GENERAL INTEREST Quick Takes
Kinder Morgan to promote Kim Dang to CEO
Kinder Morgan Inc. will promote Kim Dang, currently president of the company, to chief executive officer effective Aug. 1, 2023. She succeeds Steve Kean who has spent over 20 years with Kinder Morgan, the last 8 as chief executive. Kean will remain on the KMI board of directors.
Dang has been with the company over 20 years, serving as chief financial officer and then as president for the last 5 years and on the board of directors since 2017.
Tom Martin will become KMI president, also effective Aug. 1. Martin has been with Kinder Morgan nearly 20 years, most recently as president of the gas group. Effective Aug. 1, Martin will join Rich Kinder, executive chairman, and Kim Dang as a member of the office of the chairman.
As announced July 20, 2022, Sital Mody, president of the midstream gas group, will succeed Martin as president of the gas group, effective Feb. 1. Between Feb. 1 and Aug. 1, Martin will serve as executive vice-president, working with the office of the chairman.
Vitol’s VTX to acquire Delaware Basin Resources
Vitol Inc.’s US upstream company, VTX Energy Partners LLC, has agreed to acquire Delaware Basin Resources, Midland, Tex., and associated surface and water businesses, the company said in a release Jan. 19. A purchase price was not disclosed.
The deal is VTX’s first acquisition since the partnership was established by Vitol and VTX in 2022. Assets to be acquired comprise of 35,000 net leasehold acres and 46,000 surface acres across Reeves and Pecos counties in the Delaware basin, with current daily production of about 40,000 boe/d, Vitol said.
Delaware Basin Resources, a portfolio company of Stellus Capital Management, was formed in December 2009 to develop a largely contiguous acreage position primarily in Reeves County, Texas, in the southern Delaware basin oil-weighted resource play. The company had been focused on horizontal development in multiple benches of the Wolfcamp interval, according to the capital provider’s website.
VTX Energy Partners is the successor company to ATX Energy Partners, an Austin-based oil and gas company pursuing an acquisition and development strategy in the US Lower 48. Phillips 66 lets contract to support UK CCS project
Phillips 66 Ltd. has let a contract to Babcock & Wilcox’s environmental segment to design a flue gas pre-treatment technology upstream from a planned CO2 capture system (CCS) on the Humber refinery’s fluid catalytic cracker (FCC) in North Lincolnshire, UK.
Phillips 66’s Humber refinery carbon capture plans are part of the Humber Zero project, a world-scale carbon reduction project that aims to capture up to 8 million tonnes/year of CO2 by 2030.
bp contemplates hydrogen hub, infrastructure repurposing in Germany
bp PLC will evaluate the feasibility of building a new hydrogen hub in in Wilhelmshaven, Germany, as well as the use of repurposed oil and gas infrastructure to transport hydrogen.
The project would include an industrial-scale ammonia cracker which could provide up to 130,000 tons/yr of low-carbon hydrogen from green ammonia starting in 2028, the company said in a release Jan. 18.
Green ammonia is produced by combining nitrogen with hydrogen derived from the electrolysis of water using renewable energy sources. bp will ship green ammonia from green hydrogen projects around the world to Wilhelmshaven. The cracker converts the green ammonia back into green hydrogen by splitting the larger molecule into its smaller nitrogen and hydrogen components which can then be used directly.
bp’s plans include using existing infrastructure at Nord-West Oelleitung terminal, where bp is a participating shareholder. The deepwater harbor and pipeline system could support energy transition activities, bp said.
Utilization of current oil and gas pipelines could support hydrogen transport to the Ruhr region and other demand centers, it said.
Exploration & Development Quick Takes
Wintershall discovers gas onshore Nile Delta
Wintershall Dea discovered gas in its East Damanhour exploration block in the onshore Nile Delta in Egypt and will assess the discovery as a possible tie-back development to nearby infrastructure at Disouq, a gas project operated by DISOUCO, a joint venture of Wintershall and the Egyptian Gas Holding Co. (EGAS).
Wintershall began exploration at East Damanhour in November 2021. The discovery well, ED-2X, lies about 3 km north of Disouq field.
The well encountered a 43-m thick gas bearing reservoir with a gas-water encountered a 43-m thick gas bearing reservoir with a gas-water contact at 2,627 m. A thorough and fit for purpose data acquisition program has been carried out and the discovery has been tested at peak production of 15 MMscfd.
Wintershall is operator of the license with 50% interest. Partners are Cheiron Energy (40%) and INA (20%).
Shell set to advance gas project offshore Malaysia
Sarawak Shell Bhd presented a letter of award with limited notice to proceed to KKB Engineering Bhd subsidiary OceanMight Sdn Bhd for provision of engineering, procurement, and construction of standard wellhead platforms for MLNG FaS (F27, F22, Selasih) gas field development offshore Malaysia.
