The discovery of light crude in the deep waters of Newfoundland has opened a fresh chapter in At- lantic Canada‟s offshore oil and gas industry. In late September 2013, Statoil ASA along with Husky Energy Inc. announced light crude discoveries in the Flemish Pass Basin, offshore Newfoundland. Statoil, which is 67 percent owned by the Norwe- gian government, revealed that it is close to com- mercially develop a trio of discoveries after uncov- ering a field holding between 300 million and 600 million barrels of oil at Bay du Nord in the Flemish Pass which is located 500 kilometers northeast of St. John‟s. The discovery of 34 API gravity oil under 1,100 meters of water is the biggest achievement of Statoil outside Norway and ranks 12 th globally, since 2010. Prior to this, Statoil has already found two wells named Harpoon and Mizzen covering an area of 8,500 square kilometers. Harpoon was drilled in June 2013 but requires additional evalu- ations and data to determine its magnitude, but Mizzen flowed 6,290 bpd of 22 degree API crude, and contained a resource of 100 to 200 million of recoverable light crude. It is being considered as the largest oil discovery off the coast of Newfound- land and Labrador in 30 years. According to the Canada-Newfoundland and Labrador Offshore Petroleum Board (the C-NLOBP), offshore produc- tion in the province is roughly 280,000 barrels of oil per day or about 40 per cent light crude of Canada. (Source: Alberta Oil Magazine Dated: 23rd Janu- ary, 2014) Light Crude Discovery Near Newfoundland overall efficiency improvement in the GTL process. By convert- ing the effluents to a valuable product (power) there is a re- sulting improvement in the GTL value proposition. (Source: www.prnewswire.com Dated: 6th November, 2013) Sasol and GE have together developed new water tech- nology that will clean waste water, while also providing biogas as a by-product for power generation. This new technology, known as Anaero- bic Membrane Bioreactor Technology (AnMBR), will be further developed at a new demonstration plant . Mechanism: AnMBR involves anaerobic micro-organisms that are able to live in envi- ronments devoid of oxygen, such as sediment layers on floors of lakes, dams and the ocean. Sasol currently uses aerobic microbes to treat GTL and coal-to-liquids (CTL) efflu- ents .One of the by-products from the Fischer-Tropsch (FT) process is an effluent stream rich in organic acids and alco- hols. Benefits : The microbes con- vert these organics into a me- thane rich bio-gas which can then be used for power gen- eration. This then results in an Oil & gas newsletter Sasol AnMBR Technology to Boost GTL Value Peak At the peaks Crude Dungeon - Oil Sector at a Glance 2 - 3 Discovery & Innovation 4 - 5 Gas Corner - Gas Sector at a Glance 6 Downstream & Refinery Section 7 Out of Box - Unconventional Sources 8 - 9 Believe It Or Not 10 Public Arcade - Comments from Experts 11 Oil Rig near Newfoundland Volume 01, Issue 01 28th February 2014 Hydrocarbon pectrum - Exploring New Horizons of Petroleum Industry Facts and Figures Www.forbes.com India is the third largest oil consumer in Asia, even though on per capita basis the consumption is mere 0.1 ton per year, the lowest in the region. Of the 26 sedimentary basins only eight have been explored so far. All this makes India the desired destination in terms of opportunities !!!
Transcript
The discovery of light crude in the deep waters of
Newfoundland has opened a fresh chapter in At-
lantic Canada‟s offshore oil and gas industry. In
late September 2013, Statoil ASA along with
Husky Energy Inc. announced light crude discoveries
in the Flemish Pass Basin, offshore Newfoundland.
Statoil, which is 67 percent owned by the Norwe-
gian government, revealed that it is close to com-
mercially develop a trio of discoveries after uncov-
ering a field holding between 300 million and 600
million barrels of oil at Bay du Nord in the Flemish
Pass which is located 500 kilometers northeast of
St. John‟s. The discovery of 34 API gravity oil under
1,100 meters of water is the biggest achievement
of Statoil outside Norway and ranks 12th globally,
since 2010. Prior to this, Statoil has already found
two wells named Harpoon and Mizzen covering an
area of 8,500 square kilometers. Harpoon was
drilled in June 2013 but requires additional evalu-
ations and data to determine its magnitude, but
Mizzen flowed 6,290 bpd of 22 degree API crude,
and contained a resource of 100 to 200 million of
recoverable light crude. It is being considered as
the largest oil discovery off the coast of Newfound-
land and Labrador in 30 years. According to
the Canada-Newfoundland and Labrador Offshore
Petroleum Board (the C-NLOBP), offshore produc-
tion in the province is roughly 280,000 barrels of
oil per day or about 40 per cent light crude of
Canada.
(Source: Alberta Oil Magazine Dated: 23rd Janu-
ary, 2014)
Light Crude Discovery Near Newfoundland
overall efficiency improvement
in the GTL process. By convert-
ing the effluents to a valuable
product (power) there is a re-
sulting improvement in the GTL
value proposition.
(Source: www.prnewswire.com
Dated: 6th November, 2013)
Sasol and GE have together
developed new water tech-
nology that will clean waste
water, while also providing
biogas as a by-product for
power generation. This new
technology, known as Anaero-
bic Membrane Bioreactor
Technology (AnMBR), will be
further developed at a new
demonstration plant .
