Offshore Asia

Japan's Deal with Saudi Aramco to Store Crude Oil

2011-03-14T15:09:00.000+07:00

Japan has signed a deal with Saudi Aramco allowing the country to increase the utilisation of its oil storage facilities, and will give the Saudi Arabian company increased access to oil storage in the lucrative Asian market.

A deal between Japan and Saudi Aramco will allow the state-run Saudi Arabian company to store crude oil on the southern archipelago-province of Okinawa. The deal follows a similar agreement with Abu Dhabi in mid-2009. Faced with declining oil demand, Japan has a rising surplus of storage capacity, allowing it to use storage deals to increase utilisation while improving energy security.

The deal between Saudi Aramco and Japan will start in 2011 when the first vessel, which will have a capacity of 1.9mn barrels (bbl), is scheduled to arrive at Okinawa. On the deal, Saudi Aramco will be allowed to store about 600mn litres in Okinawa, equivalent to 3.8mn bbl. The deal will run for three years, in order to allow Japan to restock its crude oil reserves.

Aim of Aramco is to establish storage bases in or near major Asian consuming markets in order to be able to meet spikes in demand quickly. Japan's proximity to China, the engine of global oil demand growth, is crucial in this respect. A storage-sharing deal will also benefit Japan. Its oil demand is declining, with the trend exacerbated by the impact of the global economic crisis, leaving it with surplus storage capacity. Not only will crude stocks from Saudi Arabia raise its storage utilisation rate, but Japan will also have priority access to the stocks in emergencies. Allowing Aramco to stockpile crude at Okinawa will therefore contribute to Japanese energy supply security, a major concern for the government.

The partnership with Saudi Arabia follows a similar agreement with UAE in June 2009, when Japan and the UAE signed a deal to allow the Abu Dhabi National Oil Company (ADNOC) to store crude oil in the Kiire oil terminal operated by Nippon Oil. Also, Japan has first rights to the stocks in emergency situations. As long as Japan maintains its priority access to tap the crude and products stored by third parties in the country in the event of a supply shock, joint storage deals with Middle Eastern producers can be of strong mutual benefit.

The enactment of the Oil Stock Law (1975) established that Japan had to be prepared for disruptions to oil supply. In 1978 the government authorised Japan Oil, Gas and Metals Corporation (JOGMEC) to regulate national oil storage levels. The government maintains a Strategic Petroleum Reserve (SPR), which includes 10 state-controlled storage facilities managed by JOGMEC. Furthermore, the state leases tanks from the private sector to boost its strategic reserves capacity. As well as government-managed reserves, Japanese law obliges private companies to stockpile oil products to cover a mandatory 70 days of their consumption, equivalent to around 308mn bbl in 2009.

Petronas See More Oil And Gas In Water Resources

2011-02-22T10:23:00.000+07:00

With the increasing oil prices, Malaysia through the sale of oil revenues will also be increase. And recently, Petronas has found 2 more blocks that have the potential to produce oil in Block SK316 and SK306.

These discoveries support Petronas’ strategy to intensify exploration activities in Malaysia and is expected to further enhance exploration potential offshore Sarawak.

In Malaysia there are the National Depletion Policy of limiting production at the 600-700k barrels / day. The aim is that the point of production can be maintained in time for 15-20 years. The United States also is a major oil producer and a major importer as well. In 2009, an average of U.S. issued a 5.268M barrels / day and net imports of not less at 10.5M barrels / day.

Which means, from the reasons given Malaysia has been using more oil than the amount of oil released. Just as "budget deficit" we are now, used by more than ability.

But in terms of history, exploration Petronas is never broken. Always keep doing exploration work throughout the world through multinational companies.

The following are some of the exploration activity of Petronas:

In Kelantan, 1 oil block has been successfully explored together with Thailand (Carigali - PTTPI Operating Company).
In Kerteh, exploration by Petronas in Block West Ladder Platform has just sail out of the Pasir Gudang & Moss.
The first platform in Kerteh Filter A is still the most expensive product & priced in the world than in the 70s until now.
While the first Paltform Petronas West Lutong in Miri still have more production from the Petronas was established.
This is new in the waters of Malaysia has yet to venture outside, such as Petronas Sudan, Vietnam, Qatar, UAE, Myanmar is known for the high cost of petroleum.
If the oil fields in Malaysia will be depleted Petronas will not renew the contract with ExxonMobil for the purpose of exploring for the past 50 years. Petronas will not dare to take over TCOT (Trengganu Crude Oil Terminal) from ExxonMobil, LCOT (Labuan) from Shell, Bayan, D-18, D-35, Block PM-9 (Pulai & Tinggi).
Murphy Sarawak Oil has already been explored for more than 10 blocks to be developed.

The issue here can manage treasury "black gold" that held all this time with the best?

China Hunts Energy Fields

2011-01-13T21:15:00.000+07:00

China continues to pursue the fields in different parts of the world's energy sources to meet domestic fuel demand over the high rate of economic growth.

Chinese national oil producers increasingly keen to buy shares of oil companies of the world. Not just an asset, even to spend enough in order to obtain the technology to extract resources that are difficult to reach. Chinese oil companies also continue to comb the emerging markets to continue to bid in 2011, and probably until near the United States (U.S.).

Diesel, petrol and gas demand in China increased by about 8 percent each year. Chinese oil demand will peak in 2025. To meet these needs China's energy companies seem to be racing to buy the world's oil reserves. The year 2010 was the record high oil and gas acquisitions made by Chinese who reached an agreement worth U.S. $ 24.3 billion, larger than in 2009 was only U.S. $ 17.1 billion.

Largest China's deal is undertaken by the Chinese Government-owned oil company Petrocemical acquire 40 percent stake in Repsol Brazilian assets worth U.S. $ 7.1 billion. This suggests China to expand to South America. This purchase is the largest purchase compared with other countries over the past year. This also indicates that China is willing to pay more than the market expected.

Chinese oil companies continue to diversify its source - the source of hydrocarbon. And they have excess jurisdiction where U.S. and European oil companies have been politically difficult to reach agreement in Sudan, Myanmar, Iran and Syria.

They also can extend the hunt until the Gulf of Mexico, where independent companies tend to release their assets there because of increased insurance costs and increasingly stringent regulations after an explosion at BP's refinery Macondo in April last year which resulted in the largest offshore oil spill in U.S. history. China's giant energy company, CNOOC also has purchased a small share of offshore oil projects in the Gulf owned by Norway's Statoil.

Given that three-quarters of world exploration company headquartered in the U.S., the Chinese tend to bid for U.S. firms. All the objectives of the acquisitions would lead China to North America within the next two years.