A formal agreement is expected in due course, the service provider said in a release Jan. 11.
CNOOC completes Weizhou 12-8E Phase 2 development
CNOOC has completed the second phase drilling program of the Weizhou 12-8E oil field development project in Block 22/12 in the Beibu Gulf offshore China, according to project participant Horizon Oil Ltd., Sydney.
The rig’s release marks the end of a 10-month campaign that drilled and completed 10 WZ12-8E horizontal development wells and one WZ12-8E water disposal well. Additional work in the Weizhou 6-12 field to the north included two WZ6-12 development/appraisal wells and one exploration/appraisal well plus workovers of five existing WZ6-12 wells.
Oil production is averaging more than 19,000 b/d, about 10,000 b/d of which is from the original Beibu fields and about 9,800 b/d from the new WZ12-8E field, Horizon said.
Production has increased by about 4,500 b/d compared with October 2022, prior to the start of the WZ12-8E program.
Production performance has exceeded pre-drill expectations because of longer horizontal production intervals (995 m versus a planned 920 m) and greater offset from the underlying oil-water contact, particularly for the wells in the main Jiaowei field, Horizon said.
The WZ12-8E projected is expected to reach a peak oil rate in January before natural decline begins, and formation water inflow increases. The JV is investigating options to mitigate decline.
CNOOC is operator for the development/production phase with 51% interest. Partners are Horizon (26.95%), Roc Oil Ltd. (19.60%), and Majuko Corp. (2.45%).
Vermilion discovers gas onshore Netherlands
Vermillion Energy encountered gas on the Drenthe VI concession in Diever West field, onshore the Netherlands.
LDS-01 is the first of the two-well campaign targeting several onshore gas prospects on the concession. It was drilled to a depth of 2,225 m TVDSS, encountering gas at multiple intervals in the primary target horizons.
The well has been completed and is ready for tie-in to production following conclusion of the LDS-02 well which has been spudded by the Drilltec Synergy 2 rig. LDS-2 is expected to be completed early February. First gas is expected in April.
Vermillion is operator at Drenthe VI with 52.5%. Partners are EBN (40%) and Parkmead Group PLC (7.5%).
Wintershall lets EPCI contract for Dvalin North project
Wintershall Dea Norge AS has let an engineering, procurement, construction, and installation contract to TechnipFMC for the operator’s Dvalin North project (OGJ Online, Dec. 13, 2022).
The contract covers design, engineering, manufacture, and installation of pipe for Dvalin North field, which will be tied back to the Heidrun platform via Dvalin field on the Norwegian Continental Shelf.
The service provider, who values the contract somewhere between $75-250 million, previously installed subsea umbilicals, risers, and flowlines at Dvalin field.
Dvalin North lies 200 km off the coast of Northern Norway, west of Sandnessjøen, at a water depth of 420 m. It is estimated to contain 84 MMboe and the gas will be exported via the Polarled pipeline to Nyhamna near Kristiansund in Norway.
Wintershall Dea is operator of the field with a 55% share. Petoro has 35% and Sval Energi has 10%.
Drilling & Production Quick Takes
Shell starts gas production in Oman’s Mabrouk North East field
Shell Integrated Gas Oman BV, a subsidiary of Shell plc, started gas production from Mabrouk North East field in Block 10 about 400 km from Muscat.
Production from Block 10 is expected to reach 500 MMcfd by mid-2024 with produced gas supplied to the OQ Gas Network. Shell and Energy Development Oman (EDO) signed an agreement to process natural gas from Block 10 at EDO’s Saih Rawl plant (OGJ Online, Dec. 21, 2021).
Shell is operator of the onshore block with 53.45% interest. Partners are Oman National Oil Co. (13.36%) and Marsa Liquefied Natural Gas LLC, a joint venture between TotalEnergies and OQ (33.19%).
Frontera, CGX advance Corentyne block work, offshore Guyana
Frontera Energy Corp. has spudded Wei-1 on Corentyne block about 200 km offshore from Georgetown, Guyana.
The well is about 14 km northwest of the joint venture’s Kawa-1 light oil and condensate discovery and will be drilled in water depth of about 1,912 ft (583 m) to an anticipated total depth of 20,500 ft (6,248 m). The well will target Maastrichtian, Campanian, and Santonian aged stacked sands within channel and fan complexes in the northern section of the block.
Wei-1 is expected to take about 4-5 months to reach total depth.
Following completion of drilling operations and upon analysis of the results, Frontera and joint venture partner CGX Energy Inc. may consider future wells to evaluate development feasibility in the Kawa-1 discovery area and throughout the northern section of the block. Fdrilling is contingent on positive results at Wei-1.
