EnQuest, Premier Oil and Eni – Possible Acquirers for Ithaca

Calgary-based Ithaca Energy Inc said that it has received a non-binding proposal to acquire all of the outstanding shares of the company. The Ithaca board says talks are at a preliminary stage and there is no certainty that the non-binding proposal will lead to an offer. As a result, shareholders are not required to take any action and Ithaca does not intend to comment further unless a definitive agreement is reached. The possible buyers could be Apache Corp, Premier Oil Plc, Total SA, Dana Petroleum Plc, EnQuest Plc and ENI. Continue reading here..

Argentina Shale – Neuquen basin

Drilling results to date suggest that Argentina’s Neuquen Basin holds vast amounts of shale gas, tight gas and shale oil. The 137,000 km² basin, situated entirely onshore, is part of the Sub-Andean trend which extends the entire length of South America. Many analysts believe Neuquen shale’s geology to be better than that of Texas’ Eagle Ford. Continue reading here..

SandRidge – Dynamic deal inline with past transactions

SandRidge Energy Inc will acquire Dynamic Offshore Resources for $1.275 billion. Dynamic’s assets include low operating cost, mature fields (R/P~7 years, 80% developed).


SandRidge will pay $51,000/Daily BOE which is inline with some of the larger deals in the region, viz. Energy XXI-ExxonMobil valued at $44,720/Daily BOE and Apache-Devon valued at $36,696/Daily BOE. Continue reading here..

Apache announces 5 new discoveries in Egypt Concessions! Multi Play potential opens up!

Apache today announced five new discoveries in its Faghur Basin play in the far southwest of Egypt's Western Desert Oil and Gas province (See Map).

The Faghur discoveries include West Kalabsha-I-4, which logged 79 feet of net pay and test flowed 7150 bpd of oil and 11.4 MMcfd of gas; Faghur North-1X which logged 25 feet of net pay and test flowed 1444 bpd of oil and 3.9 MMcfd gas; Faghur South-1X which logged 38 feet of net pay and tested 2768 bpd of oil and 4 MMcfd of gas; Huni-1X which logged 27 feet of net pay and tested 970 bpd of oil and the Neith North-1X which logged 77 feet of net pay.

"The Faghur Basin continues to be a successful focus area for Apache, with AEB, Safa, and now Paleozoic reservoirs that have proven to be prolific oil and gas producers. These recent discoveries support the multi-pay potential of this oil-prone area of the Western Desert," said Tom Voytovich, vice president of Apache's Egypt Region.

Apache also said that the AG-96 development well in the Abu Gharadig Concession acquired from BP in late 2010 tested 3,347 barrels of oil and 1 million cubic feet (MMcf) of natural gas per day from the Lower Bahariya formation.

Apache paid $650 million to BP in Nov 2010 to acquire four development leases and one exploration concession across 394,300 acres. The assets have estimated proved reserves of 20 million barrels of oil equivalent (59 percent liquids), and first-half 2010 net production of 6,016 barrels of oil and 11 million cubic feet of natural gas per day.  The BP assets also included strategically positioned infrastructure- a natural gas processing plant, a liquefied petroleum gas plant and oil and gas export lines – that will enable Apache to increase production from its existing fields in the Western Desert.

Thus far in 2011, Apache has drilled eight new discoveries in 10 attempts in the Faghur Basin, and drilling is under way on three additional wells —Mandulis-1X, Neilos-1X and Faghur North-2X. Eight additional exploration wells are planned for the area this year. Apache had earlier stated in its 2010 annual report that it plans to drill 65 exploration wells in Egypt in 2011, 50% more than in 2010 (See Table 1 for Apache's exploration wells in 2011). 

Exploratory wells being drilled by Apache as operator globally in 2011. Source: Derrick Petroleum Planned Wells Exploration Database. The table does not include exploration wells where Apache is partner but non-operator. 

Apache had earlier in 2011 redeployed all non-essential expatriate personnel and all expatriate dependents from Egypt. However, key expatriate personnel remained in-country to work alongside Egyptian national personnel to manage ongoing production operations. Apache's production, located in remote locations in the Western Desert continued uninterrupted. 

Earlier in 2011, the Siwa-D-1X well drilled in the Siwa Concession pushed Jurassic and Cretaceous plays farther south and westward and will lead to follow-up exploration prospects. Apache expects to commence production from the well upon approval of a development plan later in 2011.

