offshore & energy - no.1-2011

www.offshore.no>> EXPLORATION >> RIG MARKET >> SUBSEA >> NORWEGIAN TECHNOLOGY ABROAD

No. 01 >> 2011

Ekofisk-PDO delivered

BRAZIL IS EVERY SUPPLIERS DREAM

Investment boom ahead

WHO WILL AIM FOR 20 YEARS WITH STATOIL?

Your future is on the line

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4 OffSHORE & ENERGY MARCH 2011

THIS ISSUE

A BRITISH FAIRYTALE cOMIng OUR WAYThe British market has fallen in recent years, but now there is a sharp rise in waiting. Projects for a hundred billion are going out in the market.

UPcOMIng SUBSEA BOOM DOWn UnDERAustralia could become the next gold golden market for Norwegian suppliers.

42 56

EkOFISk-PDO DELIVEREDOperator ConocoPhillips has delivered its plans for revival of the aging North Sea Ekofisk field. Giant investments at Ekofisk are looming and the goal is to increase the recovery rate from 49.5 to 52 per cent.

72

BRAZIL IS EVERY SUPPLIERS DREAMFor three out of every four partners in Norway’s Intsok, Brazil is a very important market, but there are 126 other nations in the world where it is thought easier to establish new business.

36

InVESTMEnT BOOM AHEADThere were many plans in the billion size during this year's NOC conference, but supplier squeeze and increased costs could limit the investments.

58

10 InTO THE BAREnTS SEA

29 ORDERIng RIg nUMBER FOUR TO nORWAY

54 WHAT'S TIckIng On THE nORWEgIAn SHELF?

12 gULLRIS cOULD BE gOLDEn

21 REMARkABLE ROckSOURcE ESTIMATES

64 gOLDEn EAgLE TO FLY WITH TWIn PLATFORMS

34 WHO WILL AIM FOR 20 YEARS WITH STATOIL?

70 nPD cRITIcIZES InDEcISIOn

40 EXPLORATIOn MAP

46 MORE THAn PIPES AnD TUBES

13 DRILLING fALLS NINE PER CENT ON UKCS 14 GIANTS DROP EXPLORATION ON THE NCS 16 SPARING THE TIME TO TALK 24 RIG COULD HALT EXPLORATION PLANS 26 THE RUSH fOR ACCOMMODATION RIGS 31 INVESTING BILLIONS IN DEEP WATER UNITS 32 VERY GOOD TIMES TO COME 38 THE ROAD TO BRAZIL 51 PROfESSOR EMIRATUS 62 PATHfINDER POINTS TO POTENTIAL PROJECTS 66 NO REACTION TO THE OLf WARNING 68 STATOIL DISAGREE WITH THE DIRECTOR Of PETROLEUM

73 MMO gIAnTS PLAn LISTIng On THE OSE

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>> fROM THE EDITOR

Helge Lund's statement that the Gullfaks oil is not lost, but a case of delayed production, has no support in any thorough technical and economic analysis. Even the Norwegian oil minister does not know if the reserves are impaired and thus lost forever.

Recently it was announced that Gullfaks production was down 40 per cent in December and January compared to November 2010. In a response Statoil CEO Helge Lund said that the company will have a reduced production of 30,000 barrels per day in 2011, but he underlined that “This is only deferred and not lost production".

It is not uncommon on the Norwegian shelf that when you do not produce as planned, volumes are pushed back in time. But whether the oil is lost or not depends on many things, not least the economic life of the installation. The Gullfaks installations are up to 25 years old and require major modifications over time to preserve their technical integrity and functionality. If inflation continues at the rate it now seems, with an even tighter supplier market as a result of increased responsibilities, it is obviously difficult to create profitability from smaller targets. This definitely increases the risk that the abandoned Gullfaks oil can not be exploited in a profitable manner and is thus "lost."

It is therefore very surprising that both Helge Lund and Statoil E & P Norway boss Øystein Michelsen seem so sure that the reserves are still there to be taken out. To our knowledge there is no thorough technical and economic analysis to support their claim. Therefore a more appropriate description would have been that the reserves “as of today” is not written down, but postponed.

Theoretically, this could be right in the end but the profitability of such a project is at best uncertain.

The Gullfaks production loss is about big money, our estimates range between NOK 5-7 billion this year alone. As the Norwegian state owns

collectively over 80 per cent of the Gullfaks field, the projected tax loss in 2011 will be in the range of NOK 6 billion.

In the Norwegian Parliament Oil Minister Terje Riis Johansen made the following remark: “Statoil has shut down some wells, while the owners are considering how to proceed with production from the field. It is not clear today if the challenges on Gullfaks will result in lower recovery from the field, or if we face a suspension of production."

The country's oil minister and the formal owner of 67 percent of Statoil do not, in other words, know if the Gullfaks problems will result in a "lower recovery rate, or a postponement of the production."

Seen in this light Lund and Michelsen show remarkable vision in being able to determine that the Gullfaks shutdown is merely a case of delayed production. As this is what the stock exchange will hear, it will probably remain Statoil's official stance until proven otherwise.

Helge Keilen

Editor-in-Chief

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exploration>>

text by: GLENN STANGELAND [email protected]

Whilst the number of wells decreased last year to 40 wells compared to 65 exploration wells in 2009, 2011 is set to match the record year of 2009. About 60 wells have been scheduled so far.

The increase is mainly due to an increase in Statoil's plans next year. In 2011 the company drilled ten wells, but according to Øystein Michelsen, director of exploration and production in Norway, the 2011 figure could be around 20-25 wells. So far, only five of these have been named.

Barents Sea and appraisalsLundin and Wintershall want to know more about Avaldsnes, Maria and Grosbeak and will therefore drill appraisal wells.

The current exploration in the Barents Sea expands. A total of nine wells are planned in the Barents Sea in 2011.

Director of exploration, Sissel Eriksen at the NPD hopes the increased activity will result in a breakthrough in exploration off the Hammerfest Basin.

"So far we have not been able to crack the code. We make discoveries, but the reservoir quality is not good enough. The challenge is to understand the geology of the area and develop new and better search models, "she said.

north Sea most popularThe companies still find the North Sea the most attractive area. Among the 42 wells which are specified in the licenses, 23 are located in the North Sea, 10 in the Norwegian Sea and nine in the Barents Sea.

Increase in explorations wells on the NCS.

Into the BAREnTS SEA

Fransk åpningDet høres nok dristigere ut enn det er.

Når GDF SUEZ E&P Norge overtar Gjøa, åpner de ikke bare en helt ny plattform, de åpner også en helt ny del av Nordsjøen. Dessuten er det også første gang selskapet er driftsoperatør på norsk kontinentalsokkel, og akkurat det kan høres dristig ut. Men når sant skal sies, er det alt annet enn det – GDF SUEZ er et av verdens største energiselskap.

Som operatør for utbyggingen, har Statoil bistått GDF SUEZ E&PNorge med erfaring og ekspertise, slik nordmennene selv en gang fikk starthjelp av amerikanske oljeselskap.Samarbeid var en forutsetning for å lykkes da, og er det fortsatt.

Gjøa-prosjektet er i det hele tatt tuftet på et unikt og verdensomspennende samarbeid.Fra planlegging til overlevering. Fra Statoil til GDF SUEZ. Kort sagt fra a til åpning.

Vi gleder oss til fortsettelsen!

Lisenspartnere:25. januar ble operatørskiftet og åpning av Gjøa-feltet markert. Utbyggingen av Gjøa- og Vega-feltene var det største prosjektet på norsk sokkel mens det pågikk. Det er investert rundt 40 milliarder kroner i feltene, som åpner et nytt område i den nordlige delen av Nordsjøen. Gjøa-feltet utvikles ved hjelp av en halvt nedsenkbar plattform, som også er i stand til å prosessere andre funn i området, i tillegg til Gjøa og Vega. Bruken av landbasert elektrisitet gjør dessuten at CO2-utslippene reduseres tilsvarende det årlige utslippet fra 100.000 biler.


exploration>>

Det norske's exploration programme for 2011 is offensive. The greatest anticipation is related to the BG-operated Gullris prospect which will be drilled northeast of Dalsnuten in the Norwegian Sea. Det norske is operating with an upside potential of between 700 and 1700 million barrels of oil equivalent on this prospect in PL522.

"We do not want to comment on the partner-operated drilling plans, but naturally we keep an eye on these," head of communications Torgeir Anda in Det norske tells Offshore.no. "When

there's large volumes, there's also great uncertainty. Closer to existing infrastructure, the volumes are smaller, but the success rate is bigger."

12 wellsIn 2011, the company and operator plans to drill five wells, of which four are in the North Sea and one in the Norwegian Sea. In addition, the company also will drill new exploration wells together with its partners in the North Sea, Norwegian Sea and Barents Sea.

"We also have a considerable programme next year, both as operator and partner. This way, we hope to contribute to reducing the declining oil and gas production on the Norwegian continental shelf. This programme represents a continuing aggressive effort on our part with a total of 12 wells - about the same number of wells as we have had in recent years, "he said.

Avaldsnes into Aldous?Det norske does not have a share in the largest oil discovery on the NCS in 2010, the Avaldsnes discovery, but the company believes the structure Lundin found extends into PL265, where the company has a 20 per cent share. Statoil will drill two wells on the Aldous prospect next year.

More concentrated explorationAker ASA has asked Det norske to change its exploration strategy on the Norwegian continental shelf and instead concentrate on specific areas.

"It's quite simple, Det norske has drilled a number of wells without discoveries. Drilling wells is expensive, and in such a situation, any leader has to look within and learn from the results and adjust accordingly,"said CEO Øyvind Eriksen Aker in November.

"It's a job we started early this year, and it is natural for Det norske to concentrate on some areas, but at the same time have an interested eye on the shelf, "says Anda.

When it comes to Stirby results from, the results may come before Christmas according to the market.

Det norske's planned wells in 2011, where the company is operator:Skaugumsåsen (482) in the Norwegian Sea.

Ulvetanna (356) in the North Sea.

Kalveklumpen (414) in the North Sea.

Storebjørn (450) in the North Sea.

Steingeita (460) in the North Sea.

Planned partner-operated exploration wells in 2011:BG's Gullris (522) in the Norwegian Sea.

Statoil's Krafla (035) in the North Sea.

Total's Norvarg (535) in the Barents Sea.

Eon's Breiflabb (416) in the North Sea.

Statoil's Aldous Major (265) in the North Sea. (X2)

Eni's Salina (533) in the Barents Sea.

Gullris could be goldenDet norske thinks the BG-operated prospect could contain as much as 1.7 billion barrels of oil equivalent.


13MARCH 2011 OffSHORE & ENERGY

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These were the lowest drilling levels in the UK sector of the North Sea and elsewhere on the UKCS since 2003, according to an end of year report by Deloitte

“The reduction of exploration and appraisal drilling seen in 2010 was created by a decrease of 26% in appraisal drilling when compared to the same period of 2009. By contrast exploration drilling on the UKCS increased by 17%,” Deloitte’s Petroleum Services group concluded.

Turning to the fourth quarter last year there were 12 E&A well spuds - down 15% compared with fourth quarter 2009. “When compared to the third quarter of 2010, the number of wells spudded has fallen more markedly by 545,” Deloitte noted.

Drilling was concentrated in the Southern North sea and Northern North Sea - with 33% and 25% of the wells respectively while the Moray Firth and Central North Sea saw 16% of all E&A wells in 2010. And the West of Shetlands region - long considered the future for finding new resources in UK waters - saw only 8% of the exploration activity in the fourth quarter

Towards the end of last year Energy Minster Charles Hendry at the Department of Energy and Climate Change presided over the UK’s 26th

Seaward Licensing Round which resulted in a total of 144 licences being offered over 268 blocks. And a further 44 licences covering another 99 blocks are expected to be offered in future, in protected conservation areas.

Drilling offshore Norway during 2010 saw 45 E&A wells, a 30% fall compared with 2009, although 2009 was a record year for drilling offshore Norway, so it was to be expected that the 2010 failed to equal that activity peak.

Deloitte noted that Norway’s tax system played a big part in the drilling surge there in 2009, saying:” The exploration drilling tax incentives devised by the Norwegian government are wildly [widely] regarded as a driving force for this high level of drilling activity within a difficult global economy and the capital constraints being exercised by lenders.”

Nine E&A wells were spudded offshore Norway in the fourth quarter last year - up 28% on the third quarter 2010, but a 43% fall on the fourth quarter 2009.

Turning to licensing deal activity offshore Norway, the Deloitte report highlights a slow start and a slow finish but higher activity during the second and third quarters. Nevertheless deal-making and corporate activity was down 25% from 32 deals in 2009 to 24 in 2010. But

some of them were significant, including the merge of Det Norske with Aker Exploration.

Offshore The Netherlands, 11 E&A wells were recorded, equal to the 2009 figure and three were in the fourth quarter, again equalling the number in 2009.

Denmark’s offshore drilling tally was one exploration well and one appraisal, again, the same as 2009.

Offshore Ireland the story was similar, with just one exploration well, compared with three E&A wells the previous year.

Greenland saw four E&A wells during 2010, the first drilling there for a decade, and more are planned this year, also by Cairn Energy. Licensing in Greenland saw a surge with seven new offshore licences awarded to ConocoPhillips, Shell, Statoil, GDF Suez, Cairn Energy, Maersk Oil, Dong and Nunaoil in the Baffin Bay area, covering 70,768 square kilometres, taking the licensed acreage offshore Greenland to around 200,000 sq. km.

And offshore from the Faroes Islands, one well was spudded, the first since 2007, and operated by Eni, which encountered hydrocarbons in sands dispersed within volcanic rocks.

There were a total of 71 exploration and appraisal wells drilled on the UKCS last year which indicated a 9% fall below that seen in 2009 when a total of 77 E&A wells were drilled.text by: JOHN BRADBURY [email protected]

Drilling falls nine per cent on UKCS


exploration>>

The fact that the four giants won't drill on the NCS is another proof of the shelf's maturity. Major projects are missing, and that causes these companies to lose interest.

"This is a serious development. The fact that these giants have been sitting on the edge of the Norwegian shelf and simply stuck to familiar areas and their producing fields for several years, is not a good starting point for the future. This will only leave Statoil and the dwarves on the shelf. NCS needs the skills these companies have," Ramm says.

"We are not planning to drill any exploration wells on the Norwegian shelf in 2011," head of information in BP, Jan Erik Geirmo says.

"Most of the drilling will be on existing fields in 2011. There will not be more than one exploration well, "said head of information Kristin Kragseth in ExxonMobil.

The four companies plan one, maximum two exploration wells in total in 2011. In comparison, the quartet drilled six exploration and appraisal wells last year.

Figures Offshore.no has collected from all operators show that around 60 exploration wells have been planned on the Norwegian continental shelf in 2011.

new areas are the futureShell which does not plan to drill on the shelf in 2011, accounted for two of the biggest disappointments of last year. Dalsnuten was dry and the Gro appraisal a disappointment. The company will decide on a further appraisal of the Gro discovery by summer.

"The Dalsnuten result emphasises the importance of opening new areas. We will continue to evaluate opportunities on the Norwegian continental shelf, but we believe that the future of oil and gas industry is in new and


OFFSHORE & ENERGY

not open areas," information officer, said Terje Jonassen in Norske Shell.

could disappearRamm believes there is a danger that some of these companies could be lost for the Norwegian petroleum industry.

"They are patient. But once they leave, it is difficult to get them back. So we must be careful. It is becoming time-critical, but they will probably stick for the next elections, "said Ramm to Offshore.no.

- What is needed to rekindle their spark?

"Companies are willing if the conditions are right. If we want to explore new areas, particularly in the Barents Sea, these companies must be involved. Opening of new areas, favorable tax policies and strategies for increased diversity are very important for these companies. They want major projects where they can use their expertise, and there are not many of them on the Norwegian continental shelf."

Jan Mayen is not quality land"This is a clear signal that the land in Norway is not particularly attractive to these companies compared to other opportunities elsewhere, "said Ketil Solvik-Olsen, energy policy spokesman of the Progress Party, to Offshore.no. "And when we have a Minister of Petroleum and Energy who says that Jan Mayen represent interesting opportunities for Norwegian oil companies, it shows how little he actually grasps. We need to start talking about the quality of the advertised area, not quantity."

He does not fear that companies will pull out of Norway, but stresses the importance that they get a more active role on the shelf.

"Most are in active licenses and are interested in maximising their value here."

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exploration>>

Every inch the global businessman, he bustles into the boardroom on the sixth floor of Amec’s concrete and steel central London headquarters to talk for a while about what’s coming in Aberdeen in September at the Offshore Europe conference and exhibition. Only he doesn’t just do that...

Instead, in a rapid delivery style, he talks about global issues in the energy industry, safety, and a raft of other energy-related subjects well within his grasp. Brikho, chief executive of the global engineering and project management group, was speaking at the company’s central London headquarters, as the chairman of the executive committee for the Offshore Europe 2011 conference and exhibition.

Amec’s chief executive was talking after the submission deadline closed for papers for the SPE Offshore Europe conference and exhibition which takes place in Aberdeen in September organised by Reed Exhibitions with the Society of Petroleum Engineers, based on the theme of “…securing safe, smart, sustainable supply.”

Brikho is the overall conference chairman this year and outlined the range of subjects which are due to be tackled at 0E 2011, which include facilities and infrastructure; new well technology; reservoir management, HSE, exploration and the potential for an upstream industry contribution to carbon reduction.

Homing in on that safety theme, Brikho is firm in his views about the Deepwater Horizon disaster: “That was a wake up call for the whole industry,” he declared. “We are stupid if we do not take this as an opportunity to improve. From an engineering and construction company perspective, we are not looking for who is responsible in this – that is not our job. We have to see how we are able to work better and see that everything is being learned and implemented.”

One of the features of this year’s exhibition is a deepwater zone which aims to highlight the latest deepwater technologies, and a Brazil pavilion is bound to be a key attraction as the country has emerged as one of the most desirable markets for petroleum related production and services after a series of giant deepwater discoveries, which in turn have led to a demand for no less than 13 new floating

production storage and offloading units in the next few years. Also presentations will focus on Brazil’s deepwater industry. There will be a showcase for unmanned underwater vehicles, and sessions dedicated to deepwater exploration and knowledge-sharing hosted by EAGE and SPE.

Talking tax “The biggest challenge for operators in the North Sea is the tax issue, with a 50% flat tax rate,” Brikho declared during a meeting with industry journalists. But he acknowledged that other regions have higher rates: “For other places it is up to 90%,” he noted. “But I believe this is an opportunity. The more lucrative you make it, the more attractive you make it,” Brikho said.

Chancellor George Osborne is said to be “listening and understanding” to what the UK offshore sector has to say about the tax regime, as the offshore industry seeks to eke out the remaining reserves of around 30 Billion barrels of oil equivalent from the UK sector of the North Sea.

Asked about the government’s view on offshore taxation, Brikho, said: “George Osborne is very listening and understanding. He is very sensitive and alert to the situation.”

ProspectsPressed about the prospects for any UK offshore tax changes, Brikho added: “I cannot expect, I would hope,” he answered diplomatically.

However, for the contracting community, the biggest issue in the North Sea is different. : “It is about establishing sustainable and reliable operations,” Brikho declared. For Brikho, future challenges for the industry involve safeguarding the environment better than we do now, and tackling some of the industry’s supply chain issues related to the introduction of new technology: “Nobody wants to be the first one,” he says, so more industry collaboration is needed,

Appointed chief executive at Amec in 2006, Brikho joined ABB in 1983 and in 2000 became head of Alstom Power. Between 2003 and 2006 he was chief executive and then later chairman of ABB Lummus Global.

Apart from his role as chairman of Offshore Europe 2011, Brikho has chaired a World Economic Forum engineering and construction board. He has led a government task force aimed at demonstrating the UK’s expertise in energy to the world, and in February 2010 was appointed by the then Prime Minister Gordon Brown as a UK business ambassador.

And don’t think he can’t get his message across: He’s a fluent speaker in Swedish, Arabic, German and French, and, oh yes, English too.

Offshore Europe 2011 takes place at the Aberdeen Exhibition and conference centre from 6 to September 2011. To find out more go to: http://www.offshore-europe.co.uk

Samir Brikho can only spare a couple of hours: He’s clearly a busy man with a global empire to run.