Petrobras exceeds 2022 production target by 3.2%
Petrobras exceeded its 2022 oil and natural gas production target by 3.2%, the company said Jan. 17. The company reduced its 2022-26 production targets in January 2022 to about 2.6 MMboe/d from its 2.7 MMboe/d forecast in November 2021, reflecting a reduced interest share in Atapu and Sepia fields.
Total oil and gas production in 2022 was 2.684 MMboe, higher than the 2.6 MMboe/d target. Commercial production reached 2.361 MMboe/d, 2.7% above the target of 2.3 MMboe/d, the company said.
Oil production for the year was 2.154 million b/d, 2.6% above the target of 2.1 million b/d.
Norway production up in December, NPD says
Norway’s production averaged 1.983 million bbl in December, the Norwegian Petroleum Directorate (NPD) reported. The figure is down from 1.946 million bbl produced in November.
Average daily liquids production in December consists of 1.773 million b/o, 191,000 bbl of NGL, and 19,000 bbl of condensate.
Oil production in December was 9.7% lower than the NPD’s forecast and 6.1% lower than the forecast.
Equinor granted PSA consents for Norwegian Sea, North Sea work
Equinor Energy AS has been granted consents by the Petroleum Safety Authority Norway to advance work in the Norwegian Sea and North Sea.
The operator has been granted consent for exploration drilling in Block 6406/5 in the Norwegian Sea where it will drill well 6406/5-2 S (Tott West prospect) in production license 255B. Drilling, by the Deepsea Stavanger drilling rig in 304 m of water depth, is expected to take 81 days, or 103 days should there be a discovery.
The company also has been granted consent for drilling rig use in the North Sea. The company will utilize the Transocean Spitsbergen mobile drilling unit for production drilling of well 34/7-E-4 BH (Lomre) in production license 089 in Vigdis field in the Tampen area. Activities include well intervention for the preparation of side steps as well as drilling and completion of a new well path. The main objective is to establish an injection well that provides pressure support to production well 34/7-H-1 AH to maintain the production level and increase the recovery rate for the field.
Consent for use of the Noble Lloyd Noble mobile drilling rig for production drilling on Gina Krog field has also been granted. The field lies in production license 029C and 048 on the Utsira High in the central part of the North Sea, just north of Sleipner Vest field. Water depth in the area is 110-120 m.
PROCESSING Quick Takes
CPChem, QatarEnergy let contract for Qatari petrochemical complex
QatarEnergy and Chevron Phillips Chemical Co. LLC (CPChem)—a 50-50 joint venture of’s Chevron USA Inc. and Phillips 66 Co.—have secured Emerson Electric Co. as lead automation contractor for the Middle East’s largest ethane cracker now under construction at the JV’s Ras Laffan petrochemical project (RLPP) in Ras Laffan Industrial City, Qatar.
As part of a contract awarded alongside consortium partner Viasat Inc.’s Viasat Energy Services, Emerson will provide the complex with a suite of automation technologies, software, and analytics, including integrated process control and safety systems that leverage advanced predictive technologies to reduce operational complexity and minimize project risk, the service provider said on Jan. 24.
Emerson confirmed Viasat will design and provide the RLPP’s sitewide integrated telecommunications infrastructure.
The award for the $6-billion integrated olefins and polyethylene complex follows contracts by QatarEnergy and CPChem in early January upon taking final investment decision to proceed with the project.
To be operated by Ras Laffan Petrochemicals (RLP), a newly formed JV in which QatarEnergy will hold a 70% interest and CPChem will hold 30%, the RLPP will house an ethane cracker equipped to produce 2.08 million tonnes/year (tpy) of ethylene and a two-unit, high-density polyethylene plant with a total production capacity of 1.68 million tpy.
Located on a 435-acre project site in Ras Laffan Industrial City, which—in addition to housing an LNG export terminal—serves as an onshore base for the processing of gas and other hydrocarbons produced from Qatar’s offshore North Field, RLP’s Ras Laffan petrochemical complex is scheduled for mechanical completion by 2026 for targeted commissioning later that year, according to the RLP JV.
Aramco lets contract for Riyadh refinery modernization
Saudi Aramco has let a contract to Technip Energies to modernize sulfur recovery operations at its 130,000-b/d Riyadh refinery in central Saudi Arabia.
As part of the contract, Technip Energies will install three new tail gas treatment (TGT) units to improve performance of the refinery’s existing three sulfur recovery units (SRU), the service provider said on Jan. 24.
The project, which Technip Energies will execute locally using in-Kingdom resources and infrastructure, aims to ensure the refinery’s compliance with more stringent regulations for sulfur-dioxide emissions by improving recovery efficiency of the SRUs to more than 99.9%.
