Drilling & Completion News

Transocean Norge Wins Six-Well Contract With Equinor

Equinor has awarded Transocean a contract for drilling six wells on the Norwegian Continental Shelf (NCS) by use of the Transocean Norge semi. Drilling start-up is scheduled for summer 2019. The rig has also been awarded a contract option for drilling four additional wells and is intended for subsequent continuing options.

In a previously signed agreement with Equinor, the Transocean Spitsbergen semi was the company’s first rig to be included as per the framework agreement terms. The Transocean Norge will be the second. The contract backlog is approximately $89 million, excluding a bonus opportunity and other services.

In separate news, Transocean has also entered an agreement to acquire Ocean Rig in a transaction valued at approximately $2.7 billion.

The transaction, which is expected to be completed during Q1 2019, is subject to the approval of both Transocean and Ocean Rig shareholders and the satisfaction of customary closing conditions.

West Hercules to Drill Barents Sea Exploration Wells

Seadrill Norway has been awarded a contract to drill two exploration wells for Equinor in the Barents Sea by use of the West Hercules semi. The contract includes options for nine additional wells, and drilling is scheduled to start in spring 2019.

The contract is based on a master framework agreement between Seadrill and Equinor. The rig owner is responsible for integrated drilling services, such as casing running, remote-operated vessel, slop treatment and cuttings handling.

Rowan Announces New Contracts for 2 Jackups

Rowan Companies announced that the Rowan EXL III, an EXL-class high-specification jackup, has been awarded a six-month contract from Cantium in the US Gulf of Mexico.

The company also announced that the Rowan Norway has been awarded a two-well contract in the Mediterranean Sea by Turkish Petroleum, with an estimated duration of 100 to 140 days. The contract is expected to commence in late 2018. The Rowan Norway is warm-stacked in the UK sector of the North Sea.

Siccar Point confirms Cambo Well Test Success

On 23 August, Siccar Point Energy announced it had concluded well testing operations on the 204/10a-5 appraisal well in the Cambo field, northwest of Shetland. A vertical pilot hole was initially drilled, confirming more than 100 ft of oil column and a higher-than-anticipated net pay of 58 ft. The results of the well will be incorporated into the Cambo field development plan, with the well also being suspended for use as a future development well.

Exxonmobil Adds Ninth Discovery Offshore Guyana

ExxonMobil has made its ninth discovery offshore Guyana at the Hammerhead-1 well, marking its fifth discovery on the Stabroek Block in the past year. Hammerhead-1 encountered approximately 197 ft of high-quality, oil-bearing sandstone reservoir. The well was drilled to 13,862 ft depth in 3,773 ft of water. The Stena Carron drillship began drilling on 27 July 2018.

Hammerhead-1 is located approximately 13 miles southwest of the Liza-1 well and follows previous discoveries on the Stabroek Block at Liza, Liza Deep, Payara, Snoek, Turbot, Ranger, Pacora and Longtail. Those previous discoveries led to the announcement of an estimated recoverable resource of more than 4 billion oil-equivalent barrels discovered to date, and the potential for up to five floating production, storage and offloading (FPSO) vessels producing more than 750,000 bbl/day by 2025.

A second exploration vessel, the Noble Tom Madden, was due to arrive in Guyana to accelerate exploration of high-potential opportunities and will commence drilling at the Pluma prospect, approximately 17 miles from Turbot.

Nicklos Drilling Set To Move Into Permian With 4 Rigs

Gulf Coast-based Nicklos Drilling is preparing for its entry to the Permian Basin with the purchase of four rigs from Cyclone Drilling. To assist with this expansion, the company has brought onboard Roland Smith as Senior Vice President, said Jim Nicklos, President of Nicklos Drilling.

“I feel like the company has been reborn,” Mr Nicklos said, noting that sluggish activity levels in the Gulf Coast region over the past few years almost had him considering retirement. “But now it’s a whole new energy around here.”

Nicklos Drilling signed the first of four rigs in mid-September and is preparing to mobilize the rig from Gillette, Wyo. All four rigs to be moved into the Permian will be equipped with walking systems, 7,500-psi pumps, iron roughnecks and automatic catwalks. Once the first rig mobilizes, the company will begin upgrades on the remaining three rigs, Mr Nicklos said, likely mobilizing them in late 2018 and into early 2019.

Encana To Sell San Juan Assets to DJR Energy

Encana Oil & Gas has reached an agreement to sell its San Juan assets, located in New Mexico, for $480 million to Denver-based DJR Energy. Encana’s San Juan assets include approximately 182,000 net acres. In 2017, the assets delivered an average production of approximately 5,400 bbl/day of oil equivalent, including 3,900 bbl/day of liquids.