CNOOC in 2005 never to bid against California Unocoal, which then failed after some U.S. lawmakers oppose the deal on the grounds of national security. However, in 2010 CNOOC successfully acquire oil and gas assets in the project Eagle Ford Shale in South Texas for U.S. $ 1.1 billion.

One - an attraction for Chinese energy companies are buying these projects using new technology that could extract energy from unconventional sources like oil sands or gas trapped in coal. The project is attractive to Chinese buyers because they provide an opportunity not only to collect hydrocarbons only, but also to learn new technologies to develop the potential of China's large gas reserves.

Chinese state-owned enterprises, Sochem Group is buying 40 percent stake in Peregrino, offshore Brazil from Statoil worth U.S. $ 3.07 billion in May 2010. Although there may be no oil to be sent to China after a successful production next year. But they traded with the local product state energy company that operates outside the country.

Chinese enterprises are also increasingly competing among one another and not the state that determines the winner. So the likelihood of success in the auction of a property abroad is determined by their own.

2 Japanese Rigs Ready to Enter Indonesia

2010-12-27T11:37:00.000+07:00

Two units of the ship supporting activities offshore, type jack-up rig from Japan will go to Indonesia and changed the flag to be Indonesian flag. Ships that fall into category C, this could undoubtedly be able to be provided by the national employers so that the operational restrictions on foreign vessels associated with certain types of cabotage principle extended to May 7, 2011 from earlier on January 1, 2011.

The company is Japan Drilling Company which currently operates at least six units, including jack-up rig, are ready to work in Indonesia. Both of rig will go to Indonesia to follow the rule that requires all marine transport fleet in the country must use ships in Indonesian flag.

Owner and President Director of PT Pelayaran Tamarin Samudera-that explains the company is currently finalizing the plan by looking at the implementation of Law no. 17/2008 on Shipping.

The Japan Drilling Company (JDC) is known to the company that provides specialized services to companies drilling for oil and gas in the sea around the world. JDC currently operates the ship offshore jack-up rig types as much as three units, two units of semi-submersible rigs and one drilling ship. The company has worked more than 40 years in drilling.

Jack-up rigs are operated by company is iu kuryu-10 made in 2008, Sagadril-1 (1984) and Sagadril 2 (1984). The two units are semi submerible rig Naga-1 (1974) and Hakuryu-5 (1977), while the drilling ship named Chikyu (2005).

Previously, jack up rigs operator in Indonesia, PT Apexindo Pratama Duta Tbk known to make the turn flag rig his ship as many as three units of six fleet currently operated. The company has completed three units to replace the flag of rigs operating in Indonesia, while the other three are still in the process.

Disclosure of information will facilitate the national entrepreneurs to provide the ships needed as soon as possible. Shipping Law Revision coercion which was not yet 3 years old can be a bad precedent.

Plan a number of national shipping companies to expand the fleet of offshore supply sector, large-scale FSO type allegedly hampered because the procurement of oil and gas operators that are not transparent.

Pertamina Toward A World Class Oil & Gas Company

2010-12-15T14:57:00.000+07:00

Pertamina effort to manifest itself toward the world-class oil and gas company is not just a dream following the company's performance in the upstream and downstream sectors continues to increase. These state enterprises face many challenges as well as hope.

The challenge is how to Pertamina's efforts in realizing the vision of the company's world-class oil and gas as well as to improve its performance as a company a competitive state. Pertamina was born by Government Regulation No 27/1968 as a result of the merger of three oil companies, namely Pertamin, Permigan and Permina.

Ibnu Sutowo was appointed as its first director. Through Law No. 8/1971, Pertamina defined as a state-owned oil and gas company which means all the companies running their business in Indonesia must cooperate with Pertamina, both as the regulator and through cooperation contracts in the working area of Pertamina. Pertamina also acts as an operator because it managed its own working areas.

Driven surge in world oil prices, Pertamina had a golden period in the mid-1970s in which the company posted profits of Rp382, 2 billion. The amount is equivalent to 39% of total state revenues in the budget in the same year. One thing that never happened throughout history, one capable of economic sectors accounted for more than a third of total state revenue. Indonesia was transformed into one of the oil-producing country a respected world.

However, that era has passed. Pertamina is now facing various challenges. In terms of reputation, Pertamina left behind from Petronas, which formerly learned to Pertamina. Meanwhile, Pertamina still trying to get up, Petronas has entered the ranks of giant world oil and gas version of Platt and Fortune magazine.

In terms of economic performance, Pertamina also lagged. Based on the survey of Energy Intelligence, 2008, Pertamina was ranked the 30th as oil and gas company that has a net profit and total assets of the world's largest, while Petronas is ranked 18th world. Petronas even have opened outlets in Indonesia.

Pertamina effort to realize the vision of world-class companies actually been initiated since 2008 and, even in 2006 when the transformation of Pertamina triggered. Pertamina target in 2018, the company became the number one oil company in Southeast Asia. Pertamina intention to manifest itself as a world class company is not kidding. Pertamina is now different, stretching the country's current business is very promising and increasingly aggressive and expansive.

Pertamina will remain the largest oil and gas producer in Indonesia, given Pertamina performance so far does show fantastic results. In the downstream sector, until September 2010 Pertamina's oil production has reached 191,000 barrels per day (bpd) and is targeted to break the 200,000 bpd in 2011.

This figure is much higher when compared with oil production in 2009 is an average of 150,000 bpd. The key to success exceeded the production target because Pertamina has successfully acquired a number of oil and gas companies operating in Indonesia. Pertamina managed to acquire BP's Offshore West Java, including working with the NOC such as BP. Pertamina also acquired assets of Inpex West Java in September 2010.

Not only expansive in the country, the company also started to spread to other countries. Through Pertamina Upstream Energy (PHE), since 2007, Pertamina has been exploring Block SK-305 drilling off the coast of Sarawak, Malaysia, in collaboration with Petronas and Petro Vietnam. This block is predicted to have oil reserves of 541 million barrels and natural gas as much as 1.91 billion cubic feet. On the field, the PHE holds 30% stake.

In addition to SK-305, PHE also has several other blocks such as Block 17-3 and Block 123-3 in the whole Libyan-owned by the PHE. Block 17-3 is estimated to have reserves of 3.5 trillion cubic feet of gas and block 123-3 has 427 million barrels of oil reserves. PHE also pocketed a 10% stocks in Block 10 and 11.1 in Vietnam. In the block, PHE works with Petronas, Petro Vietnam and Quad Energy.

