Posted in drilling, Guyana, Offshore Energy - General, tagged Guyana, OilNow, Stena Carron, Stena Drillmax on January 15, 2025| Leave a Comment »
Below is a nice shot of the Stena Carron seen from the Stena DrillMAX offshore Guyana. The DrillMAX returned to Guyana after drilling the high potential Persephone well in the Orphan Basin offshore Newfoundland. Unfortunately, the Orphan Basin well failed to discover commercial hydrocarbons.
StenaDrilling shows the current locations of the 2 drillships. The DrillMAX is northwest of the Carron.
Posted in Guyana, Offshore Energy - General, tagged arbitration, Chevron, dispute, Exxon, Guyana, Hess, ICC, Nexen, Stabroek on January 15, 2025| Leave a Comment »
“Most investors see Chevron and Hess emerging as victors in the case, Goldman analyst Neil Mehta said in an interview.”
This is consistent with the opinion previously expressed on this blog. How does a partner in a single Hess asset prevent Chevron from acquiring the entire company?
Chevron is not buying the Stabroek share; they are buying the company that holds that share. Hess is to be part of Chevron and there would be no change of control from the standpoint of the partnership.
As an offshore operator, Exxon has been highly responsible from a safety standpoint. However, the company is not reluctant to stretch the envelope when it comes to contract rights. The most recent example was their acquisition of 163 GoM oil and gas leases for carbon disposal purposes, contrary to the terms of the sale notice and lease contracts.
Interestingly, Exxon’s partner in this dispute is state-owned China National Offshore Oil Corporation. CNOOC acquired their 25% Stabroek share when they purchased Nexen, a Canadian company (sound familiar?). Both the Canadian and US governments had reservations about this acquisition and nearly nixed the deal. Would either government bless that acquisition today?
An International Chamber of Commerce arbitration panel will hear the Stabroek case in May 2025, and the final decision is expected by September 2025.
Posted in Gulf of Mexico, Guyana, Offshore Energy - General, well control incidents, tagged BSEE, Chevron, deepwater technology, Exxon, HPHT, JPT, Lars Herbst, research, well capping on September 6, 2024| Leave a Comment »
A new JPT article features comments from BOE contributor Lars Herbst on advances in HPHT technology, control systems, sensors and transmitters, and automation that are facilitating the next era of deepwater development.
Well capping technology, which provides a tertiary well control capability, is an essential element of post-Macondo exploration and development. Lars points to the importance of BSEE’s unannounced drill program to verify that capping stacks can be transported and installed in a timely manner. Chevron expresses pride in leading a team that deployed and installed a capping stack in 6,200 feet of water in a drill monitored by BSEE. During that drill, a remotely operated vehicle (ROV) closed 10 valves to shut in a simulated well.
Exxon’s Jayme Meier aptly characterizes the challenge and excitement of deepwater development:
“You are floating on a surface, and you have to be able to pinpoint exactly where you’re going to land subsea hardware, exactly where you’re going to moor an FPSO and hit target boxes that are a few feet by a few feet, and they’re 6,000 ft below you,” she said. “It is the most exciting thing that I’ve ever been involved in. And it involves technology, technical know-how, and an ability to really plan the base plan and the contingency plan.”
Advances in deepwater technology are indeed impressive, but continuous improvement must always be the objective. In that regard, Lars rightfully emphasizes the importance of sustaining research through the industry’s up and down cycles.
Posted in Guyana, Offshore Energy - General, Uncategorized, tagged Guyana, Koaita Grant, oil and gas, photography on August 22, 2024| Leave a Comment »
From Oil Now Guyana:
“In the evolving landscape of Guyana’s oil and gas industry, few have managed to carve out a niche quite like Koaito Grant. A name synonymous with corporate photography, Grant’s journey from discovering his passion for capturing moments to becoming a sought-after photographer within the oil and gas sector is as inspiring as it is instructive.“
So true: “It’s the best feeling when a client reaches out and says you were very highly recommended by this or that person.” His professionalism and work ethic have been key differentiators. “I have a client that always asked if I was Guyanese because I’m always early for all projects and activities.”👍 💯
Posted in Guyana, Offshore Energy - General, tagged arbitration, Chevron, CNOOC, Exxon, Guyana, Hess, merger, Nexen, Stabroek on August 22, 2024| Leave a Comment »
Reuters has published an interesting article on the Exxon/CNOOC vs. Chevron/Hess dispute scheduled for arbitration next year in Paris. According to Reuters (emphasis added):
“Getting the panel to consider the appraised value is central to Exxon’s claim that the deal is an asset acquisition disguised as a merger. Exxon believes the Guyana asset is so valuable that the merger would trigger a change of control and give Exxon and CNOOC a right of first refusal to the asset sale, the people said.“
The Exxon argument implies that Hess’s only major asset is its share of Stabroek, which is hardly the case. Hess’s 30% Stabroek share is without question an important asset with great long-term potential, but Hess is also a major player elsewhere, most notably in the Bakken formation in North Dakota and the Gulf of Mexico. Implying that Hess was a single asset acquisition is thus misleading:
Exxon’s ally in this dispute is state owned China National Offshore Oil Corporation. CNOOC acquired their 25% Stabroek share when they purchased Nexen, a Canadian company (sound familiar?). Both the Canadian and US governments had reservations about this acquisition and nearly nixed the deal.