Sparing the time to talktext by: JOHN BRADBURY [email protected]

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Scanmatic

Seal-Jet

SEC

Sepro Technology

ShoreConnection international

SI-KA-TEC GmbH engineering coating

SIMEX

SMB Odda

SOLBERG & ANDERSEN

Solid Vedlikehold

SoluDyne

sp-tools

Stangeland Glassfiber Produkter

staubo elektro-maskin

Stokvis Tapes Norway

Strukturplast

Sub Sea Services

Subsea 7

Subsea Technology Group

Sulzer Pumps Norway

SVAFAS

Svenska Statoil AB, Lubricants

Sverdrup Hanssen Spesialstål

T Bruvik

Teamtrade

Teksal

TESS

TOOLS VEST

Torgy Mek. Industri

Trac ID Systems

Tranberg

Trelleborg Offshore Norway

Trio Oiltec Services

Tyco Valves & Controls Norway

Umoe Schat Harding Services

Veolia Miljø

Vestpak

Vestteknikk

VICTORIA

Viking Moorings

Vink Norway

VisCo

Wago Norge

Wärtsila Norway

Watech

Well Partner

West Contractors

Westsoft

XAIT

nORWAY’S LARgEST AnnUAL OIL EXHIBITIOnThe Norwegian offshore market is the world’s largest, even larger than Brazil and the Middle East. Each year until 2015 some US$ 35 billion will be invested in the Norwegian Continental Shelf. With its geographic proximity this should be of interest for suppliers.

Every second year the world’s oil industry gathers to ONS in Stavanger, which in 2010 had 1.200 exhibitors. In 2011 Norwegian oil industry will gather once more in Stavanger, this time for the annual Offshore Technology Days which is Norway’s largest annual oil and gas exhibition. OTD is focusing solely on the Norwegian Continental Shelf under the motto:

• 220-250 exhibitors and a sell-out out the last four years.

• Between 10.000-14.000 oil professionals visit the exhibition.

• With only two exhibition halls even small exhibitors will be noticed.

• The exhibition is actively marketed through www.offshore.no, Scandinavia’s largest petroleum website with up to 19.500 readers every day.

• All exhibitors are invited to a great OctoberFest, Icebreaker and AfterParty.

• OTD is arranged the same place as ONS and with the same technical arranger.

• Primo March 210 stands (85 % of total capacity) is sold.

WE ARE THE nORWEgIAn cOnTInEnTAL SHELF

Facts about Offshore Technology Days:

• OTD was started in 2001 and is Norway’s largest annual oil and gas exhibition.

www.o ffshoredays .com

In the beginning of March 2011, more than 210 exhibitors had booked a stand on the Offshore Technology Days (OTD) in Stavanger, October 19-20 2011.

This represents 85 per cent of available stand capacity in Stavanger Forum, and is a sure sign that the 11th OTD exhibition will be a sell-out, like the

previous ones in Bergen.

Tickets to the legendary Octoberfest are also sold at an unprecedented race.

You may find additional information on www.offshoredays.com

EXHIBITIOn OnLY 15% AVAILABLE

Main sponsor: OTD sponsors:

Octoberfest sponsor: OTD lounge sponsor: Arrangør:

EXHIBITIOn OPPORTUnITIESIf your company is considering beeing part of the exhibition, please contact us to make reservations for a stand.

contact: Offshore Media Group+47 56 31 40 [email protected]

OVERALL PROgRAMME

OTD Icebreaker

OTD Subsea SeminarsOTD ConferenceOTD Students

TUESDAY 18. OCT. WEDNESDAY 19. OCT. THURSDAY 20. OCT.

OTD Exhibition

OTD Octoberfest

OTD Subsea SeminarsOTD ConferenceOTD Students

CONfERENCE

EXHIBITION

SOCIAL OTD Concert

A PART OF IT


OFFSHORE & ENERGY

The company believes it has a very accurate exploration technology. Earlier last year, Rocksource announced a sensational high probability of discovery on the Norvarg prospect , which Total E & P Norway was to drill in the Norwegian Barents Sea with the semi-submersible West Phoenix. Rocksource, which has a 20 per cent share in the prospect, told the market they saw a success probability of 50 percent. In comparison, the success rate over the last few years has risen to around 50 per cent in mature areas in the North Sea.

Also for comparison, so far it has not been customary to expect a higher chance of success than 10- 20 percent in either the Norwegian Sea or the Barents Sea.

The market reacted to the Norvarg message that was sent out 11 October last year by sending the stock price up 28 percent in two days.

- EM analysis provided additional information 1. Per Anders Muri, vice president of Rocksource, told Offshore & Energy that it is the company's own electromagnetic technology that enables the company to estimate the chance of success better than other operators.

O&E: You operate with a much higher chance of success than other oil companies. How can you do this?

“Based on traditional seismic interpretation and geological work, we operate normally with the discovery probabilities in line with our partners. It is only when we integrate the EM analysis and conclude that our findings are positive that probabilities increase. However, it is important to But on Norvarg EM analysis gave valuable additional information which resulted in the discovery probability which was raised to about 50 percent. This was also the case on Heilo - another Barents prospect, which we will test next year,” said Muri.

High estimate of HeiloThe company GDF Suez is the operator of Heilo, which will be drilled next year with the rig Aker Barents. Also here Rocksource has a stake of 20 percent, and here Rocksource estimates the chance of success of 50 percent or more, while the operator does not want to talk about the perceived success rate.

Oslo stock exchange comments:According to the Oslo Stock Exchange, it is the companies themselves that define what information they convey to the market.

Rocksource recently announced to the market that the chance of success on the prospect Norvarg was at 50 percent. This is far above what other oil companies reckon to be the chance of success. How does the Oslo Stock Exchange react?

“This is the company's own assessment, and this is also evident in their

announcement. We have no reason to doubt this assessment,” said Per Eikrem, communications director at the Oslo Stock Exchange, told Offshore & Energy.

To be or not, this year“The main business idea for Rocksource is to use the interpretation of electromagnetic (EM) data in addition to conventional seismic surveys in the exploration work. This they think can opt out many less promising prospects and point the exploration drilling to the prospects with the highest chance of discoveries. This remains to be seen, and the drilling results later this year will tell the market just how successful this technology is, Eikrem adds.

Some statisticsSo far a total of 80 wells have been drilled about in the Barents Sea, and in 2008 six wells discovered hydrocarbons, i.e. well over 50 percent success rate. Unfortunately, there were no commercial discoveries, and Sissel Eriksen exploration director in the NPD,, recently told Offshore&Energy that we still have not cracked the code in parts of the Barents Sea.

“So far we have not been able to crack this code. We make discoveries, but the reservoir quality is not good enough. The challenge is to understand the geology of the area and this understanding to develop new and better plays,” she said.

The oil company’s stock value rose 28 per cent in two days after a very optimistic drilling prospect estimate.

REMARKABLE ROCKSOURCE ESTIMATES text by: STEIN TJELTA [email protected]


rig market>> rigs under construction

OPERATOR RIg nAME DESIgn BUILDER cOUnTRY OF BUILD

DELIVERY W.D. FEET

D.D. In FEET

JAck UPSAsia Offshore Drilling Ltd. Asia Offshore Rig 1 KFELS B Class KFELS Singapore 2012 350 30 000

Asia Offshore Drilling Ltd. Asia Offshore Rig 2 KFELS B Class KFELS Singapore 2013 350 30 000

Atwood Oceanics Atwood Mako Pacific Class 400 PPL Shipyard Singapore sep-12 400 30 000

Atwood Oceanics Atwood Manta Pacific Class 400 PPL Shipyard Singapore des-12 400 30 000

Atwood Oceanics Atwood Orca Pacific Class 400 PPL Shipyard Singapore juni-13 400 30 000

Clearwater Capital Partners LLC Clearwater jackup TBN 1 KFELS B Class KFELS Singapore 1Q - 2013 400 30 000

Clearwater Capital Partners LLC Clearwater jackup TBN 2 KFELS B Class KFELS Singapore 2Q - 2013 400 30 000

Egyptian Offshore El Qaher II Baker Marine Services Pacific Class 375 PPL Shipyard Singapore 2011 375 30 000

ENSCO ENSCO jackup TBN 1 KFELS Super A KFELS Singapore 2Q-2013 400 40 000

ENSCO ENSCO jackup TBN 2 KFELS Super A KFELS Singapore 4Q-2013 400 40 000

Essar Oilfield Services Essar Jackup TBN 1 F & G JU 2000 A ABG Shipyard India 2011 350 30 000

Essar Oilfield Services Essar Jackup TBN 2 F & G JU 2000 A ABG Shipyard India 2011 450 30 000

Eurasia Drilling Company Eurasia jackup TBN 1 LeTourneau Super 116E Lamprell U.A.E. Q4 - 2012 350 30 000

Great Offshore Great Offshore V351 LeTourneau 116-E Bharati Shipyard India 2011 350 30 000

Greatship Global Greatship jackup TBN 1 LeTourneau Super 116E Lamprell U.A.E. 4Q -2011 350 30 000

Hercules Offshore Discovery Offshore jackup TBN 1 KFELS Super A Class KFELS Singapore 1Q - 2013 400 35 000

Hercules Offshore Discovery Offshore jackup TBN 2 KFELS Super A Class KFELS Singapore 2Q - 2013 400 35 000

Jasper Investments Ltd. Jasper Jackup TBN 1 KFELS B Class KFELS Singapore nov-12 400 30 000

M/S Drilling & Offshore pte Ltd. M/S Drilling Jackup TBN 1 JU-2000A-01 ABG Shipyard India 2014 350 30 000

M/S Drilling & Offshore pte Ltd. M/S Drilling Jackup TBN 2 JU-2000A-01 ABG Shipyard India 2014 350 30 000

Maersk Drilling Maersk jackup TBN 1 Gusto MSC CJ-70-150MD - enhanced KFELS Singapore 2013 150 40 000

Maersk Drilling Maersk jackup TBN 2 Gusto MSC CJ-70-150MD - enhanced KFELS Singapore 2014 150 40 000

Maritime Industrial Services MIS Jackup (Hull 108) Friede & Goldman F&G Super M2 UAE shipyard U.A.E. 2011 300 30 000

MenaDrill MenaDrill Hercules II F&G Super M2 MIS Shipyard U.A.E. 2011 300 30 000

Momentum Eng. F&G Super M2 Yantai Raffles Kina 4Q -2011 300 30 000

Mosvold Drilling MEJU Jackup TBN 1 Friede & Goldman F&G Super M2 UAE shipyard U.A.E. 2011 300 30 000

National Drilling NDC jackup TBN 1 LeTourneau Super 116E Lamprell U.A.E. 2012 200 30 000

National Drilling NDC jackup TBN 2 LeTourneau Super 116E Lamprell U.A.E. 2012 200 30 000

Noble Drilling Noble Jackup I - new F&G JU-3000N Jurong Shipyard Singapore 2012 400 30 000

Noble Drilling Noble Jackup II - new F&G JU-3000N Jurong Shipyard Singapore 2013 400 30 000

Odebrecht P-59 LeTourneau Super 116E Rio Paraguacu Brasil juni-11 350 30 000

Odebrecht P-60 LeTourneau Super 116E Rio Paraguacu Brasil okt-11 350 30 000

PetroVietnam PetroVietnam Jackup TBN 1 LeTourneau Super 116E PV Shipyard Vietnam 2012 300 30 000

Prospector Offshore Prospector Rig 1 F&G JU2000E DSIOC Kina 4Q - 2012 400 35 000

Prospector Offshore Prospector Rig 2 F&G JU2000E DSIOC Kina 1Q -2013 400 35 000

Rowan Companies Rowan EXL IV LeTourneau Super 116E Keppel FELS Singapore 2012 350 35 000

Rowan Companies Rowan Norway KFELS N Class Keppel FELS Singapore 2011 400 35 000

Rowan Companies Joe Douglas LeTourneau LeTourneau 240C LeTourneau Shipyard USA 2011 375 35 000

SAAG Drilling SAAG Jackup TBN 1 MSC CJ46-X100D Labuan Malaysia 2011 375 30 000

Saudi Aramco Saudi Aramco TBN 1 KFELS Super B Class Keppel FELS Singapore 2012 200 20 000

Seadrill West Telesto Friede & Goldman JU2000E Dalian Shipyard Kina 4Q 2012 400 30 000

Seadrill West Oberon Friede & Goldman JU2000E Dalian Shipyard Kina 1Q 2013 400 30 000

Seadrill West Castor Friede & Goldman JU2000E Jorung Shipyard Singapore 4Q 2012 400 30 000

Seadrill West Tucana Friede & Goldman JU2000E Jorung Shipyard Singapore 1Q 2013 400 30 000

Seadrill West Elara Gusto MSC CJ70-X150A Jurong Shipyard Singapore 2011 450 40 000

Shanghai Offshore Kan Tan 6 Pacific Class 375 PPL Shipyard Singapore 2011 375 30 000

Standard Drilling Ltd Standard Drilling Ltd TBN 1 KFELS B Class KFELS Singapore Q2 - 2012 400 30 000

Thule Drilling Thule Force F&G Super M2 QGM Shipyard U.A.E. 2011 300 30 000

Thule Drilling Thule Energy F&G Super M2 QGM Shipyard U.A.E. 2011 300 30 000

Transocean Ltd. Transocean TBN 1 KFELS super B Class KFELS Singapore 1Q - 2013 350 40 000

Transocean Ltd. Transocean TBN 2 KFELS super B Class KFELS Singapore 3Q - 2013 350 40 000

Transocean Ltd. Transocean Honor Pacific Class 400 PPL Shipyard Singapore 4Q -2011 400 30 000

Yantai Raffles Yantai Raffles TBN 2 F&G Super M2 CIMC Raffles Singapore 2011 300 30 000

Yantai Raffles Yantai Raffles TBN 3 F&G Super M2 CIMC Raffles Singapore 2011 300 30 000

SEMI-SUBMERSIBLESAtwood Oceanics Atwood Osprey Friede & Goldman F&G Ex-D Millennium Jurong Shipyard Singapore 2011 8 200 32 000

Atwood Oceanics Atwood Condor Friede & Goldman F&G Ex-D Millennium Jurong Shipyard Singapore 2012 10 000 40 000

China Oilfield Services COSLInnovator GM 4000 Yantai Raffles Kina 2011 2 500 25 000

China Oilfield Services COSLPromotor GM 4000 Yantai Raffles Kina 2012 2 500 25 000


OPERATOR RIg nAME DESIgn BUILDER cOUnTRY OF BUILD

DELIVERY W.D In FEET

D. D. In FEET

Delba Perf. Delba III Gusto MSC TDS 2500 Abu Dhabi shipyard India 2011 8 000 30 000

Delba Perf. Delba IV Gusto MSC TDS 2500 Abu Dhabi shipyard India 2013 9 000 25 000

Delba Perf. Delba V Friede & Goldman Samsung Korea 2012 7 800 25 000

Delba Perf. Delba VI MSC TDS 2000 Samsung Korea 2012 7 800 25 000

ENSCO ENSCO 8504 Dynamically Positioned DP-2 KFELS Singapore 2011 8 500 35 000



Gazflot Severnoye Siyanie Moss Maritime CS-50 Samsung Korea 2011 10 000 24 000

Gazflot Polyarnaya Zvezda Moss Maritime CS-50 Samsung Korea 2011 10 000 24 000

Industrial Perforadora de Campeche Bicentenario Gotaverken GVA-7500 Daewoo Korea 2011 10 000 40 000

Island Offshore Island Innovator GM4000-WI Cosco Shipyard Kina 2012 10 000 26 000

Odebrecht Odebrecht Semisub TBN 1 - Daewoo Korea 2013 10 000 -

Perf. da Campecha La Muralla IV Gotaverken GVA-7500 Daewoo Shipyard Korea 2011 10 000 40 000

Petroserv SA SSV Catarina Gotaverken GVA 7500 DSME Korea 2012 10 000 35 000

Queiroz Galvao Oleo e Gas S.A. Alpha Star MSC Gusto DSS-38, DP2 Keppel FELS Singapore 2011 9 000 25 000

Saipem Scarabeo 8 Moss CS 50 MkII Severodvinsk Yard Russland 2011 9 000 35 000

Schahin Amazonia F&G Ex-D Yantai Raffles Kina 2011 8 000 25 000

Seadrill West Capricorn F&G Ex-D Jurong Shipyard Singapore 2011 7 500 35 000

Seadrill West Jaya KFELS SSDT3600E-GOM-C42 Keppel FELS Singapore 2011 6 500 30 000

Seadrill Seadragon II Moss Maritime CS50 Mk II Jurong Shipyard Singapore 2011 10 000 35 000

Seadrill Ltd West Leo(SD 2) CS50 MkII Jurong shipyard Singapore 4Q - 2011 10 000 35 000

Seadrill Ltd West Pegasus(SD 1) CS50 MkII Jurong shipyard Singapore 2011 10 000 35 000

Sevan Drilling Sevan Driller II Sevan 650 Cosco Nantong Kina 2012 12 500 30 000

Sevan Drilling Sevan Driller III Sevan 650 Cosco Nantong Kina 2012 10 000 30 000

Songa Offshore Songa Eclipse F&G Ex-D Millennium Jurong Shipyard Singapore 2011 10 000 40 000

DRILL SHIPSAker drilling TBN 1 DSME Ultra Deepwater Drillship Daewoo Shipbuilding Korea okt-13 12 000 40 000

Aker drilling TBN 2 DSME Ultra Deepwater Drillship Daewoo Shipbuilding Korea des-13 12 000 40 000

Atwood Oceanics Atwood Advantage - South Korea Shipyard Sør Korea 2013 12 000 40 000

Diamond Offshore Ocean BlackHawk Hyundai Korea 2Q - 2013 12 000 35 000

Diamond Offshore Ocean BlackHornet Hyundai Korea 4Q - 2013 12 000 35 000

Etesco Etesco VIII S10000E Samsung Korea mars 12 10 000 35 000

Noble Corporation Noble TBN Gusto P10000 Hyundai Korea 2Q - 2014 12 000 40 000

Noble Drilling Noble Bully I Gusto PRD12000 Gusto Eng./Keppel Singapore 2011 12 000 40 000

Noble Drilling Noble Bully II Gusto PRD12000 Gusto Eng./Keppel Singapore 2011 12 000 40 000

Noble Drilling Noble DS TBN 1 Gusto P10000 Hyundai Korea 2Q - 2013 12 000 40 000

Noble Drilling Noble DS TBN 2 Gusto P10000 Hyundai Korea 4Q - 2013 12 000 40 000

Noble Drilling Noble Globetrotter I Globetrotter Class STX Shipyard Kina 2011 10 000 40 000

Noble Drilling Noble Globetrotter II Globetrotter Class STX Shipyard Kina 2013 10 000 40 000

Ocean Rig/Dryships Ocean Rig Mykonos Saipem 10000 design Samsung Korea sep-11 10 000 35 000

Ocean Rig/Dryships Ocean Rig Poseidon Saipem 10000 design Samsung Korea juli-11 10 000 35 000

Ocean Rig/Dryships Ocean Rig Olympia Saipem 10000 design Samsung Korea mars-11 10 000 35 000

Odebrecht Norbe VIII DSME 10000 Daewoo Korea 2011 10 000 35 000

Odebrecht Norbe IX DSME 10000 Daewoo Korea 2011 10 000 35 000

Odebrecht Norbe X DSME 10000 Daewoo Korea 2011 10 000 35 000

Odebrecht Norbe XI DSME 10000 Daewoo Korea 2012 10 000 35 000

Odebrecht Odebrecht Drillship TBN 1 Daewoo Korea 2013 10 000

Odfjell Drilling/Metrostar Metro I Gusto Engineering Gusto P10000 Hyundai/Gusto Korea 2011 10 000 40 000

Odfjell Drilling/Metrostar Metro II Gusto Engineering Gusto P10000 Hyundai/Gusto Korea 2011 10 000 40 000

Pacific Drilling Services Inc. Pacific Mistral Samsung 10000 Double Hull Samsung Korea mai-11 10 000 35 000

Pacific Drilling Services Inc. Pacific Santa Ana Samsung 12000 Double Hull Samsung Korea juli-11 10 000 35 000

Pacific Drilling Services Inc. Pacific Scirocco Samsung 12000 Double Hull Samsung Korea mars-11 10 000 35 000

Petroserv SA Carolina Daewoo Daewoo Korea 2012 10 000 35 000

Pride International Deep Ocean Molokai Samsung, DP3 Samsung Korea 4Q - 2011 12 000 40 000

Pride International PS-5 Samsung, DP3 Samsung Korea 2013 12 000 40 000

Schahin Cerrado S10000E Samsung Korea 2011 10 000 37 000

Schahin Sertao S10000E Samsung Korea 2012 10 000 37 000

Seadrill West Auriga SHI S10000 Samsung Korea 1Q 2013 12 000 40 000

Seadrill West Vela SHI S10000 Samsung Korea 2Q 2013 12 000 40 000

Stena Drilling Stena DrillMax ICE Samsung DP Dual Mast Ice-Class Samsung Korea 2011 10 000 35 000

Vantage Drilling Titanium Explorer DSME Ultra Deepwater Drillship Daewoo Shipbuilding Korea juli-11 12 000 40 000

Vantage Energy Cobalt Explorer DSME Daewoo Korea 2012 12 000 40 000

Vantage Energy Services Dalian Developer MPF 1000 6th Generation Cosco Shipyard Kina juli-12 10 000 30 000

Vantage Energy Services DragonQuest DSME Daewoo Korea juli-11 12 000 40 000

*Updated 07.03.2011


rig market>>

text by: JOHN ØKLAND [email protected]

Offshore.no has previously reported that oil companies plan to gear up exploration on the Norwegian shelf in 2011. The number of wells will increase from 40 wells in 2010 to 60 in 2011.