In addition, PHE also has Block 13 in Sudan and Block 3 in Qatar. On the domestic upstream sector, Pertamina, through its subsidiary Pertamina EP, also recorded remarkable achievements. As of January 2010, Pertamina EP managed to produce 130,000 bpd of oil, an increase compared to January previous year (year on year), which amounted to 125,000 bpd. Although the increment is not too fast (about 2.5%), but that achievement should be appreciated in light of the decline in the capacity of oil fields are naturally quite high which is an average of 18% per year.

Field of the central well of Pertamina EP is Java Region with a range of production 25,000 bpd, 19,000 bpd of Sumatra, 32,000 bpd Sukowati field, and Business Unit Limau with 12,000 bpd. Other fields varies between 2,000 to 10,000 bpd. Pertamina EP is the second largest oil producer after Chevron with total profit in 2009 more than Rp20 trillion (not taxed) or equivalent to 80% of the total income of the parent company.

Since established in 2003, the company that was born as a consequence of changes in the status of Pertamina into this company did show satisfactory performance from year to year. In 2003, Pertamina EP's production amounted to 95,000 bpd and jumped to around 102,000 bpd in 2006. This production continues to increase to 110,300 bpdbpd (2008). By the end of 2009, Pertamina EP has exceeded the production target of 125,500 bpd.

For natural gas sector, the average production of Pertamina EP in November 2009 amounted to 1,050 million cubic feet per day. Of these, 28% supplied to the National Gas Company (PGN), 22% to meet the needs of industry, 18% for the fertilizer industry, 18% for power supply, and 14% more to the needs of Pertamina refineries. According to data from the Ministry of Energy and Mineral Resources, Pertamina EP is the largest domestic gas supplier in Indonesia after Total Indonesia.

In the downstream sector, Pertamina also do not want to be whiz at home. Since 2006, Pertamina lubricant has been exporting products to several countries including China, Pakistan, Japan, Singapore, Australia, Malaysia and Cambodia with an average volume of 80,000 kl per year with an average export value of USD240 million per year. In addition to maintaining its market share above, the company also co-branded with local companies, including in Pakistan, Belgium, Qatar, Singapore, and Thailand.

Aviation fuel production of Pertamina has also been recognized internationally. Pertamina is working with airports has been supplying aviation fuel to Singapore, Jeddah, Dubai, Bangkok, Hong Kong and Kuala Lumpur. Not only that, the General Fuel Filling Station owned by Pertamina plans to expand into neighboring countries. In the near future, Pertamina will soon open the first retail outlets in Australia. As a result, various efforts to expand upstream and downstream sectors in the above led to bigger profits.

In 2006 the profits from state enterprises ranging from Rp19 trillion, then rose in 2007 to Rp24,5 billion and rise again in 2008 to Rp30,2 trillion. Based on data from Forbes Global 2009 and LKPP RI 2008, Pertamina is the state with the largest profit of Rp30,2 trillion, followed in second place with earnings of PT Telkom Indonesia Rp14 trillion. The increase in corporate profits in line with the increase in dividends paid to the state.

Performance as indicated Pertamina upstream and downstream sectors in the above shows that what Pertamina aspired to achieve world-class oil and gas company is not just a dream. Since the change of status of Pertamina into a company as stipulated in Law No. 22/2001 on Oil and Gas and followed by Government Regulation No. 31/2003 concerning Amendment to Form a company Pertamina, Pertamina is better. However, behind the various successes, Pertamina still has some homework to be completed.

Pertamina must minimize the cost recovery oil and gas production and more keen anticipation of external factors, especially international oil prices. Both of these affect to Pertamina business and profitability in the upstream sector. As is known, cost recovery resulting from Pertamina's production process is still relatively high. Pertamina's cost recovery during the period 2004-2006 an average of USD27 per barrel.

It is not particularly felt when the international oil price is constant in the range of USD100 per barrel, but it would be very detrimental if oil prices slumped. No less important, as a profit-oriented company Pertamina also have to maintain the quality in every product and services to suit customer satisfaction. For example, applying the standard dose at all filling stations, LPG cylinders to prevent the circulation of counterfeit, fake or lubricants on the market. All the above services must be considered because it deals directly with the daily life of people so of course directly affects the image of Pertamina.

BP Migas Supports The Acceleration of Oil Exploration Program Pondok Makmur

2010-12-10T15:40:00.000+07:00

Pertamina EP discovered new oil and gas reserves. Results of the fifth delineation well test (PDM-5) in the area of Pondok Makmur, Bekasi, managed to produce 3600 barrels of oil per day and 5.7 million cubic feet of gas. The result is a production test wells in the largest openings conducted from 1 January 2010.

This success complements previous success in the area of Pondok Makmur, which has been done put on production (POP), which takes oil production from exploration wells.

Pondok Makmur is a new exploration concept of Pertamina to produce oil from the most basic layer or basement. This concept is now to be evaluated and developed carefully, and be aggressive effort Pertamina EP to acquire new oil and gas reserves that is able to be produced quickly.

Acceleration of drilling program at Pondok Makmur not be separated from the support of BP Migas, which has approved work program and budget (WP & B) prior to fiscal year 2010 run, as well as the cooperation of local government of Bekasi who strongly supports the operation of Pertamina in the region.

PDM-5 wells to reach the final depth of 3450 meters that penetrate bedrock marble or similar to a depth of 2918 meters final. Until now the area of Pondok Makmur has produced three wells, the PDM-1, PDM-2 and PDM-3 through a pattern of POP over a total average oil production of 1900 barrels per day and 5.5 million cubic feet of gas. Production was deliberately maintained at a level not too high to maintain reservoir pressure given the wells are still in the status of exploration wells.

Pertamina EP will also be producing wells PDM-4 which is now in the evaluation stage to present a POP proposal to BP Migas.

In 2010, Pertamina EP aggressively carry out exploration drilling of 26 wells with the target of exploration in various regions and the implementation of the 1345 km2 of seismic surveys are three-dimensional (3 D) and 721 km survey of two-dimensional (2 D). During 2009, Pertamina EP, produced 46.4 million barrels of oil and found 60 million barrels of oil. That is, oil discovery of Pertamina EP exceeds the amount produced.

EP Pertamina's oil production target in 2010 of 128 thousand barrels per day and continue working hard to improve the growth of production in the next year. Although this step is not easy considering the majority of field conditions that have been classified as old and natural production decline rate on average is very large: by 18 percent.

OGDCL is Inviting Partners for Gas Development in Jhal Magsi

2010-12-06T16:07:00.000+07:00

Oil and Gas Development Company Limited (OGDCL) is inviting tenders for building a gas processing plant in Jhal Magsi. The Jhal Magsi Field is located about 5 KM North East of Jhal Magsi Town, District Dera Murad Jamali, Baluchistan Province.

