Week in review
Multinational 
ISTANBUL, March 25, 2017 – The past week had it all; new projects coming on stream, a slew of EPC contract awards, divestments and financial figures. The past week also saw Ghana make its debut on TOGY’s business intelligence, strategic communications and networking platform TOGYiN. As such, we begin our week in review in Ghana.
TechnipFMC has been selected as project manager for construction work on the onshore receiving facilities associated with Ghana’s Offshore Cape Three points project. In a statement on its website on Tuesday, the engineering major said it would be carrying out supply, construction and commissioning works for Eni Ghana E&P, a joint venture vehicle comprising Eni, Vitol Upstream Ghana and Ghana National Petroleum Corporation.
Later that week, GE Oil & Gas opened a services centre in Ghana that will underpin the company’s work on deepwater offshore projects in the country. GE will be supplying equipment, ranging from turbines to centrifugal compressors, for the Eni-led Offshore Cape Three Points project as part of an USD 850-million contract awarded earlier in March. The new facility’s 1,600-square-metre testing grounds allows for the simultaneous examination and testing of three subsea trees.
Located in Takoradi Port, the new site has 4,000 square metres of storage space available. GE will also be providing training of the Ghanaian workforce on site. Over the next five years, the company plans to achieve 45,000 training hours.
Iran powers on
Iran has begun producing oil from the South Pars Oil Layer, an official from the National Iranian Oil Company (NIOC) said on Sunday. The oil layer lies in the same area as the super-giant South Pars gasfield, but is developed separately.
While the field falls under Pars Oil and Gas Company’s mandate, Petroiran Development Company and the Iranian Offshore Oil Company have taken leading roles in aspects of the project such as the installation of Iran’s first FPSO, Cyrus.
The asset is now producing from seven subsea wells connected to the FPSO and has a target of 35,000 bopd in its first phase, which officials expect to reach within a week.
That same day, SK Engineering & Construction said it had won a USD 3.6-billion deal to build and operate power plants in Iran. A deal under which the South Korean company will purchase 30% of Turkish energy company Unit International was announced on Sunday. SK E&C will build and operate five gas-powered plants as part of the deal. The plants are expected to have a combined capacity of 5 GW.
Permian push
A week in review wouldn’t be complete with news on Texas’ red-hot Permian basin. Marathon Oil Corporation will acquire an additional 85 square kilometres of Permian acreage, the Houston-based entity announced on Tuesday, having reached an agreement with Black Mountain Oil & Gas. The deal, which also includes a number of private sellers, will see Marathon pay out USD 700 million in cash. Ninety-five percent of the bolt-on acreage is in the Northern Delaware basin. Combined with the USD 1.1-billion purchase of 283 net square kilometres earlier in March, Marathon’s Permian footprint will be expanded to around 365 square kilometres.
Meanwhile, Kinder Morgan Texas Pipeline (KMTP) aims to capitalise on the projected increase in natural gas production across the Permian basin with a new pipeline project.
The Kinder Morgan subsidiary on Wednesday proposed to build a 692-kilometre gas pipeline from the area near Waha, Texas, to Agua Dulce, located some 55 kilometres to the west of Corpus Christi. The bidding for use of the 42-inch pipeline, designed to transport the equivalent of some 48.1 mcm (1.7 bcf) of natural gas per day, will be open until April 20, KMTP concluded.
Celebrations at Eni
Eni held its naming ceremony for the Jangkrik floating production unit (FPU) in Indonesia on Tuesday, marking the start of the vessel’s journey to the Muara Bakau PSC area. Once moored and hooked-up in the Makasar Strait, the unit will be connected to 10 deepwater production wells. First gas is scheduled for June. The 14,300-tonne FPU can process and export up to 12.7 mcm (450 mcf) of natural gas per day. In the future, it will also serve as hub for the Merakes discovery in the neighbouring East Sepinggan Block.
On the other side of the world, Eni completed drilling the Amoca-2 well in Mexico’s Contract Area 01, located in the shallow waters of the Southeastern Basins,
Drilled to a depth of 3,500 metres, the well reached a net oil pay of 110 metres, the super-major announced Thursday. About 65 metres of the oil pay was located in a deep reservoir and is light oil. The rest, with oil gravity of 18 degrees API, was discovered in a shallower Pliocene reservoir. Drilling began in January 2017.
Eni is now planning to continue its USD 245-million appraisal programme, which includes the drilling of Amoca-3, Miztón-2 and Tecoalli-2 in 2017.
Chinese struggles
Sinopec will take Chevron’s 75%-stake in several assets in South Africa and Botswana, the Chinese group said on Wednesday. The transaction, valued at almost USD 1 billion, lands Sinopec its first African refinery, a 100,000-bpd facility in Cape Town, as well as a lubricants plant in Durban. The deal also includes more than 800 petrol stations, 220 convenience stores and other facilities.
The past week also saw several Chinese entities post disappointing full-year 2016 financial results. Sinopec Engineering, Sinopec’s subsidiary specialised in building chemical plants and refineries, reported a sharp drop in 2016 profits on Monday. Revenue was down 13.5% year-on-year to CNY 39.4 billion (USD 5.71 billion) while net profit, at CNY 1.66 billion (USD 241 million), was about half that in 2015, largely on account of a slide in demand for chemical plants using coal, the group said in its annual report.
China Oilfield Services (COSL) posted its full-year financial results on Wednesday, announcing a drop in revenues on account of lower activity. COSL said it had dipped into the red in 2016, posting a loss of CNY 11.5 billion (USD 1.7 billion) compared with a profit of CNY 1.1 billion (USD 160 million) over 2015. Revenues fell from CNY 23.7 billion (USD 3.44 billion) in 2015 to below CNY 15.2 billion (USD 2.21 billion) last year.
China’s CNOOC posted its worst annual report in years on Thursday, with revenue for 2016 down 17% and profit, at USD 92.3 million, just a small fraction of the USD 2.93-billion profit in 2015.
Farewell to onshore
Shell on Friday announced it had reached an agreement with Carlyle Group unit Assala Energy Holdings on the sale of its onshore assets in Gabon.
The transaction, valued at USD 587 million, will see Shell divest both fields and related infrastructure. The company will not only let go of the five fields it operates, Rabi, Toucan/Robin, Gamba/Ivinga, Koula/Damier and Bende/M’Bassou/Totou, but also sell its participation interests in Atora, Avocette/M’Boukou, Coucal and Tsiengui West.
The associated infrastructure it is shedding includes the Rai-to-Gama pipeline system and the Gamba Southern export terminal. Production from Shell’s onshore Gabon assets averaged 41,000 bopd last year.
Pipe down
Canadian pipeline operator TransCanada received a presidential permit from the US administration on Friday to proceed with the controversial Keystone XL Pipeline, international media reported. Keystone XL is an extension of the existing Keystone Pipeline that links Canada’s oil sands in Alberta with refineries and ports in the central USA and Gulf Coast region. A 36-inch-diametre pipeline is planned to run 1,897 kilometres and carry as much as 830,000 bopd of crude oil from Canada through the US states of Montana, South Dakota and Nebraska.
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