarrels have been produced since August 2011.To get to that production, Total had to inventnew ways of drilling underwater, including agroundbreaking subsea gas and liquidseparation process.Commonly, oil is mixed with gas and water

when it is extracted. The Pazflor deployedsubsea separation units (SSUs) that strip oiland gas apart at depths where humanintervention is impossible. Once separated,the oil and the water is pushed to the surfaceby seabed Pazflor pumps. The lighter gas risesnaturally to the FPSO.The subsea modules are designed to operatefor a 20-year period. Bon said the SSUs hadnever been used before on such a scale."So we decided to run through a very intensivequalification programme for each of thecomponents of the subsea separation units.Commissioning tests were carried out inNorway and ensured functionality andsimulated all steps of the installationsequence. In all 13 different pieces ofequipment were tested in 56 separatequalification tests," he said."Strong quality assurance and quality controlorganisation within the Total team andcontractors' teams was in place and turned outto play a crucial role."The project also required meticulous co-

ordination at all levels.Total teams worked hand in hand withcontractors, all of whom were located on theconstruction site and onboard during thecommissioning. Supervision of the projectspanned the globe in Angola, South Korea,Norway and the US.After departing South Korea in January 2011,the Pazflor FPSO headed to its position inAngola in April 2011.A well defined scope of work was createdthrough extensive front-end design andengineering studies. The project also strived towork in partnership with Angola by trainingtechnicians and management personnel inforefront deep offshore technologies. Finally,drilling into a pay of almost 600mn barrels ofoil required finding just the right spot.Total's geosciences team also ensured theoptimisation of well placement and maximumwell quality in co-ordination with the drillingteam. Within six months, all facilities, includingwater gas injection, were fully operational."One of the important achievements of theproject was to manage good integration and agood relationship between the geosciencesand drilling teams in order to optimisedrilling", Bon said.In August 2011 Pazflor became one of theworld's largest deepwater developments.One year after reaching its maximum capacity,the Pazflor is operating smoothly with anavailability ratio of more than 97 per cent."We have made some new technologies andproven some new technologies to be useful inthe industry," Bon said.

EARLIER THIS YEAR Repsolentered into a partnershipwith Sonangol which willallow the company to useRepsol’s ProjectKaleidoscope technology,which has also been used tomake recent discoveries inBrazil and the Gulf of Mexico.Twenty-seven Sonangolengineers will be trained touse the technology atRepsol’s technology centre inMadrid with the aim ofhelping them to model theKwanza basin, an areaoffshore Angola which hasbecome a hot area forexploration in recent yearsand which geologists see asanalogous to the Santos basinin Brazil.

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Total’s Leviathan deepwater Pazflor: a technological marvel that will drill for 20 years

Repsol enterspartnership withSonangol

TWMA wins Angola’s first oil & gas processing contract


Pazflor’s subsea separation unit.


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WWITH LIMITED KNOWN reserves,South Africa relies heavily oncrude oil imported from theMiddle East and Africa to meet the

country’s current consumption of some 680,000bpd.

These imports contribute significantly to thecurrent account deficit with only a small proportionof the country’s requirements produced domesticallyby Sasol and from PetroSA’s Mossel Bay project.

In general, refined petroleum products includingpetrol, diesel, paraffin, aviation gasoline andliquified petroleum gas are produced by refiningcrude at the country’s refineries, by converting coalto liquid fuels and gas to liquid fuels (Sasol), and byturning natural gas into liquid fuels (PetroSA).

However, the oil and gas boom sweeping Africahas not bypassed South Africa completely andinternational oil companies are showing greaterinterest, particularly in offshore prospects.

According to research by PwC, more thanUS$1bn will be spent on exploration with about 10companies having been granted explorationlicences. ExxonMobil and Anadarko have acquireddeepwater rights on the east coast and BHP Billiton,Cairn India and Sunbird Energy on the west coast.

South Africa is estimated to have the fifth-largest shale gas reserves in the world. Manyhurdles remain, but the first step towardsdevelopment took place in September last yearwhen the government lifted its moratorium onshale development. Coal bed methane reserves areestimated to be between 10 and 30tcf.

On the refining front, PwC says PetroSA is stillevaluating the construction of its proposed refineryat Coega, and that Euro V standards may bringconsiderable change to the refinery landscape as itcould cost US$4bn to meet the required standards.

Proposed new legislationIn the light of the country’s dependence on oilimports, there has been much criticism of theproposed Mineral and Petroleum ResourcesDevelopment (MPRD) Bill that is intended toreplace current legislation of the same name. Atpublic hearings on the bill in September, oilcompany executives and financiers complainedthat it would make South Africa’s oil and gassector less attractive.

Amongst the industry’s concerns areproposed requirements that governmentappoints two directors to company boards, thesector be subject to unknown beneficiationrequirements, and the dissolution of the oil and

gas regulator, the Petroleum Agency SA, and thetakeover of its functions by offices of theDepartment of Mineral Resources.

These and other changes led to calls for theoil and gas sector to be exempted from the bill.Others drew comparisons with Uganda, which isalso amending legislation in order to keep upwith the oil rush.

MPRD Amendment Bill South Africa’s MPRD Amendment Bill wasintroduced into Parliament on 21 June this year,while in Uganda, the Petroleum (Exploration,Development and Production) Act 2013 (PEDPA)came into force on 5 April, repealing the Petroleum(Exploration and Production) Act cap 150 (PEPA).

According to Lizel Oberholzer, head of oil andgas at pan-African corporate law firm BowmanGilfillan: “In South Africa and Uganda, amongstother countries, the method of applying forpetroleum rights or licences, the significance of the

regulator, state participation, and the duration ofrights or licences have come under scrutiny.”

Under PEPA in Uganda and the MPRD Act inSouth Africa grants were made by way of directapplication to the minister. This position haschanged under the new legislation, which providesthat areas open for bidding in exploration licensingwill be announced in the government gazette.

However, in Uganda the minister may inexceptional circumstances receive directapplications. These circumstances include instanceswhere no applications have been received inresponse to invitation to bids, and instances whereareas are adjacent to existing licensed reservoirs.

Oberholzer said that, “From a practical point ofview it would be recommended that South Africanlegislators also consider providing for exceptionalcircumstances as is case is in Uganda.”

Another difference is that, while under theMRPD Amendment the independent regulator isdisbanded in South Africa, PEDPA moves closer tointernational best practice and introduces thePetroleum Authority Regulator (PAU). “It is unclearwhy the South African legislator is moving awayfrom international best practice,” said Oberholzer.

Although neither the MPRDA nor PEPA providedfor state participation in petroleum licences orrights, in practice such participation was negotiatedin the petroleum agreements. This position has

International oil companies are showing greaterinterest, particularly in offshore prospects.

From a practical point of viewit would be recommended

that South African legislatorsalso consider providing forexceptional circumstances.

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The oil and gas boom sweeping Africa has not bypassed South Africa completely andinternational oil companies are showing greater interest, particularly in offshoreprospects.

New interest in

offshore prospects



changed under the MPRD Amendment Bill andPEDPA which make provision for state participation.

She added: “However, in both countries thepercentage of state participation is not specified inthe legislation. Since there have been significantdiscoveries in Uganda, this uncertainty may beacceptable to oil companies. However since nosignificant discoveries have been made in SouthAfrica such uncertainty may scare investors away”.

In Uganda the initial period of the petroleumexploration licence was reduced from four years totwo years under PEDPA, while in South Africa theinitial period of the exploration right was increasedfrom three years to five years.

“In practice it can be very expensive and timeconsuming to mobilise a drilling rig, and particularlyin the case of Uganda, difficult to gain access toland. As a result, the exploration period of two yearsmight be insufficient to complete work programmes.

“African Governments should learn from eachother to establish regulatory frameworks that are inline with international best practice and encourageinvestment in the continent,” said Oberholzer.

Willing to take risksPwC says Africa currently supplies about 12 percent of the world’s oil and boasts significantuntapped reserves estimated at eight per cent ofproven reserves globally. These reserves have

increased in the last two decades and the trend isexpected to continue.

“Overall, the booming oil and gas industry isseeing greater interest in all regions, includingfrontier states such as Namibia, Togo, Liberia andareas where exploration and production had beendiminishing over the last few years. This includescountries such as Ghana, Côte d’Ivoire and SouthSudan. The crown jewels are, however, the newplayers on the east coast, particularly Mozambiqueand Tanzania.

“Significant gas finds in excess of 127tcf inMozambique have created the potential for anotherAfrican super player.”

PwC estimates that in sub-Saharan Africa onlyabout 30 per cent of 2,900 identified oil and gasblocks are licensed, with many new opportunities,especially for exploration and productioncompanies that are willing to take risks.

Amongst these are South Africa’s National OilCompany, PetroSA, and Sasol who have signed aco-operation agreement, their first in 10 years, toexplore a block in the country’s offshore area -Block 3A/4A, which is located within the OrangeBasin, along the western margin of South Africa.Large and relatively under-explored, the blockcovers 19,066 sq km, with water depths rangingfrom 100 to 500 metres.

PetroSA Group CEO Nosizwe Nokwe-Macamo

said that, in order to deliver on its mandate ofensuring security of liquid fuels supply in thecountry, the company entered into strategicpartnerships with different entities. In the past twoyears PetroSA has concluded co-operationagreements with Sinopec, Eni, PetroMoc and theKorea National Oil Corporation, among others. Thepartnership with Sasol on Block 3A/4A hassignificant strategic value to PetroSA’s West Coastexploration efforts.

PetroSA also announced suspendedoperations at its Mossel Bay facilities for 37 days


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A significant share of South Africa’s consumption will bemet with synthetic fuels (synfuels), derived from coal-to-liquid (CTL) and gas-to-liquid (GTL) processes.

In practice it can be veryexpensive and time

consuming to mobilise adrilling rig, and difficult to

gain access to land.



from 22 September for a planned statutorymaintenance shutdown, which affected theMossel Bay gas-to-liquids (GTL) refinery and theoffshore Platform. The statutory shutdown,required every four years, is aimed at ensuringthe integrity of equipment and systems.

And the Orca, PetroSA's floating production andstorage facility will be docked at Port Elizabeth forup to twelve months to undergo reclassificationand refurbishment upgrades. The Orca FPSO wasoriginally a drilling rig that was converted into afloating production platform in 1997. Since 2008the Orca has been utilised by PetroSA to produceoil from the Oribi/Oryx Oilfields, which are locatedin Block 9, off South Africa’s southern coast.

On its side, Sasol said at its year-end resultspresentation in September that in South Africa akey project to ensure sustainable synfuelsoperations was the development of the Impumeleloand Shondoni collieries that are part of SasolMining’s US$1.4bn mine replacement programme.In terms of growing its existing asset base, Sasol’saim is to extend the lifespan of its synfuelsoperations to the middle of the century.

Where low-carbon power generation is concerned,CEO David Constable said that in Mozambique thegroup had advanced its 140MW gas-fired power plantin Ressano Garcia. Also in Mozambique, it wascommissioning a US$198mn loop line to increase the

capacity of the existing gas pipeline. Christine Ramon, financial director of Sasol, said

that part of the group’s strategy was to accelerateGTL growth. “Here we are moving forward onseveral fronts - in Escravos, Nigeria where our thirdGTL plant is close to commissioning; in Uzbekistan,where we are concluding the FEED phase; and ourUS GTL project in Louisiana, which will beprogressing to the FEED phase later this year.”

In Africa, PwC said that apart from Mozambique

joining Egypt, Nigeria Libya, Algeria and Angola asmajor upstream power houses in Africa, it isunlikely that Ghana or the other East Africancountries will disturb the equilibrium that hasexisted in Africa for the last two decades.

Exploration and refining capacity in Africa willcontinue to increase, in contrast to what is happeningin the developing world, as countries strive to have agreater security of supply and increase exportearnings from the sale of refined products. ■


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GLOBAL PETROLEUM HAS filed anapplication to renew the large4,500 sq km Juan de Nova Estpermit in French overseas territory,north-west of Madagascar in theMozambique channel.

Global's seismic review of thearea indicates a thick stratigraphicsection in deep water in both thenorthern and southern triangles of

the block, justifying renewal.Under the terms of the

existing permit, joint venturepartner Wessex Explorationmaintained operatorship and 70per cent equity.

Global holds full legal interestin the permit through subsidiaryJupiter Petroleum Juan de Nova,which has applied for renewal as

100 per cent interest holder, withoperatorship, over a five year term.

Alongside the permit renewalapplication, a new joint ventureagreement has been signed withWessex giving Wessex the right toapply to relevant Frenchauthorities to take legal title to 50per cent working interest, in theevent of approval.

Global to renew project off Madagascar

PETROSA HAS BECOME the first company toestablish what it terms a “state-of-the-art”geoscience collaboration, visualisation andtechnology centre in South Africa.The US$1.45mn Ulwazi (Knowledge) Collaborationand Visualisation Centre presents seismic andgeological data in detailed, 3D views of subsurfaceformations. All disciplines of PetroSA’s upstreamasset teams use the facility to assist explorationand development of oil and gas prospects.The Ulwazi complex will be used on a daily basisto monitor and guide drilling operations for

PetroSA’s Project Ikhwezi, an initiative to secureadditional feedstock reserves from South Africa’ssouthern offshore gas fields to sustain the MosselBay Gas-To-Liquids (GTL) refinery.Nosizwe Nokwe-Macamo, PetroSA Group CEO,said: “Collaboration between our multi-disciplinary sub-surface teams in Ulwazi furthersour understanding and description of geologicalstructures and reservoirs which lead to improveddecision making in areas such as wellplacement, field development planning, andreserves estimates.”

South Africa opens geoscience complex

FUGRO HAS BEEN awarded alarge three-year survey contractrecently by Total E&P Angola,with an estimated value ofUS$26mn, to support itsdevelopment programmesoffshore Angola. The contractincludes the provision of offshorepositioning services andaccurate navigation systems forTotal E&P Angola’s drilling units,vessels and structures, togetherwith onshore and offshore surveyservices. This contract is acontinuation of services suppliedto Total E&P Angola under asimilar contract since 2008.The contract is one of thebuilding blocks for the continueddevelopment and furtherinvestment into Fugro’s activitiesin Angola.

Fugro wins $26mnsurvey contractfrom Total for workoff Angola

S09 ORA 5 2013 Gas_Layout 1 22/10/2013 16:02


THE LARGEST AUV (Autonomous UnderwaterVehicle) survey in the oil and gas industry is a coreelement of two contracts awarded to Fugro thatalso include metocean measurements andgeohazard consultancy services for Eni East Africa.The data is being acquired for the Area 4 Rovumabasin development offshore northern Mozambique.

The challenging AUV survey is the largest evercommissioned and one of the first in this new andremote frontier area off the coast of East Africa.Fugro is providing hull-mounted reconnaissanceand AUV detailed data from the development area.The data will aid the design of subsea facilities.

Covering approximately 1,440 sq km, the surveyarea stretches from the nearshore to deepwater(depths greater than 2,700 metres. The work isbeing carried out using one of Fugro’s newestsurvey vessels, the state-of-the-art MV FugroEquator, which is equipped with hull-mountedmultibeam echosounder, sub-bottom profiler, pistongravity corer and piezocone penetration system, inaddition to the Echo Surveyor III AUV.

Meteorological and oceanographicmeasurements are collected using mooring buoyslocated in water depths ranging from 20 to 1,800metres. To assist in the routing of the 60-km exportpipeline, Fugro completed a regional and localgeohazard assessment, including data processingand reporting, from its offices in Europe and Asia.