Mechanism: AnMBR involves
anaerobic micro-organisms
that are able to live in envi-
ronments devoid of oxygen,
such as sediment layers on
floors of lakes, dams and the
ocean. Sasol currently uses
aerobic microbes to treat GTL
and coal-to-liquids (CTL) efflu-
ents .One of the by-products
from the Fischer-Tropsch (FT)
process is an effluent stream
rich in organic acids and alco-
hols.
Benefits : The microbes con-
vert these organics into a me-
thane rich bio-gas which can
then be used for power gen-
eration. This then results in an
O i l & g a s
n e w s l e t t e r
Sasol AnMBR Technology to Boost GTL Value
Peak At the
peaks
Crude Dungeon -
Oil Sector at a Glance
2 - 3
Discovery & Innovation 4 - 5
Gas Corner -
Gas Sector at a Glance
6
Downstream & Refinery
Section
7
Out of Box -
Unconventional Sources
8 - 9
Believe It Or Not 10
Public Arcade -
Comments from Experts
11
Oil Rig near Newfoundland
Volume 01, Issue 01 28th February 2014
Hydrocarbon pectrum - Exploring New Horizons of Petroleum Industry
Facts and Figures
Www.forbes.com
India is the third
largest oil consumer in
Asia, even though on
per capita basis the
consumption is mere 0.1
ton per year, the
lowest in the region. Of
the 26 sedimentary
basins only eight have
been explored so far.
All this makes India
the desired destination
i n t e r m s o f
opportunities !!!
Facts and Figures
NELP Round 10 Offers New Block
ONGC Decided to Invest KG Basin
works. As per the new arrange-
ment the NELP round X would
require bidders to quote the
amount of oil or gas output they
were willing to offer to the gov-
ernment from the day one of
production. The terms and condi-
tions were same as those recom-
mended by the panel, headed
by Prime Minister‟s Economic
Advisory Council Chairman C.
Rangarajan, for awarding future
oil and gas blocks.
(Source:www.oilandgastechnolog
y.ne/, Dated: 6th January 2013)
The Government of India re-
cently showcased 56 new oil
and gas blocks to international
investors and world leaders at
the International Oil and Con-
ference held for duration of
three days from January 12-15
at Greater Noida. These blocks
are to be put on offer during
the tenth round of the New
Exploration Licensing Policy
(NELP).
The Petroleum Secretary Mr.
Vivek Rae had earlier re-
marked that the Ministry would
seek to profile 56 blocks at the
conference. However, the notice
for invitation of bids for auction
of these oil and gas blocks is
expected to be issued next
month. The International Oil and
Conference organized under
the aegis of Petrotech and the
Oil and Natural Gas Corpora-
tion (ONGC) is a biennial plat-
form for national and interna-
tional experts in the oil and gas
industry to share professional
and technical expertise and at
the same front be foretold
about the upcoming challenges
and innovations which could
shape the future of the industry
Oil and Natural Gas Corp (ONGC) will invest over $9 billion in bringing to production an
array of oil and gas discoveries in its prolific Krishna Godavari basin block off the east coast
by 2017-18.
ONGC has made 11 oil and gas discoveries in the Block KG-DWN-98/2, which sits next to
Reliance Industries' KG-D6 Block and Gujarat State Petroleum Corp's Deendayal gas field.
The block is divided into a Northern Discovery Area (NDA) and Southern Discovery Area
(SDA). NDA holds an estimated 92.30 million tons of oil reserves and 97.568 billion cubic
meters of in place gas reserves spread over seven fields The NDA comprises discoveries like
Padmawati, Kanadurga, D, E, U and A.
(Source: Economic Times, Dated: 5th January 2014)
In 2011, Alberta's Total
Proven Oil Reserves
Were 170.2 Billion
Barrels which is about
11 % of Total global oil
reserves (1,523 Billion
barrels) !!!
The State of Alaska
has collected $157
billion (in today's
dollars) from oil since
1959 !!!
Oil Rig in Barmer Region by Cairn
India
India Approves the Policy of Shale Gas Exploration tory minimum work program. They will be permitted three assessment phases of a maximum period of three years each. Royalties and taxes will be payable at par with conventional oil/gas being pro-
duced from the respective areas.
(Source: Hindustan Times, Dated:
24th September 2013)
In an act to bolster energy security The Government of India recently approved the much debated Shale and Oil production policy. The government plans to execute the policy in phases; an approach which gives room for analysis and risk management. Initially the poli-cy is aimed to permit state-run Oil and Natural Gas Corporation (ONGC) and Oil India Ltd (OIL) to explore shale resources from allot-ted inland blocks on nomination bases which were awarded be-fore the advent of the New Explo-ration Licensing Policy (NELP) in
1999 – following which explora-tion blocks are offered on bid-ding and block award basis. In the second phase, the government will offer shale oil and gas blocks to other companies through anoth-er Cabinet approval that is likely
to occur in next few weeks..
The statement issued by the gov-ernment states that NOCs can apply for grant of shale gas and oil rights in their interested PEL/PML acreages and as per an additional requirement will be obligated to undertake a manda-
Cairn Begin Exploration in KG Offshore Block Cairn India is set to begin exploration at a promising offshore block in the Krishna-Godavari basin, next to
its prolific Ravva field on the eastern coast of the country.
