Oil and Gas Innovation Spring 2016 by Emery Hill Media Ltd

Oil and Gas Spring 2016

INNOVATION

Business Information. Industry Solutions.

Chemical Engineering School: Hands ON is the Best Approach Offshore Special: Marine Navigation Electronics

Emery Hill Media Ltd. ÂŠ 2016

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Spring 2016 CEO Matthew Patten Managing Editor Simon Milliere Publishing Director Edward Findlay edward@oilandgasinnovation.co.uk Commercial Director & Advertising Enquiries Nicholas Parker nparker@oilandgasinnovation.co.uk Technical Director and Website Valters Skrupskis web@oilandgasinnovation.co.uk Office Assistants Janet Elseberg admin@oilandgasinnovation.co.uk Mylene Daugan mylene@oilandgasinnovation.co.uk Contributing Journalist Emma Patten Business Development Executives Luigi Palasco Market Researchers Mylene Miguel Kiefer Reddy Melissa Phanjoo Jesse Wiafe Dasol Moon

Emery Hill Media Dalton House 60 Winsor Avenue London SW19 2RR Tel: +44 203 239 1581

Please enjoy the Spring 2016 edition of Oil and Gas Innovation. Yours Sincerely,

Simon Milliere Managing Editor

EMERY HILL MEDIA ÂŠ 2016

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CONTENTS COVER STORIES & SPECIALS Hands on is the Best Approach

University of Hull prides themselves on their approach to learning and therefore develop and maintain close links with industry and businesses across a very wide range of science and engineering disiplines, including chemical engineering.

Interview with Ships Electronic Services

Oil and Gas Innovation sits down with Jeff Dixon of Ships Electronic Services, market leader in the supply, installation and maintenance of maritime communication and navigation electronics. Operating from eight strategic sites in the UK, the company has over 40 years of experience within the leisure, fishing, commercial shipping, military shipping and offshore oil industries.

INDUSTRY NEWS North America Europe Asia Pacific Russia & CIS Africa

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EXPLORATION & PRODUCTION

Scale Protection Interview

We speak to Scale Protection’s CEO, Ole Magnar Drønen about their innovative products and services. Scale deposition is one of oil industry’s major challenges. It causes immature production decline for oil fields world wide. Ole helps readers with a solution to this issue.

Unique Solutions

Protea explains how they help companies in the industry. Over the years, Protea has delivered a wide variety of equipment but its core products are Pedestal Cranes.

EVENTS CALENDER

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CONTENTS Rockhopper Makes Acquisition of NonOperated Production and Exploration Assets in Egypt

Rockhopper Exploration plc (AIM: RKH), the oil and gas exploration and production company with interests in the North Falkland Basin and the Greater Mediterranean region, is pleased to announce amended terms for the acquisition of a portfolio of non-operated production and exploration interests in Egypt (the “Interests”) from Beach Energy Limited (“Beach Energy”) (the “Acquisition”)..

DR 750 P Offshore Reeling Cable for Maritime Use

Cable manufacturer SAB Bröckskes presents a new marine cable for the market. According to the manufacturer it is a DNV-GL approved reeling cable, called DR 750 P offshore, with applications for ships and also for offshore use.

Life of Concrete Mattresses

Regular contributor Pipeshield explains concrete mattresses. These are large concrete structures typically used to stabilise subsea pipelines, umbilical’s & cables. This is achieved by adding global weight and hydrodynamic edge optimisation to resist wave and current actions. They also provide protection from dropped objects.

MIDSTREAM & PIPELINES

PROCESSING Using Rheology to Optimize the Performance of EOR Fluids

White paper from Malvern. Although the price of crude oil has dropped significantly in the past couple of years, the longer term predictions suggest that it may settle in the region of US$50 – 70/bbl, a figure that still encourages the exploitation of existing oilfields, with infrastructure already in place, rather than new reservoirs.

Houdini Act

Regular contributor Bronswerk BV gives a lesson in Retubing. Depending on the process conditions, the choice of materials, the structural details of the installation and the equipment and the state of maintenance, corrosion should never be allowed to happen. Bronswerk explains when it does.