FRENCH SEISMIC CONTRACTOR CGG has won a contract for what it describes as a “large, high-end”seismic acquisition programme offshore West Africa.The company said it has received a letter of award to conduct a 1484-sq km BroadSeiz wide-azimuthsurvey for a mystery operator. The value of the contract has not been disclosed.CGG would not reveal the identity of the client concerned. However, the file name for the accompanyingpress release - "PR CGG Total Angola Ang Final" - suggests it may be the French supermajor Total.CGG said it will mobilise its vessels Geo Coral, Geo Barents and Pacific Finder to conduct the shoot.The survey is due to start in the middle of this month and is expected to take nine months to complete.CGG already has a five-year contract for the 4D seismic processing and imaging of annual and biennialmonitor surveys planned to take place offshore Angola. More than 6,000 sq km of seismic data from five ofTotal’s deep offshore group of fields in Block 17, which is operated by Total in partnership with Statoil, BPand Esso, are expected to be processed over the contract’s duration.

CGG awarded West Africa shootFugro performs AUV survey Geo

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NORWEGIAN ELECTROMAGNETIC SURVEYcontractor EMGS has won a letter of anintent for a contract worth a minimum ofUS$8mn for work off West Africa.The Oslo-listed player will deploy its vesselEM Leader on the 3D data acquisitionproject, though it did not disclose the client.Chief executive Roar Bekker said thecompany expects the vessel to remain in theregion for a longer period “based on demandfrom both new and existing customers.

EMGS wins West Africa job

S09 ORA 5 2013 Gas_Layout 1 22/10/2013 16:02


ENI CONTINUES ITS string of successfulwells in offshore Mozambique Area 4with a gas discovery at the Agulhaexploration well. Work is under way tofinalise the assessment and to plan anappraisal strategy.Eni’s preliminary estimates are that thestructure could hold five to seven tcf ofgas, and three additional wells could bedrilled in 2014.The well is the 10th drilled in Area 4and went to TD of 6,203 metres in 2,492metres water depth about 80 km offCabo Delgado.

Eni is the operator of Area 4 with a 50per cent indirect interest owned throughEni East Africa, which holds 70 per centof Area 4. "The discovery opens a new explorationarea in the southern part of Area 4,where Eni plans to drill three new wellsin 2014," the company said.Eni, which has already agreed to jointlydevelop Area 4 with Anadarko'sneighbouring Area 1 field, will decideon liquefied natural gas projects in 2014with first cargoes due in 2018.Mozambique is now a key prospect forthe export of liquefied natural gasbecause of the size of recentdiscoveries, its location en route to Asiaand its appeal to buyers trying todiversify away from big suppliers Qatarand Australia.

BP EGYPT HAS made a "significant gas discovery"while drilling in deep waters in the eastern NileDelta. The company announced this discovery inits Salamat well while drilling in a water depth of640 metres in the eastern Nile Delta. The deepwater exploration well which is thedeepest well in Nile Delta, was drilled using the6th generation semi-submersible rig “MaerskDiscoverer” at water depth of 649 metres reachinga total depth of around 7000 metres."With a hydrocarbon column in excess of 180 m,the discovery increases our confidence ... in theEast Nile Delta," Mike Daly, executive vicepresident of exploration for BP, said.“Salamat discovery is a great outcome for our firstwell in this core exploration programme in theEast Nile Delta. It shows our commitment tomeeting Egypt’s energy needs by exploring thedeep potential offshore the Nile Delta” saidHesham Mekawi, BP Egypt regional president.

Mekawi added that they are currently evaluatingthe standalone and tie-back to the nearby Temsahinfrastructure development.

RWE DEA EGYPT has produced first gas from theDisouq concession in the Egyptian Nile Delta.

The seven-field development is expected toproduce a total of approximately 11.4 bcm of gas.

RWE Dea chief operating officer DirkWarzecha said that while the German explorerhad been producing oil in the Gulf of Suez foralmost 40 years, Disouq was the company’s firstoperated gas asset in Egypt.

Gas produced from the North West Khilala(NWK) field is being collected in a temporaryprocessing facility operated by Suez OilCompany, where it is separated into dry gas andcondensate before being fed into the Egyptiangas supply grid.

By mid-2014, four of the fields will be inproduction and the concession will have its owncentral processing facility, RWE Dea said.

A peak production level of around 4 to 4.5mcmd is expected to be achieved in mid-2014when additionally a central treatment plant willstart producing.

During the initial project phase, four of a totalof seven gas fields will be brought intoproduction by July 2014. The gas produced fromthe North West Khilala (NWK) field will initiallybe collected in a temporary processing facility,where it will be separated into dry gas andcondensate. From the facility operated by SuezOil Company (SUCO), the gas will be fed into theEgyptian gas supply grid via the state-ownedGASCO pipeline system.

“We’re excited to be able to startproduction in this RWE Dea growth project,”said Dirk Warzecha, chief operating officer ofRWE Dea AG.

RWE Dea launches gas production in Egypt

STATOIL IS FACING a key decision this monthto determine the technical and commercialfeasibility of a planned liquefied natural gas”mega-project” in Tanzania as it prepares tolaunch a further drilling campaign thisautumn on its deep-water block.

Gas

BP finds gas in EgyptTanzania LNG decision dayfor Statoil

Eni strikes gas againoffshore Mozambique


BG GROUP HAS hit more gas at a discovery offTanzania as it readies another appraisal welland drill stem test.The UK gas giant struck 20 metres of netpay at the Pweza-2 appraisal well on Block4 just two kilometres from the Pwezadiscovery well.Block partner Ophir Energy, which holds a 40per cent stake with BG on 60 per cent, saidthe pay zone was of excellent reservoirquality and pressure communication withPweza-1 was confirmed.The find has firmed up the resource estimateat Pweza which stands at 1.7 tcf of grossrecoverable resources.The Deepsea Metro 1 drillship is now to moveonto the Pweza-3 appraisal well while a drillstem test is also planned on the discovery.

“These are to confirm reservoir deliverabilityfrom the cluster of Block 4 discoveries thatwill provide a second hub for the LNGdevelopment,” Ophir said.“These activities are expected to becompleted in early October.”

BG hits more gas off Tanzania

Semi-submersible rig “Maersk Discoverer”

Deepsea Metro drillship.

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CANADIAN EXPLORER ORYX Petroleum believes it has a commercialdiscovery on its hands after striking gas and oil pay with a probedrilled at its Elephant prospect off Congo-Brazzaville.The E-1 wildcat drilled at the prospect, formerly named Xiang,encountered gross pay zones of 102 metres and 46 metres fornatural gasand oil,respectively,across twointervals inthecompany’sHaute Mer Alicence.The wellwas drilled by drillship Jasper Explorer to a total depth of nearly2,500 metres in a water depth of 550 metres about 80 km offshore.It was targeting a deeper Tertiary play similar to that being tappedin fields adjacent to the licence, such as Total’s producing MohoBilondo field and Chevron-operated Block 14 in Angola.Henry Legarre, Oryx Petroleum's chief operating officer, stated: "Weare very pleased with the Elephant discovery as it represents animportant milestone in the building of our West African business.Overall the results are consistent with expectations. Reservoirquality, crude quality and viscosity appear to be better thanoriginally anticipated while the areal extent of the reservoir appearsto be slightly smaller than expected. We look forward to workingwith our partners to test and potentially appraise the Elephantdiscovery. Although subject to testing, the discovery gives usconfidence that there is further upside potential and opportunity toexpand the prospect inventory in the license area."

TOTAL HAS MADE a pre-salt gas discovery in the deep-waters off Gabon,following on pre-salt oil finds earlier this year, which could galvaniseinvestment in the country’s pre-salt potential, but only if we see moreoil and less gas.

In mid-August, Total (TOT) announced an accumulation of gascondensate in a pre-salt layer of the ocean bed, some 100 km off thecoast of Gabon.

The Diaman-1B successfully confirms the existence of a workingpetroleum system and is the first discovery drilled in the deep-waterportion of the pre-salt play. The Diaman-1B well was drilled to a totaldepth of 5,4864 metres in approximately 1,524 metres of water. Thefind is about 97 km from the nearest pre-salt discovery made earlier thisyear by Total.

For now, there are no details as to the scale of the discovery, as Totalis still analysing the data.

Total Gabon is the operator of the license, with a 42.5 per centworking interest. Marathon Oil holds a 21.25 per cent non-operatedworking interest, while Cobalt International Energy has a 21.25 per centstake and the government of Gabon retains 15 per cent.

Earlier this year, Total made oil discoveries in pre-salt layers off thecoast of Gabon and Côte d’Ivoire.

Spurring optimism over Gabon is the pre-salt potential of Angola,which is analogous to pre-salt darling, Brazil.

But this second find for Total brings to light the gas potential, ratherthan the already snowballing oil potential, and while the excitement isstill there, the hope for another oil find, rather than a gas find, dulls thefervour a bit.

Indeed, shares in Marathon and Cobalt both fell on the news of thegas discovery. It’s not a huge find, and it’s not oil.

It’s an expensive drilling endeavor that will be more challengingeconomically and commercially than oil extraction. So far this year,Total has reportedly spent US$922mn on development in Gabon, whichrepresents a 20 per cent increase over expenditures last year.

Gabon, however, is confident that gas will prove another boom for itseconomy, and it’s already preparing for another licensing round laterthis year for new oil and gas blocks.

OPHIR HAS AGREED heads of terms for a deepwater drillship for its operatedmulti-well West African drilling programme in 2014. A total of six firm plusadditional contingent slots have been agreed. The programme is scheduledto commence in Gabon in early February 2014 with drilling of the circa onebillion barrel pre-salt Padouck Deep prospect on the Ntsina Block. The second well is expected to target the Affanga Deep prospect on theGnondo Block with the third well likely to be the pre-salt Okala prospect onthe Mbeli Block.

Rig secured for West African 2014 multi-well campaign

Jasper Explorer.

CHARIOT OIL & GAS has been given a boost for an upcomingexploration campaign in its Central Area blocks off Namibia with abullish assessment of the resource potential for the frontier play.The explorer’s main drilling target, dubbed Prospect B, is nowestimated to hold 469mn barrels of unrisked gross meanprospective oil resources, according to the independent audit byNetherland Sewell & Associates.It also assigns mean resource estimates ranging from 213mn tonearly 1.5bn barrels to a number of other Upper Cretaceousprospects and leads identified by earlier 3D and 2D seismic data.Chariot intends to focus its exploration efforts on a lower-riskshallower petroleum system in Upper Cretaceous turbiditereservoirs in the blocks off the south-west African state, which itoperates with a 90 per cent stake with partner AziNam on 10 percent.The company has now launched a farm-out process to enlist apartner for exploration of the emerging province.Chief executive Larry Bottomley said the findings of the resourceaudit showed “the giant scale of the opportunity” that exists withinits Namibia acreage.“Although Namibia remains a frontier and high-risk province, all theplay elements of source, reservoir and seal have now beendemonstrated and success in our exploration campaign woulddeliver transformational growth,” he added.

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Total scores another pre-salt ‘win’ in Gabon

Namibia study oils Chariot’s wheels

Oryx makes Elephant discovery


TULLOW GHANA LTD, lead operators of Ghana’s Jubilee Oilfields, hasannounced that the total production of crude oil in the West African countrysince it began operations in the last quarter of 2010 stood at 80mn barrels.Operations Manager Bob Gettka, who was visiting the Western Corridor GasInfrastructure Project, said Tullow earned about US$7bn in revenue from itsoperations on which it paid corporate tax to the government of Ghana.Meanwhile, the Ghanaian government said it intends to save US$1.5mn aday when Ghana starts producing electric power from its gas processingplant next year.Benjamin Asante, Director of Operations of the Ghana Gas Company (GGC),said substituting crude oil with gas in energy production was much cheapersince 120mn scfd of lean gas was required to produce 500 MW of electricity.He said the oil wells at the Jubilee Oilfield would produce 140mn scf of rawgas per day initially and later increase this to 700mn scfd in three years.

Jubilee crude oil production hits 80mn bbls

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JAYA HOLDINGS HAS won a two-year contract valued at morethan US$20mn for its new DP-2 platform supply vessel JayaVigilant to operate offshore Mozambique.The vessel, originally designed as a large PSV, is being upgradedto accommodate additional equipment prior to delivery.The work scope includes ROV support, survey work, and coresampling in water depths of up to 2,000 metres. This willrequire a 50-tonne subsea-rated deepwater crane and amezzanine deck for the ROV spread, along with communicationsand survey pole equipment, and enhanced passenger facilities.

CHINA’S STATE-OWNED China National Offshore Oil Corporation(CNOOC) has secured a US$2bn deal to develop a petroleum field inUganda and help propel the east African nation into the club of oil-producing countries. The Kingfisher field is estimated to hold 635mnbarrels of oil, of which 196mn are recoverable., and CNOOC will developthis over a period of four years

"This is a major breakthrough as a country," Uganda's junior energyminister Peter Lokeris said confirming that a deal had been reached inSeptember with CNOOC.

"It is a milestone towards making us self-sustaining as far as oil andgas production is concerned," he added.

"The contractor, among other responsibilities, will be responsible fordeveloping the Kingfisher oil field which should become operational inthe next four years from now," the minister added.

Uganda has oil reserves estimated at 3.5bn barrels but the path toproduction has been a bumpy one since deposits were discovered in2006 near its border with the Democratic Republic of Congo.

Such reserves have the potential to radically alter Uganda's economyand could eventually as much as double the national income.

Lokeris said he expected the initial output of the new Chinese-runfield to be modest. "We expect to produce about 40,000 bopd once theKingfisher well is fully developed and operational," he said.

THE FIND IS the fourth consecutive wildcat discovery, through exploratorydrilling, since 2012. It was made at the Ekales-1 wildcat, located inBlock 13T in Northern Kenya. Tullow operates the Ekales-1 well, withAfrica Oil taking a 50 per cent interest.

The well will now be tested to confirm productivity but reservoirvolumes are expected to be over 50mn barrels gross recoverable.

The company also announced its Agete-1 well in block 13T hadcommenced drilling.

Angus McCoss, exploration director with Tullow Oil said: “This successat the Ekales-1 wildcat is further evidence of the exceptional oilpotential of our East African Rift Basin acreage. Having opened the firstbasin with the Ngamia-1 well last year, we are now increasing the paceof exploration in Kenya aiming for 12 wells over the next 12 months.”

Tullow makes new discovery in Kenya

AFRICA-FOCUSED FAR Ltd has completed negotiations on jointventure agreements with Ophir Energy plc on highly prospectiveoffshore Kenya exploration permit Block L9.

Block L9 is a large permit in the heart of the Lamu basin. A seriesof 2D and 3D seismic surveys have identified numerous oil and gasprospects and leads. FAR has assessed several leads each with thepotential to contain prospective resource volumes in excess of 300mnbarrels of oil (unrisked best estimate, 100 per cent basis).

FAR has already received a considerable number of unsolicitedexpressions of interest in Block L9 and will immediately embark on aprocess to farm out a portion of its 30 per cent participating interest.

Following government approval of the Block L9 joint ventureagreements, FAR will pay for its participating interest of past costs(approximately US$11mn) principally relating to the two large 3Dseismic surveys acquired on the permit. FAR expects to recoup asignificant portion of these past costs through farming down itsparticipating interest.

Managing director, Cathy Norman said, “The successful executionof these Joint Venture agreements is a further important milestone inFAR unlocking the significant value of its excellent acreage positionin the fast emerging Kenyan offshore arena. Ophir provides extensiveoperational expertise to our joint venture and we hope to be drillingour first exploration well on this block in late 2014. Success on thiswell would likely have a profound impact on the value of FAR.”

Block L9 was originally awarded in May 2011 with DominionPetroleum Kenya Ltd (a wholly owned subsidiary of Ophir) thenominated operator on the permit. Since then FAR and Ophir havebeen negotiating the terms of joint venture arrangements for FAR toobtain a 30 per cent participating interest.

Block L9 contains well developed large carbonate Miocene reefstructures that are perceived to be oil prone. There are turbidite sandsat several levels over most of the permit with potential for bothstructural and stratigraphic plays. The eastern part of the block is ontrend with the Mbawa-1 gas discovery where several large structuralleads have been identified. Good quality Tertiary and Cretaceousmarine clastic reservoirs are likely to be present and sealing shalesare widespread. The Block L9 Joint Venture anticipates drilling its firstexploration well in late 2014.

