E&P Notes (December 2018)
Authors: Zborowski Matt , Rassenfoss Stephen 
Published: December 2018

E&P Notes

Company Fracturing First UK Horizontal Shale Wells

Matt Zborowski, Technology Writer

Hydraulic fracturing of the UK’s first two horizontal shale wells is under way. However, injection work has been paused on multiple occasions because of seismic activity.

Cuadrilla Resources began fracturing the first well in mid-October at its Preston New Road site in Lancashire. Gas began flowing to the surface in early November. 

Both wells, which intersect the Bowland Shale, are slated to be completed over 3 months, with their flow rates tested over 6 months. An initial assessment on recoverable gas is expected in next year’s first quarter, at which point Cuadrilla will determine the site’s commerciality.

 

BHGE To Buy Stake in ADNOC Drilling as Firms Form UAE Partnership

Matt Zborowski, Technology Writer

Abu Dhabi National Oil Company (ADNOC) and Baker Hughes, a GE company (BHGE), will partner to turn ADNOC Drilling into “a fully-integrated drilling and well construction provider,” the companies said in a joint statement.

The deal calls for BHGE to buy a 5% interest in ADNOC Drilling for $550 million, placing the subsidiary’s value at $11 billion including $1 billion of net debt. BHGE will join ADNOC Drilling’s board of directors, and the two firms will create an advisory board to jointly oversee the partnership’s implementation and ongoing operations. The deal is expected to close in the fourth quarter.

 

Eni, BP To Team in Hopes of Boosting Libyan Oil and Gas Exploration

Matt Zborowski, Technology Writer

Eni, BP, and Libya’s National Oil Corporation (NOC) inked an agreement on 8 October that should enable Eni to buy a 42.5% stake and become operator of three of BP’s Libyan oil exploration contract areas, where the companies plan to resume exploration work next year.

BP’s 54,000-sq-km exploration- and production-sharing agreement (EPSA) consists of two onshore contract areas, A and B, in the Ghadames Basin and one offshore area, C, in the Sirt Basin. BP currently holds an 85% interest in the EPSA, with the Libyan Investment Authority holding the remaining 15%. Eni and NOC jointly have other operations and infrastructure near the onshore areas.

 

Petrobras, Murphy Oil Form 75,000-BOE/D US Gulf Partnership

Matt Zborowski, Technology Writer

Brazil’s state-owned Petrobras and El Dorado, Arkansas-based Murphy Oil have agreed to combine most of their US Gulf of Mexico assets to form a joint venture (JV) that will average 75,000 BOE/D in production during the fourth quarter.

Murphy Exploration & Production will serve as the JV’s operator with an 80% stake, while Petrobras America will hold 20%. The combine will have the following assets:

Operated deepwater fields: Cascade, Chinook, Clipper, Dalmatian, Front Runner, Medusa, and Thunder Hawk

Nonoperated deepwater fields: St. Malo, Lucius and Hadrian North, Hadrian South, Cottonwood, Habanero, and Kodiak

Shallow-water fields: South Marsh Island 280, Garden Banks 200/201, and Tahoe

 

Merger of Ensco and Rowan Jacks Up Their Market Share

Stephen Rassenfoss, JPT Emerging Technology Senior Editor

Ensco has acquired Rowan, continuing the run of major acquisitions by the biggest offshore contract drillers at a time when the outlook for the business is starting to look up.

The combined company will be the largest player in the jackup sector, according to Wood Mackenzie, with rigs working on six continents. More than 60% of the 82 rigs in the fleet will be jackups, and Rowan also adds a growing joint venture with the largest jackup customer in the world, Saudi Aramco, according to the announcement.

Ensco will be offering 2.215 shares of its stock for every share of Rowan, or about $2.4 billion. This will create a new company in which Ensco shareholders will hold more than 60% of the shares, with Rowan’s shareholders holding the balance, and the top four executive positions evenly split.