The Norwegian Petroleum Directorate finds these figures concerning. When the Directorate summed up 2010, it pointed out some problems with a higher activity.

"If the activity increases, NPD believes limited capacity will once again be a problem. Increased rig capacity is particularly important to realise the planned activity. The current plans cover many wells, both exploration wells and production wells," NPD said about 2011.

no available rigsAt the same time as oil companies plans increased activity in the coming years, the rig companies with rigs qualified for work in Norway have the best cards. They experience a rush for rigs. But there are no available rigs for hire right now.

The first rig to end its current contract is the semi sub Bredford Dolphin, which will be available in November or December. Some weeks later the first jack up, Maersk Giant, will be available.

Rig Analyst Atle Hauge Carnegie says it sounds a lot with 60 wells considering the current rig count.

"Of course it depends on how long time is spent drilling per well and what tasks are included. But the fact is that it is a tight market and that rigs could quickly become a bottleneck," he tells Offshore & Energy.

Returning rigsIn the near future followings rig will enter the NCS. Scarabeo 8 is waiting for completion in Ølen and will not be ready before the end of the year. West Elara is expected to start working in August. These two including three COSL rigs, COSL Pioneer, COSL Promoter and COSL Innovator will enter the market once they've been completed.

What will happen with Songa Eclipse and West Capricorn is not yet decided. The three jack ups Rowan Norway, Rowan Viking and Rowan Stavanger will not come to Norway in the nearest future to drill. Norway and Viking are both contracted in UKNC. It is important to say that Rowan Stavanger will come to Norway, but the jack up is contracted to Talisman at Yme as an accommodation rig from summer 2011 and for approximately 90 to 120 days.

This leaves another possibility, to fetch rigs operating abroad. This will be costly for the oil operators. A rig needs approval from PSA before it can work in Norway, and this requires investments. In return, the rig companies can achieve better contract terms.

"If this happens, the rig companies probably will demand long term contracts with day rates higher than $ 350.000-400.000. It also takes time to get a rig approved," Hauge says. It can take three months to six months, he estimates.

Two rigs already have been approved, but both Eirik Raude and Leiv Eiriksson won't be able to work on the Norwegian shelf this year.

The exploration activity will increase in 2011, but the number of rigs may not.

RIg cOULD HALT EXPLORATIOnS PLAnS

Rig analyst Atle Hauge in Carnegie says 60 wells in Norway during 2011 is much, because of the current rig capacity. - The fact is that it is a tight market and that rigs could quickly become a bottleneck, he says.

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West Contractors AS • NO-5582 Ølensvåg, Norway • Tel: +47 53 77 50 00 • Fax: +47 53 77 50 01 • E-mail: [email protected] • www.westcon.no

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rig market>>

It's a battle for the vacant accommodations rigs in Norway.

Normally the market tightens into the summer, but the trend now is that oil companies signs contracts earlier then before and offers jobs for other seasons as well.

“This is a leading indicator that prices will go up, "says Bjørn Thoresen - rig analyst at First Securities.

Seven unitsThe contract situation for the semi accommodations rigs is as follows.

MSV Regalia is leased to BP and Valhall through October this year.

Safe Scandinavia is on contract with BP until March, before the rig moves to Statoil's Snorre A for six months work in August. Then it returns to BP and Valhall through January, with an option to March. After this, it is contracted to an undisclosed customer from August to November 2012.

Safe Caledonia will continue in UK North Sea and BG, from March to November - with the option of working through January 2012.

The Borgholm Dolphin has recently extended its contract with an unnamed customer in the UK North Sea, starting in November with duration of ten months. In addition there is an option period of four months.

Floatel Superior is contracted to Talisman on Yme. In May the rig will move to its contract with Statoil at Oseberg for five months. It is thus employed to October this year.

COSL Rival has a long-term contract with ConocoPhillips to the end of next year with options for further work.

The seventh unit in this segment is Safe Bristolia. This rig is currently without a contract, but has limitations in terms of when it can work in practice and this is a summer-rig because of this.

no new builds

“In practice accommodations rigs in the North Sea is sold out for 2011 and there are no new units entering the market. Nothing is under construction,” says Thoresen.

This means that the market is tight for the next few years and then prices will go up.

In contrast to the drilling rig fleet, which will see significant new construction deliveries in the years ahead, there are no new accommodation units under construction.

Must use Jack UpThe pressure on the accommodation rig sector is exemplified by Talisman rental of rig for Yme. The company has signed an agreement for the use of Floatel Superior for 90 days before the rig moves to Statoil in May. To further meet the need they have had to hire the new Jack Up Rowan Stavanger and use it as accommodation unit.

“The rig is a new-build and has, for a drilling rig, a modern and quite large bed capacity. Since no accommodation units are available in the period from May, it has been necessary to hire a drilling rig for this purpose. Talisman has obtained market information for other possible housing units before it was decided to hire a drilling rig for the purpose”, says information manager Andreas Middleton in Talisman Energy Norge.

The seven units mentioned have day rates of between $ 200,000 and $ 242,000. To hire the modern Jack Up Rowan Stavanger Talisman must pay just under $ 300,000, according to Rowan.

“Talisman consider this option the best that the market could offer, "comments Middelthon.

By comparison, it can also be mentioned that the company will pay $ 18,000,000 for 90 days with Floatel Superior, according to Floatel. This gives a day rate at $ 200,000. Here it could be mentioned that Rowan Stavanger is hired during peak season, while Floatel Superior is on a winter rate.

The market for accommodations rigs is now so hot that an oil companies must use a new drilling rig as hotel.

The rush for accommodation rigstext by: JOHN ØKLAND [email protected]


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nAME OWnER cLIEnT TYPE cOnTRAcT YEAR cOnTRAcT MOnTH DAYRATE SEcTOR cOMMEnTAker Barents Aker Drilling Det norske Semi 2014 7 $520 000 Norway 2 years opt.

Aker Spitsbergen Aker Drilling Statoil Semi 2013 7 $537 000 Norway + 2 years opt. x 5

Bideford Dolphin Dolphin Statoil Semi 2014 1 $385 000 Norway 1 year opt.

Borgland Dolphin Dolphin Cons. Semi 2014 1 $530 000 Norway

Borgsten Dolphin Dolphin Undisclosed Semi 2011 10 $240 000 UK

Bredford Dolphin Dolphin Lundin/Premier Oil Semi 2011 11 $333 000 Norway To Preimier Oil Aug. 2011

Byford Dolphin Dolphin BP Semi 2013 4 $324 000 UK

Deepsea Atlantic Odfjell Drilling Statoil Semi 2014 8 $490 000 Norway + 1+2 years opts.

Deepsea Bergen Odfjell Drilling Statoil Semi 2015 6 $320 000 Norway + opts.

Energy Endeavour Northern Offshore Maersk Olie og Gas Jack Up 2012 4 $70 000 Denmark 2 years opts.

Energy Enhancer Northern Offshore Ithica/Perenco Jack Up 2011 7 $70 000 UK To Perenco early May 2011

Ensco 100 Ensco Shipyard/E.On Jack Up 2012 3 $130 000 UK E.On from May.2011

Ensco 101 Ensco Maersk Jack Up 2012 1 $170 000 UK Plus one unpriced option

Ensco 102 Ensco ConocoPhillips Jack Up 2016 6 $200 000 UK Plus options.

Ensco 70 Ensco Maersk, PA Resources, Tullow Jack Up 2012 9 $60 000 UK Accommodation work.

Ensco 71 Ensco Maersk Jack Up 2012 1 $80 000 Denmark 1+1+1 years opt.

Ensco 72 Ensco RWE/Shipyard/Maersk Jack Up 2012 6 $80 000 UK Plus three one-well options.

Ensco 80 Ensco Tullow, Wintershall Jack Up 2011 12 $130 000 UK

Ensco 92 Ensco ConocoPhillips. E.On Jack Up 2012 7 $100 000 UK

GSF Arctic III Transocean ExxonMobil Semi 2011 7 $249 000 UK

GSF Galaxy II Transocean ADTI Jack Up 2011 3 $150 000 UK

GSF Galaxy III Transocean Nexen Jack Up 2011 10 $107 000 UK

J W McLean Transocean Marathon Semi 2011 3 $258 000 UK

Maersk Gallant Maersk Drilling ConocoPhillips Jack Up 2013 3 N/A Norway 2 year opt.

Maersk Giant Maersk Drilling Talisman Jack Up 2011 12 $340 000 Norway

Maersk Guardian Maersk Drilling Talisman Jack Up 2012 3 $295 000 Norway

Maersk Innovator Maersk Drilling ConocoPhillips Jack Up 2017 2 N/A Norway 2 year opt.

Maersk Inspirer Maersk Drilling Statoil Jack Up 2015 1 N/A Norway

Maersk Reacher Maersk Drilling Maersk Olie og Gas/BP Jack Up 2014 6 N/A Denmark BP Norway from May

Maersk Resolute Maersk Drilling Dong Jack Up 2011 12 N/A Denmark

Maersk Resolve Maersk Drilling Maersk Olje og gass Jack Up 2011 5 N/A Denmark 1 year opt.

Noble Al White Noble Drilling Total Jack Up 2011 6 $112 000 Holland Plus a six month priced opt.

Noble Byron Welliver Noble Drilling ATP/Chevron/Yard Jack Up 2011 11 $86 500 Denmark

Noble George Sauvageau Noble Drilling Wintershall Jack Up 2011 12 $93 000 Germany Plus opt.

Noble Hans Deul Noble Drilling Shell Jack Up 2013 2 $175 000 UK

Noble J. Robertson Noble Drilling Centrica Jack Up 2012 3 $88 000 UK

Noble Lynda Bossler Noble Drilling Dana (KNOC) Jack Up 2011 10 $88 000 Holland

Noble Piet van Ede Noble Drilling Gaz de France Jack Up 2011 12 $86 000 Holland

Noble Ronald Hoope Noble Drilling Gaz de France Jack Up 2011 12 $87 000 Holland

Noble Scott Marks Noble Drilling Centrica/Saudi Aramco Jack Up 2014 6 $213 000 UK To Saudi Arabia Jun. 2011.

Noble Ton van Langeveld Noble Drilling Centrica/Maersk Semi 2011 7 $247 000 UK

Ocean Nomad Diamond Offshore BG Intl. Semi 2011 6 $240 000 UK

Ocean Princess Diamond Offshore Talisman Semi 2011 7 $330 000 UK

Ocean Vanguard Diamond Offshore Statoil Semi 2013 6 $349 000 Norway + opt.

Paul B. Loyd Transocean BP Semi 2012 3 $503 000 UK

Polar Pioneer Transocean Statoil Semi 2014 1 $503 000 Norway

Rowan Gorilla V Rowan Total Jack Up 2013 2 $160 000 UK

Rowan Gorilla VII Rowan Apache Jack Up 2012 5 $180 000 UK

Rowan Gorilla VI Rowan BG Jack Up 2011 7 $200 000 UK

Rowan Stavanger Rowan Talisman Norway Jack Up 2012 10 $300 000 UK

Rowan Viking Rowan Total Jack Up 2012 10 $220 000 UK

Scarabeo 5 Saipem Statoil Semi 2013 12 $399 000 Norway 1 year opt.

Sedco 704 Transocean ADTI Semi 2011 6 $417 000 UK

Sedco 711 Transocean Shell Semi 2011 10 $416 000 UK

Sedco 714 Transocean Total Semi 2011 12 $251 000 UK

Songa Dee Songa Offshore Marathon/Lundin/Statoil Semi 2014 6 $423 000 Norway To Statoil summer 2011.

Songa Delta Songa Offshore Det Norske/Wintershall Semi 2012 2q $448 000 Norway

Songa Trym Songa Offshore Statoil Semi 2012 7 $365 000 Norway 2x1 year opt.

Stena Carron Stena Drilling Chevron Drill Ship 2013 8 $515 000 UK

Stena Don Stena Drilling Statoil Semi 2013 12 $400 000 Norway

Stena Spey Stena Drilling TAQA Bratani Semi 2011 11 $355 000 UK

Transocean Arctic Transocean Statoil/Rig management team Semi 2012 12 $286 000 Norway + 18 months opt.

Transocean John Shaw Transocean Enquest Semi 2011 7 $246 000 UK

Transocean Leader Transocean Statoil Semi 2015 2 $459 000 Norway one year opt.

Transocean Rather Transocean ExxonMobil Semi 2012 9 $428 000 Angola Moved to Angola.

Transocean Searcher Transocean Statoil/BG Semi 2013 7 $422 000 Norway To BG May 2012

Transocean Winner Transocean Lundin Semi 2012 10 $471 000 Norway

West Alpha Seadrill BG consortium Semi 2012 6 $494 000 Norway

West Epsilon Seadrill Statoil Jack Up 2014 12 $276 000 Norway Plus 2 year opt.

West Navigator Seadrill Shell Drill Ship 2012 12 $599 000 Norway

West Phoenix Seadrill Total Semi 2015 1 $536 000 Norway To UKNS from Jan.12

West Venture Seadrill Statoil Semi 2015 7 $419 500 Norway 2 x 1 year opt.

riglocator AcTIVE RIgS In THE nORTH SEA


OffSHORE & ENERGY

COSL Drilling Europe has three rigs on the way to Norway, and now they order rig number four.

COSL Pioneer, COSL Innovator and COSL Promoter shall operate in Norway and is contracted by Statoil. At the same time the company has worked to finish the building and delivery process on these three rigs, they have been discussing building the fourth rig.

Had the drilling packageA NOV-drilling package is built in Grimstad, completed and sent to China. COSL has also bought thrusters and an engine from Rolls-Royce. All intended for the next rig.

“We are currently considering three different types of design and plan to award the design contract in the third quarter this year. Depending on yard capacity, we expect delivery fourth quarter 2013 or first quarter of 2014, “ says CEO Jørgen Arnesen in COSL Drilling Europe to Offshore & Energy.

He says that the rig will be built able drill down to 1,500 meters, but that the company focuses on working in the 500-600 meter segment with their rigs.

By doing this, COSL Drilling is thinking different than several other players. Both Aker Drilling and Odfjell Drilling recently have flagged an enormous faith in deep waters and huge rigs.

“We have not succumbed to the temptation to build for ultra-deep waters, but remained true to our strategy - which is to focus on work at 500-600 meters - instead of 3,000 meters. We have a plan to be in Norway with our rigs for at least 20-30 years and have great faith in the possibilities for drilling rigs specially fit for Norwegian waters.”

Far more affordableA rig is not just a rig - to build and hire a giant rig is expensive and can be unnecessarily large. While the ultra-deepwater units can quickly come up in 700 million dollars and more, mid water rigs, will be much cheaper.

It means that one can accept a lower day rate and still earn good money.

How much the final bill is for the three rigs that

are going to Norway, Arnesen will not say. Nor what the fourth rig will cost. But there is little doubt that it will be competitive, set up against many older rigs - or giants.

The oldest semi-submersible rig on the Norwegian Continental Shelf is now Bideford Dolphin, which was built in 1975. The rig can fetch day rates of $ 385,000 when it is now going on his new contract with Statoil for the next three years.

“There are to many older rigs on the Norwegian continental shelf and there is a need to renew the fleet. Average age in Norway is only about a year better than the UK and other places, “ he reminds.

“confirming our strategy”COSL is not alone when thinking that most of the shelf does not have the need for the biggest drilling rigs. Statoil is soon to send out a tender of at least two rigs specially adapted to Norwegian conditions. These are smaller units - in line with Arnesen now order a fourth of.

“It's nice to see that they confirm that our strategy is good and we look with interest for this possibility. We try to focus our strategy to invest as we do.”

Rig number four is now on the way, but nor shipyard or design is decided. But one thing can Jørgen Arnesen tell; the name.

“The rig will be named COSL Target.”

A tight marketRig Analyst Atle Hauge in Carnegie turns thumbs up for COSL Target, with delivery in 2014.

“I believe it is appropriate to build a semi-rig for Norway, because the market is super tight and long-term picture will probably be the same in 2014,” he says. Hauge believes that the market for the rig will be good, both in terms of job opportunities and the size of the day rate it achieves.

“If one is to build a floater one must be build for Norwegian conditions, or a deepwater rig. The math does not work in other ways. Since COSL already had a drilling package, they really had

no choice, "he notes.

When it comes to the focus on renewing the rig fleet in Norway, Hauge is not sure that news rig automatic can beat the good old ones.

“Ten years ago we said that the oldest rigs were on the way out. We are talking about the same rigs in the same way to day. Some of the older rigs are super effective on the jobs they do. So to say that 20 to 30 percent of the Norwegian fleet must be replaced - is just nonsense, "he underlines.

While the older devices will be able to offer lower prices, COSL and other players have the advantage of ultra-modern rigs built for the future. When the calendar shows 2014, we get the answer to how the market receives the COSL Target.

“With a contract for two or three years, one can probably wait a day rate of 400,000, maybe something about this, "Hauge predicts.

Can have four mid water rigs on the shelf in 2014. “We stresses our strategy.”


Ordering rig numberfour to Norway


rig market>>

nAME OWnER cLIEnT TYPE cOnTRAcT YEAR

cOnTRAcT MOnTH

DAYRATE LOcATIOn cOMMEnT

COSL Pioneer COSL Drilling Europe Statoil Semi 2012 6, $320 000 Asia +2+2 years. Delivered - ready for

operation early 2011.

Deepsea Stavanger Odfjell Drilling Ophir Energy / BP Semi 2013 2 q $450 000 Tanzania To Angola/BP 2q 2011 + 1+1+1

Eirik Raude Ocean Rig Tullow Semi 2011 11, $637 000 Africa + LOI for two wells with Borders &

Southern at Falkland Island + opt.

GSF Britannia Transocean Jack Up N/A UK Stacked.

GSF Galaxy I Transocean Jack Up N/A UK Stacked.

GSF Labrador Transocean Jack Up N/A Holland Stacked.

GSF Magellan Transocean Jack Up N/A Holland Stacked.

GSF Monarch Transocean Jack Up N/A Holland Ready stacked.

Jack Bates Transocean Hess Semi 2011 4, $420 000 Australia "Moved to Australia.

"

Leiv Eriksson Ocean Rig Petrobras Semi 2012 10, $540 000 Tyrkey

Ocean Guardian Diamond Offshore AGR, Desire,

Rockhopper

Semi 2011 7, $240 000 Falkland

Sedco 712 Transocean Semi N/A UK Stacked

Transocean Prospect Transocean ADTI Semi 2011 4, N/A UK

WilHunter Awilco Drilling Consortium Semi 2011 6, $166 000 UK In class through May 2011.

WilPhoenix Awilco Drilling AGR Petroleum

Services

Semi 2011 6, $233 000 UK One well + 6 opt. wells

COSL Innovator COSL Drilling Europe Statoil Semi 2019 11, $335 000 Norway 8 X 1 years opt. Under construction.

COSL Promoter COSL Drilling Europe Statoil Semi 2020 1Q $335 000 Norway 8 years opt. Under construction.

Start on contract is 2011.

COSL Target COSL Drilling Europe Semi N/A Norway

Island Innovator Island Offshore Semi N/A Norway

Rowan Norway Rowan Xcite Energy Jack Up 2012 6, $250 000 UK Del. Jun. 2011

Scarabeo 8 Saipem ENI Semi 2014 10, $460 000 Norway Yard stay until 4Q 2011.

West Elara Seadrill Statoil Jack Up 2016 10, $350 000 Norway Contract from Aug. 2011 + four year

otps.

OTHER RIgS

>> This list was last updated November 29. Please visit our online rig locator at www.offshore.no. Questions, errors and other feedback can be sent to [email protected].