The initial production from the proposed gas processing plant will be around 15 million cubic feet per day (mmcfd). There are proven gas reserves from two wells while three others are being drilled. The field has high contents of H2S, requiring removal before gas is injected into the transmission network.

Experts predict the possibility of oil being found in the same lease block and the OGDCL may soon give the nation good news in this regard. Although there is little information about the Jhal Magsi gas field in the public domain, the reserves may be larger than a number of existing fields in Sindh, Balochistan and Khyber-Pakthunkhwa.

The company expects the Zin Block in Baluchistan to generate its first gas flows within two years. The Zin block is estimated to have about 9-10 trillion cubic feet (TCF) of gas reserves and we are moving in the area in a couple of weeks to start drilling.

The government is playing down the Jhal Magsi discovery for political reasons. Independent economists hope that Jhal Magsi reserves will help bridge the domestic demand and supply gap. The local industry, already reeling under the effects of excessive power outages, will also get some benefit.

There are also bright chances of finding oil and gas reserves in the Bolan block, particularly in a hilly track near Dhaddar. Foreign firms are engaged in exploring oil and gas in this part of Balochistan. The federal government is providing adequate security to firms exploring oil and gas in this block.

OGDCL and other companies are facing difficulties in carrying out oil and gas exploration in Marri and Bugti tribal territories for political reasons as local tribesmen are demanding full control over their resources.

The people of the area are not prepared to gave Pakistani or foreign companies to exploit there resources only for few jobs they want to be the master of their lands and they must decide on which conditions their natural resources should be exploited, are not prepared to abandon their opposition to Western exploration companies operating in the province, fearing that they will ultimately take over control of their lands.

Almost all companies exploring oil and gas in the Marri and Bugti regions had stopped working after attacks on their officials by Baloch militants.

Qatar Petroleum Sets Offshore Gas Exploration Bids in Early 2011

2010-12-02T15:42:00.000+07:00

Qatar Petroleum (QP) is calling for bids for offshore gas exploration to be submitted in early 2011, people familiar with the auction said. The company is the state run energy company in the country with the world’s third largest gas reserves. Bids for rights to explore for gas off the coast of the Arabian Gulf state in an area called block A are due on January 9.

The country, which is the world’s biggest exporter of liquefied natural gas and is the single largest supplier of liquefied natural gas, plans to increase gas output to 23 billion cubic feet a day by 2014 to boost exports and provide fuel for domestic industries and power plants.

Qatar has offered exploration rights to three companies over the past two years. A joint venture between Royal Dutch Shell and China National Petroleum Corp signed a 30 year exploration and production sharing agreement in May for block D. The deal, which includes a five-year exploration period, covers onshore and offshore exploration for natural gas and its production in Qatar Block D. Cnooc Ltd of Hong Kong signed a 25-year agreement with Qatar Petroleum in August 2009 to search for gas in a separate offshore block.

The country expects by early next year to increase its annual capacity for exporting liquefied natural gas to 77 million tons, equivalent to about 3.75 trillion cubic feet of pipeline gas, with the completion of its final planned liquefaction plant. Qatar's future growth may lie in construction of sub-sea pipelines to oil-rich neighbours, which are desperate for gas for energy-intensive economies but reluctant to pay market rates for it.

Development Contract of Natuna D Alpha Completed 90%

2010-11-30T15:23:00.000+07:00

Indonesian Government and PT Pertamina has completed 90% related matters Natuna D Alpha block development. Targeted this year, signing contracts 70% block that contains CO2 gas reserves that can be performed.

Natuna is expected to be completed in the near future, and the process of completing the Natuna which has been relatively easy, to say the almost 90% complete.

Team Energy and Pertamina trying to accomplish things that hang over the Natuna with the best of it. In principle, put forward the national interest so that natural resources can be developed, but the agreement obtained also benefit the state.

Natuna Block Development requires high technology and large amounts of funds and unable to give results in the short or medium term. However, PT Pertamina will get an indirect result of his cooperation with other production sharing contract (PSC).

Until now, the number of potential partners Pertamina has been pursed to 5 from eight PSC at first. The government officially appointed Pertamina in developing the Natuna D Alpha block.

Natuna D Alpha block is located approximately 250 km from the Natuna Islands. The reserves are very large, estimated at 46 trillion cubic feet. But to develop the Natuna Block is not easy because 70% of its gas reserves contain CO2. Thus, the necessary advanced technology for the removal, disposal, and storage of carbon dioxide because CO2 can not be discarded carelessly. Investment required is also not small, estimated at about U.S. $ 52 billion.

A week ago, the government asked Pertamina to immediately deliver the elected partners to government. It is expected that elected name partners to be announced soon.

Regarding the elected partner of Pertamina, the state government gives the right to Pertamina to select more than one partner. Based on the study of Wood MacKenzie Ltd, a consultancy based in Edinburgh, Scotland, who was appointed Pertamina, there are eight multinational oil companies that fit into prospective partners Pertamina in Natuna Block. The eight world-class companies are ExxonMobil Corp., Royal Dutch Shell plc, Total SA, Chevron Corp., Statoil, China National Petroleum Corp (CNPC), Petroliam Nasional Berhad (Petronas) and Eni SpA.

Second Phase of Iran-Turkmenistan Gas Pipeline

2010-11-29T16:12:00.000+07:00

Iran and Turkmenistan started the second section of gas pipeline which will help Turkmenistan diversify exports away from Russia and boost Tehran's ambition to bypass foreign sanctions by becoming a gas hub.

The $1.2 billion has been invested in the project. A 500-kilometer long pipeline with a diameter of 48 inches began operating earlier this month and will eventually double Iran's imports of Turkmen gas to 20 billion cubic meters a year.

The first phase of the 1024km pipeline came on stream in January 2010 to deliver gas from the Turkmenistan's Dovletabad field to Iran's Khangiran refinery.

The second nationwide north and northeastern gas transport pipeline and the second section of the second Iran-Turkmenistan gas transport pipeline connects Iran's gas network to six neighboring countries: Iraq, Turkey, Pakistan, Turkmenistan, Armenia, and the Republic of Azerbaijan, as well as Persian Gulf.

Despite having the second largest gas reserves in the world, Iran's own production of 600 million cubic metres per day barely meets domestic consumption. Also, Iran is the world's fifth largest oil exporter.

At a ceremony in the Iranian border town of Sarakhs, Iranian President Mahmoud Ahmadinejad told an audience which included Turkmen leader Kurbanguly Berdymukhamedov that he hoped for closer energy ties with Turkmenistan. Iran are ready to extend cooperation toward the implementation of whichever choice they make in regard to their gas.

