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Posts Tagged ‘Shell’

Reality check for supermajors

Posted in climate, energy, Gulf of Mexico, Offshore Energy - General, Uncategorized, tagged , , on March 6, 2023| Leave a Comment »

“I am of a firm view that the world will need oil and gas for a long time to come,” (Shell Chief Executive) Sawan, who started the job on Jan. 1, told Times Radio in the U.K. on Friday. “As such, cutting oil and gas production is not healthy.”

Back in 2021, Shell predicted that its own oil production would decline every year and drop by as much as 18% by 2030. BP had a similar outlook, but CEO Bernard Looney rolled back its climate targets this year and said it will increase investment in exploration and production.

BP and Shell have trailed their U.S. peers in price to earnings ratios. Analysts have said investors interested in exposure to oil and gas have shunned them for putting more money into renewables, while investors focusing on environmental concerns haven’t rewarded them. That’s kept European energy firms trading at a discount.

Barron’s

It will never happen, but a separate company composed of BP and/or Shell upstream US assets would be very attractive to investors.

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China’s US OCS leases – exit coming?

Posted in Uncategorized, tagged , , , , , , , , on March 2, 2023| Leave a Comment »

Some may not be aware that the Chinese government, through a fully owned subsidiary of the China National Offshore Oil Corp. (CNOOC), is a leaseholder in the US Gulf of Mexico. Per BOEM records, CNOOC Petroleum USA Inc currently has ownership in 12 OCS leases. Most significantly, CNOOC holds 21% interest in the Appomattox Field, operated by Shell, and a 25% working interest in Stampede, operated by Hess. Peak oil production for these projects is expected to be 175,000 bopd for Appomattox and up to 80,000 bopd for Stampede.

CNOOC acquired the Gulf of Mexico properties through its purchase of Nexen, a Canadian company, in 2013.

The state-owned Chinese oil explorer surrendered operating control of those assets to quell U.S. national security concerns, said two people familiar with the agreement who asked not to be named because the terms aren’t public.

FInancial Post

Reuters has reported that CNOOC is considering an exit from its operations in the US, Canada, and the UK because of sanctions concerns. JPMorgan is reportedly assisting with the sale of the US assets.

Stampede TLP

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Simpler, safer, greener: Vito takes center stage!

Posted in Gulf of Mexico, Offshore Energy - General, tagged , , , , , , , , , , on February 16, 2023| Leave a Comment »

Shell Vito

Last year, BOE featured 5 deepwater platforms that were under construction: Shell’s Vito and Whale, Murphy’s King’s Quay, bp’s Argos, and Chevron’s Anchor. These floating production units are noteworthy for their lighter, smaller designs. King’s Quay was the first to produce, beginning last April. The spotlight is now on Vito which began producing today. Vito’s peak production should reach 100,000 boe. The other 3 platforms are expected to begin production this year or next.

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2022 Safety Honor Roll: Gulf of Mexico operators

Posted in Gulf of Mexico, Offshore Energy - General, Regulation, tagged , , , , , , , , , , , , on January 24, 2023| 1 Comment »

The Honor Roll companies for 2022 (listed alphabetically) are Anadarko (Oxy), bp, Cantium, Chevron, Contango, Hess, LLOG, Murphy, and Shell.

Our criteria:

  • Must average <0.3 incidents of noncompliance (INCs) per facility-inspection.
  • Must average <0.1 INCs per inspection-type. (Note that each facility-inspection may include multiple types of inspections (e.g. production, pipeline, pollution, Coast Guard, site security, etc). On average, each facility-inspection included 3.25 types of inspections in 2022. Here is a list of the types of inspections that may be performed.)
  • Must operate at least 3 production platforms and have drilled at least one well (i.e. you need operational activity to demonstrate compliance and safety achievement).
  • May not have a disqualifying event (e.g. fatal or life-threatening incident, significant fire, major oil spill). Due to the extreme lag in updates to BSEE’s incident tables, investigation and news reports are used to make this determination.
  • Pacific and Alaska operations will be considered separately.
oil (million bbls)gas (BCF)
Shell145.8163.5
bp82.457.1
Chevron79.445.2
Anadarko59.650.8
Murphy28.145.5
LLOG19.634.3
Hess17.939
Cantium3.95.3
Contango0.023.5
2022 production through Oct.

Mid-Year 2022 review

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Marvels of the deep

Posted in Gulf of Mexico, Offshore Energy - General, Uncategorized, tagged , , , , on January 20, 2023| Leave a Comment »

A rare photo of a Big-Fin Squid, caught on camera on November 11th 2007 by a Shell Oil company ROV, at a depth of 2,386 meters (1.5 miles). This species of Squid dwell at extreme depths, and are characterised by their long, thin tentacles. They can reach almost 20ft long when fully grown.

Hasan Jasim

ROV video:

Of course, much of our knowledge about deepwater biology is attributable to oil and gas exploration and the associated environmental studies. This includes the discovery and study of chemosynthetic communities in the Gulf of Mexico:

Some of the same conditions responsible for petroleum deposits also provide the basis for biological communities that receive energy from chemicals through a process called chemosynthesis (in contrast to photosynthesis that provides energy to terrestrial and shallow-water communities through processes in which sunlight is the basic energy source).