HEALTH & SAFETY

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COVER STORY

Exclusive Interview: We Speak to University of Hull’s Chemical Engineering Department “A proud heritage of academic excellence and a history of creating and inspiring transformative impact”. As befits the UK City of Culture 2017, Hull offers a stimulating postgraduate student experience. The city is enjoying an exciting time of rapid development, but it is already a place of opportunities, excitement and interesting places to enjoy. Choosing to study here will put you at the heart of 365 days of world-class arts and culture. The University is a 2017 strategic partner and some of the 1,500 events pledged for the year will be hosted on campus alongside a programme of events and artworks over the year, providing plenty of opportunities to get involved. OGI: Could you start by explaining The University of Hull’s credentials and experience in terms of its education and training which are applicable to the Oil and Gas sector? Could you tell our readers the breadth of its industry experience and how long it has been active? Hull: The University of Hull was established in 1927 and granted a Royal Charter in 1954, making it England’s fourteenth-oldest university. Rich in tradition, the University has a proud heritage of academic excellence and a history of creating and inspiring transformative impact. The University will celebrate its 90th anniversary next year, coinciding with Hull’s year as UK City of Culture in 2017. Central to our mission are the principles that have informed our University since its founding: a conviction that stature and reputation can only be built on academic excellence, a belief in the power of our University to help build a better world, a commitment to our local communities, and a recognition of our responsibility to inspire the next generation of students. Our vision articulates the University’s commitment to shaping a better future – ‘inspired in Hull to go beyond’. OGI: What’s life like at the school for students? What could a prospective post grad look forward to in terms of research and facilities for example? Hull: The University offers an array of specialist professional support for our postgraduate students. We are here to ensure that you make the most of your time at Hull and that you get the help you need, whenever you need it. From

day one, our team of expert advisers and support staff are available to welcome you to the University and to help with any queries and issues that you may have throughout your time with us. Following its £28-million redevelopment, the Brynmor Jones Library is one of the finest institutions of its kind in the country, a stylish state-of-the-art place of learning for generations to come. Boasting more than a million books, journals and periodicals, plus a vast collection of digital information, it is open when you need it – 24/7 during semesters. The Brynmor Jones Library’s Postgraduate Lounge – reserved exclusively for PhD students – provides a calm and distinctive atmosphere in which you can pursue your

research away from undergraduate hustle and bustle. The University’s friendly skills team provides support on note taking, digital literacy, academic writing, referencing, mathematical skills and data analysis. Free high-speed WiFi turns our entire campus into a virtual classroom. There are more than 1,100 open access computers and 1,600 study spaces available. The Graduate School offers dedicated workstations and quiet study areas for the exclusive use of our postgraduates. The Postgraduate Association provides a community for postgraduates to share ideas, enjoy social events and activities and generally make friends and have fun.

Academic Support Tuition - Personal supervision on your programme of research is provided by academic staff who are experts in their field. Disability support - A team of professionals support our students with disabilities, whether these are physical, medical or associated with learning such as dyslexia and dyspraxia. Pastoral and wellbeing support A dedicated team offer friendly and informal support, when required, with any personal or practical difficulties that you may encounter Our graduates acquire expert knowledge and skills in their chosen academic fields, enriched by a wide array of professional and employability skills, including digital literacy and knowledge management skills, skills in critical thinking, communication and presentation skills, and the ability to work in groups and to take responsibility for themselves. As citizens of our diverse University community, our graduates will have the opportunity to develop the interpersonal and life skills to function effectively in a world tolerant of diverse views and committed to resolving disagreements by reasoned argument. The University of Hull Graduate benefits from leadership development and the fostering of a creative and entrepreneurial spirit capable of generating impact, wealth and value through innovation. Committed to the value of ‘going beyond’,