The start of 2011 has been good for Westcon in Ølen. The yard won the huge job on the Scarabeo 8. The work task for Westcon has doubled since they won the contract with rig owner Saipem.

In addition, the Seadrill unit West Alpha came to quay for installation of new equipment in February. At the same time, the accommodation

rig Floatel Superior was completed. The rig is hired by Talisman for work on the Yme-field, before it is off to Statoil in May.

- We experience very high activity these days and have job to approximately 1.400 people. The number of contracts we have won shows that Westcon is a prefferd yard for both rig and ships, says CEO Øystein Matre.

Three rigs in lineIt is busy times at Westcon in Ølen.text by: JOHN ØKLAND [email protected]

Floatel Superior, West Alpha and Scarabeo 8 at Westcon Yard in Ølensvåg. (Photo: Øyvind Sætre)


OffSHORE & ENERGY

Half of the discoveries in the world to day are done now in ultra deep waters. This gives the rig companies eager to acquire new, modern units designed for harsh conditions and with the capacity to drill ultra deep. As one of several players in the rig industry, Aker Drilling also has a strong desire to win stakes in a strongly growing market.

Aker Drilling already possesses the two ultra-deepwater rigs, Aker Spitsbergen and Aker Barents. These rigs have very good performance and day rates for a total of over USD 1 million, which secure a solid cash flow to the company.

Aker Spitsbergen is leased out to Statoil until the summer of 2013, plus options that could give the rig job for another ten years. Aker Barents is hired by Det norske, an agreement that lasts until the summer of 2014, plus an option for another two years.

Aker Drillings focusIn February the company entered into a letter of intension to build two drill ships from the DSME shipyard in South Korea. In addition, an option for two additional drill ship, are secured.

“We already have two rigs built for harsh conditions and can operate in deep water, and with this LoI, we can secure up to four modern drill ships. We wish to underline our focus and faith in the deepwater market, "says CEO of Aker Drilling Geir Sjøberg to Offshore & Energy.

The price per drillship is approximately 600 million dollars, or 3,5 billion Norwegian kroner. If the company decides to build both of the two first and then take options on unit three and four as well, the total sum may reach 14 billion. And more can come.

“We believe it makes sense to have a level of ambition of further growth. In this light we have said that this level should be between six and ten units in total by 2015-2016”, Sjøberg explains.

What kind of units we are discussing in such an estimate is not set in stone.

“It's something we need to consider from project to project, so there are not any guidelines that it must be just drill ships or just semi subs. We want to continue to focus on units for deepwater and harsh environment”.

Up to 35 billionIf the fleet shall grow to ten units in total, Aker Drilling has to order another four drill ships or rigs. Another 14 billion are needed. Adding the final bill for Aker Barents and Aker Spitsbergen, the company may have bought rigs for about 35 billion Norwegian kroner.

Another element is which region the company now are focused at.

Exploration drilling in deep water is often linked to Brazil, Gulf of Mexico and West Africa, but Norway is far from being excluded as a target. Sjøberg stresses that the northern regions, including Norway is "very exciting".

The Statoil tenderA good opportunity for Aker Drilling at home is Statoils tender for so-called category D-rigs. Here, Statoil will ask for two or more new rigs specially fit for the Norwegian shelf. The rig companies that wins this opportunity is secured contracts for eight years on these units.

“We are following this tender with interest and make our assessments”, is all Geir Sjøberg will say about this matter.

Aker Drilling has an ambition. The ambition is to own rigs for up to 35 billion Norwegian kroner within 2016.

InVESTIng BILLIOnS In DEEP WATER UnITStext by: JOHN ØKLAND [email protected]

Aker Spitsbergen is one of two rigs that Aker Drilling has on long-term contract. (Photo: Aker Drilling)


rig market>>

The rig market is again prepared for a positive cycle. After the financial crisis a number of players have filled the order books at the most popular shipyards by ordering new rigs.

The times have changed from investors pending to at great belief in the market.

“We now see that it is far more financial capacity in the market than just a few months ago and the activity at the shipyards in Korea, for example, is formidable", says CEO of Odfjell Drilling, Simen Lieungh.

Odfjell had a busy 2010 in which the company landed new contracts for both Deepsea Bergen, Deepsea Stavanger and got Deepsea Atlantic back in business after a lost trial against Statoil.

In 2011, the focus is to complete agreements for the two drill ships currently under construction at Hyundai Heavy Industries in South Korea. Odfjell owns 40 percent of each rig, with delivery in May and November this year.

None of the units are rented out yet, but Lieungh is working on it.

“We expect to conclude contracts for both units before delivery. I'm not concerned that it does not go as planned”.

no new plans Like several other players Lieungh is pointing towards the deep water and difficult weather conditions. Both Seadrill, Aker Drilling and others have ordered a number of new units, based on faith and hope of the future market.

Odfjell has not decided to order additional units – yet.

“There are no plans to order new rigs for us at the moment. We have just

received two ultra deepwater rigs (Deepsea Atlantic and Deepsea Stavanger). Now we are waiting for the two drill ships later this year. So we are focused on our plans for deep water and harsh environment", says Lieungh.

Positive to Statoil rigsAs everyone else in the rig industry Odfjell is informed about Statoils tender for new category D-rigs for Norwegian waters. The oil company is expected to go out in the market and ask for two so-called category D-rigs, which are specially adapted for use on the Norwegian continental shelf. These are devices that are smaller than the two giants Deepsea Atlantic and Deepsea Stavanger. The rig companies winning this contract are promised long-term contracts of up to eight years.

This is an offer Odfjell Drilling are waiting for with great interest.

“Statoil has seen a direct need for this type of rigs on the shelf. We are positive to this process and believe it will be an important step in the right direction to renew the fleet in Norway”.

“A good recovery” Odfjell Drilling has rigs in Norway and in other areas. The company knows both the strong demand at home and the huge opportunities in new geographic areas worldwide. Among other things, Deepsea Stavanger drilled the first well on ultra-deep water in Tanzania.

And Lieungh thinks the market is now moving in the right direction again.

“The trend is good now, but I do not see a bonanza in the next few years. We believe in a good recovery, but the road is bumpy - and the need for rig capacity is irrevocable”.

“But there will be ups and downs”, says Simen Lieungh, CEO in Odfjell Drilling.

Very good times to come


Deepsea Atlantic is back to work for Statoil. The rig is one of two ultra deepwater units owned by Odfjell Drilling. (Photo: John Økland)

Deepsea Metro I is the first of two drill ship that Odfjell and Metrostar Group has ordered. (Photo: Odfjell Drilling)


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rig market>>

Late February Statoil sent out an invitation to 13 rig companies to build two specially designed rigs on behalf of Statoil for use on mature fields on the Norwegian continental shelf (NCS).

The purpose is to make drilling and completion of production wells less expensive, more effective and safer, and thereby boost oil recovery.

“Big and costly”“The rigs delivered to the NCS in recent years were first and foremost constructed for operations in deep water. That means that they are big and too costly for our requirements and challenges on the NCS. We are therefore taking steps to rejuvenate the rig fleet and ensure that the right rig meets the right requirements”, says Jon Arnt Jacobsen, chief procurement officer in Statoil.

The specially designed category D rig is able to operate at water depths of 100-500 meters and drill wells down to 8,500 meters. It will be a workhorse on mature fields, primarily for drilling production wells and well completion.

Statoil is issuing a tender for minimum two such rigs for work on the NCS. The contract will run for either eight years with four three-year options or for 20 years firm contract period. An unusually long period of contract, but this will reduce the risk for the drilling contractor who will build the rig.

“This is a strategy from Statoil to achieve good prices. To provide long-term contracts has historically been a way for the oil companies to secure attractive day rates”, says rig analyst Bjørn Thoresen at First Securities.

At what level the contracts will be settled at only time will show when the tender winner is decided. However, where a comparable agreement concluded today at just under $ 400,000 per day, the winner will probably have to offer a day rate in the area of $ 330,00 to 350,000, according to industry sources.

20 percent more A rig like this will be able to drill and do well

completions in the North Sea and the Norwegian Sea throughout the year.

“The goal is that the new rig will drill 20 percent more effectively than conventional rigs,” says Jon Arnt Jacobsen.

Plans call for the contract to be awarded in the third quarter of 2011 and the rigs to be delivered in the second half of 2014.

Five favoritesAccording to Statoil is 13 rig companies invited to bid into the contract, without saying which ones. It would nevertheless be appropriate to list the following companies, which now will start to calculate.

Fred. Olsen Energy

Ocean Rig

Transocean

COSL Drilling Europe

Songa Offshore

Seadrill

Aker Drilling

Odfjell Drilling

Stena Drilling

Saipem

Maersk Drilling

Diamond Offshore

Island Offshore

Several sources Offshore & Energy has talked to points out that several rig companies do not have the need to send inn a low offer, just to win the contract. But it seems natural that all will bid.

“I think most of the rig companies that are invited will be interested in bidding. This ensures growth with a relatively secure cash flow. The question is, who see the greatest value in winning such a long contract with a fixed rate", says Thoresen.

Experts Offshore & Energy have talked to see

the companies as follows:

Very interested: Songa Offshore

Aker Drilling

Fred. Olsen Energy

Odfjell Drilling

COSL Drilling Europe

Possible interested: Diamond Offshore

Less interested:Seadrill

Transocean

Stena Drilling

Saipem

Maersk Drilling

Ocean Rig

Island Offshore

Then, what about the price? None of the analysts we have talked to or Statoil will comment anything in public about this. But as we know it, a complete rig in this contest can cost somewhere between 550 and 600 million dollars.

According to Statoil it may be necessary to build up to four such workhorses, as Statoil like to call them.

Built in korea or Singapore Statoil has reserved slots at four different construction yards. The four yards have the proven construction record Statoil requires to be able to build the rigs within the expected delivery time, according to a press release.

These four shipyards are:

Daewoo Shipbuilding in Korea

Samsung Heavy Industries in Korea

Keppel FELS in Singapore

Jurong Shipyard in Singapore

13 drilling companies are invited to bid on Statoil’s new rig tender. But it is not too interesting for everyone.

Who will aim for 20 years with Statoil?



OffSHORE & ENERGY

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Trying to break The Norwegian Sea lava codeExperts from 18 oil companies, government bodies and various research institutes and service companies are working together to find out more about the possibilities hidden beneath the lava in the Norwegian Sea, the so-called sub-basalt.

These volcanic rocks are masking the underlying level, and they make seismic imaging challenging. No wells have to date been drilled through the volcanic rocks in the west.

"There are plans for a test well in the area that can give us more information about opportunities there," Bente Nyland, Director General at the NPD, tells Offshore & Energy.

"The results can also help us to understand the geology around Jan Mayen better."

ExxonMobil’s elephant huntLocated 400 km from the coast and at over 1200 meters depth, ExxonMobil hopes to find the next elephant on the Norwegian continental shelf. License 520 in the northwestern part of the Norwegian Sea is, with its 2000 square kilometers, among the largest on the NCS in terms of area.

"We have done seismic surveys and are trying to understand the results of these investigations," John Whelan, head of ExxonMobil's operations in the North Sea, told Offshore & Energy.

O&E: "Are you mainly chasing elephants on the NCS?"

"That is true. Given the size of the company, it is important for us that the prospects have large potential, we need to own a substantial share and we also like to be the operator," he says.

noreco dreams of hitting the jackpot Noreco, which owns 50 per cent of the license, has already revealed their high hopes related to the prospect. Last year the company suggested that the area could contain between 500 and 2500 million barrels of oil equivalent. In comparison, the Gullfaks field originally contained 2.264 billion barrels of oil.

“The potential is huge for such a small company, but the probability of a large discovery is quite small. Expectations also decreased with the disappointing results from Shell's Gro and Dalsnuten wells," says analyst Carl Christian Bachke in RS Platou Markets.


norwegian technology abroad >>


Brazil’s market is a big attraction to suppliers because of investments predicted at US $174 Billion (NOK 1000 Bn) over the next four years. Norwegian suppliers are active in the hunt for a share of that money. But the road there can be long and bumpy, Brazil watchers have said.

“A common mistake is to take too lightly on the specific challenges that apply to Brazil,” says Erik Hannisdal, of Inventure Management. “It is not without reason that the country is ranked number 127 in the world on "ease of doing business,” says Hannisdal who has previously worked with Innovation Norway but who now concentrates on helping companies set up in Brazil.

Most importantWhile South-East Asia, India and Australia are now seen as the most important foreign markets for Norwegian suppliers, followed by West Africa, the UK North Sea, and the US, the situation is changing.

A report by Rystad Energy prepared for Intsok now shows that Brazil is considered to be the market that most vendors consider to be the most important. And the US Gulf of Mexico and the UK are next in line.

One of the drivers behind that perception is the

size of the resource opportunity available as a result of recent pre-salt discoveries: Total estimated reserves for Brazil are now put at over 50 billion barrels since major discoveries were made in pre-salt fields. Before the country's pre-salt discoveries, Brazil’s known reserves were 14 billion barrels.

BG, in partnership with Brazil’s major operator Petrobras has netted huge finds offshore Brazil in Carioca, Guara, Iara, and Tupi, whose reserves have been measured in billions of barrels of oil.

Also the exploration drilling success rate offshore Brazil is now put at 90%, but the technical challenge for operators and partners is a big factor too: New field developments are typically in deep water with depths ranging from 2,000 to 3,000 metres (6,560 - 9,840 ft) - and 480 kilometres (300 miles) offshore, creating huge demand for a new logistics industry with rigs, supply vessels and helicopters all needed.

Opportunities throughout the value chainHannisdal says this means big opportunities too: “There are opportunities in many different areas, when the sector in Brazil is experiencing a strong growth phase, with increased demand for most products and services.”

He points out that Brazil aims to grow production from 2 million to 5 million barrels over the next 10 years, mainly from offshore. “There will be opportunities throughout the value chain. Brazil currently has a great shortage of qualified and specialised personnel. The companies that win the battle for the market here will be those that effectively manage to transfer their expertise to Brazil,” he suggests.

nOk 10 billionNorwegian suppliers secured just under NOK 10 Bn (US $1.74 Bn) of turnover from Latin American states Brazil, Venezuela and Mexico in 2009, which represents a 12% market share. Around 50 Norwegian offshore suppliers are now established in Brazil.

According to UK Trade and Investment, Brazil is the largest energy market in Latin America. With global subsea equipment spending estimated to hit US $64 Billion between 2009 and 2014, the South American market - dominated by Petrobras - will account for some 42% of that global spend.

“It is estimated that Brazil will need to purchase approximately 525 wet Christmas trees, 4,000 km of flexible lines, 2,200 km of umbilicals and

Brazil is every suppliers dream

For three out of every four partners in Norway’s Intsok, Brazil is a very important market, but there are 126 other nations in the world where it is thought easier to establish new business.

(Photo: Petrobras)


OFFSHORE & ENERGY

Brazil is every suppliers dreammore than 30 manifolds over the next three years and that there is not enough local supply to meet this demand,” according to UKTI figures.

And the overseas trade and investment arm of the UK government highlights some of the key opportunities that exist for companies which have technology to sell into the Brazilian offshore energy market: These include subsea

engineering expertise, riser qualification engineering for ultra-deepwater applications with CO2 and high-pressure capabilities. There is scope for suppliers of riser towers, and steel catenary risers with lazy wave configurations, and for qualification of thermally insulated flowlines, and high pressure gas injection flowlines.

BRAZILNorwegian offshore suppliers had a turnover of NOK 10 billion in Brazil, Mexico and Venezuela in 2009.Three out of four Intsok partners consider Brazil to be their most important market abroad. Some 50 Norwegian offshore suppliers are established in the country. Statoil operates the Peregrino field.

FAcTS

(Photo: Petrobras)

(Photo: Petrobras)



Norwegian suppliers consider Brazil to be the most important international market, and K. Lund Offshore is among the companies working to secure its share of the contracts available there.

"It was through Aker we received the first deliveries to Petrobras, and they were our door opener. Petrobras is our main customer, but we also deliver to Statoil, Subsea 7, Aker Solutions and Seawell and others," says managing director Gaute Jørpeland. "The Norwegian companies that establish themselves now will stand strong when the market develops."

Established in 2004K. Lund Offshore achieved its first delivery to Brazil in 2003 and established its own business in the country in 2004. But the company, which supplies compressors and lifting equipment to the offshore market, admits that the way to Brazil can be long and tortuous.

"It is another world, literally. One must understand the cultural differences

and use the time to familiarise [oneself] with local conditions. We have doubled sales in Brazil in the last three years and [we] expect to end up at around NOK 40 million turnover in 2011. We expect that 2011 will be the first year that this part of our business makes a profit," said Jørpeland.

Best technical resourcesThe upside is great. Many companies are interested, many have tried and many have failed.

"The most common mistake is to underestimate the need to use their best technical resources to get into position. This is a huge cost for the company at home. The smaller a company is, the more vulnerable it will be, says Erik Hannisdal at Inventure Management, who has a background from Innovation Norway, but who now advises companies seeking to establish themselves in Brazil.

Large companies are usually first when new markets are to be conquered.

"Good advisors, funding, patience, lawyers and local knowledge are key to Norwegian suppliers who want to establish themselves in Brazil," K. Lund Offshore tells Offshore & Energy.

The road to Braziltext by: GLENN STANGELAND [email protected]


OFFSHORE & ENERGY

1. Get good local financial advisors, both Norwegians and locals. Lawyers with varied professional backgrounds are also necessary to avoid many unpleasant surprises.

2. Have access to funding. Things take time, and it is expensive to establish a business there. Having Norwegian employees in Brazil, is also expensive.

3. Choose the right geographic area. For operation and maintenance, Macaé is the right area, while Rio may be the right

place if you focus on newbuilds. If one is to engage in production, it may well be that neither city is the right choice.

4. Use resources on recruiting. It is challenging to find the right people.

5. Be present. One should have a Norwegian employee who can make sure the culture of the company is transferred to the Brazilian business.

k. Lund Offshore's advice to companies wishing to establish themselves in Brazil

But with a mature home base, more and more small companies need new business opportunities. For them, cooperation may be the solution.

networks"We are now seeing a trend that small companies form networks to acquire knowledge before entry. We have even organised several such networks already, and for the individual enterprise, it might be a good opportunity to obtain information sufficient to build a good basis for decisions. We've also seen companies come together and form joint ventures for a Brazilian initiative. This is an interesting model, which may cause the companies to get a larger resource base," said Hannisdal.

There are investment plans for up to NOK 1000 billion in the Brazilian offshore market over the next four years, but Jørpeland do not think there is reason to fear that the enormous investments will be draining the Norwegian suppliers industry.

"Because of the demands for local content, that will never happen," he said.

Hannisdal believe these requirements makes it harder to get into the Brazil market with products than with services.

"You often have to go through a Petrobras qualifying round to succeed. This is a bureaucratic process, and one must therefore be prepared to spend both time and money to get into position. Local content is also required for products, which in the longer term means a need for production, testing and assembly in Brazil," he said.


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text by: ARILD GILJA [email protected]

The British market has fallen in recent years, but now there is a sharp rise in waiting. Projects for a hundred billion are going out in the market. Also Statoil joins and plans to invest 60 billion dollars on Mariner and Bressay fields.

A britishfairytale coming our way

“We are going to a see strong growth in the UK up to 2014”, told regional director, Einar Holmefjord from INTSOK in Bergen Chamber of Commerce.

As many as 14 projects have DECC approved in 2010 to a total value of 80 billion Norwegian kroner. This corresponds to the four previous years combined. And there's more to come. For 2011 the estimate tells that 30 projects will be approved by the British approval authority.

For the period 2011-2014, the list looks like this:

- 10-12 fixed platforms.

- 10-12 FPS projects.

- About 30 subsea projects.

- In addition a number of modification projects to existing platforms.

“The world's fourth largest” “UK will be the world's fourth largest offshore market the next four years and the third largest export market for the Norwegian offshore industry”, the Regional Director told.

- Starvation for a long time “The UK oil industry has been starved for a period and has been quite unhappy with the situation.”

According to Holmefjord the mood changed when the government granted a substantial package of tax credits. Each project could trigger 160 million pound. The package has already had a good effect on the number of new projects.

Statoil is investing 60 billion Holmefjord gave a lot of attention to Statoils’ two heavy oil-projects, Mariner and Bressay, where Statoil is operator with respectively 62 percent and 81.625 percent interest. British authorities and the supplier industry seem to be pleased that Statoil took over and has plans for rapid expansion.

“Statoil took over as operator for Chevron who never gave these fields high enough priority in their system.“

Statoil plans to invest nearly 60 billion dollars on the two fields, but has plenty of time to earn

back the expenses. The fields will in fact produce for 40 years. Daily production will be about 60,000 barrels for Mariner and 50,000 for Bressay. The somewhat modest production is due to the fact that this is heavy oil.