In the next quarter, the Anil Agarwal led company will begin seismic shoots (or imaging the earth below by sending shock waves and capturing their reflection) in the KG-OSN-2009/3 block, Chief Executive P Elango told Business Line. Cairn won the 1,988 sq. km block in 2010, in the eighth round of the NELP (New Explora-tion Licensing Policy) bidding of hydrocarbon assets. The Ministry of Defense put a stopper on Cairn‟s plans for the block as it had plans for its own activities in the area. A two-year wait came to an end for Cairn two months back when the ministry, at the behest of the Cabinet Committee for Investments, agreed to let the oil
company go ahead with its plans on one part of the block, which constitutes about 60 per cent of the area.
Cairn told the Ministry of Petroleum and Natural Gas it would surrender the other 40 per cent, provided the latter would correspondingly reduce its agreed “minimum work program” for the block. In the hydrocarbons business, nobody can predict a find unless a company drills and gets to it, but since this block being next to
the „jewel‟ Ravva, Cairn is optimistic.
(Source: The Hindu Business Line, Dated: 9th February 2014)
Exxon Mobil to Boost Acreage in Permian Basin
Exxon Mobil the world‟s largest publically traded oil and gas multinational corporation an-
nounced that it aims to intensify and enrich its U.S. Oil and Natural Gas portfolio ,managed
by its subsidiary -XTO Energy Incorporation .The subject has acquired limelight when pres-
ence of separate agreements by the company in the Permian Basin, Texas and Utica
shale ,Ohio were disclosed. “These transactions underscore our commitment to developing
high-margin liquids growth in areas such as the Permian, while also efficiently funding devel-
opment of our extensive domestic natural gas resource in emerging plays such as the Utica,”
said Randy Cleveland, president of XTO Energy Inc. Through an agreement with Endeavor
Energy Resources, L.P., XTO will fund development to gain substantial operating equity in
approximately 34,000 gross acres in the prolific liquids-rich Wolf camp formation in Mid-
land and Upton counties.
(Source: Oil & Gas Journal, Dated: 18th December 2013)
Exxon Mobil is the
w o r l d ’ s m o s t
profitable company
in 2013.
Over 65 billion
barrels have been
p r o d u c e d f r o m
GhaRwar Oil Field,
Saudi Arab.
Cairn Rig in KG Offshore
Block
Oil Well in North Dakota Out of Control A Whiting Petroleum Corp oil
well in North Dakota was leak-
ing drilling fluids after a blow-
out late on Thursday.
A company spokesman said
that the well lost control after a
blowout preventer failed and
was leaking between 50 and
70 barrels per day of fracking
fluid that contains chemicals,
water and sand.
The leak, close to the frozen
Cherry Creek in McKenzie
County, was contained and the
fluids were being collected and
trucked from the site. No liquids
entered the water.
Fracking fluid is pumped into a well
under pressure to fracture rock
deep underground to release oil or
natural gas. A blowout typically
occurs when an unexpected burst of
high pressure comes up the well,
causing a loss of control.
Measures: They are still trying to
divert what's flowing from the well
into storage tanks and hauling that."
A three-foot berm has been placed
around the well, containing the liq-
Page 3 Volume 1, Issue 1
Recent Oil News
uids within the site.
Risk To Leakage: This large blowout
and also in terms of health and hu-
man risk it's a big one. Pressure and
control of a well is essentially priority
number one for oil and gas compa-
nies. There would be a "very serious
postmortem" conducted with the
company.
(Sou rce : www.reu te rs . co m/
article/2014/02/14/energy-crude-
blowout, Dated: 14th February
2014)
Facts and Figures
Source: www.forbes.com
Pacific Rubiales Unearthing Oil in Peru
Faroe makes small gas Discovery in Norwegian Sea
Pacific Rubiales Oil Corp. has
found oil in the Los Angeles-1X
exploration well on Block 131
of Peru‟s onshore Ucayali basin.
The well reached a total depth
of around12,409 ft. after being
spud in September. Pacific Ru-
biales conducted three sepa-
rate tests across different net
pay intervals in the Cushabatay
formation under swabbing and
natural flow conditions and
through variable choke sizes
over 22-60-hr test periods. Final
flow rates from the three test
intervals were 135 b/d, 936 b/
d, and 2,351 b/d, respectively,
of 44-45° API gravity sweet oil,
the company said. Water cuts
ranged from 10% in the lowest
interval to 0.3% to nil in upper
intervals.
(Source: Oil & Gas Journal,
Dated: 5th February 2014)
Faroe Petroleum has reported of a significant discovery in the Novus exploration well
which is estimated at about 5 to 15 million barrels in oil and recoverable resources. The
field is located about 5 miles south of the Statoil operated Heidrun field in the Norwegian
Sea .the well which was drilled by West Navigator (DW Drillship) which was aimed to
target Jurassic reservoirs, encountered a 39-foot net gas column and a 41-foot net oil
column in a high-quality, thicker-than-expected Garn formation. Faroe confirmed about the
prevalence of a large gas cap reservoir and claimed that the immediate plan of action
would be plugging and abandonment of the field. In addition to this the firm confirmed of
usage of the well to identify and reduce risks in nearby areas and hinted commercial us-
age in the future. The well result would thus offer a favorable geophysical model of the
area and “leads on license” of identical potential drilling models.