This dispute will continue to smolder given the delay in the arbitration hearings until May 2025. As previously mentioned, I believe the Government of Guyana should have intervened. I’m all for companies settling their disputes privately, but this dispute is over Guyanese resources, and the protracted delay could have implications for Guyana.
Posted in energy policy, Gulf of Mexico, Guyana, Offshore Energy - General, tagged expenditures growth, flowlines, risers, Rystad, subsea market, umbilicals on August 16, 2024| Leave a Comment »
Rystad Energy projects a 10% annual compound growth rate for the subsea market from 2024 to 2027, with total spending anticipated to exceed $42 billion by the end of this period.
Brazil dominates the subsea umbilical risers and flowlines (SURF) market. Unsurprisingly, the US is lagging given the absence of a robust offshore leasing program and the dearth of deepwater discoveries in recent years.
Posted in Guyana, Offshore Energy - General, tagged arbitration, CNOOC, dispute, Exxon, Guyana, Hess, Stabroek Block on August 2, 2024| Leave a Comment »
An International Chamber of Commerce panel has set a May 2025 date for the hearing on the dispute over Chevron’s acquisition of Hess’s share of Guyana’s Stabroek field. This is a massive delay considering the impact of this arbitration case on Chevron’s purchase of Hess.
The matter also has significant international intrigue given that (1) Exxon’s Stabroek partner is state-owned China National Offshore Oil Corp, which ironically acquired their 25% Stabroek share when they purchased Nexen (sound familiar?), and (2) Chevron continues to operate in neighboring Venezuela where the Maduro regime has claimed much of Guyana’s offshore resources.
As noted in a previous post, the Exxon/CNOOC position seems to be a stretch. Chevron did not buy the Stabroek share; they bought the company that holds that share. Hess is to be part of Chevron and there would be no change of control from the standpoint of the partnership. The panel will decide, but given the May 2025 hearing date, we probably won’t know the outcome for a year.
The Guyanese government has not taken a position in this dispute, but in my opinion, there are reasons for them to be concerned. Stabroek is Guyana’s offshore gem, their most important economic asset. The dispute has to affect teamwork and communication.
From safety, environmental, and production standpoints, do you want feuding partners managing such an important national asset? Those are Guyanese resources that the Stabroek partners are licensed to produce. I would have liked to have seen the government tell them to get this resolved in 30 days or we’ll resolve it for them.
Posted in Alaska, Guyana, Jamaica, Offshore Energy - General, tagged Jamaica, next Guyana, string of pearls, United Oil and Gas on July 31, 2024| Leave a Comment »
United Oil and Gas excels at promotion and isn’t shy about making bold statements. Can they find a strong partner and move their Jamaican exploration program forward?
The term “string of pearls” was used about 30 years ago to describe discoveries in the Beaufort Sea and on adjacent Alaska lands. Although they were modest individually (by Arctic standards), the sense was that these discoveries would collectively support sustained production in the region. While there has been some success in that regard, the optimistic expectations have not been realized.
Below is a recent United Oil & Gas presentation to prospective investors. Previous Jamaica posts.
Posted in Gulf of Mexico, Guyana, Offshore Energy - General, oil spill response, well control incidents, tagged macondo, top kill, LSU, blowout, capping stack, Guyana, Mayank Tyagi on May 6, 2024| 1 Comment »
The government’s decision to require that a capping stack be located in Guyana is prudent. Although the need for a capping stack is dependent on multiple barrier failures and is thus extremely low, the environmental and economic consequences of a prolonged well blowout warrant timely access to this tertiary well control option.
A capping stack must be properly maintained and deployable without delay. In that regard, BSEE has a good program for testing Gulf of Mexico capping stack readiness. Capping stack drills are an important post-Macondo addition to the unannounced oil spill response program that dates back to 1981.
The capping stack designed during the Macondo blowout shut-in the well on 15 July 2010. The decision process that allowed the well to remain shut-in was a bit perplexing, and we had a bizarre situation where the Federal Incident Commander threatened to require the resumption of the blowout. The same well integrity concerns had prematurely ended the “top kill” operation on 28 May, allowing the well to flow unnecessarily into the Gulf for an additional 48 days (5/28-7/15). (See this important paper by LSU Petroleum Engineering professor Dr. Mayank Tyagi et al: Analysis of Well Containment and Control Attempts in the Aftermath of the Deepwater Blowout in MC252)
Posted in Guyana, Offshore Energy - General, tagged Chevron, CNOOC, Exxon, Hess, Q1 oil production, Stabroek on May 3, 2024| Leave a Comment »
Chevron wants in, Exxon and China want bigger pieces, and Venezuela claims it all.
Exxon CEO Darren Woods sums it up:“I believe Guyana will go down as one of the most successful deepwater developments in the history of the industry.”
Nice production growth and this is just the beginning:
