Friday, March 25, 2011

Salamander Energy reports 2010 Annual Results; Average Daily Production up 49%; Plan to achieve Production growth of 22,000-23,000 boepd

Salamander Energy’s 2010 production was 20,300 boepd up 49% over 2009. This is due to first full year of production from the Kambuna field, an increased equity interest in the Bualuang field and higher than expected production from ONWJ, where a new operator invested to increase production. The company forecasted 2011 production is expected to be between 22,000 and 23,000 boepd. Salamander achieved  reserves replacement ratio of 121%


Exploration program remains active with a further 13 exploration and appraisal wells planned in 2011. The company plans to invest US$ 195 million in 2011, of which US$ 95 million for production and development activities and US$ 100 million for exploration and appraisal activities.

Lukoil 2010 Results Presentation

Wolfberry Play- the Monarch of Permian Basin!!

In the recent days, the oil and gas industry sees many oil-weighted plays grooming up.. One such play is Wolfberry play- The Monarch of Permian Basin!!

The Wolfberry play is named after the two main productive formations, the low-permeability Wolfcamp and Spraberry. The Wolfberry play is spread across Midland, Upton, Martin, Howard, Glassock, Andrews and Reagan counties of Permian Basin. Rig count has increased noticeably in Glasscock and Andrews counties in West Texas over the last 90 days as both private and public operators ramp Wolfberry programs. The activity in the Wolfberry has recently increased, spurred by the current relatively strong oil prices. The active participants in the Wolfberry play include Berry Petroleum, Linn Energy, Energen and PDC Energy.

PDC Energy is planning a 25-well drilling program in the Wolfberry in 2011 and anticipates continued production growth. Linn Energy’s 2011 capital program of $480 million has two distinct components: high rate-of-return liquids-focused drilling in the Granite Wash and Permian Basin Wolfberry trend and low-risk, low-cost projects. The capital program calls for drilling 45 horizontal Granite Wash wells and more than 130 Wolfberry wells in the Permian Basin.

The Wolfberry Economics
The Wolfberry has moderate rate of return with low risk. The Wolfberry play has gained better interests now than when oil was $147 a barrel in 2008. The 2010 production metrics of Wolfberry play had hit ~$120,000/daily boe as against ~$100,000/daily boe in 2008. 

The economics of the Wolfberry well is as follows: 
  • Multiple zones: Spraberry, Wolfcamp, Strawn, Clearfork
  • EUR 100-140 MBOE
  • Capital Costs: $1.5 - $1.75 million
  • IRR: 35% - 70%

Here is the Wolfberry opportunity available for sale! 

Nexen 2011 Investor Roadshow Presentation

Petrobank March 2011 Corporate Presentation

Idemitsu Third Quarter Results 2010 Presentation

Salamander Energy's 2010 Annual Results Presentations

Premier Oil reports 2010 annual results; Reserve Replacement Ratio up 138% over 2009; Plan to achieve 2012 production of 75 kboepd through developments in Asia, North Sea and Middle East-Pakistan

Premier oil’s 2010 average working interest production was 42.8 kboepd, down 3% over 2009. This was due to unplanned maintenance requirements on UK North Sea fields in the Balmoral, Scott and Wytch Farm areas and due to some flooding-related downtime at the Zamzama field in Pakistan. In 2010, Premier achieved 57% success rate in exploration and appraisal well activities.

- Premier revealed 2011 capital program of approximately US$ 850 million to achieve production in the range of 45-50 kboepd. The company plan to achieve production rate of 75 kboepd in 2012 from existing 2P reserves of 261 mmboe and through exploration by focusing on core geologies.

- In Indonesia, Premier plan to develop the full potential of Natuna Sea and  Block A Aceh gas positions.
- In Vietnam, the company is working on Dua and Cá Rng Đ (CRD) accumulations as well as by undertaking new exploration activities.

- In North Sea and West Africa, Premier is pursuing actively  new assets that are capable of delivering near-term production
- In Middle East-Pakistan business unit, Premier continues to focus on enhancing the value of our Pakistan producing assets by maximising production through exploration and development within the existing fields.

- Exploration drilling in 2011.

Cairn Energy 2011 Operational Update

Greenland – A frontier “giant” yet to be awakened!

Greenland is one of the few frontier regions left in the world where there are still large unexplored areas with giant structures and documented prospects. The latest hunt began in July, when the drillship West Navion spudded a well for Statoil and three partners about 145 kilometers offshore of Greenland's capital, Nuuk. The Qulleq-1, a name derived from the Greenlandic word for "oil lamp," marks the first drilling in the region since the 1970s.

Detailed geochemical studies undertaken by the Geological Survey of Denmark and Greenland (GEUS) have recognised five distinct oil types. The most significant of these is the “Itilli” type, which originates from a marine (Type II) oil prone Cenomanian-Turonian source rock.

These findings, in combination with the interpretation of an extensive modern seismic grid have revealed all the required ingredients for a potential “World Class” petroleum basin. As a result there has been significant renewed industry interest in the petroleum prospectivity of offshore West Greenland.

Cairn Energy currently has an interest in 11 areas (blocks) offshore Greenland, covering an area of approximately 81,000 sq km. Cairn has operated interests offshore Greenland at Sigguk, Eqqua, Lady Franklin, Atammik, Sallit, Kingittoq, Saqqamiut, and Uummannarsuaq.

In July 2010, Cairn in July commenced drilling operations on the Alpha prospect (Alpha-1) and T8 exploration prospects in the Sigguk Block, approximately 108 miles (175 km) offshore Disko Island, west Greenland. The  well discovered oil in it. Cairn's West Disko program includes two Sigguk exploration wells and the acquisition of around 2,000 kilometers (1,242 miles) of 2D seismic in Eqqua.