(Source: Faroe Petroleum, Dated: 14th January 2014)
world’s top 10 oil
producing companies
(million barrel per
day):
Saudi Aramco - 12.5
Gazprom - 9.7
NIOC - 6.4
ExxonMobil - 5.3
Petro China - 4.4
BP - 4.1
Royal Shell - 3.9
Pemex - 3.6
Chevron - 3.5
Kuwait Petro.—3.2
Oil Discovery by BP & Conoco Phillips
BP PLC made an oil discovery at its Gila pro-spect in 4,900 ft. of water on Keathley Canyon Block 93 about 300 miles southwest of New Orleans in the Gulf of Mexico. The Gila discov-ery, which BP co-owns with ConocoPhillips, is the company‟s third in recent years in the emerging Paleogene trend. Past discoveries in this trend include Kaskida in 2006 and Tiber in 2009 .The well, which penetrated multiple Paleogene-aged reservoir sands, was drilled to a total depth of 29,221 ft.
Sercel launches new 508 XT system A new land seismic acquisition technology has been launched by Sercel recently, the 508XT system, designed to improve crew output, working flexibility and data value. The 508XT system is division of Sercel‟s new genera-tion of state-of-the-art land seismic acquisition systems. It is the combination of cabled and wireless system tech-nologies and integrates various new capabilities. While conducting seismic operations, the 508XT offers crews the ability to record up to one million channels in real time, which leads to better image resolution. It also gives access to data with zero downtime thanks to a new generation of sharp networking technology. Particular fea-tures for local data storage, automatic rerouting, and new levels of redundancy and quality control ensure non-stop production. The 508XT provides a wide range of sensors (1C or multicomponent, digital or analog). Pascal Rouiller, CEO of Sercel CEO, said: “The 508XT steers in a new era for land seismic data acquisition. It presents unparalleled data quality and integrity for continuous, very rapid acquisition. The X-Tech architecture combines the wireless and cabled technologies to commence a new level of acquisition flexibility and operational reliabil-
ity for all types of geographies, climates and environments.”
(Source: www.cgg.com, Dated: 24th September 2013)
Schlumberger Launches Quartet Wireless Downhole
Reservoir Testing System Schlumberger announced the release of the Quartet downhole reservoir testing system enabled by Muzic wireless telemetry, which provides data in real time for validation so that critical information is available to meet the well test objectives. “While working in environments which require high cost such as deep-water, it is significant to be able to interact with downhole test equipments, administer wellbore events and refine well tests in real time,” said Sameh Hanna, president, Testing Services, Schlumberger. “With this new structure capability, clients can manage wellbore events and refine well tests to ensure their objectives are met, and to gain a better perspective of the reservoir.” Wireless bidirectional communication is used by the Quartet system to provide downhole equipment status, and pressure and temperature data, which permits test design changes and validation of test data while reservoir testing is taking place. The system also improves testing efficiency by making probable the isolation, control, measurement and sampling of the reservoir in a single run. Field tests by means of the Quartet system along with wireless telemetry have been run in Egypt, Indonesia, Qatar, Brazil, and Angola in environments varying from onshore to deep-water. A total of 22 reservoir tests have been taken with data from downhole to surface at a 100% communication achievement rate. In Brazil, Petrobras and Schlumberger identified a chance to improve deep-water well test operations using a real-time communication solution on a well in the Presalt Santos basin. As a result of the collaboration, the Quar-tet system with wireless telemetry was successfully deployed, delivering flow and shut-in data to monitor opera-tions and adjust the test course in real time.
(Source: http://subseaworldnews.com/)
Aker Solutions Developed New Stabilizer Arm for Tubular Handling The leading oilfield service
providing company, Aker Solu-
tions, has designed a Casing
Stabilizer Arm (CSA) which could
replace the labor‟s requirement
on derrick for tubular makeup.
This technology is equipped with
stabilizing and non – load bear-
ing mechanism which makes it
safer and productive for tubular
handling in onshore and offshore
rigs.
Design and Working: The CSA
can be installed on offshore as well
as offshore rigs. The stabilizing
mechanism is placed approximately
10 m above the drilling floor and is
incorporated with an internal hy-
draulic cylinder which extends and
closes the padded jaws. This cylin-
der could be operated by radio
remote control.
The arm comprises of 3 hydraulic
cylinders (i.e. lifting, extension and
clamping) to place, assemble and
mobilize the pipe jaws and can be
Page 5 Volume 1, Issue 1
Innovation
Section
equipped in tubular capacities of 2-
7/8” – 22” diameter without chang-
ing the jaws.
Technical Aspects: Rick Comeaux,
(Business Development Manager,
Aker Solutions) claims, “Aker‟s casing
stabilizer arm offers superior perfor-
mance and higher safety features
when compared to similar units”.