OFFSHORE & ENERGY

“giant Jackets““It will be built two giant jackets with topsides of respectively 24,000 and 20,000 tons. These will be the largest built for the UK shelf for many years.”

The plan also includes building two drilling rigs on each field. In addition, a light intervention rig will be placed below deck on one of the platforms. The reason is Statoils’ high drill ambitions. According to plan will have 60 well slots and Bressay will have 40.

concept studies already completed Both concept studies are already completed. Aker Solutions delivered the first in late autumn for Mariner, while WorleyParsons followed on

with the one for Bressay. According to Holmefjord the feed contracts will be awarded in early spring for Mariner, while Brassey will be awarded later this summer. Now Statoil will mature their thoughts and will likely decide in February whether to invest and implement their plans.

“If Statoil goes for it, the first contracts for long lead items will already go out this summer and autumn. So this is just around the corner,” he said.

Aberdeen cheers In Aberdeen there was great cheering when Statoil announced to set up a major operations office with 500 employees.

Britain got its manufacturing capacity sharply reduced 10-15 years ago. When the major projects that could have maintained the expertise disappeared, the large shipyards were closed down. There was no financial basis for further operation. Today the ten largest shipyards in the UK "only" sell about 450 million each on average, based on the last three years of trading.

“However the massive development plans that were approved in 2010 and which under present plans will be approved in 2011, again require a much greater manufacturing capacity.”

“not credible” “The large operators are reluctant to use British shipyards, and run rather to foreign shipyards as Dragados, Rosetti Marino, Saipem, Heerema, as well as shipyards in Dubai and Asia. Today there is no credible, major suppliers of topsides in the UK. Topsides are too big and complicated for them. They have been working on subsea tie-ins projects for nearly a decade. For larger projects the british yards have to cooperate," says Holmefjord.

He refers to Claire project as an example.

“On Claire BP divided the topside in as many minor modules that British industry was able to deliver.

The jobs the British lost This is a list of larger projects that went to foreigners:

1) ConocoPhillips on Jasmine: Two 6000-tons steel decks went to Spain, Dragados. One deck went to a yard in Dubai and three jackets to Rosetti

Marino in Italy.

2) RWE DEA on the Clipper South: A 1,700 tons topside and jacket were won by Heerema.

3) BP on Clair Ridge: Two jackets, respectively 22,300 tons and 9,000 tons went to Aker Verdal, while the topside modules probably will be go to Asia.

4) Talisman Auk Redevelopment: Drilling modules went to Rosetti Marino.

5) Talisman on West Franklin II: A 2800-ton jacket went to Saipem, Sardinia.

Option 1: Buy yards “When the British now see a stream of new projects coming up, they have to turn around. Norwegian companies are therefore invited to come over and revive old shipyards. Groups like Bergen Group Rosenberg, Aibel and Aker Stord must realize that now is the time to act. They must carefully consider whether this is something to do.

Option 2: cooperation “Norwegians could also seek cooperation with British suppliers in order to get a hand on the rapidly growing market”.

“Why cooperation, Is not Norwegian supply chains credible enough to stand alone?”

“Of course, Norwegian supplier lines are credible. The many contract-wins for complete Norwegian supply chains, documents that fact. But still it is very difficult to deploy an entire Norwegian chain to a UK-job. The reason is that British operators by tradition purchase equipment that they have

Due to downfall of British shipbuilding industry, the oil companies go abroad with their larger construction projects. “Norwegian fabrication groups could capture a nice share of the growing market, by either buying old British shipyards or collaborating with British contractors.”

“Buy a yard”

text by: ARILD GILJA [email protected]


preferences for. Therefore, they probably will tear up a wholly Norwegian-based solution", says Holmefjord and mention topsides as a typical example.

He explains that on topside equipment, the operators often choose standardized solutions across their platforms.

“Aker Verdal did it” However there is an Norwegian exception for jackets:

“Aker Verdal managed to deploy its whole supply chain when the fabricated the jackets for Nexen’s Buzzard. This also seems to be the case for Clear Ridge, where Verdal now have two large jackets under construction.

Despite Aker Verdals success on jackets, Holmefjord is convinced that Norwegians should cooperate with the British suppliers on topsides:

“If Norwegians want to win a topside delivery, it will be an advantage to be oriented towards British sub-contractors.”

“no local content“Holmefjord denies that there are still official requirements for local content, such as in Brazil and Angola. However British authorities clearly appreciate that contracts also ends up on British hands, as our own government do.

First register in FPAL The first step for a Norwegian freshman, is to register in FPAL (Editor: First Point Assessment Ltd), Holmefjord reminds.

“This is the first point where British operators check out possible suppliers, such as if they are able to fabricate modules of 10,000 tons. Then they will assess the financial soundness of the candidates and finally the companies them will be able to get onto the "bidders list".

Aker Stord which has topside as its main product confirms that they follow the UK market with a strong focus.

“It is exciting that the British industry again points upward. We screen the market on a monthly basis and is in regular contact with the oil companies ", says Aker Stord-chief, Lars Eide.

When it comes to choice of strategy, whether to buy British shipyards or enter into partnership with British actors, Aker choose secrecy.

“We cannot reveal anything at this moment, but we careful evaluate what to do. However, we do not exclude any options.

He points to the fact that the Aker system earlier on has owned a shipyard in Britain, but that this has been history for a long time now.

“I understand very well that the British want new activity at home.”

Foothold Also her sister, Aker Verdal carefully follows what is happening over there. Not least, because the yard in the recent past, have gained a good foothold in the British market.

Aker Verdal boss, Nina Udnes Tronstad says that they also see a great potential in wind

power the coming years.

“Have you considered buying British yards?”

“We believe that local content is an important competitive factor, but this can be created in many ways. Currently we have no concrete plans for any acquisition in UK.

According to Udnes, Aker Verdal has for several years had a good relationship with British suppliers, and she emphasizes the importance of long-term relationship.

“Our supply chain is global and we have good experience with both the Norwegian and international suppliers. The markets we operate in, is constantly changing, and long-term and predictable relations with our suppliers, will be very important parameters in the future”, she ends.

“not yet” Also Bergen Group has noted the change in mood over there.

“We have cooperated with British suppliers a while, "CEO, Pål Engebretsen in Bergen Group states. But he will keep for themselves what kind of partnership this is.

“We have not considered buying British yards yet, however we are players in the market and

follow it with the best of our ability. Any contract in UK will likely go to the Rosenberg yard which is the spearhead and driving force in Bergen Groups offshore business.

Who should pay attention? Regional Director for UK in Intsok, Einar Holmefjord recommends a number of Norwegian shipyards and fabrication facilities to check out the growing possibilities over there:

• Aibel, Haugesund

• Aker Stord

• Aker Verdal

• Aker Solutions, Egersund

• Apply Leirvik

• Bergen Group, Rosenberg

• fjell Industrier

• Grenland Group, Tønsberg

• Grenland Group, Skudesneshavn

• Gann Mechanical

• Langset Nord

• NLI Alfred Andersen

• NYMO, Grimstad / Eydehavn

• Radøy Group

Norwegian yards confirm that they closely follow the British market. “We cannot say anything at this moment, but we careful evaluate what to do”, reveals Lars Eide at Aker Stord.

A falcon’s view at the Uktext by: ARILD GILJA [email protected]

45DECEMBER 2010 OffSHORE & ENERGY

Come to the 16th European Gas Conference in Oslo and be enlightened by stimulating debates and round table discussions with energy industry experts, politicians and environmentalists – all trying to tackle the issues below.

Session 1 : Bringing Norwegian gas to EuropeWill Norway be a key supplier in the future gas supply mix in Europe? 2011 marks the 10th anniversary of Gassco.

Session 2 : Natural Gas in a low carbon EuropePolitically clean in Europe and dirty in Norway. Some say it is part of the solution, some say it is part of the problem.

Session 3 : Gas sources – origin and useCan new sources of gas be unlocked? What is the potential in the European transportation sector?

Organizer

Gas is a fantastic resource which must be recognised as a high-value natural product. It will most probably be the bridging fuel to an diversified, sustain-able and affordable energy future with reduced global CO2 emissions. Ideal-ists and realists may battle over our common energy future, and the debate will not be an easy one. But gas will be part of the solution.

Sponsored by

Gro MjellemGeneral ManagerNorwegian Petroleum Society

Brian BjordalPresident and

CEO in Gassco AS

Helli G

rafisk - design og komm

unikasjon ww

w.helligrafisk.no

The Norwegian Petroleum Society and the Norwegian Gas Association have been the proud hosts of The European Gas Conference since 1981. The biannual conference has all these years been a valuable meeting place for the European gas industry, underlining the impor-tance of Norwegian gas exports to Europe. With the 16th conference, we are again pleased to invite you to Oslo where important issues related to the industry will be presented and discussed.Welcome to Oslo !

The Norwegian Gas Association

WWW.EGC2011.COMJuNE 6. - 7. OSlO - NOrWAy

14236 EGC 2011 - Annonse 235x297mm.indd 1 16-11-10 18:21:15

OffSHORE & ENERGY MARCH 2011 46

MORE THAn PIPES AnD TUBESThe business community must take care of those who are left behind in the job queue, and Norwegian offshore companies have great opportunities abroad. If you can communicate those two facts to your readers I'm happy with this interview, says Tore Christiansen.

He is clearly used to getting what he wants, the boy with the golden helmet. As the leader of a solid offshore supplier business, football and hockey donor and award-winning Pøbel-champion, and with a fortune of several hundred million kroner, he is by no means an ordinary entrepreneur. Ardent Manchester United fan and a personal friend of Ole Gunnar Solskjaer and recently the owner of a twice bankrupt mountain hotel in Sirdal outside Stavanger, he goes his own way. But it started with tubes, and even a little before.

Actor Tore Christiansen (48) is an original Sandnes-gjøk (cuckoo), as they call it there. His father was an ardent football fan, but young Tore’s career went in other directions. For ten good years, until he became 18, he was an actor and held various roles at the Rogaland Theatre, where he played against future Norwegian celebrities such as Mia Gundersen and

Johannes Joner. His favourite role was Chief constable Bastian in Kardemomme City and the Kardemomme Law has played an important role in his later life. He never became a professional actor, but only last year he played the Ice King in a Christmas performance at the Stavanger Concert Hall. Another important feature of growing up was that when he was seven years old, he had a brother who was partially disabled. This gave him an early lesson that we are not all equal, yet of equal worth. With this ballast, he graduated from high school and went directly into job life.

crazy young men He got a job in Stavanger Rørhandel together with Bergen Rørhandel had such a high market share in supplying of pipes and accessories that they blocked the other vendors who wanted to enter the Norwegian Continental Shelf. Tore

started as "coffee maker, calculator and junior sales man" and rose quickly through the ranks.

In 1991 he was approached by the world's largest producer of flanges, Italian Galperti, and together they started the company Scandinavian Fittings and Flanges (SFF).

”Galperti had factories, products and capital, and I had the market knowledge. After some years of sporadic orders from various customers, we got the breakthrough in 1994 with our first project contract. It was Phillips who was brave enough to bet on a newcomer in the market. But the real breakthrough came two years later, when Statoil went out to the market with five framework agreements. We were invited to bid on four of the packages, but when the big wholesalers saw this they formed a joint venture to offer on all the packages. The result was that Statoil invited the SFF to bid on the fifth package, too, and we made a clean sweep with large deliveries to the Asgard A and B projects and at the Kårstø plant. We were ten

men, young and crazy, and worked around the clock with IKEA beds in the office. We did everything ourselves, and sales rose, from NOK 28 million to 115 million the next year. When Johan Fredrik (Brandt) came straight from school as an economist in Oslo – who would eventually take over as CFO, he received last year’s invoices in plastic bags, to sort out. Although I regret not obtaining an education in economics, there are probably many things I'd never dared to do if I had been aware of the economic impact,” laughs Christiansen.

Social commitment As managing director and major shareholder in SFF, Christiansen had the opportunity to do something for his brother. Their mother was a teacher and had decided that his brother should take the certificate. She read the entire tutorial to the driving license on tape and his brother passed the theory test and, with somewhat heavier resistance, the drivers test.

"We employed him as a good old errand boy, where he is to this day drives around in the local area and delivers goods; he goes to the bank, to the Post office and runs other errands where colleagues may need help. At first he drove himself completely away, but today no one is better known in the local area than my brother. To me this is a confirmation that it is possible for anyone to perform meaningful tasks in everyday life, while simultaneously affecting the enjoyment factor and the human values of the company. Our recruitment policy may appear pretty special, but is quite natural for us. Today some 20 per cent of the staff is recruited from what we have chosen to call "the forgotten assets" - people with physical and / or mental handicaps. We work with NAV, Byprestene in Sandnes, Pøbel project, and Work with assistance, to name a few. We see the individuals and their needs and try to adapt and facilitate both tasks and working hours. Some

reportage>>

text by: HELGE KEILEN [email protected]


OFFSHORE & ENERGY


have started to work only one day a week - and maybe work for just a few hours - and then they gradually increase their hours towards a full day job and as a regular employee with full employment with us. No one is prouder than them to wear the SFF uniform! And no one is prouder than we are to have them here! We have a few stories that are not so bright; the biggest challenge is with former drug abusers. Some of them unfortunately do not master the everyday life and resort to old habits. We must of course have zero tolerance and it is always painful to acknowledge that we have to let someone go. The joy of success with this type of challenge is all the greater! Some might wonder how our recruitment policy affects our performance record. Well, sick leave was just under 3% in 2010. Measured against average in Rogaland and Hordaland, which is respectively 4.5 to 6%, we can safely say that our recruitment plays a positive role! I lecture a lot on this subject in several forums. Most of the people I talk to are all enthusiastic, but they

cannot answer to me why they do not do the same in other parts of the business sector and employers in general," says Christiansen.

Sports fanAround 10 per cent of the SFF staff are recruited from sports. Christiansen welcomes young and promising hockey and soccer players to help in the activity peaks, and offers full-time jobs when their careers are waning. A former Oilers ice hockey player is now CFO for the company's branch in Sweden. And the Stavanger Oilers are, by the way, another of Christiansen’s flaming interests.

"It started when my son started playing soccer and ice hockey. I love going to games and get an outlet for my feelings and was a sponsor for the Oilers when the club went bankrupt in the 03/04 season. When I saw the kids smash their saving pigs for the club to continue, I decided to step up the involvement. My demand was that the club would be run like any normal business, that all the paper work on employer liability and tax would be correct - and that we, together with Stavanger municipality should build a new Oilers ice hall. In the autumn 2010 the decision was taken and for the 2012 season a large multipurpose hall will be ready. I am convinced that the Oilers will compete at the top of their league and that it should be possible to make money on the investment, but it might as well be after 2020," says Christiansen.

His sports interests have led into other exciting alleys. In 2000 he started together with the Norwegian Manchester United player Ole Gunnar Solskjaer and his manager Jim Solbakken the company Dynamic Solutions. The company has since split into two; the travel agency Travelnet Stavanger which currently employs 12-15 people and sells for an impressive NOK 120 million a year, and the agency/consulting company Solution that sells football players. Here are naturally Ole Gunnar Solskjaer is no longer co-owner because the rules of the Norwegian Football Association. Solution is now a well-known football agency, which has been responsible for most of the transitions of players to English football (Eikrem Dioff, Lindegaard, Nordtvedt, to name a few) in recent years. The travel agency is known for package tours to Old Trafford, home of Manchester United, where Christiansen has his own box, but which he has visited only two or three times.

”I like it best when I smell the sausages from the inner court,” Christiansen says with a smile.

Fluctuations in pipeline No matter what activities he engages in - horse racing is another favourite - SFF still takes most of his working day. Although he wants to gradually reduce his own importance, it is often Tore the customers want to talk to, if only out of habit.

"For me, SFF is the locomotive. The company now has about 10,000 articles and a stock value of NOK120 million. But like most others we find that the oil industry is heavily fluctuating at times. We got the first down in 1998-2000 and now again 2008-2010, which were pretty awful years. Turnover fell from NOK 1.4 billion to 600 million in a couple of years, and we had to terminate 5-6 employees. Fortunately, we do not only depend on the Norwegian continental shelf. Over the years we have grown significantly abroad and we now operate from nine countries. It started in Denmark with delivery to Maersk and DONG and has since evolved in countries like Sweden, Finland, Canada, Malaysia, Singapore, Vietnam, Australia and last but not least China.

In connection with our project agreement with Aker Solutions at the Kashagan field, we established ourselves in 2009 with our own sales office in Almaty, Khazhakstan, where the former cross country ski king Vladimir Smirnov owned half. But this is now almost history. The regime is not amenable to our type of business. But we have mostly succeeded in our foreign ventures and, best of all when we can come in the wake of companies like Aker Solutions. To us they mean much more than Statoil. Total turnover is now about 40 percent international, with the goal of 50/50 shortly. Norwegian companies have a competitive advantage and we should be proud of the NORSOK standard, which is becoming more accepted abroad.

The downturn comes Tore Christiansen is by nature optimistic, and now he sees some really good years for the Norwegian offshore industry. But after two massive lows over the past 10-12 years, he knows that the third downturn will come, and he'll be prepared for this.

"We tend to forget in the oil industry, but with a bottom line of 3-5 percent, we must constantly be on the alert. The greatest danger for a trading company like ours is to become fat and happy. We must not go bananas because we have some good years ahead, but adjust operations to last for the next 10-15 years. On the other hand, the world has never used more valuable metals and Norway has a good expertise on the use of these," says Tore Christiansen.

“I am convinced that the Oilers will compete at the top of their league and that it should be possible to make money on the investment, but it might as well be after 2020," says Christiansen. Photo: Guro Waksvik.

reportage>>

>> Offshore Europe

Utgave nr.2 - 2011 Publiseres 22. mai / materiellfrist 20. april

Offshore & Energy er det eneste energi-magasinet i Norge som er medlem av Fagpressen innen kategorien olje og offshore. Gjennom vårt medlemskap i Fagpressen kan våre annonsører være trygge på at vi oppfyller kravene til mediers faglig-etiske standarder, blant annet med tilslutning til Redaktørplakaten, Vær Varsomplakat og Tekstreklameplakaten. Med over 10.000 godkjente adresserte abonnenter, og et distribusjonssamarbeid med Achilles, SPE og NPF, når våre annonsører beslutningstakerne på norsk sokkel. Offshore & Energy kan også leses i sin helhet på Offshore.no - Nordens største nettavis innen olje, gass og energi.

Tilleggsdistribusjon: Utgave nr.2 - 2011

Utgiver - Offshore Media Group – Norges største uavhengige nyhetsleverandør og mediehus innen olje, gass og energi. Med avdelinger i Bergen, Stavanger, Oslo og London leverer vi daglig nyheter til opp mot 20.000 lesere fra olje-, gass- og energibransje gjennom kanalene Offshore.no og Offshore247.com. Årlig samler vi over 12.000 bransjepersoner gjennom en rekke konferanser samt messen Offshore Technology Days. Magasinet Offshore & Energy har over 10.000 adresserte abonnenter og distribueres på de fleste større konferanser i Norge samt messene OTD i Bergen, ONS i Stavanger, Offshore Europe i Aberdeen og OTC i Houston.

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Faste kategorier i Offshore & Energy: Exploration, Rig market, Contract cuttings, Norwegian technology abroad, Subsea, Field development, Maintenance & modifications, Recruitment, Renewable energy og HSE.


OFFSHORE & ENERGY

PROFESSOR EMIRATUS"Professor Berteussen? We have no one by that name here". A stressed receptionist scrolls through the list of employees at the State Petroleum Institute in Abu Dhabi. When we insist on having an interview appointment with Professor Karl Berteussen, the man shines up with a happy smile and exclaims: "Ah, you're visiting Doctor Karl!"

The state oil company ADNOC in Abu Dhabi possesses nearly 8 percent of the worlds proven oil reserves and is has the fourth largest oil and gas reserves (after Saudi Aramco, the Iranian state oil company NIOC and Qatar Petroleum). The first oil was discovered in the area in 1958, while the state of the United Arab Emirates was not formed until 1971, and is thus only 39 years old. The emirate of Abu Dhabi has 95 per cent of the emirates’ oil reserves. The job of building up its infrastructure and expertise has been long and steep, and this is where Karl Berteussen from Sørreisa in Troms comes into the story. He is probably the Norwegian with the closest contact with the owners of the oil industry in this important part of the world.