As per an article in the Business Day, Cairn will spend more than $1 billion over the next three years drilling up to 10 wells off Greenland.

Other producers with exploration interests offshore Greenland include Husky Energy, which recently has been interpreting seismic data from its three Greenland exploration licenses.

PA Resources AB on July 15 2010 completed a seismic survey of Block 8 offshore West Greenland. The seismic survey, initiated on June 6, was completed 10 days ahead of schedule. Data processing is now underway.

ExxonMobil and Chevron also hold rights off Greenland and are interpreting their own seismic data to identify potential drilling locations. ''Any exploration drilling campaign is unlikely before 2014,'' said Chevron, which holds 29 per cent equity in Block 4 off western Greenland with the operator Dong Energy.

Scott Kerr, the chief executive at the Norwegian Energy Company, said: ''We believe that with the estimated size of resources in Greenland it would be economic to develop at over $US75-a-barrel oil prices, but this depends on the reservoir quality, the field's size, and distance from shore. There are big differences in the size of resources because little exploration has been done.''

The energy consultancy IHS Cera estimates that technically recoverable undiscovered resources in Greenland could be equivalent to 50 billion barrels of oil.

The basic challenges that Greenland is currently facing at its oil and gas exploration front are the high costs necessary to pay for infrastructure, icy winter conditions which limit the time window for drilling operations and also opposition from different environmentalist groups.

What next?

Amid all these challenges and controversies, Greenlanders believe that an increase in its oil and gas exploration and production efforts will establish political independence from Denmark. If Greenland is successful in generating income from its mineral resources it will decrease its reliance on £500 million ($819 million) a year in subsidies from Denmark by 50 percent. 

.... the battle for a new oil frontier is on!!!!!!

Transocean's E&P company put up for sale!!!

Challenger Minerals Inc (CMI), an E&P subsidiary of Transocean Ltd, has retained BofA Merrill Lynch Securities as its exclusive advisor to seek proposals with respect to a corporate sale.


-- CMI is generally a non-operating participant, screening prospects focused offshore; CMI provides opportunity to invest in pre-screened drilling projects
-- CMI holds oil and gas property interests primarily in the Gulf of Mexico (offshore Louisiana and Texas), North Sea (United Kingdom and Ireland), and offshore of Nigeria, Ghana, Senegal, Cote d’Ivoire, Tunisia, Gabon, Congo, Cameroon, Guinea and Angola, New Zealand, and other International areas
-- Equity interest in 122 wells in 60 fields, with gross production over 174 MMcf/d and 20,600 BO/d
-- Holds interest in 64 offshore blocks
-- As of April 2008, net Proved plus Probable reserves were estimated at 6,533 MBOE and net production was reported as 3,810 BOE/d.

Source: Derrick Petroleum E&P Database

ConocoPhillips to shed $5- $10 billion worth assets in UK and North America......Who are the probable buyers???

ConocoPhillips plans to sell an additional $5 billion to $10 billion in non-core assets over the next two years, the proceeds to fund its share buyback and capital expenditure programs.

Chief Executive Jim Mulva told analysts the company plans to sell a total of $12 billion to $17 billion in assets in a three-year period, including at least $1 billion in refining and marketing properties this year. The dispositions include non-strategic assets in the North Sea and additional mature assets in the U.S. and Canada. The plan also includes a 15% stake in the Australia-Pacific liquefied natural gas project it agreed to sell last month to Sinopec.

Mulva told analysts that the additional asset sale target is expected to come on top of the $7 billion the company already sold in assets last year and excludes the $8.3 billion from the sale of its 20% stake in Russian oil giant Lukoil.

Shift from debt-fueled acquisition strategy to profitability improvement strategy

Conoco is in the midst of a restructuring plan started in 2010 to shore up its finances by selling assets. It initially didn't plan to sell refining properties until, aiming to avoid selling assets at deep discounts, but in October it said it would ramp up its sale of assets in 2011 amid a rebound in the industry.

The asset sales mark a shift from Conoco's debt-fueled acquisition spree when commodity prices were soaring. It also underscores the company's confidence that its "shrink-to-grow" strategy is yielding positive results among investors.

Impact of asset sale on production

ConocoPhillips expects its oil-and-gas production to be between 1.6 million and 1.7 million barrels of oil equivalent per day in 2013, down from 1.75 million barrels of oil equivalent per day it produced last year due to the impact of the asset sale program. However it expects output to grow 2% to 3% per year in the long term, driven mainly by the startup of projects in Asia, the North Sea and the U.S.

Proceed to be diverted to Capital Expenditure program

The company expects to use proceeds from the asset sales announced Wednesday to fund a $10 billion share repurchase program it had previously unveiled, and for capital investment. In a slide presentation, the company said it expects share buybacks to total $11 billion through 2012.

Conoco plans $13.5 billion of capital spending this year, with the vast majority targeted for exploration and development. It said it plans to invest $14 billion to $15 billion per year from 2012 to 2015.

Conoco said it plans to invest 50% more this year in projects in North America mainly aimed at increasing drilling activity in oil-rich shale areas such as the Eagle Ford in Texas and the Bakken Shale in North Dakota.
Conoco will not make any large-scale acquisitions,it will expand its presence in some areas such as the deepwater of the Gulf of Mexico through small scale deals.

The company said it plans to invest $1.4 billion in the APLNG project, which will be sanctioned by mid-year and have its first liquid natural gas delivery in 2015. Conoco is also planning to ramp up exploratory drilling in the Caspian Sea, with a new well planned for its Kazakhstan N Block offshore for late this year or early 2012. The company is also negotiating a production sharing agreement for Block 19 in Turkmenistan.


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