E&

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China wins US$2bn Uganda oil deal

FAR completes JV negotiations for Block L9

2nd Jaya PSV for East Africa


INDIAN STATE PLAYER ONGC is likely to bid in Tanzania’s eight-block roundwhich opens this month, according to the country’s commerce ministry.The explorer’s overseas arm ONGC Videsh is set to join the running forseven offshore blocks and one onshore block with bidding due to starton 25 October.India’s minister of state for commerce Daggubati Purandeswari and herTanzanian counterpart Abdallah Kigoda discussed the round duringbilateral talks in Dar-es-Salaam."Both the ministers agreed to double the volume of bilateral trade inthe next two years and to reduce the trade imbalance, which is currentlyin favour of India," the Indian commerce ministry said.

ONGC set to bid for Tanzania blocks

S10 ORA 5 2013 E&P_Layout 1 22/10/2013 16:15

S11 ORA 5 2013 E&P 02_Layout 1 23/10/2013 16:02


LIBYA’S OIL MINISTER Abdelbari Arusi has revealed that National Oil Corporation(NOC) is considering buying US oil major Marathon Oil's stake in Waha Oil Company.

According to a Reuters news report, the Waha Oil Company in Libya has thecapacity to produce 350,000 bpd and manufactures Libya's main light sweetcrude grade. The company operates four oil fields, the largest being the Wahaoil field. Waha Oil Company manages oil for several companies through itsproduction lines running from the Sirte Basin to the Es-Sider terminal. Hess Corpand ConocoPhillips along with the NOC, are the other two partners in Waha.

Arusi said, "Regarding Marathon, yes, we're interested to buy the stake. Libyawould discuss a potential deal with Marathon, though other firms are also interested.”

Separately, Arusi also revealed that Libya was reviewing terms for existinginvestors and on how to ease them into the next round of licensing forexploration and production, which will be announced in the first half of 2014.

CHINA PETROCHEMICAL CORP, or Sinopec Group, has agreed to payUS$3.1bn for a 33 per cent stake in Apache Corp's Egyptian oil and naturalgas business, its biggest purchase in the Middle East and a sign of China'sincreasing overseas energy investment.The deal is the first stage of a partnership between China's largest refinerand the Texas-based exploration and production company. The twocompanies aim to pursue joint upstream oil and gas projects.The operations that are being acquired, located in the Western Desert andaway from the centres of political unrest in Egypt, will add daily output ofabout 130,000 barrels of oil for Sinopec Group, the company said.The deal is expected to close in the fourth quarter, and it will be Sinopec'sbiggest such transaction since the 2010 purchase of Syncrude Canada Ltd."Their (Sinopec's) technical expertise complements our 20 years ofexperience operating in Egypt and creates an alliance that will continue toexplore and deliver the tremendous hydrocarbon resources in the WesternDesert," Steven Farris, chairman and CEO of Apache, said.Wei Fujun, a spokesman at Sinopec International Petroleum Exploration& Production Corp, the unit making the purchase, said that Sinopec isaware of the political uncertainties in Egypt and is focused on long-term development in the region. Wei termed the price of US$3.1bn"very reasonable".The deal is viewed by some analysts as a sign of China's increasinginvestment in Africa as it secures energy resources.Chinese companies have completed 83 overseas oil and gas purchasesworth US$100.7bn in the past five years. CNOOC’s US$15.1bn acquisition ofCanada-based Nexen Inc early this year was China's largest overseasacquisition.

Sinopec clinches Egyptian oil deal

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S11 ORA 5 2013 E&P 02_Layout 1 22/10/2013 16:42

S11 ORA 5 2013 E&P 02_Layout 1 22/10/2013 16:42


CANADIAN NATURAL REOURCES Ltd (CNR) and Total E&P SouthAfrica BV will jointly explore Block 11B/12B offshore SouthAfrica. The farm-out agreement will provide Total with a 50 percent working interest in the block and the right to operatorship,with CNR receiving an undisclosed upfront cash payment, arecovery of 50 per cent of past incurred costs and a carry in thefirst exploration well drilled, up to a maximum of US$150mn.

CNR has performed seismic studies on Block 11B/12B andnow the newly formed consortium will work towards finalisingthe location of the initial exploration well. Drilling is slated for2014.

The Calgary-based energy firm chose Total after a "lengthyand thorough process" because of its expertise in deep waterexploration.

"The exploration potential in this offshore area of South Africais exciting,” commented Steve Laut, president of CanadianNatural, in a press release. “We are pleased to have theopportunity to work together with Total, a world class partner.The completion of this joint venture demonstrates theopportunities provided to the company through its international

portfolio which contributes to our vast and diversified assetbase. Working together with Total and the Government of SouthAfrica, we are in a positive position to maximise shareholdervalue in this exciting prospect."

Situated in the Outeniqua Basin, Block 11B/12B lies 109 milesoff the southern coast of South Africa and spans 4.6mn acres. Waterdepths range from 200 to almost 1,800 metres.

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Canadian Natural Resources farms out Block 11B/12B offshore South Africa


Source: Baker Hughes

The Baker Hughes Rig Count tracks industry-wide rigs engaged in drilling and related operations, which include drilling, logging, cementing, coring, well testing, waitingon weather, running casing and blowout preventer (BOP) testing.

SEPTEMBER 2013 - LAND & OFFSHORESEPTEMBER 13 AUGUST 13 VARIANCE SEPTEMBER 12 AUGUST 12 VARIANCE

Country Land & Offshore Land & Offshore From Last Month Land & Offshore Land & Offshore From Last MonthALGERIA 46 49 -3 42 46 -4ANGOLA 13 12 1 5 9 -4CAMEROON 3 3 0 0 0 0CHAD 3 2 1 2 2 0CONGO 3 3 0 2 2 0EQUATORIAL GUINEA 0 1 -1 1 1 0GABON 3 9 -6 5 7 -2GHANA 1 0 1 1 2 -1COTE D'IVOIRE 0 0 0 2 2 0KENYA 10 9 1 2 2 0LIBERIA 0 0 0 1 1 0LIBYA 12 15 -3 13 11 2MOZAMBIQUE 2 1 1 1 1 0NIGERIA 15 14 1 19 18 1TANZANIA 1 1 0 1 2 -1TUNISIA 2 1 1 5 3 2UGANDA 2 2 0 3 1 2D R CONGO 1 1 0 1 1 0NAMIBIA 1 1 0 1 0 1SOUTH AFRICA 0 0 0 0 0 0MAURITANIA 1 1 0 0 0 0ETHIOPIA 0 0 0 0 0 0

S11 ORA 5 2013 E&P 02_Layout 1 23/10/2013 15:53

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ETHIOPIA IS SHAPING upto be the great regionalpower supplier. Itcurrently exports electricpower to Sudan andDjibouti, and plans tosupply five otherneighbours, includingEgypt, Kenya, Uganda,Somalia and SouthSudan, once it completesthe 5,250MW GrandEthiopian RenaissanceDam, currently underconstruction.In July 2013 the country signed a second power transmissionagreement with Djibouti. The terms of the document allows Djiboutito import between 35 and 70MW from Ethiopia. The transmissioninterconnection is billed to cost US$2bn.The transmission line, which covers areas from Semera, in Ethiopia'sAfar regional state, to Jaba in Djibouti, will be rated at 230 kV, thesame capacity as the first transmission line connecting the twocountries. The African Development Bank financed 80 per cent ofthe first power transmission line, which cost US$1.5bn to construct,with the balance coming from the two countries. The newtransmission line will meet 60 per cent of Djibouti's power demand,with Ethiopia earning up to US$1.5mn a month from the exchange.Ethiopia is in a race with itself to be the continent's largesthydropower generator. Over the next 10 years it aims to investUS$12bn in power projects that will generate 20,000MW, enablingenergy sufficiency and power export to neighbouring countries.

UPSTREAM DEVELOPERS OF Kudu gas field off the coast of southern Namibiaare hoping to finalise a sales agreement with energy utility Nampower bymid-next year, paving the way for exploitation of the massive fields andconstruction of an 800MW gas-to-power plant.The Namibia Power Corporation is the sole buyer of gas from the Kudu field,which is estimated to contain 1.3 tcf of proven natural gas reserves.And the good news for Namibia does not end there: recent exploration andadditional data analysis is said to suggest that reserves could reach three tcf.Exploitation of Kudu, which is located in the Orange Sub-Basin, has beenon the cards since gas was discovered there in 1974.One of the major reasons for Kudu failing to take off has been theabsence of a gas sales off-taker and the failure for interested parties toreach an agreement on whether the pricing of the gas should bedenominated in local currency or US dollar.The Namibian government recently directed Nampower to fasttrack theconstruction of a US$1.2bn power plant.As such, Nampower is the sole beneficiary of the gas from the Kudufield and an agreement on pricing, if reached before or in 2014, couldpave the way for the exploitation of the resource and the construction ofthe Kudu Power Plant.Plans are for the power station to be on-line in 2018.“All the gas pumped from the Kudu fields will be committed to theNampower plant and nothing else,” Namcor MD Obeth Kandjoze saidlast week.“The pricing of the gas will be denominated in US dollars and this is nolonger a point of negotiation.”

TANZANIA, WHICH HAS made big natural gas discoveries, plans to startpower exports to its energy-starved east African neighbours in 2015 afterthe completion of a gas pipeline.East Africa's second-biggest economy said the pipeline, funded by aUS$1.2bn Chinese loan, would be completed by December 2014 enablingthe country to double its power generation capacity to 3,000MW.Energy and minerals minister Sospeter Muhongo said Tanzania, whichcurrently imports around 14MW of electricity from its neighbours andsuffers from chronic energy shortages, was poised to become a net powerexporter within the next two years."We are on course to start power exports in 2015 because of the surpluselectricity that we will be producing after the completion of the ongoingpipeline construction," Muhongo said after recently inspecting constructionof the 532 km pipeline on the outskirts of Dar es Salaam.He said Kenya had made enquiries about importing some 1,000MW ofelectricity from Tanzania.Tanzania has 43.1 tcf of recoverable natural gas reserves and anticipates thatwill rise fivefold within the next two years if new finds prove productive.In July the country also revised its coal reserves to 5bn tonnes from about1.5bn tonnes, and said it plans to use coal and gas for power generation.Muhongo said Chinese firms had recently shown interest in Tanzania's oil andgas sector and were expected to bid for blocks in its October oil and gasexploration bid round.Tanzania has so far licensed 16 international energy companies to search foroil and gas. British gas firm BG Group , Norway's Statoil, Brazil's Petrobras,Royal Dutch Shell and Exxon Mobil Corp are among companies alreadyoperating in Tanzania.

Tanzania to start power exports in 2015

AGGREKO, IN CONJUNCTION with itsproject partners, has celebrated theexpansion of its gas-fired power plant atGigawatt Park in Ressano Garcia,Mozambique. The extension to thefacility was officially inaugurated by theMozambique minister of energy, theHonourable Salvador Namburete, duringa ceremony held at the project site. Theexpansion adds an additional 122MW of capacity to the Ressano Garcia facility,bringing the total generation output from the plant to 232MW.

The Aggreko power plant began operating in July 2012 in what was therealisation of a truly ground-breaking initiative to build the world’s first interimcross-border Independent Power Producer (IPP) project. Power generated onsite was supplied directly into the Southern African Power Pool (SAPP) with thefirst off-takers from the project being Electricidade de Moçambique (EDM), theMozambique power utility and Eskom, the South African power utility.

Following the success of the first stage of Ressano Garcia, Aggrekoannounced in March 2013 that it had signed agreements with both EDM andNamPower, the Namibian power utility to supply an additional 122MW fromthe project. Following this announcement work began immediately to morethan double the generating capacity of the plant. As Aggreko designed andbuilt the plant infrastructure to allow for modular increases in capacity, addingthe additional power generation was achieved in just 12 weeks.

By utilising the exceptional regional transmission infrastructure of theSAPP, Aggreko will now supply power generated in Mozambique to threenational utilities, including to Namibia located more than 1,500 km away.Highlighting the mutual co-operation between the utilities to make thispossible, both EDM and Eskom will play a key role in transmitting this powerto Namibia. EDM will transmit the power over its network to the South Africanborder where Eskom on behalf of NamPower will handle the wheeling of thepower across the South African grid network to Namibia.

Mid

stre

am Galloping forward

Aggreko plant expanded to supplypower to Namibia and Mozambique

Ethiopia to be regional power exporter



Exalo Drilling S.A.

Experience

Synergy

Quality

Exalo Drilling S.A. is one of the largest providers of drilling

and oilfield services in Central and Eastern Europe(CEE).

The strategic goal of the company is to offer top quality

services and maintain the leading position on the onshore

drilling market.

Exalo Drilling S.A. continues the rich tradition of Polish

exploration as it arose from five upstream companies

of PGNiG Group: PNiG Krakow S.A.,PNiG Jaslo S.A.,

PNiG NAFTA S.A., PN Diament Sp. z o.o.,

and ZRG Krosno Sp. z o.o., which have unique experience

in running drilling and service operations. The companies

greatly contributed to the development of extraction

of petroleum, gas and other natural resources

in the territory of Poland and many countries all over

the world .

The joint potential of five companies means a strong team

of highly competent and experienced specialists as well as

comprehensive technological base that allow to meet

customer expectations and fulfill the growing demand

of international markets.

www.exalo.pl

[email protected]



AAVARIETY OF factors have characterisedWGK’s experience of working in thisregion to date. Water depths whichexceed 2000 metres in the deepest

areas, have resulted in field developments whichare technically challenging. In such a vastcontinent, and with the relative infancy of thedeepwater industry in the region, it is perhapsinevitable that there are some logistical hurdleswhen it comes to transporting equipment ordealing with unplanned events. As is the caseacross the industry, environmental conditions andthe elements create their own challenges, but onthe people front, training has also been asignificant and important part of WGK’s Africanexperience.

As international companies have becomeincreasingly involved with the development of theindustry in West Africa, the authorities have beenkeen to ensure that local people benefit from theopportunities that are created, and this is somethingwhich WGK supports. In Nigeria, local content lawsensure that the majority of engineering is carriedout in country, and 70-75 per cent of staff must beNigerian. Because of the relatively recent rise in thenumber of deep water developments in the regionthe existing pool of required skills is currentlyinsufficient to meet demand, making training acentral part of achieving that goal.

At the same time, the oil industry is facing aglobal skills shortage and a “demographic cliff”which is particularly acute in the subsea sector. Inrecent years it has become very common for subseatie-backs to be installed around existing platformsand infrastructure. As a result, major operatingcompanies have experienced a considerable rise inthe percentage of their portfolio that involvessubsea development, thereby creating strongdemand and competition when it comes torecruitment of experienced engineers.

It therefore makes sense from all perspectives,for international companies working in the regionto invest in and grow local talent – it has benefitsnot only for the local population, but for theindustry as a whole.

WGK is implementing an approach to trainingin West Africa that has successfully been applied inother countries, such as Indonesia, India, Brazil andMalaysia, and to target training at different stagesof people’s careers. For example, dynamic riserdesign is a highly specialised area of technology,particularly for the deepwater developments thatare prevalent offshore West Africa, and it is an areawhere skills are in short supply. Consequently for an

upcoming project in Nigeria, WGK will be trainingexperienced local engineers to provide additionalspecific riser-related skills.

“Sandwich courses” are a well-established routeto helping students acquire the practical experiencethat is so important to the workplace, and we haveoffered placements to African students as part oftheir university degrees. Our unique online subseatraining academy forms part of the initial trainingprogramme for all graduate engineering recruitsaround the globe, including those in West Africa,which may be followed by a placement in a WGKoverseas office before they return to theirrespective home countries to work.

