“In a recent meeting with the oil minister, he elaborately explained on plans to explore oil and gas fields in the Caspian Sea,” Ali-Asghar Yousefnejad stated.

Iran announced on December 11 it has discovered a large gas field in the Caspian Sea with at least 50 trillion cubic feet (some 1.4 trillion cubic meters) of reserves.

The field, in waters 700 meters deep, lies wholly within Iran’s territorial waters, Oil Minister Rostam Qasemi explained.

He added excluding this new discovery Iran has 11 trillion cubic meters of proven gas reserves in the Caspian Sea.

Qasemi also announced that Iran is now the sole country in the region which has found access to the technology to drill wells in deep waters.

Previously, deputy oil minister Mohsen Khojaste-Mehr told the Mehr News Agency that extensive operations are underway to explore new gas deposits across the country which will probably increase the country’s proven gas reserves.

The Fifth Five-Year Development Plan (2010-2015) has envisaged boosting the country’s gas production by 250 million cubic meters per day to reach 1.4 billion cubic meters per day.

Second to Russia, Iran holds the world’s second-largest gas reserves, according to the BP Statistical Review of World Energy in June.

Source: www.tehrantimes.com

Both Italian and U.S. companies recently announced the discovery of massive natural gas fields off Mozambique, which could dramatically alter the Mozambiquean economy.

U.S.-based energy giant Anadarko Petroleum announced earlier this week that its natural gas reserves in its Mozambican reserve bloc fields could be three times larger than earlier estimated, comprising up to 30 trillion cubic feet of recoverable natural gas.

Italian oil and gas company Eni SpA two weeks ago also announced that it has discovered large amounts of gas off Mozambique and stated that it plans to invest $50 billion to develop the resources.

Eni SpA’s estimated reserves? A mere 22.5 trillion cubic feet.

Houston-based Anadarko Petroleum stated that its Barquentine-3 appraisal well “encountered more than 662 net feet of natural gas pay, expanding the estimated recoverable resource range from 15 to more than 30 trillion cubic feet.”

After announcing that Anadarko Petroleum announced that its estimated recoverable resources had effectively doubled. Anadarko Petroleum Chairman and CEO Jim Hackett said that this could be one of the most important natural gas fields discovered in the last decade worldwide, commenting, “In parallel, we’ve continued to advance an expandable LNG (liquefied natural gas) development that will support this world-class field. This is great news for Mozambique, as our ongoing activities will continue to spur meaningful investment in the region, generate significant revenue for the government and offer a multitude of opportunities for the people of Mozambique. The positive results of each appraisal well we have drilled and analyzed have continued to increase our estimate of recoverable resources and natural gas in place on our block, and add to our confidence that this could be one of the most important natural gas fields discovered in the last 10 years.”

Anadarko Petroleum is currently the operator of one of Mozambique’s major offshore Indian Ocean exclusive economic zone (EEZ) offshore concessions area and has a 36.5 percent interest in the joint venture project. Other investors include Mitsui Exploration and Production Mozambique Area 1 Ltd. with a 20 percent share, BPRL Ventures Mozambique B.V. with a 10 percent stake and Videocon Mozambique Rovuma 1 Ltd with 10 percent, while Cove Energy Mozambique Rovuma Offshore Ltd retains 8.5 percent and India’s Bharat Petroleum has 10 percent as well, with Mozambique’s national oil company Empresa Nacional de Hidrocarbonetos E.P. de Mocambique ‘s retaining a share as well through the initial exploration phase.

Should the projects be developed, Mozambique is able to transship its output to two of the world’s top liquefied natural gas markets, Japan and South Korea, along with being in a prime position to service other rapidly emerging Asian gas markets, such as China and India.

The future?

Anadarko Petroleum is considering building a complete liquefied natural gas (LNG) facility to facilitate shipments of future production to East Asia, but is considering all options, with its final investment decision for a LNG train to process Mozambique’s offshore natural gas production expected in 2013, when, if all goes well, initial production will begin five years later in 2018.

As for Eni SpA’s production?

Eni SpA Chief Executive Paolo Scaroni said in an interview last month after visiting East Africa, “We aim to have several liquefiers working for Southeast Asia. The gas is targeted for Asia,” adding that Eni SpA was looking at constructing 2-3 liquefiers in Mozambique and that the first production of LNG gas could occur in 2016.

Not relying exclusively on the words of his new best international energy buddies, Mozambiquean President Armando Guebuza is sending advisors to Nigeria and Angola to survey their oil and natural gas operations.