Iran has been hit by United Nations, US and EU sanctions over its disputed nuclear program, which the United States and its allies say is a cover to build bombs. Iran says its nuclear work is aimed at generating electricity. By increasing imports from Turkmenistan, Iran hopes it can export more of its own gas and become a regional hub for gas.

"In May the country needed around $25 billion a year in oil and gas industry investment to meet its target development goals because sanctions have frightened away international energy firms", Iran's Oil Minister said.

The Sarakhs-Tehran pipeline would also allow Iran to become a regional "gas hub," by increasing its gas swap capacity with neighbours and having Central Asian gas transit through its territory to Europe.

The geographic and geopolitical position of Iran for exporting, transiting and swapping energy to east Asian and European countries will make the country the regional gas hub in the future.

ONGC Makes Joint Bid With PetroVietnam for BP Asset

2010-11-27T12:25:00.000+07:00

The Indian government plans to buy BP's stake in Vietnam's largest gas project as the company plans to sell several of its assets to meet the rising cleanup costs of the Gulf of Mexico oil spill. BP announced its plans to pull out of Vietnam as part of a US$30bn divestment drive aimed at raising funds to pay for the Macondo oil spill cleanup and associated liabilities demanded by U.S.

For this purpose, state-run explorer Oil and Natural Gas Corporation (ONGC) will make a joint bid with Petrovietnam. Vietnam as a geography will be simple for investments and ONGC knows the geology of the area.

This ONGC's efforts to acquire BP's Vietnamese assets would be a welcome step forward for India's international growth strategy, which has been slowed by stiff competition from China for foreign oil and gas assets.

ONGC is in the process of evaluating BP's assets, after which it will make a joint bid with PetroVietnam. The valuation process to be completed within a few weeks. It is expected that the OVL-PetroVietnam effort would be successful, as its stake in the Nam Con Son project gives it pre-emption rights over that block and, in spite of earlier reports indicating potential Russian interest in the assets, the company is the only one in active negotiations.

ONGC has a 45% share in Block 6.1 in the Nam Con Son basin, off Vietnam’s southeast coast, operated by BP, which has a 35% stake. The remaining 20% is owned by state-run Petrovietnam. These two fields contain estimated reserves of 58bn cubic metres (bcm) and are producing 4bcm per annum on average. Gas from the Nam Con Son fields is transported via a 400km pipeline to two power plants in the Ba Ria-Vung Tau province. BP operates the pipeline in partnership with PetroVietnam and ConocoPhillips.

For the India state-run company it would mark a much-needed success in its drive to acquire oil and gas assets abroad. Indian companies have repeatedly found themselves outspent and outmanoeuvred, particularly by China's large state-owned companies, in the search for international assets which the country needs to keep up with soaring domestic demand. State-owned Chinese companies spent US$32bn acquiring energy assets in 2009 with to a sole US$2.1bn acquisition by ONGC. ONGC will no doubt be hoping that buying BP's Vietnam assets will mark the first of more successful asset acquisitions.

Oman Gas Company Sets Up Supply Gas to Shadeed

2010-11-24T16:27:00.001+07:00

Oman Gas Company (OGC), the major gas company in Oman, added Shadeed Iron and Steel LLC in its list of customers. Shadeed Iron and Steel is a state of the art facility based in Sohar, one of many established in recent years to take advantage of the industrial area's strategic location and vital gas and water supplies.

OGC gas pipeline network is spread across the country with more than 2300 kilometers of high pressure transmission pipelines and ancillary facilities covering Fahud, Muscat, and Sohar in the north and from Saih-Rawl to Salalah in the south of the country.

In Shadeed's case, OGC undertook construction of a dedicated high tech supply station and 7.3 kilometers 16 pipeline. This project features the latest technology including pressure meters that monitor constantly within a + 1%t accuracy. Shadeed are now one of the Sultanate's most important natural gas customers, requiring some 1.4 million standard cubic meters per day.

For Shadeed, it was important that they be able to deliver a constant pressure of between 31 to 35 bar. To meet the requirement they had to design the whole supply station and pipeline, the metering and control systems to ensure that any variability in the supply would be well within these limits. They are looking to more than double capacity from their initial output.

Shadeed Iron & Steel hopes to benefit from the Sohar industrial area's easy supplies of gas, water and power and adjacent deep water loading facilities, to gain a competitive business advantage. The Company has also recently successfully completed two months ahead of schedule the commissioning of the new upgraded low pressure streams of Oman Cement Company (OCC) gas supply station. The upgraded low pressure stream having capacity 1.2 million standard cubic meters per day comprising control valves, enginery based flow metering system, UPS, ESD valves, new piping and associated modification in existing control systems.

This project has total cost about OMR 2 million. Oman Gas Company now supplies over 32 customers across the Sultanate including recent industrial additions like Shadeed, Salalah Methanol and the public water and electricity services. The Sultanate's vital natural gas supply is carried over a network of some 2,500 kilometers that OGC has upgraded and expanded to meet the needs of its customers.

Iraq Oil Reserves Jumped Over Iran’s

2010-11-22T11:27:00.000+07:00

Iraq increased the proven oil reserves with new data suggesting its proven oil reserves have reached 143.1 billion barrels of oil, up from a previous 115 billion barrels. The new figure of oil represents a 24-percent increase, the first update since 2001.

It would mean Iraq has the world's second largest reserves according to statistics on the OPEC website. Iraq would take second place from Iran, which has 137.01 billion barrels of proven reserves, but would still be far behind Saudi Arabia, which has 264.59 billion barrels of proven oil reserves, according to OPEC data.

These were the results of deep surveys carried out by the ministry's oil reservoir company and international companies which signed contracts with Iraq. Most of these figures were the result of surveys conducted by these international companies, specially at oil fields such as West Qurna and Zubair.

Iraq has signed 12 deals with international oil companies to ramp up output capacity to about 12 million barrels a day from around 2.4 million barrels a day. Iraq now had 66 oilfields, including seven supergiant fields. Total, BP, Shell, Exxon Mobil, Lukoil, Eni, Japan Petroleum Exploration and China National Petroleum Corp., have signed on to develop Iraq's vast oil fields.

The largest Iraqi oil field was West Qurna, with total proven oil reserves of 43 billion barrels, making it the second biggest oilfield in the world. West Qurna is divided in two--Phase 1 and Phase 2. Exxon Mobil led a consortium won a deal to develop Phase 1, while Lukoil to develop Phase 2.