Adapting training programmes tospecific needsWGK is adapting its training programmes to meetthe specific needs in the region, including workingwith local educational establishments to developspecialised oilfield courses. In addition, there areon-going efforts with Scottish DevelopmentInternational to establish links with Scottishtraining institutions and help transfer skills from thenow mature UKCS to West Africa.

Operational safety is an especially importantpriority throughout the industry and existingstandards that are achieved may vary around theglobe. Where safety standards are high, it isimportant to transfer the safety culture that existsas a result of decades of experience, to emergingcountries via lessons learned and research. Safetyremains an area in which the industry strives forcontinued improvement through the framework ofinitiatives such as the UK based partnership StepChange in Safety, which provides a focus for co-operation, collaboration and sharing of bestpractice. In developing regions like Africa, theopportunity exists to share knowledge and embedbest practice through training.

Safety - top priorityThe company feels strongly that it is bringing itsinternational technical expertise into the region andso will also bring with it the benefits of the years ofexperience gained in other parts of the world withrespect to safety. Indeed “Safety and Assurance” isthe most important of the seven core values thatform the cornerstone of how Wood Groupbusinesses conduct themselves and deal withothers. An integral part of this is the fostering of aculture of empowerment and shared responsibilityfor safety throughout the workforce. In other words,every employee needs to be able to recognise anunsafe situation and report it; they need to stop andsay “I’m not doing that because it isn’t safe”.

Whilst that sounds straightforward in practice,the more difficult thing is often engendering the

Ariel fly by of offshore drilling rig.

It makes sense, from allperspectives, for international

companies working in theregion to invest in and grow

local talent.

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West Africa is proving to be one of the biggest growth areas in the world today for the oil and gas industry. Strongoil prices combined with rising demand and major offshore discoveries have resulted in the creation of an excitingand dynamic region, and Wood Group Kenny (WGK), part of the international energy services company Wood Group,has already worked on a number of prestigious West African projects prior to establishing a permanent presence there.

Training - the route to developing global expertise

with a local focus



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confidence to speak up. It is a highly complex taskthat requires constant positive reinforcement.Ingrained cultural attitudes and behaviours mayneed to be overcome in order to successfully buildan effective safety culture and a recentlypublished paper proposed that efforts to improvesafety performance within the industry will beenhanced if the prevailing national culture isassessed and a location-specific plan developed

1

.

For example, within some cultures people mayfeel especially uncomfortable when it comes toquestioning their seniors or those in authority. Asan industry we need to reinforce that anyindividual has the right to question or stop a taskif he or she deems an activity or operation may beunsafe, regardless of who has ordered the work.We need to embed an environment of mutualtrust and shared perceptions of the importance of

safety amongst a diverse workforce, and provisionof safety specialists to engender a safety culturewithin projects is an important step to achievingthis.

By working closely with local partners in WestAfrica to close the skills gap and increasetechnical expertise within the region, internationalcompanies can build long lasting relationshipsand contribute to the development of anengineering hub which applies global expertise toprovide world class local solutions. ■

Aidan O’Connor, Nigeria in-country manager,Wood Group Kenny and Philip Reina, BusinessDevelopment African Region, Wood Group Kenny

Ref: 1. The Impacts of National Culture onSafety Culture in the Global Oil and Gas IndustrySteve Merritt, Chevron Corporation, 2012,SPE/APPEA International Conference on Health,Safety, and Environment in Oil and Gas Explorationand Production

http://www.onepetro.org/mslib/app/Preview.do?paperNumber=SPE-156638-MS


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Because of the relatively recent rise in the number of deep water developments in the region, the existing pool ofrequired skills is currently insufficient to meet demand, making training a central part of achieving that goal.

“Safety and Assurance” is themost important of the seven

core values.



AFEX provides oil and gas camps built on safety and designed for comfort. Wherever your exploration takes you, let us lead you there.

Email for a Free [email protected]

Learn more atafexgroup.com



MMAINTAINING OFFSHORE ASSETS, whether FPSO or other floating structures, is not a straightforward matter and does not have a ‘one size

fits all’ approach. The reality is that maintenancebegins the day the first paint is applied at newconstruction. Selection of a paint that is notappropriate for the service environment and assetlifetime is where the first mistakes are made.

In this respect International Paint find that theindustry trend for FPSOs is to select coatings whichare able to help maintain asset integrity for agreater time period, typically 20 years. On board anFPSO, one of the areas of high concern for an owneris the selection of coatings for the water ballasttanks. These tanks play a crucial role in stabilisingthe FPSO as the crude oil is offloaded. Typically thishappens every 10 days. Standard water ballast tankcoatings, as used on other marine vessels, are notalways applicable for FPSOs. The action of ballastingmeans highly corrosive sea water is moved aroundinside the ballast tanks. As a result the steel insidethese tanks is very sensitive to corrosion because ofthe combination of chloride ions, water and air. Thisis made even worse by the warm and humid airwithin the tanks. In hot climates this becomes evenworse and for this reason owners want to ensurethat the coating used in the ballast tank is apremium coating. International Paint’s Intershield300 is a pure epoxy paint with greater than nine percent aluminum content and a proven 15 year

performance. The high aluminum content in thedried film of this coating is one of its key propertiesto ensure excellent anticorrosive properties requiredfor long lifetimes. This is in addition to its carefulformulation to show good film thickness retentionaround edges. This is often one of the areas wherecoatings break down first. Overall, InternationalPaint experience customers of both conversion andnew build FPSOs requesting Intershield 300.

Maintenance procedure for long serviceoffshore structuresThe correct maintenance procedure for long serviceoffshore structures such as FPSOs begins before theyeven leave the construction yard. International Paintalways recommend a detailed inspection survey iscarried out to identify areas of the asset where thecoatings applied are at risk of failing after anyadditional work or modifications on board thetopside structures. For instance, such an inspectioncould identify areas that may have been affected byhot welding in close proximity. Having thisdocumented means that the onboard maintenanceteams on the FPSO have a clear idea on what areasneed to be addressed first. It is important toremember FPSO and offshore assets are akin tochemical and refining plants, and so have uniquemicro-environments on board. The average FPSOwill have many miles of piping all stacked on top ofeach other. Each and every area should be detailed.Only then can you prioritise coatings maintenanceand pass on the correct repair procedures.

It is more straightforward to carry out such asurvey before the asset leaves the yard.Opportunities to carry out such inspections onceoffshore are much harder to facilitate and bear asignificant increase in cost.

Ensuring longevity of coatings on an FPSOEnsuring longevity of a coating requires largecapital investment in product testing. Thechallenges for offshore assets led to the specific

development of ISO 20340, which details“performance requirements for protective paintsystems for offshore and related structures”. Thisstandard should always be universally adopted as aminimum during coatings selection.

Within ISO 20340 minimum test requirementsare details for ageing, sea water immersion andcathodic disbondment of coatings. The latter isextremely important for FPSOs which typically relyon cathodic protection of hull structures, either withsacrificial or impressed current, in conjunction withcoatings, to protect them.

One also encounters owners and operators withlarge fleets distributed across the world who wish togo above and beyond this standard. Oil majors suchas Shell and ExxonMobil are just some who haveoutlined extra requirements, to which Internationalare also qualified. Some of these include basic testingof over-applied paint for instance. This may soundsimple but the reality is that control of film thicknesscan be hard around complex structures such as thebase of modules on decks. A good coating isformulated in such a way to tolerate over-application.

International Paint spends in excess of millionsof Euros on research and development each year tosatisfy the needs of customers and ensure newproducts are fit for purpose. Internationals Paintcentral support labs are in continuous use, testingand approving products for the offshore industry.

With this level of investment, Inter¬national isable to develop tests in the absence of industrystandards to help customers. One such example is

Coatings provide a critical path to reducing corrosion on offshore structures.

The steel inside the ballasttanks is very sensitive tocorrosion because of thecombination of chloride

ions, water and air.

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On board an FPSO, one of the areas of high concern for an owner is the selectionof coatings for the water ballast tanks.*

Ensuring asset integrity

on board an FPSO


The hulls of FPSOs willrequire inspection fromClass Societies to ensure

asset integrity.

S13 ORA 5 2013 Technology B_Layout 1 23/10/2013 16:14

with International Paints high temperature underinsulation product Intertherm 751CSA. Corrosionunder insulation is a real problem for the oil and gasindustry as layers of insulation can lead to a moistand warm environment, which is perfect for corrosion.The insulating layer often hides this problem until it’stoo late. Traditionally there was no industry standardfor this scenario, and International Paint’s customersasked them to help develop a test that they coulduse to determine product selection for thisenvironment. This test is now widely publicised andbecoming rapidly adopted by the industry.

Key steps in application for maintenanceand new building of FPSOsApplication of any coating begins with the correctsurface preparation on the substrate. In the case ofnew building FPSOs this is generally always gritblasting, which creates a surface profile on thesteel and helps remove residual salts. Blastingshould always be done to Sa2.5 (ISO 8501-1). Todetermine the salt levels owners should insist onusing ISO 8502-9. However, when one is in amaintenance situation offshore, it is too costly and

not always practical to use abrasive blastingequipment. An alternative is to use ultra highpressure water jetting. This removes paint residuesand exposes the original blasted surface profile.

It is also important to realize that coatings aredesigned with different surface preparationtechniques in mind.

Environmental consequences onselectionsAs FPSOs remain stationary for most of their lives,there are not the same requirements of fuel savingsto be gained by use of antifouling coatings whichreduce fuel emissions. However, importantly, the hullsof FPSOs will require inspection from Class Societiesto ensure asset integrity. Therefore this need toinspect means biocidal or foul release coatings areoften applied on the hulls and jackets of offshorestructures. Foul release fluropolymer coatings are thedirection in which the industry is moving. Thistechnology does not rely on a predetermined level ofbiocide in the coating. The surface energy of foulrelease coatings means that organisms cannot firmlyadhere to them. No biocidal antifouling can protect

an FPSO over a long period. International Paintrecently supplied Intersleek 970 fluropolymer coatingto the hull of a large conversion FPSO destined forthe West Coast of Africa. Class societies know thatsuch coatings are easy to clean and thus enable thecondition of the hull to be easily documented. ■

*Toby Stein, upstream oil and gas market manager atInternational Paint.


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HEMPADUR 35760, A heavy-duty tank lining solution, 100 percent Volume Solids product offers superb corrosion protection andexcellent chemical resistance.Developed specifically to satisfy the requirements of demandingstorage operations, Hempadur 35760 is the ideal coating andlining solution for tanks storing oil, gasoline, fuel, petroleumproducts and a wide range of chemicals. As one of the finest twocomponent products on the market based on the most innovativephenolic epoxy resins available, it offers the best possibleresistance against chemicals. It canalso be used as a filler layer withglass mats for repairing bottoms ofchemical storage tanks or to coat anentire tank. Hempadur 35760 is the product ofHempel’s years of experience andfeedback from highly demandingcustomers in the industry. Hempelknows the extent of damage weakcorrosion protection might cause to abusiness.As a high-solids product that can beapplied in high film thickness,Hempadur 35760 cures to a highlydurable tank lining with excellentcorrosion protection and resistance to chemical exposure, makingit the perfect lining solution for industrial and commercial tanksand at the same time guaranteeing the safe containment of theircontent with zero contamination.To demonstrate an example system to coat the interior of a tankfor fuel oil, it can be applied in two layers of 250 micron filmthickness to form a tough coating that ensures excellentchemical resistance. Example of system to coat the interior of a tank for fuel oil:

Paint Type

6 High-build phenolic epoxy (solvent free) Hempadur 35760250 micron

6 High-build phenolic epoxy (solvent free) Hempadur 35760250 micron

Hempadur 35760 is a solvent-free, two-component, high-buildphenolic epoxy (novolac) paint that will deliver the perfectsolution, whether the job is to repair or line chemical storage

tanks. It cures to a glossy and smoothfinish, making it easy to clean thelining and inspect the tank fordamage. It is easy and safe to apply. Itrequires no special equipment forapplication, and as a 100 per centsolids, solvent-free epoxy, it poses noexplosion or ignition risk when beingapplied in confined spaces.Due to exposure to differenttemperatures and chemicals,commercial and industrial tanksdeteriorate over time. Hempadur35760 can be applied to refurbishtanks that are already showing signs

of corrosion, saving businesses from major costs and from havingto replace tanks.Not having to replace old tanks already reduces theenvironmental impact from business operations. It takes this onestep further as a low-VOC paint that also satisfies the EU’senvironmental legislation.Hempel sets the standard for tank linings and repair withHempadur 35760, the ideal solution that satisfies all customer,industry and legislation demands.

Stopping trouble before it starts.

HEMPADUR 35760: the ultimate solution for tank linings and coatings

In hot climates sensitivity to corrosion becomeseven worse - here the FPSO Kwame Nkrumah in the

Jubilee oil field off Ghana.



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HARDIDE COATINGS HAS developed an innovative coating to extend the life and improve the performanceof drilling tools operating in extremely abrasive environments. This is the first successful high performancecoating for TSP (thermally stable polycrystalline) diamonds which can withstand the higher temperaturesassociated with TSP brazing, extreme loads and aggressive media.

This will enable a new generation of diamond-based hardfacing materials to be deployed in extremelyabrasive wear and erosive conditions such as horizontal and directional drilling, as well as fracking.Improved tool performance will enhance the viability of more challenging or marginal oil and gas reserves.

Hardide Coatings CEO Philip Kirkham said: “Drilling activity is taking place in deeper and moredemanding conditions than ever before and tools need protection from extreme abrasive wear and erosionthat current hardfacing materials can no longer provide.

“Some critical drill string components need replacement after every drilling programme, so the newcoating application will reduce expensive maintenance and down time costs of drilling projects. This will inturn boost the economics of smaller and more mature oil and gas fields, such as those in the North Sea.”

Diamonds are notoriously difficult to attach and are prone to oxidation and graphitisation, limiting theirhardfacing use to date. Previous attempts to solve these problems have been unsuccessful due to theporosity of other coatings and their weak adhesion to the diamonds. Hardide-D overcame these hurdleswith its pore-free tungsten carbide based adhesive and protective coating which chemically bonds todiamond and has good wettability with brazing alloys.

The coating was developed in the company’s Oxfordshire manufacturing facility following several yearsof fundamental research. The production process was developed with the support of a Technology StrategyBoard (TSB) ‘Smart’ grant for up to US$400,000 which was awarded in January 2013. The technology iscovered by new UK and international patent applications.

Hardide Coatings has signed a mutually exclusive five-year supply agreement with hardfacingspecialists Cutting & Wear Resistant Developments Lyd of Sheffield, UK, for its use in oil and gasapplications.

Hardide Coatings unveils groundbreaking new technology

OWNERS AND OPERATORS know that all offshore structures represent a valuable asset as both capitalexpenditure (CAPEX) and source of ongoing revenue.

The balance between CAPEX and return on investment is an important aspect; however, the operatingexpenditure (OPEX) is also a factor that strongly influences how fast one will have return on investment. Bystriking the right balance between investing more up-front one will most likely save on OPEX in the future.

Another factor also needs to be considered. Due to technological advances many offshore structures arereaching the end of their design life if they have not already done so. This scenario is also likely to occur inthe future as a result of these developments

By investing a small amount during construction in high quality coatings solutions and running a goodmaintenance programme, it can be argued that there will be savings in OPEX cost and downtime will bereduced to a minimum, and in some cases even saving major investment in refurbishing installations thathave exceeded their design life.

Jotun has been a leading provider of high-quality coating systems for stationary and floating steelstructures for almost a century, and has become a truly global supplier of high performance coating solutionsto the offshore industry.

Its latest innovation is Jotachar JF750 (for more information, see Oil Review Africa Issue Four, page 60) theonly mesh-free epoxy intumescent coating solution available to the market where jet fire protection isrequired for safety critical steel structures, divisions and vessels.