Viewed from its current point at the age of 65, his career development may appear rather natural. He started as a researcher at the Norsar, obtained position at the University of Oslo in 1979 and followed his own students into the oil industry. He worked as section head of geophysics in the long-gone oil company Saga Petroleum, and then spent several years in managerial positions in Read Well Services and PGS Reservoir, while he maintained a position as Adjunct Professor at the University of Tromsø.

The last seven years he worked for PGS from Houston. Moving to a warmer climate was not just an academic choice, but also medical. According to Berteussen “all elderly people from Northern Norway have gout problems and need warmth.” So in 2003, when the choice was between retiring and taking one last mission to a warm place, and the Chair in Abu Dhabi became available, he accepted on the spot. What originally was supposed to be three years has currently become seven, and from being a mere professor, he once again has become an administrator and is now responsible for the development of ADNOC's new petroleum research centre.

Following norway Blue eyed, friendly and large framed, he

receives us in his 40 metre square office on the third floor. Beard and hair has greyed graciously since we last met him, and he laughingly states that in this part of the world grey hair is treated with respect. He has been a key figure at the Petroleum Institute in three-quarters of its decade-long lifespan and is thus an institution. Currently he is the only employee of ADNOC-PI Research Centre, but he is busy recruiting and suggests that anyone of our readers may feel free to contact him in this respect. This prompts us to ask him what about the main differences between the Norwegian petroleum industry and

the Emirates. "In Norway we have been lucky and clever. Our advantage was that we already lived in an educational community with scientists, engineers, lawyers and geo-experts and had considerable experience in the maritime industry. Being only 39 years [old] the Abu Dhabi government is younger than the Norwegian oil adventure. Before oil was found there was only desert. But Abu Dhabi has 10 times greater oil and gas reserves than Norway, and eventually there was a strong desire to develop this with indigenous resources. The vision of our university is to train local forces to assume responsibility for the development of the country's oil industry, like we originally did in Norway. We have 1000 students of which 70

percent are from the Emirates and after graduation everyone is guaranteed a job in one of the five oil and gas companies, which together form the ADNOC with its 26,000 employees," says Berteussen.

goodwill Berteussen’s Norwegian experience was crucial in getting the job at a university where the 300 employees now come from 50-odd nations. He learned that the ADNOC CEO, HE. Yousef Omair Bin Yousef, is very impressed with the Norwegian oil industry. But when Dr. Karl last year introduced INTSOK to him Bin Joseph,

although admitting that Norway is leading in technology, explained that Abu Dhabi had its own oil fund before Norway and that it is considerably larger than the Norwegian! The accumulation of knowledge and technological understanding is important for the owners of ADNOC. The Norwegian authorities introduced Goodwill agreements in the 1980s and the early 1990s, where the oil companies earned goodwill from the government for investing in the Norwegian industry. In the late 1980’s Berteussen persuaded Elf to sponsor development of downhole measurement equipment. Now Berteussen has been central to initiating a similar goodwill system for foreign oil companies willing to work in Abu Dhabi.

<<ABU DHABI HAS 10 TIMES GREATER OIL AND GAS RESERVES THAN NORWAY, AND THERE IS A STRONG DESIRE TO DEVELOP THIS WITH INDIGENOUS RESOURCES.>>

Abu Dhabi: HELGE KEILEN [email protected]


”A few months ago Shell and Total accepted to pay 5 million dollars per year for 20 years to the Petroleum Institute in connection with a long term contract with GASCO, the national gas company. As chairman of the company’s management committee that manages the money, I experienced that the oil companies’ first question was "Who do we send the checque to?" My answer was that the goodwill should also include the transfer of experience and exchange students, and that the main goal in this case is to help the national gas company to develop the relevant technology. They were a little surprised at this somewhat unexpected answer from the blue-eyed Norwegian”, laughs Berteussen.

norwegian opportunities As head of research Karl Berteussen communicates with all managers in the ADNOC system, and he promotes his Norwegian heritage. On the office wall hangs pictures from Northern Norway under the midnight sun. The fact that the sun disappears in winter and never sets in the summer is mysterious information for Arabs who are familiar with 50-degree summer heat from the sun in its zenith. He believes that Norwegian companies have ample opportunities here.

”Abu Dhabi has 95% of the oil in the Emirates and the market is two to three times larger than the Norwegian. Production is split 50/50 on onshore and offshore, but with water depth of around 10 meters there are quite different challenges than on the Norwegian Continental Shelf. Besides, the Emirates have traditionally been heavily reliant on the United States oil expertise with research projects and exchange students. Statoil has had an office in Dubai for several years but it has recently opened an office in Abu Dhabi, and it will be interesting to see what they can achieve. A general advice is that one must be prepared to remain in the region for a period of time before starting to do business. From my time in Read I remember that we came here with colourful overheads and gave a speech about our excellence before returning to Norway after a few days. After this nothing happened. You can have the best technology and experience and the Arabs may seem positive, but without establishing a local office and being willing to live here, you achieve nothing," says Berteussen.

Doctor karl When Berteussen and his wife Vibeke established their first home in Abu Dhabi in 2003, they did something unexpectedly.

"We have been living in Moscow, where we had many friends, and Houston, where we in seven years got a lot of Norwegian friends, but hardly visited the house of an American family. Abu Dhabi is a young country based on a tribal

society. We wanted to get closer to this and avoided the concentration of foreigners who live in the central city of Abu Dhabi. We decided to move into the desert, where we almost instantaneously were adopted by a local family. In this context it is good to settle down here with your wife. I have seen many examples of single men who use more and more time at the bar in the afternoons and evenings. My wife has been invited to 20-odd weddings already, where only women are present. This division between men and women may appear a bit strange for us Norwegians. At the university women wear a black headscarf and only in master classes can they share a class room with male students. A bachelor's degree is four or five years, depending on the background and a Masters, to which the university received accreditation in 2010, is two years. But one thing is crystal clear: Even if you belong to the sheikh’s family, you will not get any special treatment at this university," says Doctor Karl.

Fast developmentMany conditions are different here than in Norway, he observes.

”Several parents of students can neither read nor write, and one of the students was a shepherd in his childhood. They are smart enough, but must often be almost forced to read books and many read slowly. My motto to them is: "Read anything, but read more!" To a student, I gave the book "Call of the wild" by Jack London. He came back and said that the book had changed his life. It was the first time he really had lived himself into a written story!

I came to this part of the world with a pre-impression that Arabs are hard people. It is not true. They are often soft and vulnerable. Female suppression? Think back to how your grandmother and grandfather worked together,

and you will probably find that the difference is not that great. Moreover, the development goes tremendously fast in this part of the world. When I came here there was no question of having women in the field. Now this has started. As research director, I guess that in 10 years we will see more women in oil-related

research than men. Being an Arab country Abu Dhabi is a very tolerant society, you do not see much fundamentalism and a long beards in the streets here," says Berteussen.

Do not stress Karl Berteussen has never learned Arabic and any potential impatience he has left back in Norway. The Arabs have a phrase called In'shallah which means something like that "if God wills" and this is interpreted in many different ways. The meetings start here mostly according to the agenda, but if my boss is requested from his boss, our meeting is postponed indefinitely. One of my biggest cultural experiences was during Ramadan, when the leadership in ADNOC was invited to a meeting with Crown Prince Mohammed. We all sat on the floor in a circle around the crown prince, who gave messages to the audience in a low voice. I do not understand Arabic, but I quickly realised his authority, however,” says Berteussen.

What awaits him in the future? On the way to the 70 Berteussen admits that he does not do long-term plans. When not enjoying days in the heat, he uses his allotted 60 days per year in Norway to visit the family estate that he owns in Sørreisa, or the house in Paphos, Cyprus (according to him the warmest and driest place in Europe). He has also been in contact with "Geophysics Pioneers", 12 old guys with names like Anders Farestveit, Kjell Arne Oppebøen and Olve Torvanger, who meet together regularly to reminisce about past victories.

How long he will be in Abu Dhabi? Even he does not know. But he is committed at least to include the initiation of construction of the new research centre which will start this summer. In'shallah!

karl Berteussen has become a popular professor in Abu Dhabi; here he recives a gift from ADMA CEO Ali Al Jarwan.

reportage>>

• Norges største nettsted innen olje, gass og energi

• Leses av 70 000 bransjefolk hver uke

• Når leserne i jobbmodus

• Annonser på forsiden av offshore.no og på stilling ledig torget

• Annonsen blir søkbar gjennom A-pressens rundt 50 lokalaviser med et nedslagsfelt på 1,2 millioner lesere

Ta kontakt i dag med salgssjef Marius Ulstein-Brokner på telefon 480 27 400 eller e-post [email protected]


reportage>>

In spite of improvements in several areas, like operations, maintenance and modification – the financial impact do not match the decline in production. The unit lifting cost continues to rise, margin drops - and the economic lifetime of producing assets is shrinking. It’s tough to be a “mature” asset. Increasing demands for maintenance and life extending modifications are causing big problems. There are, however, several promising achievements and trends. Developments in drilling, field development and operations are world class. The achieved production is as an average 60% above the initial PDO estimates. Some old assets aim for recovery rates in the seventies. Our oldies are industry leaders.

Oil mosquitosFocus on improvement must not take the attention away from finding better ways of doing what we do today. Operators must find a balance between doing things right – and doing the right things - that match their real field challenges. Innovation is required when improvement is insufficient to extend assets life expectancy. New concepts, like unmanned, remotely operated or topside as subsea becomes a lot more acceptable when the option is a premature exit. Innovation is necessary to justify smaller size, remote and even arctic fields.

Which companies are best suited to develop and realize new opportunities? The debate is fuelled by the distribution of assets between operators, and in particular Statoil’s dominant position. Is the imbalance slowing down development of new fields? Are the knowhow, capabilities, and capacity proportional with the distribution of licenses?

The discussion will not shift the current license distribution, but may be of interest to how future licenses will be awarded. The new small and lean operators – coined the “oil mosquitoes” - have some unique strength, which may be rewarded – if leveraged. While they are new, their human resources are not. Their experienced teams have mixed operator

backgrounds and may be less prone to “group thinking”. They can consider prospects without the burden of legacy - or bias to how things should be done.

Fast track not newFast track concepts have got a lot of attention, but the ideas are far from new. Besides, the real custodians of fast-track capabilities are not the operators, but the major engineering and construction service providers. They do not discriminate, but serve both large and small developers. Maybe the real value large operators can derive from their fast-track programs is an opportunity to revise their internal investment and development processes that we developed for different times and challenges. The quality of future PDO’s and the time from PDO to Production will show whether the mosquitoes can match the giants. Maybe the playing field of future developments is more even than expected.

gassco and PetoroThere are disadvantages of being new and small. Tying the knots with an ageing tieback partner involves risks. The tieback hosts’ life expectancy versus own ambitions can illustrate this. Any initiative that improve infrastructure availability and cost predictability, even beyond assets abandonment will increase the probability of new fields being developed. It would benefit both large and small operators, and should be a key topic for the petroleum authorities.

Gassco and Petoro have different but complementary capabilities, and may play an increasingly important role in future development. As architect of transportation infrastructure – and stakeholder in most field developments - they have perspectives beyond the individual operators’ agenda. Given the necessary means and mandate they may influence even more the value creation from both mature and new areas. The key is orchestration of individually small – but collectively significant - developments.

The Norwegian shelf seems to be described by problems these days. Is it justified, or can we hope to achieve more during the next decades?

WHAT’S TICKING ON THE NORWEGIAN SHELf?

Guest writer: OLE EVENSENpartner PwC


OFFSHORE & ENERGY

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subsea>>

The Subsea market in Australia is very good in the coming years, according to multiple reports and sources.

By far the largest from 2013 According INTSOK and Rystad Energy Australia will be the largest subsea market from 2013. From 2010 to 2018, the number of trees installed almost triples and forms the basis for enormous business opportunities on the seabed.

INTSOK´s annual market report 2010-2014, created by Rystad Energy, shows that the market is $7 billion in 2013 and 11.1 billion in 2014. By comparison, number two on the list in 2013, the UK, will be $4.6 billion and in 2014 the U.S. GoM $6.9 billion, according to the report.

“The industry and the government are very optimistic when they see the development in the future for Australia. They can not see any dark clouds in the sky - except for a shortage of skilled labour which could trigger problems with higher wages", says General Manager of the subsea cluster NCE Subsea Trond Olsen. He has just returned home after participating in the Australia Oil & Gas & exhibition conference. According to Olsen 15,000 people visited the exhibition and 240 exhibitors. About 30 of the exhibitors were from Norway.

need to build quickly Australia is experiencing a major oil production decline. Gas production will go in the opposite direction.

But the development of the petroleum industry has gone slow because of the mining industry that has been strong. Now the focus is on gaining momentum in the oil and gas operations.

“It is very extensive to build up a smaller industry to very high activity in such a short time. One should remember that even if we think of Australia as a country, the distances are very large. They do not have the infrastructure in form of bases and ports, as we have in Norway”,

Australia could become the next gold golden market for Norwegian suppliers.text by: JOHN ØKLAND [email protected]

Upcoming subsea boom down under

Anja and Olaf Bilsbakk Brakstad, ClampOn and Arne Riple, Aker Solutions were all present at the Australia Oil & Gas in February. (Photo: Trond Olsen / NCE Subesea)

“Australia provides great opportunities for Norwegian subsea players, "says Managing Director of NCE Subsea, Trond Olsen. (Photo: John Økland)


OFFSHORE & ENERGY

exemplifies Olsen.

The heart is in the northwest The largest geographical area of activities is in north west of Australia. Several major developments are creating the country's subsea core. Large areas of the Greater Gorgon in front, are creating tremendous activity in the Northern Carnavon Basin. Only the Greater Gorgon development has a capex of $43 billion.

Easier to establish down underThe numbers on how large the subsea market will become in Australia should alone get all the Norwegian players to take an interest. For here are possibilities that exceeds both Brazil, Nigeria and U.S. GoM. And another good news is that it is far easier to establish in Australia than, say, Brazil.

“In Brazil, it is far more bureaucratic, it is up to 70 different taxes you should pay, and it is required very high percentage of local content and language and cultural challenges. In Australia we talk the same language, there are laws that Norwegian players recognizes and there are no formal requirements for local content”, Olsen says.

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field development>>

Rystad Energy has previously predicted an investment boom on the Norwegian continental shelf. At the NOC conference, partner Jaran Rystad presented a list of projects which the company expects to be put into production on the Norwegian continental shelf by 2018:

New platforms: Yme, Gudrun, Valemon, Ekofisk living quarters platform, Eldfisk II, Ekofisk South, Hild, Dagny / Ermintrude Tommeliten Alpha.

"In addition, we were told that new platforms were a possibility on both Snorre and Gullfaks during the NOC conference," said Rystad.

floaters/fPSO: Gjøa, Skarv, Goliat, Frøy, Jordbær, Draupne / Hanz, Bream, Luno, Luva, Snorre New, Gullfaks Sør, Grosbeak, Beta / Zeta, Peon.

In addition, around 50 subsea projects, including Statoil's fast-track projects, Morvin, Vega, Trym, Oselvar and so on.

new platform capabilitiesNew wellhead platforms could be the solution to recover

more oil from a range of fields. License director Tor Rasmus Skjærpe in Petoro pointed to Snorre, Gullfaks and Heidrun as candidates.

If Petoro's suggestion goes ahead, there could be two new wellhead platforms on Snorre, as well as two on Gullfaks and Heidrun. According to Skjærpe, a a decision must be made within a maximum of five years.

Fast trackStatoil's fast track projects also received a great deal of attention. Statoil currently has 60 field development projects ongoing, which is four times as many as ten years ago.

Half of these are small field developments, the other half are projects in enhancing recovery. An increasing share of the company's future field developments will be fast-track projects.

The first four projects, PanPandora, Katla, Vigdis Northeast and Hagrid, will pave the way for the group's continued

Investmentboom aheadThere were many plans in the billion size during this year's NOC conference, but supplier squeeze and increased costs could limit the investments.

text by: GLENN STANGELAND [email protected] JOHN BRADBURY [email protected] STEIN TJELTA [email protected]: ELISABETH H. KOLSTAD

Rystad Torstein Sanness


OFFSHORE & ENERGY

Torstein Sanness

commitment to fast-track developments. The next three fast-track projects are Fossekall and Dompap north of Norne ship in the Norwegian Sea and Vilje Sør near the Marathon-operated Alvheim field in the northern part of the North Sea. And more are in progress.

"This is a new way of working. The ambition is to start production two and a half years after a discovery. But costs has to be reduced by 30 per cent, and standardisation is the key to achieving this. The areas that are prioritised are Sleipner, Oseberg, Snorre, " said Gjertsen.

Ten billion Troll compression The 3rd and 4th stage of gas compression on the Troll field is one of the major ongoing modification jobs. It includes a module for 4000-5000 tonnes, and an extensive integration work on Troll A. A realisation decision is planned during 2011.

"This is a 10-billion project," said Gjertsen.

Shell wants new exploration areasShell in turn called for new exploration areas.

"We are pursuing oil and gas in the same areas as in 1994," says Shell.

Gaining access to new exploration areas is becoming increasingly important as production falls and producing fields are approaching shutdown.

Director of Exploration and Production, Shell, Grethe Moen, pointed out some of the hard facts in Norway.

"We are still searching for oil and gas in the same areas that were opened in 1994 - that's 16 years ago," she said.

"It could take 15 years from opening a field to the start of production. The future lies in the closed areas, which are vital for our jobs and

high living standards, "she says, adding that there is enough ground for the opening of the prospective areas in Nordland VI and VII as well as in the Barents Sea.

But Shell will invest tens of billion kroner in the Ormen Lange field in the coming years. The company plans to install the world's largest subsea compression facility at a cost of 38 billion, but first a smaller version will be tested with the tests beginning next year.

Shell considers expanding the Linnorm discovery in the Norwegian Sea together with Statoil's Luva discovery. This will require a new gas pipeline to NKr 9 billion, which will extend from these two fields and to Nyhamna. In addition, naturally, there will be tens of billion investments on developing Linnorm and Luva.

Transferring gas from the Norwegian Sea to the shore is likely to require major investments in Nyhamna.

So far, the companies have identified a need for increased gas compression capacity. Only this will require several billion in investments.

Will tie-in Jetta to JotunDet norske confirms that the company plans a tieback solution of Jetta towards Joutun:

"The discovery is smaller than we hoped for. It is near Jotun, so we hope to reach an agreement with ExxonMobil which will make Jetta fly, "said Det norske CEO Erik Haugane.

Wants to grow in norwayGDF Suez will continue to invest. Since 2001, GDF Suez has invested 18 billion dollars on the Norwegian Continental shelf. The company promised to continue its investments in Norway during the NOC conference.

"We have invested a lot of money in Norway, and we are prepared to do the same in the

Erik Haugane


field development>>

future, "said Terje Overvik, managing director of GdF Suez E & P Norway.

Next year, the company will drill an exploration well on the Heilo propspect in the Barents Sea. This is north of Snøhvit, and if is is a commercial discovery, it may be tied into Snøhvit.

Total increased focus on norwayHild and David have opened Total's eyes on Norway again. The company will award contracts for the platform and chassis on the Hild field next year.

Preparing for the Hild development, and David discovery set for a fast-track slot, Total has two developments underway on the Norwegian shelf. The operator is also looking forward to an exciting exploration well in the Barents Sea next year.

Chief of operations, Tore Bø, admitted that Norway has not topped the French company's list in recent years, and that there was not much activity in the past year's license rounds, but after two successful discoveries in 2009, the company will focus on Norway again.

Total believes Hild contains 150 million barrels of oil equivalent and that it will require 12 wells. The company is considering a wellhead system and a production platform. This could include a topside of 12,500 tons and a steel chassis of 8500 tons to be installed at 115 metres depth. In addition, the field will require an FSO that can treat the high CO2 content.

Total aims for Hild to come onstream in 2016 and to submit a PDO in the fourth quarter of next year. The contracts for the topside and

jacket will be awarded in 2011.

David discoveryThe David discovery contains 15-20 million barrels of oil equivalent, consisting mainly of gas with some condensate. The discovery is a subsea tie-in via Byggve to the Heimdal platform. Production start is planned for 2012.

Norvarg in the Barents Sea is scheduled to spud in May next year. Total Norway is the operator with 40 per cent. Det norske has 20 percent, North Energy 20 and Rocksource 20.

Wintershall’s Maria could be fast trackWintershall also revealed possible strategies for one of 2010's largest discoveries, Maria. The company is considering a tie-in from Maria to an existing platform.

"Åsgard is the most likely option. But Heidrun is also a possibility, "said Schrimpf.

"Could Maria be a fast-track project?"