(Source:www.oilandgastechnology.
net, Dated: 28th November 2013) Casing Stabilizer Arm
Up of CNG Petroleum minister Mr. M Veerappa Moily announced that all the natural gas distributors will have to show the break-up of the cost of the natural gas provided by the government. Natu-ral gas is the first fuel whose costs break-up will be the first fuel whose cost would be shown to the consumers. This includes the gas provided at the retailers for the automobiles and CGD. Due to rejigged supplies of the natural gas petroleum ministry has been able to cut short the supply of the natural gas by a margin of 14.90 Rs per Kg in price of the CNG and 5 Rs. per Kg in price of the PNG piped natural gas. This cost break-up includes the expenditures since the company receives the gas till the delivery to the consumers and this should include all the taxes like the VAT, other auditable duties, company‟s exercise margin, profit, cost of the supply, equipments, man power etc. All the companies have to comply from 30 April and annually have to provide break-up cost to the petroleum ministry on 30th April. Non compli-ance of the submission of the cost break-up will lead to the cancellation of the license provid-
ed by the government.
(Source: The Economic Times, Dated: 19th February 2014)
New Gas Reserves Found In Jaisalmer Focus Energy has discovered new gas reserves in Jaisalmer in the same block where it had found new reserves in October 2012. The gas reserve found is of very high quality and is found at a depth of 3,161m in an explor-atory well drilled in Shahgarh block. The gas was estimated to have 88 to 91 per cent hydrocarbon. According to officials, the company found gas in nine wells a few days ago in SJL field in RJON/06 in Bachia, Lohar vil-lage in Shahgarh Bulj area. State Mines and Petroleum Minister Laxminarain Dave that the quality was similar to the gas struck at Miano and Swan fields in Pakistan. The flow rate of gas was tested with 900- pressure square inch (PSI) for about an hour and no pressure drop was found, indicating that the well had a large quantity of gas, said the Minister. Research Activities: Mr. Dave said the discovery had shown high prospects of hydrocarbon occurrence in Shah-garh sub-basin and would promote research activities and attract investments in the region. Focus Energy is using modern technology for exploring oil and gas. The firm has also applied to the state government for making new air strip to ferry the experts in charted planes. The testing for reserve estimation was underway by the operator company. Award: The Central Government had awarded the block to Phoenix Overseas and Oil and Natural Gas Corpo-ration (ONGC) in joint venture for an area measuring 5,390 sq. km. The operator company has been carrying out exploration in the block since August 1999. (Source: www.petroleumbazaar.com/explorationnews.aspx , Dated: 3rd February 2014)
Work on LNG Terminal in Chennai is Set to Start Work on the Ennore LNG termi-nal near Chennai port is set to start as the government start the bidding for the 1175 Km pipe-line which will link the terminal to the nagapattinum in south Tamil Nadu this pipeline will pass through the major cities thus providing supply of LNG for the entire eastern part of the Tamil Nadu. The Ministry of Environ-ment and Forests gave its final clearance on February 10 to Indian Oil Corp (IOC) an ap-
proval for a 5-million-ton-a-year LNG terminal, to be set up jointly with Tamil Nadu Industrial Develop-ment Corp. The project will take 39 months to complete and is set to start from April. The project is set to be on 130 acre all of which has been approved except for a few formalities. Petroleum And Gas Regulatory Board has called for the bids of the pipeline so that the link-age is ready till the terminal reach-es its completion and there will be no further delays on completion.
Page 6
Recent Gas News
Gas Corner - Gas Sector at a Glance
Apart from industrial demand, there is also potential to lay a city gas distribution network in all the major towns and cities along the network. The pipeline project also envisages spur lines to link Naga-pattinum-Tiruchi-Madurai with a 242-km line; Nagapattinam-Ramanathanpuram-Tuticorin with a 318-km line; and a separate 290-
Itronics Announces Breakthrough Invention: New Silver Refining Process
galore with a capacity of 1.5 mt. and the third at Padur, with a capacity to store 2.5 mt. and
being built at R993 crore.
Media reports suggest ISPRL is looking at creating additional storage space of 12.5 mt. at various locations in Karnataka,
Orissa, Gujarat and Rajasthan.
(Source: www.finentialexpress.com,
Dated: 13th February 2014)
Hindustan Petroleum Corpora-tion (HPCL) and Mangalore Refineries (MRPL) will lift crude from India's maiden crude cav-erns coming up in Vizag and Mangalore, respectively .These caverns are expected to come up on-stream by the later part of the next fiscal, said LN Gup-ta, secretary, Oil Industry De-velopment Board (OIDB), a body under the ministry of pe-troleum and natural gas which assists oil companies with their
funding requirements.
OIDB, through its fully-owned subsidiary Indian Strategic Petroleum Reserves (ISPRL), is setting up three crude caverns
at Vizag in Andhra Pradesh and Mangalore and Padur in
Karnataka.
Together, these caverns will have a total storage capacity of 5.33 million tons (mt.) and will primarily be used as emer-gency crude stockpiles for the
country.
Out of this, Vizag will have 1.33 mt. of strategic storage and will be built at a cost of 1,038 crore INR. This will be the first to be commissioned and
will be ready by August 2014.
The next will be R732 crore strategic storage space at Man-
Itronics Inc. has announced that it has successfully tested and incorporated a process
termed as “Itromet Silver Refining Process"; a process to recover silver from the iron-
sulphate concentrates and thereby increasing efficiency and reducing cost.