Jotachar JF750 mesh free benefits help owners, fabricators and applicators significantly reduce installationtime, cut material cost and reduce risks compared to systems that require mesh reinforcement. The productalso makes maintenance and repair much simpler, requiring significantly less time and cost.

Jotachar JF750 - the time saving solution

Mesh free Jotachar JF750Traditional mesh

containing epoxy PFP



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000 0 0 0 0 0 0 0 0 O0 0 0 0 0 0 0 0 0 O FFSHORE PROCESS VESSELS operating at elevatedtemperatures and pressures represent one of the most arduousservice environments and major challenges for the asset owners andoperators. These vessels, and in particular those involved in the

separation of oil/water and gas as it enters the process stream, are constantlysubjected to a wide variety of aggressive conditions which can ultimately leadto severe internal corrosion.

Belzona’s successful track record dates back to 1989 and during this timeconsiderable resources have been placed on product development for thisparticular sector of the industry. This has led to Belzona coatings being widelyused by most of the major oil companies worldwide.

During 1994 linings resistant to temperatures of up to 120°C wereintroduced. In addition, these materials offer excellent resistance to explosivedecompression, and have been successfully used worldwide for the protection ofwell test separators, production separators, knock-out drums and a variety ofother types of process equipment.

Deeper wells – higher operating temperaturesHowever, with the sinking of increasingly deeper wells leading to higheroperating temperatures and pressures, vessel operators are faced with adifficult task to combat the problems associated with this kind of serviceenvironment. As a result, materials able to resist more arduous environmentshad to be developed.

When designing systems that are resistant to high temperature immersion,it was important to consider the reasons why conventional coatings fail. Manysuch materials are solvent-based, and in these instances, quite apart from otherlimitations, problems are experienced due to solvent retention within the film.This retained solvent will then increase in volume as it is exposed to highertemperatures, which in turn leads to blistering. Furthermore, in some cases,exchange takes place between the retained solvent and the process fluidleading to swelling and premature failure. A desire for more environmentally friendly systems has made the use of

volatile solvent-based resin systems increasingly unacceptable.Systems with low cross-link density are susceptible to a high degree of

permeation of both water and gases leading to corrosion. This phenomenonincreases dramatically as the polymer system reaches its softening point,whereby distances between the polymer molecules’ cross-link sites increaseand permeation occurs more readily. Even conventional epoxy resins, whichtypically display good resistance to permeation at ambient temperatures, canonly offer limited protection at ‘elevated’ temperatures.

Novel solution to high temperature immersionThe culmination of this high temperature coating research project was theintroduction of Belzona 1591 (Ceramic XHT Metal), in December of 1998,following a successful field trial programme. It was later reformulated in 2003to ease application procedure.

The high immersion resistance of this product is attributed to a novelmodification to the existing resin system. In addition, a unique binary curesystem allows the rapid development of immersion resistance during post curein service. The resulting system displays a very high glass transitiontemperature, which means it is more highly cross-linked at elevated operatingtemperatures than conventional systems.

By utilisation of a polymer matrix with a high cross-link density coupled withreinforcing fillers, which give barrier protection, the tendency for water and gaspermeation can be dramatically reduced thus leading to immersion resistance at

Offshore process vessels involved in the separation of oil/water and gas as it entersthe process stream, are constantly subjected to a wide variety of aggressive conditions,which can lead to severe internal corrosion.

As a result of deeper wells, materials ableto resist more arduous environments had

to be developed.

Belzona has a proven track record of success within the oil and gas industry for theprotection of process vessels operating at elevated temperatures.

Cold applied vessel linings

take the heat

Belzona high temperature vessel lining.

S14 ORA 5 2013 Technology C_Layout 1 22/10/2013 17:14

Think Well Testing, Think Well Fluid Services

Well Fluid Services Limited was incorporated in 2001 as a wholly indigenous Oil Service Company to serve the Oil & Gas industry in Africa and beyond. Our services include:

Well Clean-up / Testing Extended Well Testing and Early Production FacilitySand Detection, Quantification, Removal, Onsite Analysis and DisposalTemporary Well Hook-upData Quality validationProduction Operator Supply to man production platformsEffluent Water Treatment

Tel: +234(0) 8094239421 Mail: [email protected] [email protected] Web: www.wellfluidservices.com



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higher water temperatures. Extensive in-house testing, including more than 150elevated temperature/pressure immersion tests using autoclaves revealed:6 Heat distortion temperature in excess of 250°C.6 Immersion resistance in water/hydrocarbon service up to 180°C.6 Rapid post cure in service, eliminating the need for extensive stoving periods,

and reducing the risk of permeation during the initial post cure in service.6 Physical properties that show only moderate change across a temperature

range from 0-200°C.6 Limited reduction in adhesive strength across the same temperature range, a

contributory factor to the coatings excellent high temperature immersioncharacteristics.

Put it to the testFollowing on from the excellent results obtained in-house, Belzona 1591(Ceramic XHT Metal) was submitted for an extensive programme of field trialsand external testing. Included in this programme were a series of tests carriedout by a major oil and gas exploration and production company to evaluate thesuitability of paint and coating systems for oil/ brine service at temperatures upto 130°C and 30 bar pressure. This test programme which involved a series ofimmersion periods followed by explosive decompression cycles, confirmed thedata obtained in-house and the suitability of this product for high temperatureimmersion under these conditions. This material has now been added to thiscompany’s TAMAP (Technically Accepted Manufaturers and Products) list and isalso listed under Protective Coatings for Onshore and Offshore Facilities.

Further independent immersion testing has confirmed the suitability of thisproduct for operation in brine service up to 180°C.

Throughout the development of the product close consultation withpotential end-users has been of paramount importance. This was typified by thecollaboration between Belzona and a global client responsible for themanufacture of a new FPSO. Belzona was approached to offer a suitableprotection system for the internal surfaces of the test separator, productionseparator and flare knockout drums.

As the operator had already committed to producing the vessels fromcarbon steel it was of paramount importance that the coating system designedfor internal protection of the vessels was of the highest possible standard.

Due to the aggressive conditions likely to be encountered it was considerednecessary for any coating system to be extensively tested in the actual serviceenvironment, in the region of 130°C.

At the request of the field operator, Belzona carried out an extensive testprogramme, exposing the coating to a variety of expected process fluids at130°C. After the initial testing had satisfied the customer of the suitability ofthe coating system, immersion in simulated process water, identified as themost potentially damaging of the service conditions, was continued. Thislasted for a period of 12 months at an increased temperature of 150°C.

As a result of this successful test programme, Belzona 1591 (ceramic XHTmetal) was selected for the protection of all internal surfaces of a variety ofprocess vessels for this new facility. This included the main process separators,high pressure and low pressure flare knockout drums and coalescer drum.

Based on the test work and field trials carried out to date, this materialoffers the operators increased flexibility by providing a coating system, not onlyresistant to immersion in process fluids at elevated temperature, but which alsoovercomes many of the other problems associated with the use of coatingsystems in this type of service.

In addition, its success in high temperature service offers an attractiveoption for new build vessels, allowing manufacturers an alternative to moreexpensive corrosion resistant alloys. A classic example of this is an applicationin Brazil to four new build pressure vessels in 2009. Each vessel weighed 70tonnes, with a total internal area of 1,100 sq m. Pressure vessels required acorrosion-resistant coating able to resist high in-service temperatures of up to180°C. Adjacent flange faces and nozzles also required corrosion protection. TheBelzona system was chosen due to its excellent heat resistance properties andproven longevity. An inspection carried out in January 2013 concluded that thelining was still in service with no remedial work necessary. Installed Belzonanozzle inserts and Belzona-formed flange faces were also in perfect condition.

Whilst initially designed for the offshore industry, the high temperatureperformance of this product makes it suitable for a wide variety of applicationswithin the oil & gas, petrochemical, power and paper industries, as well asothers with high temperature erosion/corrosion problems.

Belzona 1591 (Ceramic XHT Metal) principle advantages include:6 High temperature resistance, suitable under full immersion resistance in

water/hydrocarbon mixtures up to 180°C.6 Resistance to explosive decompression.6 Binary curing mechanism removes the need for extensive post cure prior to

entering service.6 Application in confined areas due to a solvent-free formulation.6 Ease of application to either new-build or existing vessels combined with

easy repair in-situ.

Belzona is committed to continuing product improvements, taking intoaccount feedback from the field in order to optimise application delivery. Thisinitiative is supported by an ongoing investment in Research andDevelopment, and the department is currently finalising work on the nextgeneration of high temperature lining materials designed to provide long-termcorrosion protection whilst minimising downtime and being easier to apply toconsistently high standards. ■

Belzona Technical Services

Throughout the development of the productclose consultation with potential end-users

has been of paramount importance.

Vessel lining application in 2009.

Vessel inspected in January 2013,lining in excellent condition.


Oil Review Africa Issue Four 201364 www.oilreviewafrica.com

AAROUND 90 PER CENT of the world’s tradein goods is carried by sea. According toShipping Intelligence Weekly, there wereapproximately 58,000 cargo carry ships

operating in June 2012. It has been calculated thatmaritime shipping is responsible for emitting morethan 1bn tonnes of carbon dioxide (CO2) per yearaccounting for more than three per cent ofworldwide CO2 emissions in 2007. The oil tankerfleet was responsible for some 12 per cent of totalCO2 emissions by global shipping, reported theInternational Maritime Organisation (IMO) in 2012.Currently, the global maritime industry’s ships andtankers rely on engines fuelled by heavy bunker oiland diesel. However, a combination of rising oilprices and ever stricter environmental regulationshave raised operating costs driving ship owners todemand greater fuel efficiency, lower emissions andfaster turn-around times in port.

Currently about 240mn tonnes of LNG is shippedworldwide annually in a fleet of some 357 carriers(Lloydsintelligence.com 16 September 2013) fromcentres of production including West and NorthAfrica to East Asian markets which accounted formore than half of total global LNG demand in 2012.Globally the construction of LNG export plants inAustralia, Mozambique and Tanzania, with possibleexports from the United States, will add at least93.5mn tonnes of capacity and accounts for the 94LNG carriers currently on order for delivery betweennow and October 2017. Nigeria has ordered six newLNG carriers for delivery from 2017 to add to itscurrent fleet of 24. Not only is the worldwide LNGcarrier fleet increasing, but the size of tankers is alsorising. The biggest new tanker, the Q-max, holds upto 260,000 cu m compared with the typical tankerof around 175,000 cu m (Ernst and Young).

Tankers move approximately 2,000,000,000metric tonnes of oil every year. Currently, themarket is experiencing a surplus of tanker capacitycaused, in part, by too many tankers having beenbuilt in the run-up to the global financial crisis andsubsequent economic slowdown and the shaleenergy revolution which has significantly reducedNorth American reliance on imports of oil and gas.The Eco bank has reported that demand forNigerian oil from the USA declined to 700,000 bpdin 2013, from the 2012 average of 800,000 bpd.Likewise, Bloomberg reported 3 September 2013,that Chinese refiners will buy 28 per cent less WestAfrican crude this month than a year earlier. ForNigeria, these trends have reduced the use of the200,000 DWT Suezmax and the 120,000 DWTAframax oil tankers, which serve the North Atlantic

trade whilst recent increasing demand from Asianmarkets encouraged a switch to the use of larger315,000 DWT Very Large Crude Carriers (VLCCs). As aresult, daily earnings for VLCCs have plunged 92 percent this year, to some US$1,515 on 30 August,according to shipbroker Clarkson plc. Risingoperating costs, an increase in LNG capacity and newsources of supply together with newly emergingmarkets for LNG in India, Latin America and Caricomaffect the size of the LNG fleet. Similarly, changingpatterns of demand and supply of oil is driving fleetowners to seek much more cost effective designs inthe next generation of oil tankers.

Smarter shipping At present, all naval architects are looking to designsmarter, greener, safer and cleaner ships. This isespecially the case with tankers, whatever their sizeor cargo. Smarter shipping is about optimising thehull shape in such a way that it minimises dragwhilst, at the same time, optimising cargo capacity.For example, the GL BEST PLUS hull design conceptfor the Aframax tanker, is said by its designers, GLand the National Technical University of Athens, toreduce fuel use by seven per cent. Another idea isthat of the Slippery ships concept, in which thevessel is designed to float on a cushion of air. Here adevice on the ship’s keel makes bubbles to reduce

the frictional resistance of the ship as it movesthrough water and, as a bonus, reduce fuel use.Companies such as Mitsubishi Heavy Industries arerevisiting this concept but, a representative for theRoyal Institution of Naval Architects commented tome, “They have been trying to make this technologycommercial for more than 50 years.” By contrast,the Marine Research Institute of the Netherlands istrying to develop more energy efficient rudder andpropeller designs in order to reduce unwanted noiseand vibration. In addition, designers areexperimenting with adding fins or stabilisers: theseare designed to either enhance how the waterpasses through the propellers or, to enhance theoverall hydromantic nature of the ships design inorder to cut drag and thereby save on fuel. Anotherapproach, proposed by Skysails GmbH & Co ofHamburg is the use of sea kites to pull ships along.A vessel equipped with SkySails could requirebetween 10 to 35 per cent less fuel than a non-fitted vessel, claims Skysails.

Greener shippingGreener shipping is about reducing emissions tomeet stricter environmental controls. The simplestway of reducing emissions is to reduce speed.However, Europe’s stricter emissions regulationshave driven investment in “cold ironing” and theuse of expensive low sulphur fuels when in port.Since 2010, vessels berthing for more than twohours have had to switch to a 0.1 per cent sulphurfuel or switch off all engines and hook up to shoreside electricity to keep essential on boardelectrical equipment, ranging from refrigeration,lighting and heating running. Upcoming regulations

Wärtsilä’s new Aframax tanker concept design.

The GL BEST PLUS hull designconcept for the Aframax

tanker, is said to reduce fueluse by seven per cent.

All naval architects are looking to design smarter, greener, safer and cleaner ships,reducing emissions to meet stricter environmental controls. Nicholas Newman looks atsome of the present trends.

Drivers for

tanker design

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for the trans-European transport network (TEN-T) arealso likely to include shore connections in portmodernisation programmes.

Whilst heavy fuel oil and diesel enginesdominate the tanker market, rising costs andincreasingly strict environmental regulations haveled to consideration of alternative fuels includingpremium low sulphur fuels, nuclear power and, withthe rise in LNG production and trade, LNG. Dual fuelengines which allow the use of both diesel and gasand LNG fuelled vessels are recent innovations. As of

June 2012, there were around 300 ships worldwidepowered by LNG, of which 240 were dedicatedcarriers of LNG (Zeus Intelligence). The remainingsixty vessels comprised platform support vessels,passenger and cargo ferries and coast guard patrolships based mainly in Scandinavian waters. Already,Wärtsilä, a world class engine maker, has begun tofit Wärtsilä 8L50DF 1 dual fuel engines to tankers.These engines can operate on either natural gas,light fuel oil (LFO), or heavy fuel oil (HFO) andswitching between fuels can take place seamlesslyduring operation without loss of power or speed.When operating in gas mode, the nitrogen oxide(NOx) emissions are at least 85 per cent below thosespecified in the current IMO regulations and CO2

emissions are some 25 per cent lower than those ofa conventional marine engine running on diesel fuel.Additionally, the sulphur oxide (SOx) and particleemissions are negligible at almost zero per cent. The

fitting of Wärtsilä 50DF engines on-board the firstLNG carriers in 2006 set a trend in the industry. Sincetheir introduction, 65 per cent of all new LNG Carriershave been fitted with Wärtsilä dual-fuel engines. Anincreasing number of vessels serving the offshore oiland gas industry are being fitted with Wärtsilä dual-fuel engines. The need for flexibility, fuel efficiency,and compliance with stricter environmentalregulations, are the drivers behind this trend.

