Women – the hidden potential of oil and gas industry’s energy transition

The oil and gas industry has historically been a hard place for female workers. Now, with the oil and gas industry transitioning towards green energy, women workers could be the fresh workforce injection companies desperately need.

One of the aspects of the oil and gas
industries people rarely focus on is the work female workers do in the
industry. Here we will t[…]

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Oil Search flags $400 million impairments

The Papua New Guinea-focused oil and gas producer and PNG LNG stakeholder, Oil Search flagged a $360-$400 million impairment in its interim results.

Oil Search flags $400 million impairments
Courtesy of Oil Search

The company noted in a statement on Monday it has assessed the carrying value of its assets for impairment as June 30, 2020, in accordance with the relevant accounting standards. Oil Search has taken into account the potential longer-term impact of prevailing economic conditions, the outlook for oil and gas prices and the current status of other factors that could impact on value realisation.

The impairments that are expected to be recognised largely relate to PNG exploration licences.

As part of the strategic review currently underway and in line with OIl Search’s prioritisation of capital allocation, a number of exploration and evaluation assets in PNG have been identified as being of reduced priority due to lower prospectivity or sub-optimal economics.

As there is no current intention to pursue activities on these assets, the full value of these exploration assets is expected to be written down.

An immaterial impairment relating to exploration leases in Alaska, which are scheduled to be relinquished, also is anticipated.

Given the ongoing gas supply uncertainties resulting from the recent suspension of mining activities at the Porgera project, the carrying value of the Hides gas-to-electricity project is also expected to be fully impaired.

The expected impairment expense is a non-cash item and will not impact cash earnings or cashflow, Oil Search said.

The final impairment expense to be recognised is subject to the finalisation of the half-year accounts and completion of the half-year review by the Company’s auditor.

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World’s first converted FLNG in milestone loading

Golar’s Hilli Episeyo, world’s first converted FLNG vessel, has recently loaded its 40th cargo since the start of operations more than two years ago offshore Kribi, Cameroon.

FLNG Hilli Episeyo
FLNG Hilli Episeyo (Image: Golar LNG)

Bermuda-based shipowner Golar said the FLNG completed the milestone operation on June 18.

Through these offtakes, the floating LNG producer has provided more than 2.5 million tonnes of the fuel into the market, according to Golar.

Additionally, eleven of these cargoes were delivered to the company’s vessels Golar Viking, Golar Maria and Nanook.

The FLNG started commercial operations back in May 2018 under production tolling deals with Cameroon’s Perenco and SNH.

Russia’s Gazprom is the sole offtaker from the FLNG project taking 1.2 mtpa under an eighth-year deal expiring in 2026.

The gas giant is taking 50 percent of the vessels total 2.4 mtpa capacity produced from two trains. The FLNG has in total four trains installed onboard.

Golar previously said it held talks with Perenco and SNH to increase output to full capacity utilizing all the trains.

But this will probably not take place any time soon due to the depressed market caused by the Covid-19 pandemic.

The FLNG sources gas from Perenco’s Sanaga field located northwest of the coastal town of Kribi.

The LNG producer does not receive the gas directly from the field as it is previously treated at an onshore processing plant prior to arriving to the facility.

100 pct commercial uptime

The FLNG has maintained 100 percent commercial uptime for more then two years now, according to Golar.

Golar said in its first-quarter results that the FLNG delivers quarterly tolling revenues of around $40 million.

The company gets 50 percent of these revenues while its Nasdaq-listed unit Golar LNG Partners receives the other 50 percent as part of a drop down deal announced in 2018.

To remind, Keppel’s shipyard in Singapore converted the Hilli Episeyo from Golar’s aging 125,000-cbm tanker for $1.2 billion. The vessel departed the yard in October 2017.

It is not only the world’s first converted FLNG but also the second-ever floating LNG producer to enter service.

The first one is the Petronas-owned 1.2 mtpa PFLNG Satu that started operations in 2017 offshore Malaysia.

The largest among all of them is Shell’s Prelude FLNG off Western Australia but this unit experienced several problems since first cargo in June 2019 .