The company has already scaled the process up to the level one and plans full inte-
gration by the next quarter. Benefits of the new process are improved first pass re-
covery, elimination of an intermediate processing step that is now required to achieve
full recovery, and a reduction in glass slag production. The process is also able to
recover virtually all of the gold that may be present in the feed materials and the
process significantly reduces refining cost. Bottom line is a significant improvement in
silver refining economics and productivity. The process is now undergoing test with
several varied feeds and the professionals were quick to comment about positive
results all along.
(Source: www.itonics.com , Dated: 22nd February 2014)
Vitol to pay Shell $2.9 billion for Australian Refinery and Assets trying to cut losses. The deal com-
fortably puts Shell dead ahead
with its aim to have $15 billion of
asset sales in the time period of
two years as set by the New
Chief Executive Ben Van Beurden.
(Source: Bloomberg and the
Australian, Dated: 20th February
2014)
The biggest independent oil
trader the Vitol Group has
agreed to pay $2.9 billion to
Royal Dutch Shell for the
Australian refinery and filling
stations; a move which is seen
by analysts as an act to ac-
celerate asset sales. The Gee-
long Refinery has a process
rate of 120,000 barrels per
day. The move is irked as
result of weak margins in the
fiscal year due to unprofita-
ble shale projects in North
America and low refinery prof-
its. The local community sees the
acquisition as an act to guaran-
tee the functioning of the site
which creates jobs for hundreds
of contractors and caters to
about 50% of Victoria‟s ,25% of
South Australia‟s Oil demand.
The deal is also stipulated to
give control of about 867 filling
stations to the Rotterdam giant.
The acquisition is also likely to
pit Vitol with arch rival Trafigura
while the less nimble majors are
Petroleum Downstream
Page 7
Refinery Section
Volume 1, Issue 1
Geelong Refinery
HPCL & Mangalore Refinery
Facts and Figures
www.Forbes.com
Water Evaporation System Starts Up
Shell Canada & Caterpillar Joint Venture
The SAGD produced water evaporation system which was awarded to Veolia wa-ter solutions in 2010 get started. This sys-tem is now the largest operating system in Alberta. This system is able to treat a ca-pacity of 40,000 bbl. of water per day. Configuration of this system comprises of three high pressure evaporators. This pro-vides the benefits of removing the silica which can acts as a potential foulant in the pipelines. As of its starting the Veolia sys-tem is operating on capacity less than the full potential but will reach its maximum
operating capacity till the mid 2014 as the production via the SAGD will reach its nameplate capacity. Veolia water solution and technologies is the subsidiary of Veolia which specializes in the water treating project the sub-sidiary owns this evaporation system and has recorded a revenue of 3.1
billion $ in 2013.
(Source: New Tech Magazine, Dated:
3rd January 2014)
Shell Canada and Caterpillar which is the leading manufacturer of the mining equipment
have ventured together to test a new engine a fuel mix using liquefied natural gas which
will help them to reduce the cost and the environmental concern via reduced emissions
from the oil sand mining in the northern Alberta. Caterpillar will leverage its experience
with LNG in other applications and will continue development work to design and build a
fully integrated mining truck which will replace the diesel powered engines. Caterpillar
will test its truck in the Fort McMurray. This trial follows a trend for shell in looking at op-
tions for utilizing the resources of natural gas present in the Canada. The testing of the
trucks will begin in the early 2016 which will last up to a year while the shell Canada will
test its exiting trucks by replacing with the new engines.
(Source: New Tech Magazine, Dated: 22nd January 2014)
Industry has yet to
develop 7,000 drilling
permits: The U.S. Bureau
of Land Management
recently testified in
committee that the oil
and gas industry has
a b o u t 7 , 0 0 0
undeveloped permits
where industry has a
green light to drill.
Red Leaf Secures Permit for Oil Shale Red Leaf Resources Inc. has announced that it has cleared the regulatory hurdle and is going to launch the first commercial scale oil shale production in North America. Michael Binnion, president and chief executive officer of Questerre the partner company of the Red leaf said that they are very pleased that red leaf has secured the necessary regulatorty ap-provals and they will the first to begin the field work. Red leaf currently hold the oil shale lease on school trust lands in Utah, which will be developed under a joint venture with French energy conglomer-ate TOTAL S.A. Red leaf has additional oil shale leases on land leased in Wyoming, which will be developed under a joint venture with Questerre. Oil shale is sometimes confused with the shale oil but the shale oil is necessarily to be obtained from the shale rock while the oil shale referred to the kerogen rich which is converted to crude by means of application
of heat.
(Source: www.newtechmagazine.com, Dated: 21st
December 2013)
Out of Box - Unconventional Resources
Page 8 Hydrocarbon Spectrum
Oil Section
Water Evaporation System Using SAGD
Oil Shale Rock
Oil Sand Mining
Scenario of Shale gas bloom in United Kingdom After the sudden gas bloom in the States the analysts had imagined that a sin-
gle handed monopoly would carve in but it‟s UK which has been grabbing the
headlines for the subject quite some time now. On an assistive and gratifying
move to the investors The UK Government has made clear its strong support for
the rapid development of the UK shale gas industry, hurrying through various
legal and fiscal measures to support the industry and taking a hard line against
attempts by European legislators to introduce new European-wide regulation of
the sector.in an identical move it has been announced that Total has been grant-
ed two independent licenses to operate in Northern England. In June 2013, the
British Geological Survey estimated the gas in place within the Bowland Shale of
central Britain to be within the range of 822 TCF to 2281 TCF, with a central
estimate of 1,329 trillion cubic feet (37,600 km3).over the years number of
companies have recorded sizeable discoveries such as IGas Energy , Cuadrilla.