However, the use of LNG-fuelled shipping islimited by constraints of space and lack of a networkof LNG fuelling stations worldwide. LNG fuel tanksare rather large which is not a problem for a VLCCnor a LNG fuel carrier but is a restriction ontraditional marine cargo vessels. A more seriousconstraint on LNG marine fuel for non-LNG carriers isthat besides Scandinavia, there is a scarcity of LNGbunkering services around the world. To cater for theexpected increase in LNG marine fuel use, majorports including Zeebrugger, Rotterdam, Hamburg,Singapore and New York have publicly announcedthat LNG fuelling facilities will be ready from 2014.

ConclusionIt is likely that, as the implementation of worldwideenvironmental restrictions on coastal watersprogresses, the number of ships equipped with dualfuel engines capable of using LNG as a marine fuelwill increase. LNG is both cheaper and cleaner thancurrently used fuels. LNG as a marine fuel meetsIMO Tier III and ECA limits for sulphur dioxide,nitrogen oxide and carbon dioxide. For thoselooking for a diesel engine to propel their next oiltanker, many are selecting single engine designssuch as the Wärtsilä-Sulzer RTA96-C turbochargedtwo-stroke diesel engine, which are ideal to powerfor the next generation of larger oil tankers. It isclear that the shipping industry is on the cusp ofmajor technological and design innovations. ■

Germanischer Lloyd unveils energy efficientAframax BEST-Plus ship design.

The use of LNG-fuelledshipping is limited by

constraints of space and lackof a network of LNG fuelling

stations worldwide.

GREENFIELD GAS PROJECTS off the east coastof Africa have been fuelling services demand,according to Karel Van Campenhout – ABSregional vice president for Africa and seniorvice president for ABS Europe.In emerging markets like East Africa, classsocieties are an integral part of the verificationprocess to establish acceptance criteria for thedesign integrity of vessels, risk mitigation andoffshore safety. As a non-governmental organisation workingclosely with industry and regulators, theAmerican Bureau of Shipping (ABS) providesand maintains the technical standards for theconstruction and maintenance of offshorevessels and facilities by validating throughroutine surveys that these structures are inaccordance with certain rules and guides.In West Africa, 65 per cent of drilling unitsoperating in the region are classed with ABS.The organisation has the largest market sharefor the number of floating production units

under ABS class in the region. East Africa willalso require an influx of classification andtechnology services to lay the foundation formultibillion dollar LNG projects.ABS is joining the move eastward with plansto expand its coastal network by openingoperating bases in Pemba, Mozambique, andMombasa, Kenya, in late 2013.Mozambique recently inaugurated thecountry’s first oil port in the city of Pemba. Inthe last year, Anadarko has built additionalinfrastructure at Pemba, now the centrallocation for embarkation to offshore unitsoperating in the area, where technical supportfor large-scale projects, including a proposedLNG plant, will be needed. ABS has identifiedthis port city as its primary location in EastAfrica, where it will offer services to supportoffshore and marine operations.Although Kenya has a modest upstreamindustry today, the government is encouragingforeign investment in petroleum exploration.

The port of Mombasa traditionally has been themajor trade gateway to East and Central Africa,handling some 20mn metric tons of cargo in 2011.Construction is under way on a megaport atLamu in northern Kenya, East Africa’s largestinfrastructure project, includingimprovements to rail and road networks. Tomeet future demand for more services in theregion, ABS is finalising plans to establish anoffice in Mombasa with closer access to othercoastal port cities.With East Africa a major growth area for theoffshore oil and gas industry, ABS’ long-termfocus will be to improve service delivery whilethese massive investments are directed intoports and infrastructure along the coast.As development continues to accelerate, theorganisation will work with industry andregulators to develop technical standardsthrough established rules and guides thatpromote the security of life, vessel and thenatural environment.

ABS forms global gas solutions team



MAGNETROL INTERNATIONAL HASintroduced the heat rate reduction kit,aimed at helping power companiesmanage controllable losses througheffective, accurate feedwater heaterlevel control. The heat rate reduction kit is availablefor download atwww.heatrate.magnetrol.com andaddresses the mission-critical need toincrease the efficiency of power plantsin today’s challenging economic andregulatory environment. The heat ratereduction kit, an industry first,provides solutions that will helpreduce fuel expenditures, which canaccount for 70 to 80 per cent ofproduction costs, by minimising heatrate. According to Magnetrol, thepotential savings represent anestimated US$680,000 annually for a500 MW power plant.Included in the Magnetrol heat ratereduction kit are several useful guidesto reducing heat rate, why it isimportant and how the process willhelp reduce costs:6 Heat rate and feedwater heater level

control white paper6 Managing heat rate and controllable

losses video6 Next-generation level

instrumentation for heat rateawareness and control specialapplications bulletin

6 Reduce your heat rate and drive downfuel costs brochure

“We created the heat rate reductionkit because we recognise thechallenges power companies facetoday in an increasingly competitiveenvironment and with the advent ofclimate change protocols and theClean Air Act,” said Magnetrol'sproduct manager Jim Homoly. “The kitexplains how minimising heat rate canhelp plants use energy moreefficiently and save significant fuelexpenditures.”The causes of heat rate inefficiencycan be due to ageing levelinstrumentation or instrument-induced errors, which negativelyimpact heat rate and fuel costs,according to Homoly.“Effectively controlling feedwater heaterlevels drives overall plant performanceand fuel cost savings,” he said.

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S15 ORA 5 2013 Technology D_Layout 1 22/10/2013 16:59


IIN THE CURRENT oil and gas environmentthere is a growing requirement for oil andgas companies to operate in accordancewith their well integrity policies, statutory

regulations and various international standards.The driving factor behind the change is directly

linked to more strictly prescribed legislation andcorporate social responsibility following high profilewell integrity related incidents.

Clearly when fields were first being producedthere was less emphasis on longevity with welllifecycle management, a term only more commonlyused in recent years.

Typically, companies predicted a lifespan of

between 15 and 20 years for their wells when inreality many are still fully operational threedecades later.

In the wake of the increased operating periodthere is demand for well integrity standards to befar more robust.

Commitment to well integrity now forms a largepart of strategic planning and budgets, with wellssubjected to annual and independent audits thatprovide key performance indicators for future planning.

Service companies have identified well integrityas a growth market sector and have investedheavily in developing sophisticated solutions toaddressing this industry-wide issue.

Expro is one such market leading company inthis niche sector of well integrity and its tailoredsoftware solution SafeWells is fast becoming theestablished industry benchmark.

SafeWells monitors and reports on well integrityperformance and has been successfully deployed bya wide range of independent and major operatorsacross the globe.

The highly flexible software, which can bebespoke tailored to client needs, allows themonitoring of maintenance and associated remedialactions, risk assessment needs, dispensations andchanges in the well operating envelope.

This provides an onscreen traffic light display ofwell status according to designated well failuremodels and also the ability to communicatethrough email the same status to any number ofchosen personnel.

Operators can therefore plan their wellintervention activities safe in the knowledge thatthey are compliant with their policies, while beingable to demonstrate effectiveness at monitoringand tracking their wells' status.

SafeWells development began in 2005 and overthe last three years Expro has added more focus onthe software development as the number of clientsusing the products has risen.

In line with the growing popularity of the productthe overall need for well integrity managementsystems within the industry has also increased.

The software has been well received globallywith Expro building a specialist team in NorthAmerica to further increase its capabilities.

Tullow’s eperience One client that has benefited from Expro’s wellintegrity expertise is Tullow Oil.

The major independent oil company madesubstantial oilfield discoveries in both Ghana andUganda and as a result needed to further developits well integrity procedures. More specificallyTullow Oil had to be prepared for this major

The SafeWells sofware solution is fast becomingthe established industry benchmark, seen herewith Expro’s Simon Copping.

Service companies haveidentified well integrity as agrowth market sector andhave invested heavily indeveloping sophisticated

solutions to addressing thisindustry-wide issue.

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Expro's "SafeWells" well integrity management software can be used to monitor wellintegrity performance, send real time reports, highlight problems and prompt remedialactions. One client that has benefited from this well integrity expertise is Tullow Oil.

SafeWells software solution for effective well

integrity data management



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predicted increase in oil production.In partnership with Expro, Tullow has developed

a well integrity management system (WIMS) andimplemented SafeWells.

Simon Sparke, well integrity manager at TullowOil, and his team began using SafeWells in 2010.Since then, they have enjoyed an excellent workingrelationship that has led to significantdevelopments in the software.

“Tullow is very happy with our well integritymanagement system and this has been madepossible with the ease of developing the softwarein partnership with Expro,” he said.

“Linking various software packages to SafeWellsallows my team to monitor all our operated wells.Through the highly visual process of displaying thestatus of any of our wells, we report monthly tovarious managers on our well stock and the varioussafety critical components in the wells.”

Expro’s Simon Copping, SafeWells productmanager, who worked closely on the Tullow projectpicks up the case.

“We have a fantastic software system inSafeWells that really complements Tullow’s wellintegrity strategy,” said Copping.

“With different types of wells in challengingengineering environments operating under a range ofgovernmental legislations, having a softwarepackage that is user friendly and flexible is key to

improving the company’s well integrity performance.“This provides a direct impact on communication,

safety performance and the overall bottom line.“Initially Tullow required a centrally managed

integrity system to monitor its worldwideoperations covering onshore and offshore wellsincluding subsea completions.

“SafeWells was originally rolled out on Tullow’sBangora Gas Field in Bangladesh and is nowdeployed on its UK and Ghana operations.“So far this product and the team supporting ithave fulfilled all of our own expectations as well asreceiving positive client feedback.

“I am excited about making a difference to ourindustry and building on the foundations of thesuccess we have already enjoyed with SafeWells.”

Copping also commented on the broaderindustry issue of well integrity management.

He added: “The consequences of bad well integritymanagement can be environmentally devastating andhave a severe impact on corporate reputation.

“The lifeblood of an oil and gas company isultimately the revenues it generates throughproduction, so having unplanned productiondowntime due to well integrity issues can havemajor financial implications.

“Well integrity software is helping to addressthese challenges.”

Operators are faced with the challengingproblem of meeting production targets whileensuring that their wells continue to operate safely.

“Tubing and component selection typically ismade based on the expected life of the well.However, it is often the case that wells are inoperation far longer than originally planned andthat the nature of well fluids changes over time,further compounding the problem.

“Clear integrity management systems provideguidelines that help ensure personnel at the wellsite are kept safe.

“Importantly, they constitute a reusable set ofpolicies and procedures that ensure wells areproperly and routinely tested.”

But what are the other advantages of


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Tullow has made substantial discoveries in Ghana.

The consequences of bad wellintegrity management can beenvironmentally devastating.



In honour of the 35th Anniversary of the Foundation of the Ministry of Petroleum Republic of Angola

Angola International Oil & GasConference and Exhibition

Utilising and Identifying new Oil & Gas resources forthe benefit of Angola’sfuture generations

25 – 26 November 2013 Epic Sana Luanda Hotel, Luanda, Republic of Angola

REPÚBLICA DE ANGOLAMINISTÉRIO DOS PETRÓLEOS

Organised by: Silver Sponsor

www.aiogace.com

working in partnership with Expro to deploy itsSafeWells system?

Instant overall visibility saves timeFrom a visualisation perspective, it provides aninstant overview of well integrity statuses acrossall assets.

This is done through a green, yellow and redtraffic light system that alerts users to potentialintegrity issues with a well.

The visibility to the organisation not only givescustomers quick access to current well statuses,but having this system in place has associated costsaving benefits as well.

One customer has saved 97 per cent of thetime it takes to run well integrity reports acrossall of its assets. In real time that has condensedthe job time to just two hours, which previouslytook two weeks.

This visualisation system helps to alleviate theassociated problems so more people can find outwhat is going on with a well and do so in a fractionof the time.

SafeWells is also an extremely flexible piece ofsoftware that allows clients to customise operatingparameters that are unique to its policies andprocedures as well as updating those when specificinformation such as corrosion of tubing is available.

Additionally, the software complements other

services Expro offers especially around wellintegrity and well intervention services.

To further contextualise this, well integrity isdefined by NORSOK D-010 as the “Application oftechnical, operational and organisational solutionsto reduce risk of uncontrolled release of formationfluids throughout the life cycle of a well.”

In more simplistic terms, it is about identifyingand prohibiting leaks.

SafeWells is set up to alert users whenoperational parameters fall outside of acceptableranges. When these issues are detected, customerstrigger dispensation procedures into action.

This is part of the added value of SafeWellsespecially as customers are made aware of anyissue before it becomes a significant problem thatrequires automatic shut-in, meaning they canminimise unplanned production downtime.

Saving time and moneyOne client slashed unplanned downtime by 50 percent thanks to SafeWells.

In terms of production, a particular wellintervention activity took two days to carry outwhen it was planned and four days when unplanned.

Those additional days of gained production timeamounted to more than US$150,000 savingsbecause the well was kept online.

For example, if an annulus pressure test fails and

the customer suspects tubing corrosion, a caliperlog can be run to determine how much tubingthickness loss there might be due to corrosion.

Downhole video cameras also have similarapplications in that they literally allow customersto see first hand what might be causing the wellintegrity problem.

Expro also has expert well integrity engineerswho consult with customers on developing WIMSpolicies and procedures.

By having these in place prior to implementingSafeWells, the customer already has the rules andguidelines for the system to operate, such asacceptable leak rates.

There is little doubt SafeWells is a valuedmarket product particularly as it integrates with ahost of Expro’s other products and services.

The flexibility of SafeWells allows customers tocustomise the information they need to see. The waythe data is visualised means it is easy for companiesto turn their well integrity status into a real-timepicture that improves decision-making and helpscompanies to achieve targets, key performanceindicators and standards in well integrity. ■


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In more simplistic terms, it isabout identifying and

prohibiting leaks.



S16 ORA 5 2013 Technology E_Layout 1 22/10/2013 16:38


IIN A THOROUGH study of shalecharacterisation and inhibition testing,seven drilling fluids—including six water-base muds (WBM) and one synthetic-base

mud (SBM)—were evaluated to determine a simpleranking for technical and environmentalperformance as well as treatment and disposaloptions for each fluid.

The SBM was the strongest technically, followedby an amine-modified high-performance WBMsystem. Both systems can be combined with techno-economically feasible treatment and disposal optionsthat minimise environmental impact.

IntroductionTullow requested a fluid selection study with coresfrom fields of interest. The study was conductedto support the drilling fluid design andrecommendations for future development of anEast African basin. A total of 108 core sampleswere available, with 15 selected based on depthand fields with the most similar properties as thezones of interest.

Selected core samples from two wells wereused to evaluate the rock/fluid interaction offormation samples with different drilling fluids.Six laboratory techniques evaluated the stabilityof the rock samples. Samples from Well A wereused for testing with base fluids (brines) and thesamples from Well B were used for testing withthe fully formulated drilling fluids.

Testing was split into two phases, with thefirst examining formation material and surmising

the best fluid-rock interaction. The second phasedetermined the rock behavior with the selectedfluids.

Shale characterisation In Phase 1, shale characterisation was determinedby the shale mineralogy and Cation ExchangeCapacity (CEC) data using the semi-quantitativeXR Diffraction (XRD) analytical method. Thesetests provided information on minerals and theirrelative abundance in the shale and shalereactivity. Thin section analyses of core samplesfrom the field provided a more qualitativedescription of the rock with respect to principalmineral, mineral with distribution of the rock,qualitative description of the rock, presence offractures and orientation, and grain size ranges.