Apache also said that the the Tayim West-1X discovery in the West Kalabsha Concession represented the first Paleozoic success found in a reservoir separate from the younger proven Jurassic and Cretaceous sands and opens up the area to further deep tests in upcoming wells. The discovery is currently on production.

Apache's current gross operated production in Egypt totals approx. 215,000 barrels of oil and 900 MMcf of gas per day, including 40,000 barrels of oil per day from the Faghur Basin.

Click here for Apache's press release on the 5 discoveries.

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Investor Presentations of O&G Majors in 2011

Anadarko:

2011 Investor Conference Call

2011 Investor Day Presentation

Apache:

Investor Day - May 2011

2011 Annual Meeting Slides

Sanford Bernstein Strategic Decisions Conference

BHP Billiton:

Citi Global Resources Conference

Howard Weil Energy Conference

BP:

BP 2011 Statistical 60 Years Review

Chesapeake:

February 2011 Investor Presentation

March 2011 Investor Presentation

April 2011 Investor Presentation

May 2011 Investor Presentation

June 2011 Investor Presentation

ConocoPhillips

June 2011 Investor Update

2011 Analyst Meeting

ExxonMobil

Exxonmobil 2011 Business Model & Fundamental Strategies

Sanford Bernstein Strategic Decisions Conference

Apache in 2011:
- 13‐17% production growth expected
- Updated capital program: $8.1BN
- Strengthening balance sheet further
- Building 2012+ inventory

http://docsearch.derrickpetroleum.com/files/12973/Apache_SanfordBernstein_20110601.pdf

Corridor Resources seeking a replacing partner for Apache in Frederick Brook shale development program...

Corridor Resources announced that it received notification that Apache has elected not to proceed with the second phase of the farm-out program with Corridor in respect of the potential shale gas resource development near Elgin, New Brunswick. This option is part of the following 2009 agreement-

Source: Derrick Petroleum Services- E&P Transactions Database

As a result of Apache’s withdrawal, Corridor will entertain discussions with potential joint-venture partners who wish to engage in a program to develop the Frederick Brook shale and who can add value to the potential development. The information and data obtained to date from Corridor's and subsequent Apache programs will be of significant value as this program advances.


The evaluation of the Frederick Brook shale gas resources is still in its early stages, and that the best estimate of gross discovered resources is 67.3 trillion standard cubic feet (as estimated by GLJ Petroleum Consultants Ltd. in the GLJ shale resources report, effective June 1, 2009.

Status of work program
As was announced by Corridor on March 30, 2011, the two horizontal wells drilled and hydraulically fracture stimulated by Apache (Will DeMille G-59 and Green Road B-41), using similar large slick water techniques, have not generated sustained shale gas production to date. In May, the Will DeMille G-59 well was re-opened and flowed frac fluid at low rates with minor gas shows over 5 days. It is important to note that, when the Will DeMille G-59 well was shut-in after initial testing in early December, 2010, it had recovered only approximately 4% of the total frac fluid.

Corridor previously reported that the Green Road B-41 well had been placed on a 45 day gas lift which ended on March 16, 2011. At that time, the well was shut-in after recovering 17% of the frac fluid.  In late May, due to significant well head pressure build-up, the well was reopened and flowed gas at a maximum rate of 0.7 mmscf/d for several hours prior to frac fluids loading the well causing gas rates to decline. 


Based on a consensus among third party expert consultants and Corridor technical staff, the most significant issues identified with the G-59 and B-41 well performance relate to the design of the horizontal wells in this high-stress environment and the fracture technique. Corridor believes that a different well design and frac program will lead to a commercial development of the Frederick Brook shale. It should be noted that, as previously reported, Corridor re-tested the Green Road G-41 well in December 2010, which produced gas at a constant rate of 4 mmscf/d for five days at a final flowing pressure of 1306 psi. During Q1 2011, the G-41 well was used to provide gas lift and consistently delivered the required rate of 0.5 mmscf/d during a 45 day test, at a final pressure of 2007 psi.