"If there is spare capacity on an existing platform or we find other synergies, it might be a possibility. But if we do an appraisal and find that reserves located in the upper part of the original estimates, can also be a stand-alone development be appropriate, "said Schrimpf.

The size is estimated at between between 60 and 120 million barrels.

grosbeak can be stand-aloneWintershall has an investment budget in Norway and parts of the UK for around eight billion over the next five years. The company aims to develop Grosbeak or Mary during this period. The company hopes to extend its reserves further when it drills appraisals at Gnatcatcher

and Grosbeak late this year and early next year.

"We consider both stand-alone and subsea tie-back for the Grosbeak," Wintershall said Schrimpf.

Lundin spends 1.2 billion on explorationSwedish Lundin will spend approximately 460 million on field development and 1.2 billion on exploration in 2011, according to CEO Torsten Sanness.

Lundin boasts a success rate of around 45 per cent when it comes to exploration. Sanness thinks courage and a good system, explain the success.

"Exploration is exclusively a data-driven activity for us. We like proven systems and make use of them. At the same time we dare take a chance alone at the prospects we believe in and then find partners along the way, "said Sanness.

Appraisal aheadThe delimitation of the biggest discoveries, Avaldsnes, starting with the rig Bredford in March. The rig contract is for two wells, with an option for a further two.

Lundin is aiming to search its way to the top elite on the Norwegian continental shelf, not to buy its waythere.

"We are focussed and will concentrate on three areas on the Norwegian Continental shelf, Greater Luno, Greater Alvheim and the Barents Sea, "said Sanness.

The company also has ambitions to put a new field into production each year. Peik, Nemo, Krabbe and Gaupe are next.

John Whelan


OFFSHORE & ENERGY

Nemo and Krabbe will probably be developed together, but these projects show how difficult it is to start production from small fields when you do not own the infrastructure yourself, "said Sanness.

2007 cost levelStatoil and Rystad Energy stressed that the capacity in the supplier industry can be a problem.

Statoil has ambitions to keep the cost down even if the workload for the supplier industry is expected to increase substantially in coming years.

"We are already at the same cost level as in 2007. It will be a challenge to keep costs down, but we believe it is possible. But it is important that the entire industry in recognising the challenges we face. Industrialisation and standardisation are key elements if we are to succeed, "said Vidar Birkeland, head of procurement in Statoil, the NOC conference in Stavanger.

The goal is to lower the break-even price so that more projects can be realised.

The introduction of performance contracts, challenge their own standards and a good working relationship with the supplier industry was mentioned as measures to keep prices down.

Predicts capacity problemsRystad Energy believes that the capacity in the supplier industry becomes the limiting factor when it comes to the number of developments.

"In 2007, the supplier capacity was the

bottleneck, in 2008 and 2009 the bottleneck were the oil companies' organisation and the lack of cash supply. In 2010 we had a balanced situation. It's almost too good to be true, and we think it will not last forever. We believe that vendor capacity will again be the biggest bottleneck in the years to come," said Rystad.

What about quality?In the record year 2008, before the oil price plunged from record high levels and the financial crisis, there were wild conditions in the industry: in short, this period was characterised by galloping supplier prices, drilling rig competition, personnel with high qualifications and licenses.

Prices rose so fast that industry was alarmed, and Petoro director Kjell Pedersen said he had never experienced anything like it. The price was one thing, but the quality went the opposite way.

Most famous is the episode where the wrong alloys in pipe that was installed on a number of Norwegian oil installations.

There was also a battle for the rigs, for "everyone" wanted to drill new wells before the oil prices reached record levels.

The industry also experienced cannibalisation by the oil companies who over bid supplier firms in the battle for the best minds. The result was also wage spiral.

There was also fierce competition for stakes in both producing fields and the licenses that approached the production stage.

Are there other dark clouds in the sky? Yes,

long term investments will decrease dramatically, if new exploration areas aren't opened soon.

grethe Moen

• The Norwegian Operators Conference (NOC) is an annual conference that was started in 2003.

• Originally presenting the newcomers on the Norwegian Continental Shelf, NOC has gradually become a forum where the key NCS operators present their plans and perspectives for the coming year.

• Held in the scond half of November, the conference is thus right on target for disclosing investment levels and plans for the coming year.

• In 2010 the NOC conference gathered some 300 participants.

FAcTS


field development>>

OPERATOR PROSPEcT LOcATIOn FIELD TYPE FIRST PRODUcTIOn FIRST PRODUcTIOn OTHER InFORMATIOn

Hansa Hydrocarbons

Thoresby 48/16b gas condensate tbc 20 -30 m 60 km due north of Bacton and 12 km southwest from Lancelot and Guinevere

Hurricane Lancaster 205/21a Oil tbc 150 – 190 m

Ithaca Harrier Block 30/6 gas condensate tbc 80- 90 m

Nautical Petroleum Kraken Block 9/2 Oil Q4 2012 110- 120 m

Nexen Blakbird 20/2a Oil 2011 110-120 m Potential Ettrick tieback

Nexen Blackhorse 15/22 Oil tbd 130 - 150 m Options being considered

Nexen Bugle 15/23 Oil tbd 130-150 m Options being considered

Shell Puffin 29/5a Condensate 2015 90 – 100 m Options being considered

Valiant Petroleum Banquo 211/8a Oil Not known 300 – 310 m Options being considered

Valiant Petroleum Helena 211/13a Oil Not known 160 – 200 m Options being considered

Valiant Petroleum Tybalt 211/8a Oil Not known 300- 310 m Options being considered

Nexen UK and Valiant Petroleum each have three potential developments waiting to be tapped, while others discoveries identified within the scheme come from Hansa Hydrocarbons, Hurricane, Ithaca, Nautical Petroleum and Shell.

Only Nautical’s Kraken discovery in UK block 9/2 has a target first oil date - slated for the fourth

quarter next year - while Nexen’s Blackbird development is to come onstream this year, as a tieback to the Ettrick field FPSO, the Aoka Mizu.

On the other discoveries, a first production date is either unknown or still to be decided.

But the list clearly signals the fact that the UK’s Department of Energy and Climate Change is keen to show contractors where future

business opportunities could be found.

Nexen’s two other potential developments are Blackhorse, in block 15/22, and Bugle, in block 15/23, which both lie in water depths of between 130 and 150 metres (426 - 49 2 ft).

Valiant’s trio of potential projects are all in the Northern North Sea, and comprise Banquo, in block 211/8a, Helena in 211/13a and Tybalt, also in 211/8a.

Hansa Hydrocarbons is has the Thoresby gas and condensate discovery to consider in block 48/16b which is 12 kilometres (7.5 miles) southwest from the Lancelot and Guinevere gas fields - well within tieback distance.

Hurricane has the 205/21a Lancaster oil discovery to tap, in a water depth up to 190 metres (623 ft). Ithaca’s Harrier gas and condensate discovery lies in block 30/6 in up to 90 metres (295 ft), and Shell has the Puffin condensate discovery to consider, in block 29/5a, which is slated for first production in 2015.

Project Pathfinder, a UK government backed scheme to provide higher visibility for the energy contracting community shows, 11 further projects which could come to fruition on the UK Continental Shelf.

Pathfinder points to potential projectstext by: JOHN BRADBURY [email protected]

centrica's York gas development will see another new normally unmanned wellhead platform built by Heerema in Hartlepool in the UK to tap the Southern North Sea field.Image courtesy Heerema Fabrication Group B.V

EXECUTIVE MASTER OFMANAGEMENT IN ENERGY This is an international 12 month, part-time programme, offered in cooperationwith IFP School in Paris. The programme is professionally oriented and designed toprovide participants with a comprehensive understanding of the energy sector in amanagerial environment.

Starting September 12th 2011. Rolling admission.

Information Meetings• Tuesday March 22nd at 17.30, BI Stavanger, Hesbygata 5. • Monday April 4th at 8:30, BI Oslo, Nydalsveien 37.

Telephone +47 46 41 04 95 or [email protected]


field development>>

Production from the Golden Eagle Area Development – now referred to as GEAD by Nexen – will be processed at a major new central platform complex and the project involves tapping two fields, Golden Eagle, and Pink, just north of Nexen’s Buzzard field in the

Central North Sea spanning blocks 20/1N, 20/1, and block 14/26a, about 70 kilometres (43 miles) offshore from the UK east coast in the North Sea.

One of these new platforms will be a wellhead facility, which is to be linked via a 70-metre

(230 ft) bridge to a major production, utility and quarters (PUQ) platform. Both will stand on new steel jackets.

Current planning by Nexen indicates that the PUQ will handle all processing for Golden Eagle field fluids, and will also provide utility systems

Nexen’s UK North Sea Golden Eagle development will see a major new offshore twin platform complex and two subsea drilling centres with up to 24 wells.

Golden Eagle to fly with twin platforms

This schematic shows how the Golden Eagle Area Development could look by the time it comes onstream: Image courtesy Nexen UK.

text by: JOHN BRADBURY [email protected]


OFFSHORE & ENERGY

and accommodation. This facility will receive output from the new wellhead platform, and from two subsea drill centres to the north and south.

Nexen is considering two oil export options for the project: Either into the Forties Pipeline System using a possible tie-in at Nexen’s Buzzard field, which will require a new 20 kilometre (12.5 mile) pipeline, or through the Claymore field to Scotland’s Flotta terminal – which requires installation of a new 75 km (48) mile pipeline.

Gas will be exported to into the Scottish Area Gas Evacuation (SAGE) pipeline via a new 16.75 km (10.5 mile) export line to an Ettrick field pipeline end manifold,

A schematic of the development shows a northern drill centre manifold located 5.2 km (3.25 miles) north of the main field complex with six slots – four for production and two for water injection, with two wells to be used initially: One for will be for production and the second for water injection. At the southern manifold, 3.9 km (2.43 miles) from the main platform complex, there will be a four-slot drilling template with two production and two

injection wells. Initially one producer and one water injector will be used there.

“Pipeline and subsea structure installation operations are anticipated to start in early 2013, and take approximately eight months,” Nexen indicates in an environmental impact statement on the project obtained by Offshore.no/international.

“The installation of the platform complex will take place in stages between second quarter 2013 and third quarter 2014,” the operator indicates in the EIS, and continues: “Drilling operations will commence in late 2013 and will continue over a period of approximately three years. First oil production is expected in [the] fourth quarter 2014, with oil production at GEAD expected to peak between 2016 and 2018, with a maximum production rate of 70,000 bbls [barrels] of oil per day.”

As part of the project evaluation process, Nexen says it has worked on a new drilling specific oil pollution emergency plan, which will have to be approved by the UK’s Department of Energy and Climate Change.

“A Golden Eagle Area OPEP will be prepared

and will include emergency planning for the GEAD production activities,” Nexen indicates. “The OPEP will detail responsibilities for initial response and longer term management and will be submitted to DECC for approval prior to start of production at GEAD. In addition, Nexen has access to specialist emergency response services provided by Oil Spill Response (OSR) and are members of the Oil Pollution Operator’s Liability Fund (OPOL).”

Field life for Golden Eagle is put at 25 years.

Nexen operates the development, partnered by Maersk Oil North Sea, Petro-Canada UK and Edinburgh Oil and Gas.

Table: Golden Eagle partners:

Company Block 20/1N Block 20/1 Pink area Block 14/26a

Nexen Petroleum UK 34% 46% 100%

Maersk Oil North Sea 36% 15%

Petro-Canada UK 25% 33%

Edinburgh Oil and Gas 5% 6%

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field development>>

no reaction to the OLF warning

In October, OLF made public a calculation that shows that the Norway’s petroleum industry contribution to the Norwegian state will decline by US $58 billion over the next four years. This warning did not lead to any reaction among decision makers in Oslo, says the OLF.

- now we see the consequences“This is dramatic. Revenues will fall sharply. The high gas prices have hidden consequences of the falling oil production. Now, that gas prices have fallen, the problem with declining oil production becomes more visible,” says the OLF’s, Roger Pedersen.

58 billion less“In 2015 the petroleum industry will contribute 58 billion fewer dollars on the state budget than it is today. Lack of investment in oil and gas industry can have serious consequences for the Norwegian society,” said OLF chief Gro Brækken during the OLF's annual conference in October.

Yellow light“We have today a political situation where the traffic lights are on yellow for

the petroleum industry. It takes an average of 15, almost four times the government, years from discovery until it is in production and generating revenue,” said Brækken.

In her speech she pointed to some trends for the Norwegian Continental Shelf if investment is no made:

• Production decline continues.

• Revenues to the community fall in parallel.

• Without access to new exploration areas, the need for

• Technical expertise will disappear abroad or leave the The basis to replace or maintain competence is no longer present.

• Declining opportunities to counteract depopulation in rural areas.

• The supplier industry is losing its home laboratory, because the driver for innovation disappears.

• Financial leeway to invest in renewable energy decreases.

text by: STEIN TJELTA [email protected]

- We can say what we want, it does not help! Our warnings are not taken seriously in Oslo, says the OLF.

Photo: OLF/Tom Haga

Photo: OLF

gro Brækken, boss in Oljeindustriens Landsforening (OLF)

OLF being briefet

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Fabricom får Talisman-studie - - Kutter oljesmøringen av budsjettet - - Blir syk av Norge - Norsk sokkel på investeringstoppen - - Statoil viktig for fornybar energi - Gasslekkasje på Mongstad - Tre selskaper utelukket fra Oljefondet - Neste Training-portal - Kritisk til vedlikeholdsnivået - Samler troppene på ONS - Dalsnuten kan gi milliard-utbygging - Ny teknologi skal redde dypvannsboringen - InterOil refinansier - Olsen-selskap resykler FSO - USA avdramatiserer iransk atomkraftverk - Rosa tiger ser svart - Gavedryss over klimapros-jekter - Kjøper seg inn på Dalsnuten - Klart for en ukes oljesirkus i Stavanger - Vurderer å kutte ut fornybar energi - Vabø slutter i Wintershall - Yme-kontrakt til Bergen Group - Sevan blant Jordbær-favorittene - Seatrench graver for Total - Får kompensasjon, men mister jobbene - 375 Statoil-millioner til IKM Testing - - BP nekter å gi ut informasjon - - Seadrill-rigg til West Seno - Mulig funn i Tunisia - Bore-ja på David - USA mener Israel overdriver - Technip inngår samarbeid - Samler seg til ONS - Total tar FMC-opsjon - Uforutsigbare Fredriksen - Kongsberg kjøper Odfjell-selskap - Iran åpner russiskbygd atomkraftverk - Noreq åpner USA-kontor - - Dette vi fryktet og advarte mot - - Har ligget i kortene lenge - Balansert og logisk, Statoil - FMC-kontrakt til Grenland Group - Lite oljefunn på Brynhild - Statoil spikrer ny organisasjon - Dong tjente på kald vinter - North Energy inn i Stirby - Åpner for kabelkompromiss - 2/3 deler av Norges oljereserver er utilgjengelige - Lieungh overtar Odfjell Drilling - - Høres ut som gammelt nytt - Grønne vyer - ASCO vinner storavtale - Oppjusterer forventningene - Vindmøllekonsern nedbemanner - Maste-minister møter Hardangerrådet - Sevan-jobb stadig nærmere - Moss ny Hydro-sjef - Mindre omsetning ga pluss - Vil ha norsk tidevannspatent - DNO øker med ti prosent - Letet seg til minus - Tror på dansk olje - 80 prosent av oljesølet er ikke rensket opp - Hywind ut i verden? - Nedgang i oljeproduksjonen - Hvordan unngå ulykker? - Så moden er norsk sokkel - Gigantiske oljeressurser - Ny brønn på Ormen Lange - Tar oppgjør med klimahysteriet - Skal bli best på vind i EU - Ser frem til borestart - Vil bort fra Clapton - Store tall for olje-Norge - - Sjøkabler kan øke CO2-utslippene - Roser norsk innsats i Mexicogolfen - - Rom for forbedringer - Fra Dass til olje - Noreco stokker om - Palantir lander storjobb - Riis-Johansen avlyser Svalbard-tur - Ny daglig leder i EPTEC Energi - Råoljepriser gir økt overskudd - - Vi har aldri lovet et utvalg - Hjelper det å svømme? - Ukeslutt i oljebransjen - UKE 32 - - Vurderer å droppe Hardanger-utvalg - Alabama søksøker BP - Vil drøfte sjøkabel - Obama testet badevannet - Oljefelt oppdaget i Afghanistan - Solheim til Mexicogolfen - Modulær fremtid - Rigg-kontrakter for 515 millioner - 155 milliarder i minus - - Gasskraft må utredes - Høy oppetid og god inntjening - Seawell i milliard-avtale - Kjemper om borejobb - - La Lunde ligge - Sjøkabler kan føre til dyrere strøm - Ap til bunns tross snuoperasjon - Sp-topper vil ha kraftledninger - Det norske paradoks - Arbeidet kan være ferdig - Gas-skraft redder Bergen - Mot slutten for norges viktigste letebrønn - Bergen Group sikrer 120 mill. - Dong signerer LNG-avtale - Nedgang for Aker Solutions - Aker inn i kasaksthansk joint venture - Tyrkia vil selge bensin til Iran - - Utenlandske eksperter må til - - Bare tøys - Ett steg videre i Angola - Master kan bli overflødige - Lederen for Rieber Shipping død - Asia-jobber til to Solstad-fartøy - Lofoten kan gi 150-180 milliarder i utbygginger - Lite opplagt etter ferien - Gjennombrudd for rensing av vann - Statoil fortsetter opplåningen - Sikrer seg inspeksjonskontrakt - Ny kontrakt for Prosafe - Byggekontraktene i boks - Storm forhindrer plombering av oljebrønn - Snuoperasjon kan føre til flere vernekrav - Krever ministerens avgang - Kan bli sjøkabel likevel - - Sv er dømt til å tape - Danner investeringsgigant - Selges til Kina - Vant full seier mot Statoil - Bygger vindfarm-supply - Qatalum blir forsinket - Dobbel Bjørge-jubel - - Kraftlinjen strider ikke mot grunnloven - Ber Stoltenberg tenke nytt - Gir Sp skylden for Hardanger-mastene - - Kampen «så godt som over» - Technip vinner Snorre-jobb - Tror på milliard-resultat - Opp og ned i Murmansk - Frykter for fremdriften i klimaforhan-dlingene - Kjøper seg inn i oljetjenester - Tror han blir nedgravd - Songa Eclipse i rute - Navarsete villig til å revurdere Hardanger-avgjørelsen - Ny leder for karbonsatsingen - BP-opprydning svekker ikke motstanden i nord - Jens i høyspent-trøbbel - Vant mer tid i Mosambik - - Lofotenvern kan gi flere arbeid - 600 millioner til Subsea 7 - Tror AP vil ofre Lofoten - Besøker Lofoten - Utsetter dypvanns-boring - Ja til Gjøa SEMI - Ønsker høring om kraftlinje - 340 millioner til Prosafe - BP-brønn fylt med sement - BP har betalt 1,8 milliarder i erstatninger - Krass kritikk av oljevern - Ny Bergen Group-sjef - Åpner Stavanger-kontor - - Ekofisk-hotell forsinket - Ap rystet etter krisemåling - - Gnål om kraftlinjer - Kullkraft i Hardanger - Fyller brønn med sement - ESS vinner Skarv-jobb - Tror på gode rig-gavtaler - Sier nei til kraftlinjer - Gjøa-pålegg til Statoil - Rigg-giganten innfrir - Noreco slipper tall - Vil la Statoil lete etter olje i Alaska - Frykter flammene kan nå oljeraffinerier - Oljesølet som forsvant - Høstens boreplaner for Barentshavet - Status for årets letebrønner - Sjøsatte Sevan Driller II - Tiltalt for markedsmanipulasjon - Skeie-riggene skal få jobb - Frykter permitteringer - Vi er lite op-pfinnsomme - Lundin i siget - Ap-ledere tror ikke kraftlinjen skader partiet - Seismikkoppdrag offshore Afrika - Mister halve overskuddet - Vellykket plombering av brønnen - BP selger Colombia-virk-somhet - Havila Phoenix til Expro - Interoil-bud feilet - Storkontrakt til norsk kabelfabrikk - - Gassprisen skal opp igjen - Verdenshistoriens største oljeutslipp - - Obama står ved sitt klimaløfte - Gass-priser gir milliardtap - BP utsetter plombering - Oljeprisen over 80 dollar - - Valhall blitt enda viktigere - - Regjeringen påfører ubotelige skader på Vestlandet - Shtokman-ansatte får egen skole - Kontraktsrekord for DOF - Morvin startet opp i går - Energi til besvær - Ny Brasil-jobb til Acergy - Milliardjobb til BW Offshore - Skjerper sikkerheten ved oljeboring - Ap-topper krever omkamp om Hardanger-master - Seadrill får forlengelse - Mener oljevernet fortsatt er dårlig - Drømmer om oljeeventyr på Grønland - Opposisjonen ønsker Hardanger-diskusjon - Bore-ja til Lundin - Stoltenberg kåret til miljøversting - Svak børsåpning - Totals overskudd opp 72% - Stabile tall fra Petoro - Seadrill og Odfjell får pålegg - Ja til Island Wellserver - Forlengelse til West Hercules - Bridge Energy vil selge andeler - Komisk - Mener Statoil pynter på resultatene - California-velgere mot oljeleting - Statoil får ja fra Ptil - Statoil kan tape millioner - Bedring for Royal Dutch Shell - EMGS vant patentstrid - OIG søker om børsno-tering - Svakere resultat enn ventet for PGS - Boreja til Statoil og Polar Pioneer - Milliardkontrakt til Acercy - Statoils resultater skuffer - Nye oljeruter tar av i august - Lavere oljepris ga børsnedgang


field development>>

- 2,000 dedicated heads “Here I do not agree with the Director General Nyland. The group has no less than 2,000 employees who work with increased production,” says Øystein Michelsen, senior vice president for exploration and production in Norway, to Offshore&Energy.