BP and CNPC are developing Rumaila, the second-largest Iraqi oil field. It has total proven reserves of 17 billion barrels. Shell won the right to develop Majnoon, comes third with proven reserves of 11 billion barrels of oil.

71% of Iraq's total oil reserves are located in the southern Iraqi governorates, particularly in Basra. Some 20% of the reserves are in northern governorate particularly in Kirkuk, while the remaining 9% are located in central Iraq.

The new reserve figure doesn't include the semi-autonomous region of Kurdistan in northern Iraq. The region's authorities have estimated reserves in their Kurdistan region to be around 40 billion barrels.

Iraq depends on crude oil exports for 95 percent of government revenue, and is trying to upgrade outdated infrastructure and spur economic growth after being crippled by decades of conflict and sanctions.

The ministry will update Iraqi oil reserves on yearly bases from now on, expects the reserves to increase.

GAIL is Top Ranked Gas Utility Company in Asia

2010-11-20T13:08:00.001+07:00

GAIL (India) Limited operates as a natural gas company in India and internationally. The company has been ranked no.1 company among gas utilities in Asia in the Platts Global Ranking of Energy Companies. This is the first time ever that the company has bagged the number one position amongst gas utilities in Asia.

GAIL also improved its previous rank of fifth by inching up four notches. In the 2010 rankings, GAIL moved past heavyweights like Tokyo Gas, Osaka Gas Co., Hong Kong & China Gas, Korea Gas Corp.

The award was conferred upon GAIL on 2nd November 2010 at a glittering ceremony held in Singapore to celebrate Asian winners in the Top 250 list of Platts.

The Company has also been ranked second among gas utilities globally. This year it moved 3 notches higher than its previous ranking from fifth to second among all gas utilities globally.

Among energy companies, which include companies other than gas utilities also, GAIL has been ranked 22nd in overall performance in the Asia region.

The Platts Top 250 recognizes outstanding financial performance for the previous year amongst listed energy companies. Platts assessed the world’s top performing energy companies on a combination of Asset Worth, Revenues, Profits and Return on Invested Capital and ranked 250 Top scorers.

GAIL was founded in 1984 and is based in New Delhi, India. GAIL is integrating all aspects of the Natural Gas value chain (including Exploration & Production, Processing, Transmission, Distribution and Marketing) and its related services.

The company rankings, in Asia and globally, are across various industry categories such as Coal and Consumable Fuels, Diversified Utility, Electric utility, Exploration & Production, Gas utility, Independent Power Producer, Integrated Oil and Gas, Refining and Marketing and Storage and Transfer.

The World's Biggest FPSO is Launched by Hyundai Heavy Industries

2010-11-18T15:42:00.001+07:00

Hyundai Heavy Industries (HHI) has launched the world’s biggest floating production storage and offloading (FPSO) ship for Total’s Usan field off Nigeria. The Usan FPSO can refine 160,000 barrels of oil and 5 million cubic metres of gas daily, which has storage for 2 million barrels of oil. HHI said the FPSO will sail out for Nigeria following trial runs in South Korea.

This FPSO has 320m long, 61m wide, 32m high and weighs 116,000 tons. It is preferred in the offshore industry as they are easy to install and do not require pipelines to export oil and gas.

The three-dimensional simulation during module installation to assess risks and drydock loading of four sets of topside modules are a paradigm shift in the industry, shortening construction time by up to a month and increasing reliability and worker safety.

Usan FPSO will sail out for the Usan Field at the end of March 2011. Usan Field is located 100km south of Port Harcourt, Nigeria. The Usan Field was discovered in 2002 and began development in 2008 with Total as the operator. Development drilling commenced in June 2009, and production startup is projected for 2012.

HHI has 10 supersize FPSOs, each with 2 million barrels or more storage capacity, for oil majors worldwide since1996. Currently, HHI has a 60% market share in the burgeoning supersize FPSO business.

For more than three decades HHI has been accomplishing things thought to be theoretically and scientifically impossible. These accomplishments are due to the company's unwavering determination and endless efforts. The company is an integrated heavy industries company with business divisions specializing in shipbuilding, engine and machinery, offshore and engineering, industrial plant and engineering, electro electric systems, and construction equipment.

China-Myanmar Oil and Gas Pipeline Projects

2010-11-15T16:45:00.001+07:00

Economic and population growth raised the energy consumption in China and has turned China into a net oil importing country. Natural gas usage in China has also increased rapidly in recent years, and China has looked to raise natural gas imports via pipeline and liquefied natural gas. For this, China needs to diversify its energy sources, and in this context Myanmar provides some important solution they need to ensure the diversity and stability of energy supply. There are several aspects that established Myanmar's important position for China. The first aspect is Myanmar's position in Southeast Asia. As Middle East and Africa provide oil supply for China, China needs to secure the access of its oil and gas supply. Southeast Asia is an important area for China to provide quick & reliable access of oil and gas.

If China could build a pipeline from the Bay of Bengal via Myanmar to China, the cost will be cut dramatically. Myanmar's strategic location on a tri-junction between South Asia, Southeast Asia and China is economically and strategically significant. The oil from Middle East and Africa could be transported by this pipeline without passing the Southeast Asian countries, except Myanmar.

The Trans Myanmar-China pipeline is a multi billion project for China's state own company, China National Petroleum Company (CNPC), to carry oil and gas to China. The oil and gas pipeline will cover a length of 793 kilometres within the borders of Myanmar while the oil pipeline will cover a length of 771 kilometres from Kyaukpyu, about 400 km northwest of Yangon, to the Yunnan Province in China. The oil pipeline design capacity is 2200 tons/year, and the gas pipeline capacity on gas transport 12 billion cubic meters/year.

Oil and gas pipeline projects within the entry section, the pipeline to reach through Guizhou, Chongqing, Guizhou to Guangxi by the gas pipeline. Domestic natural gas pipelines segment length 1727 km, 1631 km long oil pipeline route.

This project is a multibillion dollar project as according to CNPC, the cost of the oil line will reach $1.5 billion and the gas line will be $1.04 billion. This multibillion dollar project will provide a designed transport capacity of 22 million tons per year for oil, while the natural gas pipeline a designed for a transport capacity of 12 billion cubic meters annually. China will also import the crude oil that it brings from the Middle East and Africa via these pipelines, which commence at Burma's Kyaukpyu deep seaport off the country's western coast and cross the country to China's Yunnan Province, enabling it to bypass the sea route through the piracy-prone Strait of Malacca.

The projects within the section started, the entire project is scheduled to be completed in 2013.