Corridor intends to drill two vertical appraisal wells in the Elgin area commencing late this year in order to confirm the well productivity required to proceed with a pilot phase. Based on the results of these appraisal wells, Corridor plans a staged approach to demonstrate commercial viability which would include a pilot phase with a capacity of approximately 40 mmscf/d,  targeting gas production in late 2013.  This program would include vertical wells in a multi-well pad design to take advantage of the shale thickness and the high gas saturations.  During the pilot phase, Corridor will evaluate various drilling and completion techniques. Corridor will provide further details on the Frederick Brook shale gas development plans in a corporate presentation to be placed on Corridor's website on June 6, 2011.


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Apache Production increased by 25% in Q1 2011; Plans to Raise 2011 Capital Expenditures by 8% to $8.12 billion

Apache Corporation posted Q1 2011 production up 25% to 732,000 boe from 586,000 boe in the first quarter 2010. Liquids production increased 57,000 bpd to 358,000 bpd, which enabled Apache to achieve stand-out earnings and cash flow as a leading beneficiary of rising oil prices. Liquid hydrocarbons represented 49% of quarter production. Approximately 60% of the company’s oil production came from operations outside North America.


Apache’s operational data for year end 2010 comparing to peers:



Last year, Apache grew substantially with three large acquisitions. A $2.7 billion takeover of Houston’s Mariner Energy gave the company its first significant presence in the deep-water Gulf of Mexico. It also paid BP $7 billion for production in Canada, the U. S. Permian Basin, and Egypt; and struck a $1 billion deal with Devon to acquire shallow-water properties in the Gulf of Mexico.

Source: Derrick Petroleum - Global Oil & Gas M&A 2010 Review Report


Milestones during the Quarter:

- Development well in the Forties field (North Sea), which came online at approximately 11,800 boepd.

In the Permian Basin, Apache is operating 24 rigs, up nearly five-fold from a year ago. Targeting primarily oil objectives, Apache drilled 110 wells including 15 horizontals during the first quarter.

- Drilled six wells in Anadarko basin’s Granite Wash formation, every well has tested in excess of 1,000 barrels of oil and 2 mcfpd.

- In Egypt, Apache operated 22 rigs during the quarter, drilling 33 wells, including the company’s first wells in the Tayim development lease in West Kalabsha producing from deeper Paleozoic pay. Apache’s production remained online throughout the quarter, increasing sequentially from the previous three months.

"We continue to strengthen our land position, both in North America and internationally. Our LNG initiatives, Kitimat in Canada and Wheatstone in Australia, are steadily progressing toward project sanction with their respective joint venture partnerships," Farris said.

Plans to raise capital expenditures by 8%

The company now plans to spend $8.12 billion in 2011, up from its forecast for $7.5 billion. “The bulk of the increase will be spent in the second half of the year, so the company's 2011 production outlook for growth of 13% to 17% remains unchanged”, Chambers said.

The company is in the planning stages for the Kitimat liquefied natural gas terminal in northwestern Canada, and expecting a final investment decision on that facility later this year or early next year, with first gas expected in 2015.

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Apache 2011 IPAA Oil & Gas Investment Symposium

- 13‐17% Production Growth Expected
- $7.5BN Initial Capital Program
Significantly below plan cash flow->1/3 future growth capital: no ‘11 production
http://docsearch.derrickpetroleum.com/files/11897/Apache%202011%20IPAA%20Oil%20&%20Gas%20Investment%20Symposium.pdf

Will Argentina lead the global shale gas race?

With shale gas drilling going global, energy importing nations are evaluating their own geology, currently, to see if they have shale reserves that can be tapped.  Likewise, Argentina which imports natural gas from neighboring Bolivia is set to win the global shale race where other countries in Asia, Europe and Africa are gearing up aswell. What is considered as the “game-changer” for the US, will shale gas success be replicated outside North America ,or for that matter, in Argentina?

Currently, Europe is in the limelight for being ahead of the shale gas activities, however, one needs to watch out who might be the next one?

Whats  happening in Argentina?