But with a major U.S. and Italian firm ready to move forward, there seems little doubt that Mozambique’s natural gas reserves will be fast tracked to production, with the only questions being when and how.

Source: www.oilprice.com

It is safe to say that the new Libya will not have a drastically different upstream oil and gas policy than the one pursued by the Gathafi regime. Most likely, under the new Libyan system of governance, oil and gas rights will continue to be granted through production sharing agreements. There will also be new opportunities for those companies interested in service contracts for existing oil and gas production, mainly in the area of enhanced oil recovery.

However, the international oil and gas industry will most likely notice a substantial difference in the level of transparency and openness when dealing with the various government entities, such as the National Oil Company (NOC) or the Ministry of Energy.

During the time of the Gathafi regime, the Gathafi family ran Libya, and especially the state’s oil and gas apparatus, like it was its own personal property. This included terrorizing mid-level and senior NOC management into submission to the whims and desires of the Gathafi family. Business, economic or commercial considerations hardly played a role in the Gathafi decision-making process. Everything was decided on a political basis, mostly for expanding Gathafi’s control. As such, most of these mid-level and senior NOC managers were unable to interact with the foreign oil and gas companies in a reasonable and transparent manner, for fear of reprisal from Gathafi’s enforcers. Of course, the relationship with the international oil and gas companies suffered tremendously from this un-natural dynamic. It was very frustrating for many foreign oil and gas company managers to deal with these scared and corrupt bureaucrats. In many cases, it was outright impossible to conduct normal, everyday business in Gathafi’s Libya.

Many of those who make up the leadership of the new Libya were intimidated into making many wrong decisions to satisfy the Gathafi family agenda. They had seen firsthand the consequences of running the oil and gas business as the personal property of the Gathafi family. It is reasonable to assume that the new leadership will function much more transparently, especially when it comes to Libya’s major source of income – oil and gas.

It is important to understand the ideals of the Libyan revolution, when considering the future of the oil and gas business in Libya. One of the main goals of the anti-Gathafi revolution was, and still is, to strive to rectify all the damage that the Gathafi regime created, which includes the mismanagement of the oil and gas wealth and the related organizations.

Moreover, when trying to predict the future of the foreign oil and gas community in Libya, we must also bear in mind the education and experience level of management of the NOC and other related governmental entities. Many of these professionals studied in the US and Europe. Many were also employees of international oil and gas companies, making them fairly aware of the needs and limitations of the international oil and gas community. Given the nature of the new order in Libya, it should not come as a surprise that these professionals will be much more transparent and accommodating. They are no longer functioning under the tyranny of one man and his family.

Most of the new Libyan leadership is made up of people who have a friendly disposition toward the West, and foreign investment in general. They are very thankful to the West for helping bring about the demise of the Gathafi regime.

On the other hand, although the Gathafi regime appeared to be friendly during its last several years in power, it was actually quite suspicious of the West, and foreign investment. It knew that it had to make fundamental reforms to attract and keep desperately-needed foreign investment, which meant giving up some control. This was not something desirable for a regime that believed it could maintain power only by ruling with an iron fist.

In addition to the abovementioned post-Gathafi oil and gas business improvements, Libya has for a long time offered very competitive production sharing agreements, and more than adequate oil and gas infrastructure for expediently monetizing any oil or gas discoveries.

In the event of a natural gas discovery, Libya offers a more than adequate domestic natural gas market that is steadily growing, with excess natural gas pipeline capacity. It also offers natural gas export opportunities, as Libya enjoys the benefits of an LNG production plant and export terminal, as well as an export natural gas pipeline to Italy. The current Libyan energy authority is more open to accommodating the oil and gas companies with favorable natural gas sales/purchase agreements. Libya enjoys a very positive cash flow, and can afford to fully pay its natural gas suppliers in a timely manner.

The existence of world class oil and gas infrastructure offers the oil and gas investor in Libya a more cost-effective environment. Currently, and in the foreseeable future, there would be no need for any major infrastructure investment on the part of the foreign oil and gas companies. Most hydrocarbon-rich areas of the world, outside the industrialized world, do not even come close to offering this kind of oil and gas investment environment.

Although it is true that some of the infrastructure was damaged during the civil war, it does not amount to more than 10% of the entire oil and gas infrastructure. Furthermore, Libya has the ability to quickly make the necessary repairs to function normally. In fact, Libya’s crude oil production has now reached 600,000 b/d from less than 100,000 b/d, during the height of the civil war in the summer of 2011. The country plans to increase its crude oil production to around 1.7 million b/d before the end of 2012, which is the pre-civil war level of production.