New Exploration and Production (E&P) Sharing Agreed by Qatar Petroleum, Shell and China Petroleum

2010-11-13T11:58:00.000+07:00

Signed in Doha, Qatar Petroleum and Royal Dutch Shell Group (Shell) and the China National Petroleum Corporation (CNPC) agreed a new exploration and production sharing agreement.

The three parties will cooperate of D block natural gas exploration. At D block there is a total of 8089 square kilometers land in Kataerhai within, near to Ras Laffan City.

The Block D concession is for pre-Khuff geological intervals. The overlying Khuff layer contains large northern gas field. D Block license extends to the northern part of the underlying field.

Valid for 30 years, the agreement includes the first exploration period of five years, where in this period Shell and China Petroleum will be conducted technical studies, two-dimensional and three-dimensional seismic data acquisition, processing, re-processing and interpretation, and play operations such as exploration wells.

As operator, Shell will hold 75% stake, and China Petroleum holds the rest. Shell and China Petroleum and Qatar Petroleum will be under the supervision of the exploitation of natural gas. Under the agreement, Qatar Petroleum will buy all the D block may be output of natural gas.

This new agreement is part of Qatar Petroleum's plan seeks to increase of their carbon. Hydrogen resource reserves to enhance oil and gas production potential, and further enhance the economic strength of Qatar. Qatar Petroleum also prepared the recent pre-Khuff gas exploration tenders again.

Shell is the development of Qatar's proven natural gas resources of the main investors. The agreement made full use of Shell in the area pre-Khuff formation of experience and exploration of oil in Qatar in Qatar unparalleled expertise.

At UAE, Exxon Plans to Develop The Massive Offshore Upper Zakum

2010-11-11T21:00:00.001+07:00

Exxon Mobil Corporation plans to build four artificial islands in the Upper Zakum oil field off Abu Dhabi that could result in cost savings of several billion dollars. Home to a staggering 50 billion barrels of proven crude.

Beneath the waters off the coast of Abu Dhabi lies one of the world's largest oilfield. About 50 miles northeast of the emirate's capital, an estimated 50 billion barrels of oil sit below the sea.

The Upper Zakum field is made up of layer upon layer of complex reservoir. On the water's surface, a handful of manmade island are taking shape.

The artificial islands would replace more than 100 conventional steel drilling towers around the super oilfield. ExxonMobil's lead country manager in Abu Dhabi, Morten Mauritzen said, multiple wells would be drilled, an "innovation" that ExxonMobil hopes will save billions of dollars during the six-year development as well as benefit the environment.

The cost savings would come over the 25 years remaining for commercial production at Upper Zakum, where Zakum Development Co. (Zadco) project is pumping crude. State-run Abu Dhabi National Oil Co. (Adnoc), has a 60 percent stake in Zadco, with Exxon Mobil holding 28 percent and Japan Oil Development Co. (Jodco) owning the rest.

Zadco plans a $15 billion artificial islands project to boost production at the field by about 40 percent to 750,000 barrels a day, where building islands is cheaper than erecting offshore production platforms.

Upper Zakum project is part of an ongoing programme launched by Adnoc to expand its oil output capacity to around 3.5 million bpd within the next seven years from nearly 2.6 million bpd at present. The programme also covers development of the emirate’s gas fields, including the Shah sour gas venture.

The idea was to build four artificial islands and utilise ExxonMobil’s extended-reach drilling technology, which allows wells to be drilled vertically and horizontally to target reservoirs several miles away. Similar technology has been tried and tested in ExxonMobil’s concessions in Northeast Russia.

The plan to develop the massive offshore Upper Zakum is going ahead despite recent furore over the offshore oil production worldwide following the massive leakage in British Petroleum’s concession in the Gulf of Mexico.

The costs of offshore drilling are high, adding that investment in Upper Zakum expansion will be huge. ExxonMobil alone plans to spend several billions of dollars on the project.

Pertamina Signed Gas Supply Contract with Chevron

2010-11-09T15:53:00.000+07:00

PT Pertamina Hulu Energi (PHE), a unit of Indonesia’s state oil and gas company PT Pertamina, signed a gas trade contract with PT Chevron Pacific Indonesia to support the national gas supply.

The commitment came after signing a gas sales agreement (GSA) worth U.S. $ 577 million. The contract also involves regional enterprises, such as PT Pembangunan Kota Batam (Batam Development Company) and PD Pertambangan dan Energi Provinsi Sumatera Selatan (PD Mines and Energy of South Sumatra province Company).

Allocation of gas is intended to 94,737 BBTU, PT Batam Development of 38,309 BBTU, PD Pertambangan dan Energi Provinsi Sumatera Selatan at 48,400 BBTU, and PT Chevron Pacific Indonesia for 8030 BBTU.

Gas production from the Jambi Block is the only block relied uponby the government from other oil and gas blocks in South Sumatera.

Gas production from Jambi Block will start 10 December. At this early stage, production is expected to reach 60 million cubic feet per day with a peak of 120 million cubic feet per day or 20,000 barrels of oil equivalent in July 2011.

To support the production preparation, PHE Jambi Merang preparing gas facilities on the River Kenawang with an investment of U.S. $ 242 million.

The allocation of gas to PD Pertambangan dan Energi Provinsi Sumatera Selatan destined to meet energy needs in the region surrounding the industry in South Sumatra and Jambi. The supply of gas to PT Batam Development will be used to meet electricity needs in Batam, especially in the industrial Free Trade Zone and Free Port Batam. The allocation of gas to Chevron will be used to support the CPP block oil production in Riau.

The big production is part of Pertamina’s effort to reach the target of 1 million barrels of oil per day in 2015.

South Korea Plans to Build Offshore Wind Farm

2010-11-06T12:09:00.001+07:00

In the Yellow Sea, South Korea plans to build an $8.2 billion offshore wind farm, its regional government has confirmed.

The three-phase plan calls for the construction of the Buan and Yeonggwang coasts by 2013 to test 20 5-megawatt turbines. A 180 5-megawatt turbines will be installed by 2016 for the second phase, and an additional 300 5-megawatt turbines by 2019 at the proposed facility.

The total offshore wind development is planned to reach a full capacity of 2,500MW, but has been reduced from an earlier blueprint where the government had hoped to build 1,000 wind turbines by the end of the third phase.

Korea’s head of energy and climate policy, said that the plan is to make South Korea the world's third-largest country in terms of offshore wind power generation.

The most expensive part of the project will be the foundational structure and underwater grids that serve the project, so additional turbines added to this structure are unlikely to entail great additional costs.

While the project's turbines are to come from various South Korean manufacturers, the level of South Korea's offshore wind farm technology is 68 percent compared to that of industry leaders.