NOAA
An aggregation of ice worms inhabiting methane hydrate. These worms eat chemoautotrophic bacteria using chemicals in the hydrate. Image courtesy of the NOAA Office of Ocean Exploration and Research, Gulf of Mexico 2012

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Stemming the decline in deepwater Gulf of Mexico exploration?

Posted in Gulf of Mexico, Offshore Energy - General, tagged , , , , , , , , , , , on November 18, 2022| Leave a Comment »

Was 2021 the low point? Hopefully that is the case, but consistent leasing is essential.

Looks like Woodside is now officially the GoM operator of record (was BHP prior to merger). Kudos to them.

Shell continues to be the GoM bellwether. There is no OCS program without them.

What’s up with BP and Chevron? Big declines from both.

US super-majors Exxon and ConocoPhillips remain out of the picture, both in terms of lease acquisition and exploration. Disappointing.

Tip of the hat to Hess, LLOG, Murphy, and Talos – independents committed to deepwater production.

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Another new Aera era!

Posted in California, Offshore Energy - General, pipelines, tagged , , , , , , on September 12, 2022| Leave a Comment »

A fresh start for Aera Energy with IKAV, a German asset management company that purchased Aera from Shell and ExxonMobil.

From 1997 to 2007, Aera operated the Beta Unit offshore Huntington Beach. Since selling those facilities, all Aera operations have been conducted onshore, primarily in Kern County, a historically important California oil production area. Aera will continue to operate these onshore properties for IKAV, which looks like an interesting company.

Platforms Ellen and Elly, Beta Unit

Meanwhile, the Beta Unit has been in the news because of the October 2021 spill from the pipeline transporting Beta Unit production from Platform Elly to shore.

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Shell restarts Mars pipeline

Posted in accidents, Gulf of Mexico, Offshore Energy - General, pipelines, tagged , , on August 13, 2022| Leave a Comment »

Assuming no significant tropical storm shutdowns this month, we should get a good read on the impact of the pipeline outage when the EIA production data for August are posted.

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Onshore pipeline leak shuts-in major Gulf of Mexico assets

Posted in accidents, Gulf of Mexico, Offshore Energy - General, tagged , , , , , , on August 11, 2022| Leave a Comment »

A small pipeline leak (estimated 2 bbl spill) at an onshore booster station is having a major impact on Gulf of Mexico production. Per Reuters, as much as 600,000 bopd could be temporarily shut-in. GoM production averaged 1.6 million bopd in May.

These major platforms are reported to be shut-in:

  • Shell: Mars, Ursa, and Olympus
  • Chevron: Jack/St. Malo, Tahiti, and Big Foot
  • Equinor: Titan

Shell, the pipeline operator, did not provide an estimate on the resumption of production.

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2022 mid-year Compliance Honor Roll: US Offshore

Posted in Gulf of Mexico, Offshore Energy - General, tagged , , , , , , , , , , , , , on July 20, 2022| Leave a Comment »

Operating companies (listed alphabetically): Arena, Anadarko (Oxy), BHP, bp, Cantium, Chevron, Hess, Murphy, Shell, and Walter

Criteria:

  • Must average <0.3 incidents of compliance (INCs) per inspection. (This is less than half the GoM 2022 YTD average of 0.64 INCs/inspection.)
  • Must operate at least 3 production platforms.
  • Must have drilled at least one well.
  • Pacific and Alaska operations will be considered in a separate post.

Comments:

  • Impressive performance by Hess: 21 inspections and no INCs
  • Cantium and Walter averaged less than 0.1 INCs/inspection. The INC rates for Anadarko (Oxy), BHP, and BP were only slightly higher.
  • Among the Honor Roll companies, Shell (highest production, 9 deepwater platforms, and 13 well starts) and Arena (115 shelf platforms and 12 well starts) were the deepwater and shelf activity leaders.They thus had the highest INC exposure.
  • Although CSI and FSI INCs are typically more significant than W INCs, that is not always the case, so the INCs have not been weighted by type.
  • As has been previously noted, more inspection data should be readily available online. At a minimum, the specific INC (type) numbers (e.g. P-103, G-110, etc) should be posted so the public can better assess performance. Absent this information, interested parties are left to speculate about the significance of the violations.
  • Incident data should also be considered in performance assessments. Unfortunately, the inexplicable lag in the posting of BSEE incident tables, precludes the use of these data in our analysis.

Compliance vs. Safety

While compliance is not synonymous with safety, most experienced observers believe there is a strong correlation. In the 1990’s, John Shultz, a PhD candidate at Carnegie Mellon Univ., studied US offshore facilities and safety data and developed expert and regression models to predict the likelihood of accidents and spills. That was a data rich era in that there were ~4000 US offshore platforms (more than twice the current number) and ~100 well starts/month (>10 times the current rate). In John’s thesis, he found that INCs are a very good predictor of accidents and spills. The offshore world has changed and further study of the correlation between compliance and safety performance is highly recommended.

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