• In 2010, YPF announced a 4,500 billion cubic feet(Bcf)  shale gas  discovery in Loma de La Lata  conventional gas field  in the well known and productive Neuquen Basin in Patagonia.
• The Company has also formed a $140 million joint venture with the Brazilian iron ore and mining multinational, Vale, which will use the gas to develop a $4.3 billion dollar potassium project in nearby Mendoza.
• American Petrogas Inc, which holds about 16 exploration blocks, both for conventional and shale gas in the eastern and western parts of the Neuquen basin, thinks that its western blocks have the greatest potential for shale gas. It believes that about 100 tcf of gas is present in 9 of its blocks.
• Indian Farmers Fertilizer Cooperative (IFFCO), a strategic  alliance partner with American Petrogas Inc  in Argentina has invited two government owned Indian companies, Oil India and GAIL , to invest in its shale prospects.
• Apache Corporation expects to hold 900,000 net acres in the shale gas prone part of the Neuquen and has a partnership with YPF to develop shale gas in several prospective blocks. It is currently drilling the first horizontal multi fracture well in Argentina specifically to develop shale gas.
• Total acquired an interest in 4 shale gas blocks in the Neuquen and will explore in partnership with YPF. This follows the acquisition of an 85% interest in 2 other Neuquen shale gas blocks recently.  Total operates about a quarter of Argentina’s natural gas production. 

Recent Shale Gas Transactions in Argentina

Global Distribution

    Source: Hart Energy Global Shale Gas Study

The Society of Petroleum Engineers estimates 2,116 tcf of shale gas in South America.

• Argentina – Neuquen Basin, Austral Basin 
• Colombia – “Cretaceous organic – rich shale source rocks are present in both the Maracaibo and Middle Magdalena basin of Colombia and Venezuela.
• Peru – Ucayali Basin

As per Hart Energy Global Shale Gas Study, shale gas is plentiful around the globe. Conservative estimates place the total resource volume at about 20,000 Tcf. This volume is likely to increase as more shale gas plays are identified and evaluated.

However , the uncertainty still remains wheather the operators would be able to overcome the hurdles of tapping this source of stored energy. The biggest challenges to developing these resources outside of the US include:

• Access to acreage / resource
• Availability of rigs and skilled workforce
• Access to water and environmental concerns about waste water
• Finances, due to high cost of wells
• Necessary infrastructure to transport the gas once in production 

Apache to divest certain Canadian conventional assets worth $1B as part of their debt reduction efforts in 2011 - Was the BP bite more than what it could chew?

Apache Corporation is currently planning to divest approximately $1.0 billion worth of legacy conventional properties in Canada to optimize and high-grade the company’s existing portfolio of assets.

Apache’s Canadian conventional operations:
-- Apache has 6.3 million net acres across the provinces of British Columbia, Alberta and Saskatchewan, including approximately 1.3 million net mineral and leasehold acres in Western Alberta and British Columbia acquired from BP in 2010; These acreage includes both conventional and unconventional plays.
-- Conventional assets are focused on oil projects located primarily in Alberta and Saskatchewan.
-- Apache is utilizing horizontal well technology to develop waterflood and enhanced oil recovery projects in the Midale and Provost fields located in southeast Saskatchewan, and the Zama and House Mountain fields located in Alberta.
-- The company will also continue intermediate-depth gas development drilling in Kaybob and West 5 areas in Alberta.
-- During 2011, Apache will run 2-4 rigs in the company’s oil, EOR and liquid-rich areas.

Apache to sell assets as part of the debt reduction effort
During the Q42010 result announcement Apache CEO asserted company will be pursuing debt reduction efforts by pursuing $1 bn worth property sales



For more on Apache: http://docsearch.derrickpetroleum.com/research/q/Apache.html
For more on BP: http://docsearch.derrickpetroleum.com/research/q/BP.html

Apache reported 2010 annual results; Production up 13% over 2009; Projected annual growth rate of 13%-15% in 2011

Apache reported annual average production of nearly 658,000 boepd, up 13% from the last year. Liquids production increased 18%, and this, combined with higher oil prices, drove Apache to record earnings of $3.0 billion for 2010. The company added 827 MMboe or 344% of production, through discoveries, extensions and acquisitions. Approximately 245 MMboe, or 102% of 2010 production, in reserve additions came through drilling.

2010 Highlights:

-- 125% reserve growth, replacing 344% of production; 102% through drilling; Record annual production for North America and international

-- Van Gogh and Pyrenees, two oil fields offshore Western Australia, commenced production in February 2010, reaching payout by October and December, respectively

-- Established new regions in the deepwater Gulf of Mexico, Gulf Onshore and Permian Basin, and expanded in Egypt, Canada, and the Gulf of Mexico Shelf.

-- Plan to invest $7.5 billion for 2011 annual year