Maersk Integrator Wins 1-year Contract with Aker BP

Maersk Drilling and Aker BP have agreed to a one-year contract to deploy the Maersk Integrator jackup on the Norwegian Continental Shelf. This is the first rig to be fully contracted under the scope of the alliance among Aker BP, Maersk Drilling and Halliburton. When the jackup finishes its current campaign on Gina Krog in June 2019, it will go directly to Ula for a new one-year assignment with Aker BP.

The tripartite alliance was announced last year and focuses on working in collaborative relationships that maximize value for all parties involved. This is established in contracts using a shared incentives model, thereby securing mutual commitment to reduce waste and deliver value. The contracts are based on market-rate terms but add the possibility of a sizable upside for all parties, based on actual delivery and performance.

In separate news, Maersk Drilling has also signed a contract with Aker Energy for the Maersk Viking. The ultra-deepwater drillship will drill the Pecan-4A appraisal well offshore Ghana. The contract covers one firm well with an expected duration of 30 to 35 days, with options for additional wells. The contract is expected to commence in Q4 2018. The rig is warm-stacked in the Gulf of Mexico and will soon commence its voyage to Ghana.

Pemex, Block 7 Consortium Sign Pre-Unitization Agreement

Pemex has signed a pre-unitization agreement with Talos Energy, as operator of the Block 7 Consortium, which also includes Sierra Oil and Gas and Premier Oil. The agreement relates to certain tracts within the Amoca-Yaxche-03 allocation, assigned to Pemex as part of Round 0, and the contiguous Block 7 production-sharing contract, assigned to the consortium by the National Hydrocarbons Commission as part of the first tender of Round 1. Both areas are situated in the offshore portion of Mexico’s prolific Southeast Basin.

This is the first pre-unitization agreement to be signed in Mexico. Under the country’s revamped legal and regulatory framework, this two-year agreement enables information sharing related to the Zama discovery and its potential extension into Pemex’s neighboring block.

All blocks Acquired in Brazil’s 5th Pre-Salt Bid Round

Brazil’s 5th Production-Sharing Round, held on 28 September by the National Agency of Petroleum, Natural Gas and Biofuels (ANP), had all four blocks acquired: Saturno, Titã, Pau-Brasil, and Sudoeste de Tartaruga Verde. The round raised R$6.82 billion in signing bonuses and R$1 billion in planned investments on the exploration phase. The goodwill of the profit oil offered was 170.58%.

In the Santos Basin, the 35-year production-sharing contract for the Saturno block went to Shell and its bid consortium member Chevron. With the addition of the Saturno block, Shell increases its total net acreage off the coast of Brazil to approximately 2.7 million acres.

The Titã exploration block, also in the Santos Basin, went to ExxonMobil and co-venturer Qatar Petroleum. The block added more than 71,500 net acres to ExxonMobil’s portfolio, expanding the company’s total position in the country to approximately 2.3 million net acres.

The Pau-Brasil block in the Santos Basin went to BP Energy, Ecopetrol and CNOOC Petroleum. In the Campos Basin, the Sudoeste de Tartaruga Verde block went to Petrobras.

“It was the first production-sharing round with more than one block on offer to have 100% of the areas acquired,” ANP Director General Décio Oddone said. “With today’s goodwill, which averaged 170%, our expectation of raising royalties and taxes over the 35 years of the contracts rose from R$180 billion to R$240 billion.”

Noble Buys New Jackup From Paxocean Group

Noble has purchased a new Gusto MSC CJ46 design jackup rig from the PaxOcean Group in connection with a concurrently awarded drilling contract.

Noble paid $33.75 million of the $93.75 million purchase price in cash, with the remainder of the purchase price seller-financed. The company also has an option for the purchase of a second newbuild CJ46 jackup from PaxOcean.

The newbuild, to be named the Noble Johnny Whitstine, can operate in water depths of up to 375 ft and drill up to 30,000 ft. A modern drilling control system and 70 ft-by-40 ft envelope cantilever skidding system equipped with two blowout preventers contribute to the rig’s enhanced drilling capabilities.

EIA: US is World’s Largest Crude Oil Producer

The United States likely surpassed Russia and Saudi Arabia to become the world’s largest crude oil producer earlier this year, based on preliminary estimates in the Short-Term Energy Outlook (STEO) from the US Energy Information Administration (EIA). In February, US crude oil production exceeded that of Saudi Arabia for the first time in more than two decades. In June and August, the US surpassed Russia in crude oil production for the first time since February 1999.

The EIA expects that US crude oil production will continue to exceed Russian and Saudi Arabian crude oil production for the remaining months of 2018 and through 2019. US crude oil production has rapidly increased since 2011. Much of the recent growth has occurred in the Permian region, the Federal Offshore Gulf of Mexico, and the Bakken region.