NPD and Petoro, which operates the state's direct investment in Norwegian fields, are concerned that it's done too little on the ageing large fields.

Petoro has previously said that if oil companies do not realise IOR [increased oil recovery] measures which are time critical to increase

production because of escalating maintenance costs that it may result in multiple fields having to be shut down earlier than expected due to unprofitable operations. What do you think about it?

“Then I do not think Petoro thought of Statoil. I do not think we understand less than Petoro,” says Michelsen.

O&E: What about the life of the Heidrun field? Here you have written down reserves, and Petoro presents a model of an anonymous field that may have to close earlier than expected. Probably it is precisely the Heidrun being used here as an example. What is your comment?

“On the Heidrun field, we have a very long perspective. It will produce for decades,” says Michelsen.

40 percent production decline The starting point was that Norway's oil production has fallen by 40 per cent since 2000, and will, according to NPD, fall faster than previously thought if operators do not grasp the situation soon. In 2005 the Norwegian Petroleum Directorate assumed that 75 per cent of the growth would have to come from existing fields. So far, only 56 per cent of the growth came from producing fields, while the rest is from discoveries that have been approved for development.

The company's director for exploration and production does not feel taken by the NPD chief’s concern that too little is done to increase the recovery rate on mature Norwegian oil fields.

Statoil disagree with the Director of Petroleumtext by: STEIN TJELTA [email protected]

Bente nyland Øystein Michelsen

Integrated operations, after reaching a high level in the first generation of internal

development is becoming a matter of continuous improvement for several

companies. A period of consolidation has been opened. It is then proper to direct our attention

to an area which requires urgent attention: The further development of mature fields.

www.npf.no

Detailed conference programme and signup: www.npf.no

Field redevelopment and operations

More barrels for less money

Technology adoption

Key business opportunities

New work processes

HSEQ for aging facilities

Integrated Operations

Field redevelopment and operations

More barrels for less money

Technology adoption

Key business opportunities

New work processes

HSEQ for aging facilities

Integrated Operations

Business Opportunities in Mature Fields

NPF Conference May 10 - 11, Stavanger

IO.indd 1 09.02.2011 10:29:32


maintenance & modifications>>

“The problem is that producing fields do not produce as planned, and we have said they need to work more with this important issue. We see that the companies fail to deliver. They do not drill enough wells, and it is through production wells, one gets increased production,” Nyland tells Offshore & Energy magazine.

Statoil recently presented a summary of the year 2010 and samples of what suppliers can expect from new projects this year. With Statoil's manager for production on the Norwegian Continental shelf, Øystein Michelsen in the lead, Statoil’s upper management gave journalists one piece of good news after another. The fact though is that the company struggles to maintain its present production. Mainly because its aging fields do not perform as expected.

nPD’s just not satisfiedIn September last year, the NPD held a press conference with focus on Norway’s falling oil production.

The starting point was that Norway's oil production has been reduced by 40 percent since 2000, and will, according to NPD, fall faster than previously thought if production increasing measures are not undertaken

soon. Bente Nyland expressed concern over an apparent lack of necessary decisions:

“The oil companies are not doing enough. There is talk a lot, but little is done. NPD has no idea and does not understand why things do not happen. When it is economically and commercially profitable, why not more emphasis on production increasing measures?,” Nyland wonders.

O&E: Is this primarily Statoil?

“It applies to all companies, but Statoil has most of the production on the NCS, so it is natural to concentrate on this company. However, we welcome the mindset surrounding the fast-track projects. We have said to the oil companies that this is very good, but what concerns us is the necessary steps to get out most of the old large fields.

growthIn 2005 the Norwegian Petroleum Directorate assumed that 75 per cent of the growth would have to come from existing fields. But the fact is, so far only 56 per cent of the growth has come from existing fields, while the rest is from discoveries that have been approved for development.

Norwegian Petroleum Directorate director Bente Nyland is satisfied with Statoil's commitment to rapid development of small fields, but what worries most is that it's done too little on the aging large fields.

nPD criticizes indecision

text by: STEIN TJELTA [email protected]

Trym, in the Norwegian sector of the North Sea is being tapped via a subsea template tied back via a 5.5 kilometre (3.43 mile) pipeline crossing

the median line to the Danish Harald platform after extensive co-operation by projects partners including Bayerngas, and Maersk Oil and Gas, which operates Harald.

Marking the first production for Dong Energy

from the Norwegian sector of the North Sea, Trym represents a big step forward for cross-border collaboration. Two wells are now onstream and there is a plan to tap the field with a third well which is due to be drilled in the next few months and development costs have been put at DKK 2.4 Billion (US $433 million).

Trym’s reserves are put at 4.4 billion cubic metres of gas (155.372 Bcf) and 1.1 million standard cubic metres of condensate.

Production has started up from the Trym development spanning the median line between the Norwegian and Danish sectors of the North Sea operated by Dong Energy.

TRYM POWERS UP

text by: JOHN BRADBURY [email protected]


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Adv Gas_GFcombi306_320_210x144.indd 1 2/21/11 4:30 PM


maintenance & modifications>>

Norway’s department for Petroleum and Energy has just received the plans for development and operation of the Ekofisk South and Eldfisk II projects and the total investment in the two is estimated at NOK 65 billion according to the department.

Improved recoveryEkofisk South includes construction of a new wellhead platform, a new sea floor based water injection facility and the drilling of 44 new wells. Eldfisk II includes an upgrade of existing facilities and construction of new living quarters, new processing facilities and the drilling of another 42 new wells.

Possibility of power from landIt is planned that the power requirement for both projects will be covered by the existing turbines and infrastructure. ConocoPhillips’ also plans to lay a power cable between the Ekofisk and Eldfisk fields, which will facilitate a more efficient operation of the two. Also, Ekofisk South and Eldfisk II will be adapted to receive power from onshore if this becomes a viable solution in the future.

The government will review the assessments related to power solutions in the PDO treatment.

contracts for the summerContract awards are expected shortly after the Norwegian authority has considered these new plans.

ConocoPhillips has confirmed to Offshore & Energy that contract awards for the two new wellhead platforms will come this summer, assuming approval of the PDOs. Also the operator confirms that it has gone out to bid both nationally and internationally in the tendering process.

nOk 425 million to FMcHowever, FMC Technologies has already entered into an agreement with ConocoPhillips for production and delivery of subsea equipment and associated services for water injection at the two fields. The delivery is valued at approximately NOK 425 million.

Much more to comeIn August last year, one of the major partners in the development, Total E&P Norway told O&E

that total investments in the greater Ekofisk area were estimated to be roughly NOK 120 billion over the next four to five years.

About NOK 95 billion will be invested in infrastructure, the remaining in drilling wells.

The wellhead platform Ekofisk 2/4 Z is scheduled to be finished in 2013, whilst the combined accommodation, wellhead and process platform Eldfisk 2/7-S is scheduled to be finalised in 2015. Before the financial crisis struck and oil prices plunged a few years ago, industry reports indicated that Ekofisk investment would be in the region of NOK 100 Bn, of which half was expected to go to drilling new wells. And in the last year, it was assumed this amount would fall as oil companies put pressure on suppliers' terms and prices.

Ekofisk-PDO deliveredOperator ConocoPhillips has delivered its plans for revival of the aging North Sea Ekofisk field. Giant investments at Ekofisk are looming and the goal is to increase the recovery rate from 49.5 to 52 per cent.

text by: GLENN STANGELAND [email protected] and STEIN TJELTA [email protected]

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SCIENTIFIC SOLUTIONS

The Norwegian oil service company Apply is planning an Initial Public Offering and a listing on the Oslo Stock Exchange during 2011. Apply currently has two Stavanger-based investment companies as its main shareholders; the private equity investor HitecVision and the privately owned KøhlerGruppen. HitecVision has previously led successful IPOs of its portfolio companies, such as the oil company Revus and the oil service specialist APL. Now the time has come to Apply.

“We’ve reached a size which makes us increasingly attractive. This was confirmed when Statoil included us in the major frame contracts it awarded within MMO last year. We also see that customers want suppliers with the size and capital to take on more demanding tasks. Further growth is therefore crucial if we are to compete even more strongly for the most demanding jobs. The strong industrial momentum and the good strategic and operational prospects, make a listing of the

company right for us now,” says Per Bjørn Habbestad, CEO of Apply, according to a press release.

2000 employeesApply has its head office in Stavanger and operations along the west coast of Norway up to Bergen and in selected international niches. The group has leading expertise in five business areas, covering maintenance and modifications (MMO), accommodation (living quarters), products and services, as well as subsea. Apply had a turnover of NOK 2.6 billion in 2010 and has about 2,000 employees.

Apply had a record high order intake through 2010 as a result of the company’s strong position in the growing MMO market on the Norwegian continental shelf. A main driver in the MMO market growth is the fact that a number of large installations both on the shelf and onshore are in need of significant modifications and upgrades to prolong their economic life. In addition, Norwegian oil

companies are facing the challenge of a reduction in the production of oil and gas. To compensate for the latter, and to increase production and the lifetime of the fields, the oil companies have to invest in MMO. Based on this, it is expected that the market for maintenance and modifications will show a significant growth the next years.

The Apply group today includes a number of subsidiaries and the group has shown substantial growth in recent years. Apply had an order intake in 2010 of NOK 3.5 billion, which was an increase of about NOK 1 billion in a market that was still characterized by the aftermath of the financial crisis.

Aibel are making preperationsThe owners of Aibel, Ferd and Herkules Capital, have also signalled that they are making preparations for a possible stock exchange listing. The company has hired 400 new employees in 2010 and plans to hire over 1000 more during the next three years.

Two of Norways largest oil service companies targets new investors.


MMO giants plan listing on the OSE


recruitment>>

1/6 A4-side, 98x98mm

Vi trenger deg som brenner for produktutvikling for å kunne utvikle enda ere patenterbare teknologier og markedslendende produkter. Til våre utviklingsprosjekter trenger vi medarbeidere som både har evnen til å tenke nytt og anderledes sammen med andre og som har faglig styrke innenfor:

- mekanikk - elektronikk - industridesign - programvareutvikling

Les mer på www.techni.no eller ta kontakt på 47200400 eller [email protected]

Produktutviklere søkesTechni AS er et produktutviklingshus hvor våre oppdragsgiveres produktideer realiseres gjennom tverrfaglighet og dedikasjon kombinert med vekt på utviklings-metodikk og nærhet til virkeligheten. De gode produktene skapes gjennom analyse, frihet på konseptnivå og nøyaktighet i utførelse. I syv hundre prosjekter siden 1997 har vi involvert oss genuint i å skape verdifulle løsninger for våre oppdragsgivere.

MacArtney Norge AS er et selvstendig selskap innenfor MacArtney gruppen. Vi er en del av et internasjonalt selskap med hovedkontor i Danmark og datterselskaper i UK, Frankrike, USA, Holland, Tyskland og Brasil.

Teknisk Selger

Deres arbeidsoppgaver vil typisk være standard ■ produkt salg samt og være med i komplette prosjekt salg.

Daglig sparring med kunder så vel som våre ■ leverandører.

Utarbeidelse av tilbud, oppfølgning og ordre ■ behandling.

Det forventes at dere har en generell forståelse for ■ system integrasjon som gjør at vi kan levere komplette løsninger til undervannsindustrien.

Noe reiseaktivitet må påregnes. ■

Vi tilbyr en udfordrende og allsidig stilling i en særdeles spennende virksomhet i global vekst.

Utdannelse som Automasjon, Elektronikk Ingeniør ■ eller elektronikk tekniker med erfaring fra lignende arbeid.

Ha evne til å se løsninger samt være utadvendt og ■ fleksibel.

Grundig kjenneskap til data (vi arbeider med ■ Navision).

Beherske engelsk skriftlig og muntlig. ■Vi forventer gode samarbeidsevner for å kunne ■

arbeide i et team og min 3-5 års erfaring fra lignende jobb.

Vi kan tilby lønn etter kvalifikasjoner, flere feriedager, kortere arbeidsuke, god pensjons/forsikringsordning, utviklingsmuligheter, godt arbeidsmiljø.

Skriftlig søknad (Merket: Teknisk Selger) fremsendes pr. post eller e-mail til: MacArtney Norge AS, Strandsvingen 3, 4032 Stavanger innen 01.04.2011. Spørsmål om stillingen kontakt Mats Ekström, System Sales Manager telefon 51951800.

Arbeidsopgaver: Kvalifikasjoner:

www.macartney.com

Offshore Media Group og A-Pressen Digitale Medier lanserer nå et felles kampanjetilbud på ledige stillinger for olje- og energi-bransjen. Kampanjen omfavner både trykte og digitale medier gjennom Offshore & Energy, Offshore.no og 45 nettaviser tilknyttet A-pressen.

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Jotuns vokser og vi søker en ny medarbeider

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nybygg og vedlikehold. Stillingen inngår i

Protective-gruppen som har et tett samarbeid

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Arbeidssted vil være i Stavanger og noe

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For mer informasjon om stillingen og søknad, se

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Jotun er en av verdens ledende produsenter av maling og pulverlakker, med 70 selskaper og 38

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medarbeidere. Konsernet er organisert i fire divisjoner og har sitt hovedkontor i Sandefjord.

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conferences>>

>> MARcH

7-9 Mar norsk UndervannsssymposiumRica Maritim Hotel, Haugesund, norwayOrganisers: Norwegian Petroleum Society (NPF)www.npf.no

9 MarFPSO InternationalOslo, norwayOrganisers: INTSOKwww.intsok.no

16 MarOil & Finance: The E&P industry back on track, Lysebu, Oslo, norwayOrganisers: Norwegian Petroleum Society, NPFwww.npf.no

20-23 Mar17th Middle East Oil & gas Show conference (MEOS)Bahrain International Exhibition and convention centreOrganisers: Arabian Exhibition Management, IEM & OES. www.meos2011.com

21-24 Margastech conference and ExhibitionAmsterdam RAI, HollandOrganisers: DMG World Media UKwww.gastech.co.uk

22-24 MarcIPPE 2011new china International Exhibitioncenter, Beijing, chinaOrganisers: Beijing Zhenwei Exhibition, ITE China & ITE Groupwww.cippe.com.cn/cippeen.

22 MarExploration RevivedBergen, norwayOrganisers: NPFwww.npf.no

23 MarOil and gas Technology for cold Regions 2011Rica Holmenkollen Park Hotel, Oslo, norwayOrganisers: Teknawww.tekna.no

23-24 MarModification conferenceStavanger ForumOrganisers: Offshore Media Groupwww.offshore.no/mod

30 MarUS-norway Technology Partnership conference: Minimising oil spills and discharges to the Sea.Houston, USOrganisers: Intsokwww.intsok.no

>> APRIL

10-12 Apr19th Middle East Petroleum & gas conference (MPgc)BahrainOrganisers: NOGA and BAPCOwww.cconnection.org/conference/MPGC/2011

10-13 AprAAPg Annual convention & Exhibition: Making the next giant leap in geosciences.george R. Brown convention centre, Houston, Texas, USOrganisers: AAPGwww.aapg.org

27-29 AprArctic Oil&gas north America conferencekrasnapolsky Hotel, AmsterdamOrganisers: IBC Energywww.ibcenergy.com

>> MAY

2-5 MayOffshore Technology conference

Reliant Park, Houston, Texas, USOrganisers: OTCwww.otcnet.org/2011

10 MayIntelligent fields and integrated operationsValhall, Oljedirektoratet, Stavanger, norwayOrganisers: Norwegian Petroleum Directorate (NPD)www.npd.no

25-27 MaySmall Scale Lngclarion Hotel, Stavanger, norwayOrganisers: Teknawww.tekna.no/intconf

23-26 MayEAgE conference & Exhibition incorporating SPE EUROPEc 2011Vienna, AustriaOrganisers: European Association of Geoscientists and Engineers (EAGE)www.eage.org/events

>> JUnE

01-02 JunOil and gas Asia 2011 (OgA 2011)kuala Lumpur convention centre, MalaysiaOrganisers: Malaysian Exhibition Services Sdn Bhd (MES)www.oilandgas-asia.com/

06-07 JunThe 16th European gas conference 2011 (Egc 2011)Hotel Bristol, OsloOrganisers: NGA and Gasscohttp://egc2011.com

07-08 JunThe 16th Field Reservoir Management conferenceclarion Hotel, Stavanger, norway


OFFSHORE & ENERGY

Organiser: Norwegian Petroleum Society (NPF)www.nfp.no

8-9 JunUTc 2011: Subsea future - leveraging innovation and industrializationgrieghallen, BergenOrganisers: UTC.www.utc.no

14-17 JuneBrasil Offshore,Macae centro, BrazilOrganisers: Brazilian Petroleum, Gas and Biofuels Institute, SPE and Reed Exhibitions Alcantara Machado.www.brasiloffshore.com

15 JunIADc World Drilling 2011 conference & Exhibition: Embracing change, creating opportunities.Bella centre, copenhagen, Denmark. Organisers: IADC International Association of Drilling Contractorswww.iadc.org/conference

Please add a new event to our calendar on Offshore.no if you think we should add it to the overview. Thank you.

Statoil has submitted its proposal as part of the pre-salt restricted public bid round organised by Sonangol for access to pre-salt acreage in the Kwanza Basin in Angola. Statoil’s proposal includes operatorship of Blocks 38 and 39 and participation in Blocks 22, 25 and 40 with a comprehensive work program and a signature bonus for each block.

Frontier playSonangol has announced the jury’s proposal of the composition of the different consortia groups for pre-salt blocks awarded in the restricted public bid round.

“The Angolan pre-salt is a frontier play with high potential. This presents Statoil with the opportunity to access several high impact exploration prospects which are believed to be analogous to pre-salt Brazil. Securing a multiple block portfolio early on in the exploration of this new play is a big advantage. Such a strong and influential position gives Statoil exposure to significant upside potential should the play be proven," says executive vice president for Exploration, Tim Dodson.

“With nearly 20 years of experience in Angola and as the 4th largest producer in the country, our ambition has been to become an operator. We are eager to expand our existing Angolan portfolio and to become a more active contributor in the development of the Angolan hydrocarbon sector and the economy at large,” Dodson adds.

180.000 barrels per dayStatoil believes that its technical and subsurface competence, experience in international deep water exploration programs and established track record in planning and executing large complex offshore projects will be beneficial in unlocking the exploration potential of the pre-salt play in Angola.

As a major partner in Blocks 4/05, 15, 15/06, 17, 31 and 34, Statoil already participates in ten producing fields and in four new fields under development (Pazflor, PSVM, Kizomba satellites and CLOV). Statoil’s equity production from Angola is currently around 180.000 barrels of oil per day, representing close to 10 per cent of Statoil’s production.

The expression "pre-salt blocks" refers to blocks where the main prospective interval was deposited prior to salt deposition.

These prospects are thought to be analogous to the recent, significant pre-salt discoveries offshore Brazil.

Statoil has experience in exploring in complex salt terrains and has developed proprietary seismic imaging expertise that will be highly applicable to the pre-salt exploration in Angola.

FAcTS

The national oil company Sonangol has announced that the Angolan jury of the bid rounds has elected Statoil for operatorship and participation in several pre-salt blocks offshore Angola.

Statoil elected pre-salt operator in Angola

What is pre-salt?Tim Dodson (Photo: Statoil)


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