Phase 2 included a shale inhibition andstability study. With the XRD/Thin Sections andCEC results, the fluid formulation was optimisedfor enhanced shale inhibition study. Tests toevaluate the formation and drilling fluidsincluded examination of bulk hardness, dispersiontesting, accretion testing, linear swelling,

immersion testing, capillary suction tests, X-RayDiffraction, and CEC.Fluid systems for study included:6 Fluid 1: Fresh Water/PHPA/PAC/XCD WBM 6 Fluid 2: Fresh water/potassium

Acetate/PHPA/PAC/XCD WBM6 Fluid 3: Amine-base high performance WBM6 Fluid 4 : SBM6 Fluid 5: High performance WBM-low

conductivity (modified amine)6 Fluid 6: Fresh water/potassium

chloride/PHPA/PAC-polymer mud 6 Fluid 7: Fresh water/low potassium

acetate/PHPA/PAC/XCD polymer WBM

The team applied elements of several qualitytargets from various published discharge guidelinesin the country and also applied internationallyrecognised treatment targets for determining theappropriate conditions of solid and liquid effluentreleased to land and water. Regulatory guidelinesallowed the team to compare the fluids against abenchmarked goal during development andassessment.

Common elements of concern found in drillingand completions fluids when assessing theenvironmental impact of the waste included: totalsuspended solids (TSS), salts/ions, hydrocarbons,heavy metals, waste minimisation and treatment ofthe waste, the methods available to treat thewastes, and identifying benefits of the treatment.

To consider environmental impacts, the study

Figure 1:Drilling fluids selected for study, including drilling performance and environmental rating.

Common elements of concernwere found in drilling andcompletions fluids when

assessing the environmentalimpact of the waste.

Drilling in environmentally sensitive areas of East Africa requires operators to consider both technical andenvironmental criteria when treating and disposing of cuttings and excess drilling fluids. In less technicallydemanding exploration wells, Tullow Oil sought drilling fluids with green credentials, but recognised that a systemwith improved technical performance was necessary to drill more demanding, high angle and extended reach wells.

Drilling fluid selection for environmentally

sensitive areas

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focused on the two phases of the system, the solidcuttings and the liquids (mud and water) that areused, separated and disposed of during the operation.

Immersion testFor the immersion test, the sample in theparaffin-base oil was not affected by the fluid. Thesample in the 10 per cent KCl was the lessaffected for water-base fluids. Immersion testingshowed that 10 per cent KCl minimum wasneeded to keep the sample intact. The addition ofamine improved inhibition. The paraffin-base oilshowed the best inhibition.

Fluids containing amine and the SBM showedno or negligible accretion. The potassiumacetate/low molecular weight PHPA (LMW-PHPA)exhibited 8.1 per cent accretion while thefreshwater/low molecular weight PHPA fluidshowed 37.2 per cent.

Bulk hardness testing showed that Fluid 4 andthe Fluid 3 system exhibited the best results. Highdispersion tendency in freshwater and a significantincrease in recoveries were obtained with thedrilling fluids. Data showed that the PHPA/PACsystem had the lowest performance.

Lowest conductance was exhibited by Fluid 4and the high performance Fluid 5, 0.5 μS/cm and1.2 mS/cm, respectively. The lowest CapillarySuction Test (CST) values were obtained utilizingfluids: 5 ppb potassium acetate in freshwater,25ppb potassium acetate in freshwater, and 25 ppb(seven per cent wt) KCl.

Thin sections analyses indicated pore sizesmainly ranged from 50 to 130 microns. Themaximum pore size is ~150 microns. XRDs showedthat the formation consisted mostly of quartz andkaolonite. The cores were unconsolidated plugswith the presence of clay. The presence of kaoloniteis generally the cause for fines migrations whenproducing the well.

A variety of fluids were considered technicallycapable of drilling the zone, but the teamquestioned whether their environmental rankingscomplemented the practicality after consideringconstituents of concern in each fluid, the totalwaste volume and the treatment options. Thefluids all shared many of the same components

with one or two substitutions that affected fluidproperty changes in terms of technical andenvironmental performance.

Fluids were assessed based on their componentsbefore coming into contact with the formation,which could contribute additional contaminants notcontained in the products, but that could negativelyalter the environmental ranking.

Fluid rankingsFluid 1 was given an environmental ranking of an Abecause of its low electrical conductivity (ioncontent), the high potential for biodegradation ofthe suspended solids in the form of polymer, andthe minor impacts that would occur from anunplanned release or spill of the fluid. Negativepoints were given because of the potentially large

volume created and required for disposal.Fluid 2 received a D ranking. Although it has a

high potential for degradation and a high rank forinhibition, the electrical conductivity is very high,especially in the liquid phase. With low intensitytreatment on site it would take several months totreat the water to acceptable discharge levels,making it impractical for operations.

Fluid 3 received a B ranking. The electricalconductivity is originally much lower than theacetate while still providing good inhibition.However, the fluid would need to be treated toremove residual conductivity and the biochemicaloxygen demand (BOD) and chemical oxygendemand (COD). The treatment may not be able toachieve the low values set for water discharge in areasonable timeframe.

Fluid 4 had a rating of 10. Lab tests indicatedthat the SBM provides a very high amount ofinhibition. The expected washout in the hole wouldbe very low (roughly 10 per cent or less dependingon the formation), greatly reducing the cuttingsgenerated. With the high inhibition, the amount ofdilution to maintain the low solids in the activemud system should be low and solids controlshould be able to remove the majority of solids,allowing the base mud to be reused for other wells.

A rating of nine was given to Fluid 5 as the labtest indicated that the amine-base highperformance WBM provides a high amount ofinhibition. The expected washout in the hole wouldbe in a low range (roughly 15 per cent or less),reducing the cuttings. With the high inhibition, theamount of dilution to maintain the low solids in theactive mud system should be low.

A rating of eight was given to Fluid 6. Lab testsindicated that Fluid 6 provides high inhibition. Theexpected washout in the hole would be in a lowrange (15 per cent or less) with reduced cuttingsand low dilution required to maintain low solids.

The environmental ranking is a D due to thehigh initial electrical conductivity of the fluid andthe low potential for biodegradation of the ionsonce they enter the environment. The ranking also


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Figure 2: Accretion results for Fluids 1-7.

Fluids were assessed based ontheir components before

coming into contact with theformation.


Figure 3: Visual depiction of accretion results for Fluids 1-4.


T H E U N I T E D R E P U B L I C O F T A N Z A N I A

Announcing the 4th Tanzania 2013 Licensing Round

Tanzania PetroleumDevelopment Corporation

Contact: Mr. Yona Killagane Email: [email protected]

ION Geophysical, Inc.

Contact: Nick BlakePhone: +44 7734 415105Email: [email protected]

WesternGeco

Stewart WalterPhone: +44 1293 556533 Email: [email protected]

www.tz-licensing-round.com

The Government of the United Republic of Tanzania through Tanzania Petroleum Development Corporation (TPDC) is pleased to announce the 4th Tanzania Deep Offshore and North Lake Tanganyika Licensing Round. The delayed 2012 round was launched during the 2nd Tanzania Oil and Gas Conference and Exhibition.

Round Close: Thursday, 15 May 2014, Dar es Salaam

Deep Offshore | North Lake Tanganyika

The round includes the deep offshore sedimentary basins

comprising of seven blocks (averaging 3000 sq km: Blk4/2A,

Blk4/3A, Blk4/3B, Blk4/4A, Blk4/4B, Blk4/5A, Blk4/5B) and is

located between 2000 m to 3000 m of water depths from 40°30’E

to 41°40’E and 7°30’S to 9°00’S. Blocks 4/1B and 4/1C are

reserved for the TPDC to execute exploration using a strategic

partner. The blocks have excellent coverage of modern regional

2D seismic data available from ION Geophysical and

WesternGeco.

The North Lake Tanganyika block is located offshore in the western arm of the east African rift system. Lake

Tanganyika is the world's longest (650 km) and second-deepest (1500 m) and is covered by sparse 2D seismic data

collected in the 1980s during the African Lakes Drilling Project. The data and copy of report will be made available.

4TH TANZANIA OFFSHORE AND NORTH LAKE TANGANYIKA LICENSING ROUND



reflects the lack of adequate treatment to removethe source of contamination.

The rating of eight to nine in lab tests of Fluid 7indicated that the WBM provides a high amount ofinhibition with an expected washout in the hole of15 per cent or less, with reduced cuttings and a lowamount of dilution required. The fluid was given anenvironmental ranking of C. Even after lowering thepotassium acetate content the initial exchangecapacity was still high. The minimisation of theadditive improved the ranking from the previousformula. A biological treatment onsite is requiredbefore discharge. The acetate is organic and willbiodegrade. There is minimal waste generation. Asummary of environmental and drillingperformance can be seen in Figure 1.

RecommendationsDrilling performance of the fluids was evaluated onthe shale inhibition (bulk hardness, dispersion,accretion and swelling tests) results while theenvironmental evaluation was based on chloridecontent, conductance and waste disposal methods.

From the summary of the results of thedifferent shale inhibition testing with all the fluids,the Fluid 4 was rated 9.7 of a maximum 10 pointsas the most inhibitive drilling fluid, followed byFluid 3 rated at 8.0.

Fluid 6 was rated 6.5, while Fluid 5 was rated 6.4and Fluid 6 scored 6.0. Fluid 7 scored 5.6, whereasthe least inhibitive WBM, scoring 2.8, was Fluid 1.

Treatment and disposalDewatering and water treatment can be utilised onlocation to reduce waste generation and recyclewater on location for Fluid 1. Treatment of mud toreleasable water would be reasonably easy. Sometreatment for excess polymers and some aerationmay be required to attain most regulatoryparameters for release.

Unless a significant amount of barite has beenused and high levels of heavy metals are detected,then the cuttings can be blended with soil and landfarmed or buried with little to no impact due tocontaminants. Cuttings with barite may requiresome blending with soil to reduce theconcentration to an acceptable level.

For Fluid 2, the dewatering and water treatmentprocess will not remove the excess acetate in thetreated water, requiring a secondary bioremediationand aeration process that can take as long at 20 to45 days per batch. Onsite and timely treatmentmay require a centralised treatment plant to treathigh concentration potassium acetate mud. Drillcuttings will retain a level of potassium acetatethat can be bio-remediated with some soil blendingand soil enhancement with amendments.

For Fluid 3, onsite dewatering and watertreatment will not remove the amine in the treatedwater, which would have a conductivity level of6,000 to 8,000 mS/cm, above the suggested levelof 2000 mS/cm or lower in many countries. Pastprojects have shown that a dilution of 70 +/-percent will bring the conductivity to a level of2,000 mS/cm. Aeration can assist in reducing theamine but will take time. If dilution can’t beperformed, a secondary bioremediation process willbe required to promote the removal of the aminesin the water. The drill cuttings will retain a lowlevel of amine that will be able to be bio-

remediated with some soil blending and soilenhancement with amendments. Burial of thestabilized cuttings can be done with quick lime,cement or fly ash.

For SBM fluids such as Fluid 4, solids below 10microns and the water phase can be removed with achemical additive and centrifugation. Commerciallyavailable systems can recover base oil from usedmud. Drill cuttings with SBM can be bio-remediated.Other options for cuttings treatment or disposal arethermal treatment and waste injection, or evenstabilisation/solidification. Waste injection disposesof all OBM waste fluids and cuttings.

For Fluid 5, onsite dewatering and watertreatment process will not remove the amine in thetreated water, thus there will be a conductancelevel of 2,000 +/- mS/cm, which is in the range fordischarge in many countries. Drill cuttings willretain a low level of amine that can be bio-remediated with some soil blending and soilenhancement with amendments. Stabilisation/solidification is a feasible option.

For Fluid 6, high chlorides not removed throughonsite dewatering and water processing must bereduced by reverse osmosis or distillation. However,both create a high-chlorides sludge for disposal.Dilution would require rates of 60 to 70 to one ormore, which is not feasible. High chloride fluids andwastes can be disposed of through injection. Drillcuttings will retain a level of chloride that will beinhibitive to bioremediation.

For Fluid 7, a secondary bioremediation processwill be required to remove acetate in water treatedon site, which can take 20 to 45 days per batch. Acentralised treatment plant may be required to treathigh concentration potassium acetate mud. Drillcuttings will retain a level of potassium acetate thatwill be able to be bio-remediated with some soilblending and soil enhancement with amendments.

ConclusionBased on the above analysis, Fluid 4, the SBM, wasthe strongest technically, followed by Fluid 5. It wasshown that both can be combined with techno-economically feasible treatment and disposaloptions that minimise environmental impact. ■

Authors: Paul Burden and Klisthenis Dimitriadis,Tullow Oil; Kayli Clements, Chau Nguyen, TonyStaples, Seye Thomas; M-I SWACO, ASchlumberger Company

Lab tests indicated that theSBM provides a very high

amount of inhibition.

Figure 4: Visual depiction of accretion results for Fluids 5-7.

GE’S MEASUREMENT AND control subsea condition monitoring system, also known as theCage, has made a mark in the oil and gas subsea sector.Cage is equipped to measure sound and electrical signals emitted from subsea equipment,often an early warning sign of developing leaks and other issues. The listening ‘ear’, which isan array of sensors in a 228-kg birdcage dome that sits on the sea floor or on subseaequipment was developed at the GE Measurement and Control site in Bergen, Norway. A 210-metre deep water facility there also provided deep water testing for the technology.Engineers designed the eardrum of the system from special crystals that respond to soundwave vibrations and convert then into electricity. A single device can listen to sounds withina 488-metre radius. In addition, an array of attached carbon rods can detect changes in themagnetic field and spot ground faults or defective isolation.

GE’s subsea signal detector creates ripples

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78 Oil Review Africa Issue Five 2013 www.oilreviewafrica.com

GAMMATEC NDT, A subsidiary of NTPRadioisotopes SOC Ltd (NTP) and part of theSouth African Nuclear Energy Corporation(NECSA) Group, has announced that theExertus DUAL 120 Gamma Ray Projectorwould be manufactured in the country.In 2010, Gammatec NDT led an initiative toestablish a joint venture with two privateentrepreneurs, which saw Oserix SA sign anexclusive supply contract with Russiangamma technology design and manufacturingcompany Energomontage International (EMI)to take ownership of the Exertus Range ofGamma Ray Projectors. Gammatec becamethe sole distributor for Oserix SA in SouthAfrica, the Middle East and South East Asia."Aggressive sales and marketing, plus the factthat a number of the current gamma ray projectorsutilised in our industry are reaching the end of their life span due toexpiration of their Competent Authority Certificate, has resulted in earlysuccess in the supply of the new gamma ray projectors," saidGammatec NDT group managing director Ralph Davies.Gammatec NDT began the stringent approval process for the productthree years ago, which included a detailed QA/QC work flow procedure,staff recruitment and training, and high-end technology machineryinvestment. Gammatec NDT was awarded with ISO 9001-2008

accreditation, as well as the approvalunder the license of EMI to manufacturethe Oserix Exertus Range of Gamma Rayprojectors in South Africa."The challenges Gammatec NDT facedincluded producing a world-classproduct under stringent controls and ata reasonable price to ensure globalcompetitiveness," Davies added."Various manufacturing options wereinvestigated prior to the purchase andinstallation of a new state-of-the-art 5axis, multi-tasking CNC machine to beable to manufacture the majority ofcomponents. Supply contracts werealso negotiated and formed for otherkey components including the supply of

depleted uranium shielding from NTPRadioisotopes SOC Ltd," he added.Over the past 30 years, Gammatec NDT has become a leading supplierof Non-Destructive Testing (NDT) equipment, accessories andconsumables. From its head office in Vereeniging, South Africa, thecompany exports to more than 60 countries around the globe.The company will now target the production of additional models of theOserix Exertus range of gamma ray projectors from its South Africanmanufacturing facility.

The Exertus DUAL 120 Gamma Ray projector fromGammatec NDT. (Image source: Gammatec NDT)

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Gamma Ray Isotope projector manufacture begins in South Africa


21-23 JANUARY 2014

CONFERENCE AND EXHIBITION



“ W“ W E REALISED PEOPLEwould be reliant onthese things — thatdowntime would be

abhorrent. So we had to do three things. One wasto design a product that was the most reliablepossible and wouldn’t fail. Second to only sell it inenvironments to which it was suited. And lastly tomake sure it’s backed by resellers who can provideany service the customer needs.”