Technip Energies—which designed and built the refinery’s existing SRUs in the early 2000s—disclosed neither the value of the contract nor capacities of new TGTs.
TRANSPORTATION Quick Takes
Equitrans gets positive FERC EIS for Ohio Valley Connector expansion
Equitrans LP has received a final environmental impact statement (EIS) for its 350-MMcfd Ohio Valley Connector expansion project from the US Federal Energy Regulatory Commission (FERC), declaring that approval with recommended mitigation measures would not result in significant adverse impacts. Commission staff concluded that most adverse environmental impacts would be temporary or short-term during construction and would have minimal effects on existing land use, as work would be completed within an area already characterized by energy production and transmission.
The expansion is intended to increase natural gas deliveries from central Appalachian basin producers to midcontinent and Gulf Coast destinations and will include Equitrans’ acquisition and operation of the existing non-jurisdictional Cygrymus compressor station in Greene County, Pa., and installation of two new turbines at the site. Equitrans also would install one additional compressor unit each at the existing Corona compressor station in Wetzel County, WV, and Plasma compressor station in Monroe County, Ohio, which currently operate a combined 40,000 hp.
Total additional compression at the three sites would be 60,900 hp. Roughly 23,000 hp will be added to Plasma and 15,900 hp to Corona. Existing compression will be removed at Cygrymus, with two 22,000-hp turbines installed for a net increase of 22,000 hp.
In addition to the compression, Equitrans would build a total of 5.5 miles of 24-, 16-, and 12-in. OD pipeline in various segments in Greene County, Pa., and Wetzel County, WV. The company plans to begin work on the compressor stations in second-quarter 2023 and on the pipeline segments in fourth-quarter 2023, targeting first-half 2024 startup.
The 37-mile Ohio Valley Connector’s current capacity is 850 MMcfd.
Vopak submits Victorian LNG import terminal environmental plan
Vopak AS has submitted an environmental plan to the Victorian government for a proposed LNG import terminal in Port Phillip Bay, Victoria, Australia.
The project was unveiled in March 2021 to supply gas to Australia’s southeast coast market.
The project includes a floating storage and regasification unit (FSRU) in Port Phillip Bay about 19 km offshore. Incoming LNG carriers would dock at the terminal to offload cargoes for regasification. Gas would then be transported by undersea pipeline plus a short onshore line to connect to Victoria’s existing network. Project completion is anticipated in 2026.
A number of LNG import terminal projects are now in various stages of planning and development in the eastern half of Australia, including Squadron Energy’s Port Kembla project in New South Wales and Viva Energy’s proposed Victorian terminal near Geelong.
Venture Global gets FERC draft EIS for CP2 LNG plant, pipeline
Venture Global LNG Inc.’s 20-milllion tonne/year (tpy) nameplate capacity CP2 LNG plant and 4-bcfd CP Express natural gas pipeline project has received its draft environmental impact statement (EIS) from the US Federal Energy Regulatory Commission (FERC). Commission staff concluded that construction and operation of the project would result in adverse environmental impacts, but that for most resources, these could be reduced to less than significant levels with the implementation of Venture Global’s proposed impact avoidance, minimization, and mitigation measures and additional measures recommended by FERC staff.
Commission staff also determined that construction and operation of the project would have significant adverse effects on the visual resources of the surrounding areas, including cumulative visual impacts, and visual impacts on environmental justice communities in the region. Climate change impacts were not characterized in the EIS as significant or insignificant.
CP2 LNG will be built in Cameron Parish, La., and the 91-mile CP Express in Cameron and Calcasieu Parishes, La., and Jasper and Newton Counties, Tex. Venture Global hopes to begin construction in 2023 to meet a second-quarter 2026 in-service date.
CP2 LNG will be able to produce 28 million tpy under optimal conditions, with the gas delivered on CP Express, the company said. It has entered into 20-year LNG supply agreements with affiliates of New Fortress Energy., ExxonMobil, Chevron, EnBW Energie Baden-Württemberg AG, and Inpex Energy Trading Singapore.
FERC will take into consideration staff’s recommendations in the EIS when it makes a decision on the projects.
NextDecade, Itochu sign 15-year LNG supply deal
NextDecade Corp. will supply LNG from its 27-million tonne/year (tpy) Rio Grande LNG liquefaction plant in Brownsville, Tex., to Itochu Corp., marking the company’s first deal with a Japanese customer, the company said in a release Jan. 19.
The companies signed a 15-year agreement for purchase of 1 million tpy indexed to Henry Hub on a free-on-board basis.
NextDecade is targeting a positive final investment decision (FID) on the first three trains of the RGLNG export project during first-quarter 2023, with FIDs of its remaining trains to follow thereafter.