Imported energy to cover 97 per cent of its energy requirements. The region is due to introduce Renewable Portfolio Standards in 2012. With 20 nuclear plants already in operation, the country also plans to construct 11 nuclear plants in the next 20 years.

Electric power companies generating more than 500 megawatts of electricity per hour must diversify their portfolio of energy sources beginning in 2012 and by 2022 increase the supply of electricity generated from renewable energy sources to 10 percent.

ONGC Targets Higher Oil Production in Three Years

2010-11-05T16:00:00.000+07:00

Oil and Natural Gas Corporation (ONGC) plans to increase crude output from new fields in three years after stagnant production from ageing blocks curbed profit growth.

ONGC produces 45 percent of India's oil, may raise annual output 12 percent to 28 million metric tons in the year starting April 2013. ONGC reported second- quarter net income rose 6 percent to 53.9 billion rupees ($1.2 billion), missing analysts' estimates after increasing provisions for dry wells.

ONGC is lagging behind global producers including Exxon Mobil Corp. and PetroChina Co. that have beaten earnings estimates this quarter after oil prices increased. India in June more than doubled gas prices to boost ONGC's earnings before selling a 5 percent stake by March.

The Indian explorer needs to boost earnings to compete with Cnooc Ltd. and China Petroleum & Chemical Corp. in the race for overseas energy assets. India lost out to China in at least $12.5 billion of deals for assets in the year ended June 30.

ONGC shares gained 0.2 percent to 1,307 rupees at 10 a.m. in Mumbai trading compared with a 0.1 percent increase in the benchmark Sensitive Index of the Bombay Stock Exchange. The stock has gained 11 percent this year.

Resource Base

ONGC has a strong resource base and that will start showing in the next few years. Natural gas production may increase 67 percent to 100 million cubic meters a day starting April 2015. Four-decade-old fields that have reached their peak make up about 80 percent of ONGC‚Äôs current output. The explorer has awarded $3.5 billion of contracts in the past 18 months that will enable new fields to start in three years. Production that has been languishing for some time will get a boost. Then, there will be some pressure on volumes.

Dry Wells

The company wrote off 24.4 billion rupees for dry wells in the second quarter compared with 6.5 billion rupees a year earlier, including depletion, amortization and impairment loss, rose to 44 billion rupees from 23.6 billion rupees, according to the earnings statement.

Oil and gas price increases boosted the New Delhi-based explorer’s profit to the highest level in more than two years.

ONGC supplied crude at $62.75 a barrel in the quarter after giving discounts to state refiners as partial compensation for selling fuels below cost, an 11 percent increase from a year earlier. The government also allowed ONGC to more than double gas prices to 6,818 rupees per thousand cubic meters in June.

Discounts given by ONGC to state refiners rose 15 percent to 30.2 billion rupees from a year earlier. The subsidy bill was 55.2 billion rupees in the three months ended June 30.

A Deal Between Brunei and Malaysia in Offshore Blocks

2010-11-04T21:12:00.000+07:00

A joint demarcation and survey activities have agreed by Brunei and Malaysia which is will begin next year. The move shows a clearer picture of the role international companies will play in a development expected to significantly boost the Sultanate's reserves.

On previously, it's disputed offshore oil and gas blocks. The dispute had centred around two blocks lying some 100 km offshore from Brunei, which the Sultanate referred to as J and K while Malaysia called L and M. The Sultanate claims an exclusive economic zone stretching 374 km from its coast.

Announced on September 22, Petronas and Petroleum Brunei had signed a new deed of agreement (DOA) for a Production Sharing Agreement (PSA) for the first of the blocks (Block J) which has been renamed CA1. An agreement on the second block, renamed CA2, was imminent.

Brunei had awarded development of Block J to a Total-BHP Billiton-Amerada Hess consortium and Block K to a consortium of Shell Deepwater Borneo (with a 50 per cent stake), Mitsubishi (with 25 per cent), and ConocoPhillips (with 25 per cent), while Malaysia had awarded the blocks in 2003 to state oil and gas firm Petronas and the United States' Murphy Oil.

The DOA allows the original consortium developing Block J to resume work, while the consortium itself is expanded to include Petronas Carigali Overseas and Canam Brunei, a wholly-owned subsidiary of Murphy Oil.

The expansion of the consortium does mean a change in the relative stakes, yet Total remains the largest party, with 54 per cent down from the original 60 per cent. BHP Billitons stake shrinks from 25 per cent to 22.5 per cent, and Hess stake goes down from 15 per cent to 13.5 per cent. This frees up a 10 per cent stake, which is to be taken by Petronas and Canam Brunei.

While the stakes may have been reduced, the block will be enlarged from 5,000 sq km to 5,850 sq km.

Total Exploration and Productions (E&P) senior vice-president of geosciences, Marc Blaizot, said that the French major was very satisfied with the signature of this agreement, which will enable exploration operations to resume on this promising block and a drilling campaign to start within a short period of time based on the seismic studies already performed.

A 3-D seismic examination of the region before the dispute was one of the most extensive for its time. Kikeh currently produces some 110,000-150,000 barrels of light, sweet crude per day. The blocks will also benefit from Totals considerable experience in drilling in deep water with depth ranges from 1 km to 2.75 km within the zone.

The new deal may also herald closer cooperation in oil and gas exploration and production (E&P) between Brunei and Malaysia.

Total Signed an Agreement With Pearl Oil in The Sebuku License

2010-11-01T16:20:00.001+07:00

Total signed an agreement with Pearl Oil (Sebuku) Ltd ("Pearl"), to acquire a 15% interest in the Sebuku license, in which the Ruby gas discovery was made.

The agreement stated that Pearl Oil, as operator, will retain a 70% interest, Inpex holding further 15%.

This license covers an area of more than 2,300 square kilometers, in water depths ranging from 50 to 200 metres, which is located 300 kilometres south of the Total-operated Peciko facilities. Indonesia approved Ruby’s development plan in July 2008 and the operator expects the field to come on stream in 2013, with a natural gas production target of 100 million cubic feet per day.

In Indonesia, Total also is intensely involved in community empowerment and capacity building actions in the areas of education and research, health and nutrition, local economic empowerment, environment and alternative energies. This action as part of its Corporate Social Responsibility in Indonesia. These endeavours are consistent with Total's commitment to answer the challenges of sustainable development.

Total also has manpower program with 1,700 recruits planned from 2002 to 2017. This effort is aligned with an extensive program to develop national manpower and high level national managers through training and international assignments, as well as career developments for new recruits. Total also continues to enlarge partnerships with national businesses in order to significantly enhance indirect employment.