We are talking here about communications. Or,more accurately, Stephen Patrick is the CEO ofWireless Excellence Ltd, a leading designer andmanufacturer of professional wireless products for awide variety of applications. That includes Wi-Fi,WiMAX, microwave, millimetre wave and more.‘More’, in this case, includes free space optics(FSO), which uses infra-red laser technology totransmit data. The focus on FSO in this article isbecause BP in Egypt has chosen what may, to manyreaders, be an unfamiliar wireless technology tosend data to and from its various Cairo offices.

Why BP chose the technologyAs for why it chose the technology, the backgroundis as follows. BP has had a presence in Cairo for along time. It was consolidating facilities into differentoffices or buildings around the city. It thereforerequired high-speed links between those sites, a notunusual need where multiple buildings in the samecity are involved. Patrick takes up the story: “BPrealised that relying on the local telecom providerwas going to be not only very expensive, but wouldnot enable them to reach their desired availabilityand reliability targets for the network. Conversely,‘owning the infrastructure’ with a wireless solutionmeans that all the equipment is owned and undercontrol of the customer — who can therefore takewhatever actions are required to ensure consistentand high uptimes. A local partner responded to anenquiry made by BP locally in Egypt, and suggestedour solution as the ‘best fit’ for the customer needs.”

A simple ideaWireless Excellence offers a number of differentwireless systems but in this case Patrick wasreferring to FSO. In principle, the idea is simple: youhave a box that generates a laser beam — a very lowpower light beam — which is modulated. It carriesdata in the form of ones and zeros from one point toanother point. There they are converted back to data.

In practice, however, making thistechnology reliable has, Patrick said, cost thetelecommunications industry as a whole many

millions of dollars and a lot of work. Even whenit was commercialised back in the late 1990scompanies like Wireless Excellence had toovercome a lack of awareness of FSO(compared to, say, microwave or fibre) withdemonstrations and trials.

FSO has many advantagesBut it has been worth it, and not just for WirelessExcellence. Customers especially like the fact thatpoint-to-point wireless communication using laseris, in most countries, licence-free. In addition, radiospectrum is a limited resource; the microwavespectrum tends to be congested in major citieswith hundreds, or even thousands of links allcompeting for the same frequencies. Infra red,however, is uncongested.

FSO’s other advantages include quick set-up,very high speed (1 Gbps) and low annual fees toEgypt’s NTRA (National Telecom Regulatory

Authority) compared with other wirelesstechnologies. In fact, Patrick explained, “With ourreseller we have worked with the NTRA to ensurethat all the products and installations meet theirneeds. The fact that these products use optical(infra-red) rather than RF spectrum means that theyare very supportive; these products don't add to thesevere and increasing congestion of RF bands, sothere is a motivation for all parties to chooseoptical links where appropriate.”

Its limitationsFSO does have its limitations. Transmission is onlyup to 2km as a rule (though much longer links havebeen achieved: up to 4km or more) and it requiresline of sight transmission. That means, in citiesmost of all, the transmission and receptionequipment is usually rooftop-based. Carefulplanning is therefore required to ensure that thedesired links can be implemented. Also in somecities and regions of outstanding heritage the usermay also be at the mercy of planning regulations.However, most business users, including BP, arefortunate in occupying fairly tall buildings whereline of sight is easy to attain, and the units areusually not visible from street level. If a companyusing FSO doesn't own a building it can usuallynegotiate with building owners for rooftop access.

Sometimes more height is needed to ensure

All our wireless links are up on rooftop level, and mounted in locationswhere there is clear line of sight between locations.

Customers especially like thefact that point-to-point

wireless communication usinglaser is, in most countries,

licence-free.

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When BP in Cairo decided it needed reliable high-speed connections between its variousoffices, it chose a wireless technology that may be unfamiliar to some readers. However, useof free space optics (FSO) is growing, as Vaughan O’Grady finds out in the first of two articleson how technology is meeting the communications needs of modern businesses.

From the wellhead

to the rooftop


S18 ORA 5 2013 ICT_Layout 1 22/10/2013 16:51

S18 ORA 5 2013 ICT_Layout 1 22/10/2013 16:51

line of sight. In such cases small masts can go ontop of buildings. In some situations there may evenbe what Patrick calls “a snooker shot”: pointing abeam at a laser ‘box’ on a different building wherea repeater installation redirects it to the one youneed to link. The owner of the extra buildingusually exacts a modest rental for the favour butthat is rarely a deterrent to the client.

All links at rooftop level in CairoWhat about Cairo? As Patrick said, “It's a busy city!All our wireless links are up on rooftop level, andmounted in locations where there is clear line of

sight between locations. Our skilled resellers areexpert at finding suitable points, starting with mapsand then checking by visiting the rooftop sitesthemselves. It's actually a lot easier than it sounds— and to put it in context globally for the wholeindustry, there are upwards of a million wirelesslinks a year being installed on similar rooftop sites.”

Nevertheless other factors can be a problem.For example FSO is also limited by the weather —things like thick fog, heavy snow and in certainconditions extremely heavy sandstorms, althoughthat still makes it viable for much of the MiddleEast and Africa. As Patrick pointed out, “This

deployment is typical of ones we have done in 65countries globally. The customer needs, and thesolution itself, are as valid and attractive in Cairo asthey are in cities as diverse as London, New York,Cape Town, Riyadh, Dubai, Lagos or Baghdad.”

FSO may be an ideal wireless solution to theproblem of communicating data in a major city. Butis it better than wired approaches such as fibreoptics? That’s what we’ll be discussing in thesecond part of this feature, where we will also lookat how the type of communications required by amodern oil company — and even a modernconsumer — have changed. ■


ICT


ARKeX HAS ENTERED an exclusive 10-year agreement for LockheedMartin to provide next-generation full-tensor gravity gradiometers forairborne and offshore geophysical surveying. ARKeX said its multi-instrument agreement will increase existing capacity and forms anintegral part of the growth strategy for the company. The eFTGs willimprove resolution over the current instrumentation and furtherenhance geological understanding. The improved resolution will giveARKeX the ability to develop new products and services for the naturalresource exploration industry. This will not only allow new resources tobe discovered but also reduce exploration timelines and costs.Gravity gradiometry measures variations in the earth’s gravitational

field and is a direct measure of the density distribution of thesubsurface. The information can help to build a picture of subsurfaceanomalies, which can then be used by natural resource explorationcompanies to more accurately target hydrocarbon and mineral deposits.John Siegfried, ARKeX CEO, commented, “We are really excited aboutthis exclusive agreement. We have been working with LockheedMartin for a number of years and we have been impressed by theirprofessionalism, responsiveness and approach to pushing theboundaries of this exciting technology. This strategic agreement willnot only benefit ARKeX and Lockheed Martin, but the wholeexploration industry.”

Lockheed to provide ARKeX with next generation gradiometres

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Project DatabankCompiled by Data Media Systems

OIL, GAS AND PETROCHEMICAL PROJECTSProject Sector Facility Budget Status Start Date Completion Date

YFP - Aje Blk OML 113 Offshore Offshore Platform 10000000 EPC Q4-2004 Q1-2015Total - OML 99 Ikike Field Offshore Offshore Platform 400000000 FEED Q2-2009 Q4-2015Total - OML 58 Upgrade Phase 1 Oil, Offshore Oil & Gas Field 1000000000 EPC Q1-2006 Q4-2013Total - Egina Field Development Oil Oil Field Development 3100000000 EPC Q4-2003 Q4-2017Stubb Creek Field Oil Oil Field Development 200000000 EPC Q4-2003 Q4-2013Southern Swamp Associated Gas Solution Gas Gas Production 1000000000 EPC Q1-2011 Q2-2015 Project (SSAGS )Oyo Field Development Oil, Offshore Oil Field Development 1000000000 EPC Q1-2006 Q4-2014Owowo Oil Field - OPL 223 Oil Oil Field Development 250000000 EPC Q3-2005 Q3-2015Okwok oil field - OML 67 Oil Oil Field Development 400000000 EPC Q1-1968 Q4-2015Okoro and Setu Fields Development Oil, Offshore Oil Field Development 200000000 EPC Q3-2006 Q4-2013Ofon Field Development Phase 2 Offshore Offshore Platform 500000000 EPC Q2-2007 Q1-2015NNPC - Olokola LNG (OKLNG) Plant Gas Liquefied Natural 20000000000 EPC ITB Q1-2005 Q3-2016 Gas (LNG)Njaba Oil Field - OML 124 Oil Oil Field Development 150000000 EPC ITB Q1-2008 Q4-2016Mart Resources - Oil Oil & Gas Field 500000000 EPC Q4-2008 Q4-2014Umusadege Field DevelopmentKita Marine Oil Field - OML 123 Oil Oil Field Development 350000000 EPC Q4-2007 Q4-2015FLEX LNG - LNGP1 (Floating LNG Production) Offshore Floating Production and 500000000 EPC Q1-2006 Q1-2017 Storage Offloading (FPSO)FCTA - Karshi Water Supply System Water Desalination 130000000 EPC Q1-2016Ebok Development Oil Oil Field Development 450000000 EPC Q2-2007 Q4-2013Chevron Texaco - Agbami Oil Field Development Offshore Oil Field 5000000000 EPC Q1-1998 Q1-2016Chevron Nigeria - Escravos Gas-to-Liquids Gas Gas to Liquids (GTL) 1700000000 EPC Q3-2001 Q4-2013(GTL) ProjectBrass LNG - Brass River LNG Plant Gas Liquefied Natural Gas (LNG) 3500000000 EPC ITB Q4-2004 Q4-2017Afren - OPL 310 Development Oil, Offshore Oil & Gas Field 200000000 EPC 2009 Q3-2014Afren - OML 115 Development Oil Oil & Gas Field 150000000 EPC Q1-2010 Q2-2016

Project Summary

Project Backgrounds

Total plans to develop Egina Field in Nigeria.

Project Status

IN DECEMBER 2003, Egina-1 was discovered. Egina-2 was discovered in October2004. In September 2006, an appraisal programme, followed by seismic dataprocessing, resulted in the discovery of well Egina-3 and Egina-4 and Egina-5the following November. In January 2013, Samsung Heavy Industries was selected as the preferredbidder for execution of the Egina FPSO facility, and in March it was awarded theEPC contract. In July 2013 the field development plan called for 44 wellsconnected to a 330m-long floating production, storage and offloading (FPSO)vessel with a storage capacity of 2.3mn barrels, as well as engineering andmanufacture of about 76 km of steel tube umbilicals including production,

water injection and (SSIV) umbilicals. That same month Saipem was awardedthe EPCI contract for the subsea development of the Egina field. This contractincludes engineering, fabrication, and installation of 52 km of oil productionand water injection flow lines, 12 flexible jumpers, 20 km of gas exportpipelines, 80 km of umbilicals, and mooring and offloading systems. In August DUCO was awarded the contract to supply umbilicals to the Eginafield. Production is expected to start by the end of 2017. In September FMCTechnologies was awarded a US$1.2bn contract to supply subsea equipment forthe Egina field. The equipment is scheduled for delivery commencing in 2015.

Status Engineering & Procurement

Start Date Q4-2003

End Date Q4-2017

Location Egina, Nigeria

Project Name TOTAL - Egina Field Development

Name of Client TOTAL

Budget ($ US) 3,100,000,000

Award Date Q1-2013

Facility Type Oil Field Development

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ARK CLS, A leading developer of geoscience solutions to the oil & gasindustry, has released a powerful new data collaboration technologycalled GeoDataSync (GDS).At a time when many seismic interpretation workflows arecharacterised by multiple geoscience interpretation systems and datastorage and duplication challenges, GeoDataSync brings order to theworkflow, allowing interpreters to use multiple interpretation systemswithin the same unified workflow. Data can also be accessed withoutthe need to copy it, removing the need to make copies of largeseismic 3D data volumes and dramatically reducing storage costs.The initial implementation of GeoDataSync, which has beensponsored by a major operator, has been developed as a plug-in toPetrel* seismic to simulation software. Through a separate plug-in,GeoDataSync will also allow users access to 3D seismic data volumesand other data stored within dGB Earth Sciences’ seismicinterpretation system, OpendTect."Seismic interpretation today is complicated by so many differentgeoscience software packages and – through the popularity of large3D seismic cubes – so much data that it’s easy for seismicinterpreters to become overwhelmed,” said ARK CLS’s managingdirector, Adrian Bennetton. “That’s why we believe that GeoDataSyncis such an important breakthrough.”“Running quietly in the background and lightweight, fast and efficient,GeoDataSync unifies the seismic interpretation workflow and enablesinterpreters to focus on their number one priority – accuratelycharacterizing the subsurface. In a few years’ time, geoscientists willbe wondering how they ever coped without GeoDataSync.”

GeoDataSync comes with a number of key features and benefits.These include:6 Collaborative working & easy synchronisation between multiple

data sources. GeoDataSync ensures easy collaboration, access,copying and synchronisation between multiple data sources andsoftware packages and is ideal for a heterogeneous geosciencesoftware environment. GeoDataSync also works well with smallerdatasets, such as interpretative horizons, faults or well data.

6 Improved data management & reduced storage costs. GeoDataSyncis simple to install and manage, and provides access to huge 3Dseismic data sets without requiring the copying of that data. Thisremoves the need to make copies of large seismic 3D datavolumes and dramatically reduces storage costs.

6 Increased asset team productivity. GeoDataSync ensures that allasset team members have access to the right data as and whenthey need it, increasing team productivity and turning data intohigh-value information.

6 Leveraging previous investments. GeoDataSync supports dataaccess from legacy systems and can easily access and incorporatehistorical data into the current interpretation workflow, leveragingprevious investments that might have been otherwise forgotten.

6 Easy migration & reduced data corruption risks. GeoDataSyncfacilitates migration to newer technologies with the minimum ofdisruption and also significantly reduces the risks of datacorruption and data versioning errors.

Depending on customer demand, plans are also being made for furtherGeoDataSync plug-ins to other mainstream interpretation packages.

ICT

ARK CLS launches GeoDataSync

Company Name..................PageABS..........................................................65Accenture Nigeria ..........................53Afex Group..........................................55Alduco Energy ..........................43, 71AME Trade Ltd. (AIOGACE 2013) ..............................70Archer....................................................63Arik Air International Ltd. ............41B.G. Technical Limited....................23Baker Hughes ....................................88DMG World Media Dubai Ltd.(ADIPEC 2013) ..................................77Dolphin Geophysical ....................39Eaton Industries GmbH ..................9Emerson Process Management ....................................31Emval Nigeria Limited ..................47Exalo Drilling S.A. ............................51GEFCO ..................................................33Gil Automations ..............................25Hempel Czech Republic SRO ....59International Exhibition Services SRL........................................83International Paint Ltd ..................57ION Geophysical ..............................75Jereh International Co. Ltd. ...................... Cover WrapKAREVA Marketing GmbH..........33Kohler Power Systems ..................69

Magnetrol International N.V.......13Marelli Motori SPA..............................5Marine Platforms ............................11Mokveld Valves BV..........................49MSAR........................................................7Nynas South Africa ........................36PEM Offshore Inc. ............................27Pennwell Corporation ........................(Offshore West Africa 2014)........79Pernod Ricard Nigeria ..................45Petroleum Agency South Africa........................................37Portwest Ltd.......................................46RIB Rental Africa ..............................82RSCC (Russian SatelliteCommunications Company) ....81SGS Inspection Services ..............17Shoreline Natural Resources......15Sky Vision Global Networks........87Solenta Aviation ..............................38Sonils, LDA ..........................................29South Atlantic Petroleum ..............2Spina Group Srl ................................67Tilone Subsea Limited ..................21Tolmann Allied ServicesCompany Limited............................19Toprope................................................35Well Fluid Services ..........................61Wilhelm Layher GmbH & Co. KG................................................54

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