Some have warned that Libya still faces the serious challenge of political (and sometimes tribal) fragmentation to be considered a truly viable investment climate. Those who make such statements do not truly know Libya and Libyans. There are many “experts” who have no knowledge of Libya’s history, culture, and the tribal/clan and family dynamics. Therefore, it is not difficult to arrive at the wrong conclusions.

In Libya, the only people who could have caused the country’s disintegration were the Gathafis and their supporters. Their ability to cause major strife between the different political or tribal factions has been entirely eliminated, and they are no longer a threat to the new Libya.

Once in a while, we hear news about clashes between different factions that appear as tribal rivalries. However, they are clashes that almost always stem from some residual effects of Gathafi’s 42-year rule. These residual effects will not disappear overnight, but they are not a threat to the general well-being and stability of the new Libya.

With the total defeat of the Gathafis and their supporters, Libya is no more a fragmented society than any stable country with different political factions competing for power, like in many Western democracies. This political reality will have no major effect on the oil and gas investment climate, much like it has no major effect on the operations in the North Sea or the Alaskan North Slope.

Let us not forget that the foreign oil and gas community has been operating reasonably well in Algeria, which is a country that has been plagued by a civil war and political violence since 1992. Libya’s political challenges are not even close to being as acute as Algeria’s.

Therefore, if there is no significant interference from foreign powers, like in Iraq or Afghanistan, there is good reason to believe that the new Libya will be one of the better places to do business for the international oil and gas industry, perhaps even better than the North Sea and the Alaskan North Slope, or even the Gulf of Mexico.

Source: www.middle-east-online.com

Speaking on the sidelines of his visit to Beijing Oil Industry University, Gholamreza Rashed said the two countries will take practical steps to launch joint educational and industrial projects before October 2012.

He added that the two sides have agreed to carry out joint research on oil and gas industries and launch post-graduate (PhD) courses in relevant fields of study.

Rashed also signed an agreement with president of the Beijing Oil Industry University, Zhang Laibin who said Iran had as an important role in supplying energy to developing countries.

Iran’s Oil Industry University is currently working with similar universities in France, Canada and Australia and holds joint educational courses with them.

Iran is OPEC’s second largest oil producer and the fourth largest crude oil exporter.

The country holds the world’s third-largest proven oil reserves and the second-largest natural gas reserves.

Source: www.tehrantimes.com

The investment announcement follows approval from the UK government for BP and partners Shell, ConocoPhillips and Chevron to proceed with the £4.5bn Clair Ridge project, the second phase of development of the North Sea Clair field.

In a statement BP said its £4bn investment Clair and three other projects represents the highest level of annual investment the company has ever made into the UK North Sea.

`Although it began more than 40 years ago, the story of the North Sea oil industry has a long way yet to run. BP has produced some five billion barrels of oil and gas equivalent so far from the region and we believe we have the potential for more than three billion more,’ said Bob Dudley, BP’s group chief executive.

‘After some years of decline, we now see the potential to maintain our production from the North Sea at around 200,000–250,000 barrels of oil equivalent a day until 2030. And we are working on projects that will take production from some of our largest fields out towards 2050.’

The company added that the four BP-operated North Sea projects are said to be part of a wave of major oil and gas projects around the world that BP expects to come on stream over the next five years.

The Clair Ridge project, which BP said will install two new bridge-linked platforms with the capability to produce an estimated 640 million barrels of oil, is planned to come on stream in 2016 and to extend production from the greater Clair area to 2050.

The Clair partners also announced the successful appraisal of an extension to the Clair field — South West Clair — confirming the overall Clair field complex’s status as the UK’s largest hydrocarbon resource with more than seven billion barrels of oil and gas initially in place.

In the central North Sea, with partner RWE, BP’s £550m development of the Devenick gas field recently passed a significant milestone when its 600-tonne module was lifted onto Marathon Oil’s East Brae platform.

Earlier this year, BP and its partners also announced plans for the £3bn redevelopment of the Schiehallion and Loyal fields, west of Shetland, and the £700m development of the Kinnoull field in the central North Sea.

BP said that together with development drilling and a number of smaller projects, the four projects represent almost £10bn of project investment by itself and its partners.

Source: www.theengineer.co.uk