Thus the picture seems comforting with claims that to cater to tangibl profits to
the investors.
(Source: BBC News, Dated: 26th February 2014)
Japan Claims Big In the Gas Hydrates Japan made landmark progress in 2013 in methane hydrate development carrying
out the world‟s maiden offshore production test and confirming the presence of the
substantial amount of methane in the sea of Japan in the northwest part. “we will be
able to commercialize methane hydrate in the next 10 years and for commercializa-
tion, we will need to enhance the reliability and stability” said Ryo Minami, director
of the petroleum and natural gas division of the agency for natural resources and
energy at the ministry of economy, trade and industry. Japan has been in research
for more than a decade and is finally able to produce an amount of 20,000 m3/
day. This could be seen as the next step towards the development of the resources
as gas hydrates are a good of methane and are present in abundance all over the
world but their production has been a matter of concern but with positive outcomes
like Japan, world could get fuel for the forthcoming years.
(Source: www.platts.com, Dated: 30th December 2013)
Dart to acquire East Kalimantan CBM block in Indonesia The pioneer company Dart Energy Interna-tional Pte. Ltd., Singapore, plans to initiate work in mid to late 2013 on the 411 sq. km Bontang Bengalon coalbed methane block in the central Kutei basin in East Kalimantan, Indonesia. Three core wells and one pilot well are planned in the exploratory work program in the first 3-year period. production shar-ing contract of 30 year period is expected to be signed within 1 to 2 months. Dart is going to operate Bontang Bengalon with a 100% working interest. Bontang LNG facility is nearby to the southern part of the two-part block and the northern part is 62 km north of that facility and close to the Sangatta West PSC in which Dart is a net 24% participant
and joint operator. Bontang Bengalon is considered as highly prospective given the significant explorato-ry and pilot appraisal work undertaken on the neighboring Sangatta West block, where CBM reserves and commercial viabil-ity have already been developed. Dart said the local market has substantial need for gas, including the Bontang LNG facility. (Source: www.naturalgaseurope.com, Dated: 10th February 2014)
Page 9 Volume 1, Issue 1
Gas Section
Bontang LNG Facility, Indonesia
Methane Hydrate or Clathrate
Shale resource estimation by British Geological Survey
Invasion in Kuwait by Iran The massive Rumaila oil field situated on the border of Iraq and Kuwait and is shared by the two countries. Rumaila has recently been in news later than the compromise to develop the Iraq side of the field was awarded to a BP-led consortium. However, it strike the headlines for all the false motives back in 1990 as accusations of Kuwait by the use of slant- drilling techniques to „steal‟ oil from the Iraq side of the field was used as an excuse by Saddam Hussein‟s regime to begin the invasion of Kuwait that led to the first Gulf
War.
Relations between the two countries were frosty to the point of freezing in the lead up to the invasion due to furious argument over US $40 billion loans that Kuwait gave to Iraq during Iraq-Iran war. Kuwait rejects to release the debt which led Iraq to promise to repay the money by increasing the price of oil through OPEC production cuts. However, Kuwait decided to increase the production of oil thus preventing an increase in oil
prices. This resulted in a loss of US $14 billion in a year in oil revenues. So, at 2AM on 2nd August 1990.
Iraq invaded Kuwait which caused several environmental losses and 600 oil wells were set alight while re-
treating Iraqi forces.
(Source: http://www.arabianoilandgas.com/)
Door To Hell Also called as Darvaze, meaning “gate” is a natural gas field in Derweze, Ahal province Turkmenistan. The
Door to hell is legendary for the natural gas fire that is continuously burning inside it since it was lit by Soviet
petrochemical scientists in 1971.The fire is fed by the rich natural gas deposits in the nearby area.
The field is situated near the Derweze village in the middle of karakum desert which is 250km north of Ash-
gabat. The gas reserve which is present here is one of the largest in the world. The name „Door to Hell‟ was
given by locals due to the fire, boiling mud and orange flames in the Derweze‟s large crater of Diameter 70
meters. The hot spot ranges over an area of 60 meters and a depth of 20 meters.
The site was first discovered by soviet scientists in 1971. It was considered to be a substantial oil field site. A
drilling rig was installed and drilling was started to access amount of natural gas. After finding the natural
gas soviet‟s started storing the gas which led to the collapsing of entire rig area. Large quantities of me-
thane was released which was becoming a disaster for the environment. The scientists let the gas burn and
anticipated that it will burn out In few weeks but from 1971 till now 2014 it is still burning!!!