Shell hasn’t exported any cargoes from the FLNG for more than five months following an electrical trip on February 2.

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Eni hands in decommissioning plan for six North Sea platforms

Italian oil and gas company Eni has submitted its plans for decommissioning of six platforms on the Hewett field to the UK authorities.

The Hewett field is located in the Southern North Sea, about 22 km northeast of the Norfolk coast.

Five of the Hewett platforms (48/29A Complex, 48/29B and 48/29C) are located in UKCS Block 48/29, with the remaining platform (52/5A) located in Block 52/5.

The Hewett area contains the main Hewett field, consisting of five horizons vertically situated above each other, and six adjacent satellite fields: Big Dotty, Little Dotty, Deborah, Dawn, Della, and Delilah.

The main Hewett field, Big Dotty, Little Dotty, and Deborah are in a single unitised licence area.

The Hewett field infrastructure comprises six platforms, 32 platform wells, and a further eight subsea wells tied back to the platforms.

Under the plan, topsides and jackets for all six platforms will be removed and returned to shore for processing, recycling or disposal.

The earliest start date for decommissioning activities is in late 2021.

Hewett field layout
Hewett field layout; Source: Eni

Some preparation works are required prior to topsides removal including piece small removal of specific items and installation of lifting points.

Following this, the topside will be removed via several possible options. These include single lift removal by single lift vessel/monohull crane vessel; or modular/piece-large removal by heavy-lift vessel (HLV) for re-use/recycling/disposal or offshore removal ‘piece small’ for onshore reuse/disposal.

The jackets will be removed either in a single lift or cut and recovered in several pieces.

In addition to the topsides and jackets removal work, during 2020, Eni proposes to remove the vent stack and redundant compressor package on the 52/5A platform to clear any obstructions for rig access to facilitate the P&A of the platform wells.

Removal and transportation to the shore of this material will be managed by the current field supply vessel and disposal arrangements to Great Yarmouth or Lowestoft Harbour, minimising any environmental or societal impacts.

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Contract cancellation, extensions, and warm-stack mode for Noble rigs

Offshore drilling contractor Noble Corporation has received several new contract extensions for its drilling rigs and cancellation of a drilling contract in Vietnam. Noble has also decided to warm-stack some of its rigs.

According to Noble’s latest fleet status report, published on Thursday, 9 July, the Noble Mick O’Brien jack-up has been awarded a contract extension from Qatar Gas.

The contract was previously expected to end in late August 2020.

Following the extension, the rig’s contract in Qatar is now scheduled to end in mid-November 2020.

The Noble Scott Marks jack-up rig has been on standby under a contract with Saudi Aramco since 10 May 2020 for a period of up to 365 days.

The rig’s day rate has been reduced to $0 through the standby period, which will not count against the contract term.

In addition, the rig’s contract in Saudi Arabia has been extended until July 2023. The day rate is set at $159,000.

In the UK, the jack-up rig Noble Sam Hartley has been warm stacked since April 2020 following the completion of its contract with Total.

The rig has now been awarded a contract with CNOOC in the UK which will last from mid-August 2020 until mid-December 2020.

The day rate has not been disclosed. The contract also includes four one-well options.

The Noble Sam Turner jack-up has been warm-stacked in the UK since March 2020 following the completion of a contract with Total.

The rig has now been awarded a one-well contract with Total expected to start in late August and end in late September 2020. The day rate has not been disclosed.

Also in the UK, the Noble Houston Colbert jack-up has been warm-stacked following the completion of a contract with RockRose Energy in April.

Over in Suriname, the Noble Sam Croft drillship has won a contract extension with Apache.

The rig’s option well has been exercised extending the contract to mid-November 2020. The day rate has not been disclosed.

The previously disclosed contract in Vietnam for the semi-submersible Noble Clyde Boudreaux has been cancelled.

To remind, Noble last April said it had won a new gig for the Noble Clyde Boudreaux with an undisclosed operator in Vietnam.

The contract was supposed to start in early June and end in late July 2020, but it has now been cancelled.

The contract includes a termination payment. The rig has now been warm-stacked.

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