Deep Water Horizon Oil Spill Also known as BP oil spill, the BP oil disaster, the gulf of Mexico oil spill, and the Macondo Blow-out started on 20 April 2010 in the Gulf of Mexico on the British Petroleum operated Macondo Prospect. It is claimed as the largest disaster happened in history of oil and gas industry, approximate of 8% to 31% largest than previous largest, the lxtoc 1oil spill. This was followed by the explosion and sinking of Deep-water Horizon Oil Rig, a sea floor oil gusher flowed for 87 days, until it was restricted on 15 July 2010. The government
of United States estimated the total discharge of 4.9 million bar-rels (210 million US gallon that is 780,000 m3). After various failed attempts the well was finally sealed on 19 September 2010, according to some reports the well is still leak-ing. A massive response ensued to protect beaches, wetlands, and estuaries from the spilled oil with the help of skimming ships, floating booms, controlled burns and 1.84 million US gallons of Corexit oil dispersant. In 2013 Al Jazeera reported that the Gulf ecosystem was „in crisis‟ citing a turn down in seafood catches, deformities and
Page 10
Hydrocarbon
Trivia
Believe It or Not
lesions found in fish. In Louisiana 4.6 million pounds of oily material was removed from beaches in 2013 which was just double than collected in 2012.Various investigations explored the causes of the spill, the US govern-ment 2011 report pointed to the use of defective cement on the well, fault-ing mostly BP also Rig operator Trans-ocean and contractor Halliburton. As of February 2013 various settlements and penalty payments to a trust fund had cost company around $42.2 bil-
“VE” to “VAVE” for Reducing Project Cost Value Engineering (VE) is a step wise analytical technique to determine whether any item of cost can be reduced or eliminated without com-promising on function and quality of a product. As the name surmises, VE was found to bring benefit to the organization. A scope existed on analyzing the VE steps, which can bring about further improvements. Additional steps were introduced which modified the VE step sequence,
and yielded much more benefits than that of VE.
Value Engineering (VE) was modified for maximizing worth by improving the functions desired by the consumers at an incremental cost and for reduc-ing unnecessary cost or avoiding such costs. It can be applied in all industrial applications and to a certain extent consumer goods also, and this is
how „MOVE‟ (Modified Value Engineering) was born.
VE identifies substitutes in present goods, services, and equipments, without compromising on function and quality mission statement built in. Compa-
ny‟s make change in top management to give impetus to growth and organization. Also time is focused and results are clear.
In VE- diagnostic journey, perusal of product gets eliminated during Group Discussion. Ideas are generated and silly ideas are encouraged. Stealthy slippage of errors, wastages, mistakes are identified analyzed and evaluated. Also are analyzed the symptoms and causes of symptoms testing theories. In No Value Addition Activity, any activity still remaining (though normally gets eliminated) is fixed with magnitude and expunged after
micro analysis.
Audit contributes to the effectiveness of VE, whereas comparative analysis gives effectiveness of VE and modified VE. Various stages in a Project are: Concept/ Conceptualization, Draft feasibility report; Fixing consultant, Final feasibility report; Critical examination of the project report, Com-pany approval; PFD/P&ID preparation, Tender, Bid evaluation; Tendering, Bid evaluation and award of contract; Construction and erection, Pre-
commissioning and start up; Commissioning and performance test, Handing over to client.
METHODOLOGY OF APPLICATION OF ‘MOVE’ IN THREE PROJECTS OF ONGC
Application of MOVE was used in three projects of ONGC Ltd. Each one of the 13 stages in project planning are applied, the 12 steps of MOVE (the appropriate steps of MOVE relevant to a particular stage of project). The deviation and impact (by way of delay cost and time) of this deviation, if any, were found out/calculated for all the above steps of MOVE for each of the three projects. The impact in terms of monetary gain or loss were
summarized, analyzed and presented.
Modified Value Engineering – Application – (Project 1 of ONGC Ltd Hazira): Capacity Enhancement of Kerosene Recovery Unit (KRU) – from 1.07
MMTPA to 1.45 MMTPA (was being implemented then).
Possible GAIN 25.3 Crore INR; Avoidable Loss 34.6 Crore INR
Modified Value Engineering Application--(Project 2 of ONGC Ltd Hazira): Initial
Commissioning of KRU 1.07 MMTPA (was already executed and was in operation).
Possible GAIN 7.6 Crore INR; Avoidable Loss 52.2 Crore INR
Modified Value Engineering Application--(Project 3 of ONGC Ltd Hazira): Aviation
Turbine Fuel (ATF) from KRU (was to be executed in 6 - 12 months).
Possible GAIN 2.6 Crore INR; Avoidable Loss 1.9 Crore INR.
Public Arcade - Comments from Experts
Page 11
Petro Articles Section
VE Phases MOVE Phases
Orientation Phase Orientation Phase
Information Phase Information Phase; Mission and modified mission statement phase
Function Phase Function Phase; Diagnostic and remedial journey phase
Creative Phase Creative Phase; No value addition activity phase
The application of „MOVE‟ benefits your organiza-tion and business, and as a first step „MOVE‟ can be applied not only to projects but also in services, con-tracts and purchases, administration and decision making. An awareness of the importance of the ap-plication need to be created amongst the masses. People need to be trained and should be prepared to innovate. Training need to be restructured so that an emphasis is given on application techniques.
„MOVE‟ to „VAVE‟ reduces project cost.
Prof., Department of
Petroleum Engineering
& Earth Sciences, UPES
About Us
‘Hydrocarbon Spectrum’ Newsletter is founded by
the B. Tech students of University of Petroleum &
Energy Studies, Dehradun. The main objective of
this newsletter is to provide a digital collection of all
oil and gas sector news, editorials and articles in one
newsletter. This will help all oil and gas sector pro-
fessionals to update themselves without loosing time