our graduates have had opportunities to deepen their understanding of the world and to acquire an understanding of other languages and cultures. The University of Hull Graduate should be confident and independent, a perpetual learner with a global outlook, with an appreciation for interdisciplinary approaches to understanding the challenges and issues of the 21st century. Our graduates will be well prepared to compete in the global arena. They will carry into the world the benefits that follow from having studied within a value driven organisational culture where civic and social responsibility are emphasised. At the University of Hull, we pride ourselves on the mixture of fundamental and applied research we conduct. We understand that research must deliver impact and be commercially relevant. We therefore develop and maintain close links with industry and businesses across a very wide range of science and engineering. We have exploited this research and enterprise activity to set up a number of successful spin-out companies, as well as working in partnership with business to bring the outputs of our research through to commercial realisation. We are a global research-focused community with more than 100 different countries represented at the University. Our campus offers all the facilities needed each day – for study, sport, socialising and

shopping. It blends the traditional with the innovative – an inviting campus with historic buildings in a leafy green setting. OGI: The Humber is the largest trading estuary in the UK and the fourth largest in Europe, with a chemical and process sector worth £6bn a year and international expertise in logistics. 40 million consumers and over 60% of the country’s manufacturing capacity lie within a four-hour drive of the Humber. The region is one of the fastestgrowing chemical bases in the UK, with investment in new build, expansion and maintenance exceeding £1 billion. Hull: Nearly 90% of the Humber area is rural. Its main settlement and commercial capital is Kingston upon Hull. Major settlements include the ports and local towns of Grimsby and Immingham, the renaissance resorts of Cleethorpes and Bridlington, and the industrial ‘garden town’ of Scunthorpe. The predominantly rural areas of the East Riding, North Lincolnshire and North East Lincolnshire look to the market towns of Beverley, Brigg, Epworth and Barton. To the west, Goole – the UK’s most inland port – is rapidly developing as a northern logistics hub. The UK chemical industry is one of the largest manufacturing industries in the UK, with a turnover of £55 billion. It has been growing rapidly at 5 per cent per annum over recent years, and

The Derwent Building, The University of Hull.

industry experts predict continued good growth despite the economic downturn. With an 8.2 per cent share of the world market and an integral role within the European market – the world’s largest with 31.6 per cent of total production – the UK provides investors with access to a thriving national industry and superb access to growing global markets. Our facilities are perfectly situated for a future career in Chemical Engineering, in a region which is home to more than 350 companies involved in the chemical and allied industries including BP Chemicals, Phillips 66, Smith & Nephew and Reckitt Benckiser. The Yorkshire and Humber chemicals clusters encompass expertise in petrochemical refining, personal care, pigments and colours, agrochemicals, fine chemicals, paint and coatings, surface treatments, speciality chemicals and inorganic and organic commodities. The region generates £8 billion in turnover from the chemical sector. It is also home to the largest port in the UK at Grimsby and Immingham located on the Humber River, which handles over 17 per cent of the UK’s port trade. Companies active in the region include Croda, Air Products, BP Chemicals, BOC (LINDE), BASF, Phillips66, Corus, Cristal, Kemira, Knauf, Novartis, Syngenta, Total and Synthomer. Australian farm chemicals group Nufarm Ltd and Indian companies Piramal Healthcare, Vivimed Labs Ltd. The Phillips 66 and Total oil refineries are on the South Humber Bank (SHB). These two refineries provide 27 per cent of the UK’s refinery capacity.

Brynmor Jones Library. OGI: From our own knowledge and investigations, one of the major issues students seem to grapple with in their education is the practicality of what they are studying, and moreover the application of theory in the real world. Could you elaborate on how the Chemical Engineering School helps students bridge the leap from post graduate studies to the jobsite? Hull: Our range of MSc’s offer the chance to specialise and to study in greater depth, particular aspects and applications of the

Professor Phil Rubini, Head of Chemical Engineering.

broader discipline in which the graduate holds a bachelor’s degree with honours. These programmes also provide an opportunity to integrate the technical and non-technical aspects of engineering and to develop a better understanding of, and commitment to, professional and social responsibility. The programmes aim to ensure that students: Develop a high level of competence and confidence in the application of engineering knowledge and techniques in the Engineering specialisation they have chosen, in particular, with reference to the latest research and industry practices. Develop the core skills needed to design, analyse and synthesise engineering systems along with professional, communication and management skills to undertake research or professional practice. Develop the skills, competencies, knowledge and behaviours needed to be successful and self-reliant in the workplace as a professional engineer. Draw attention to the impacts of engineering on people and the environment, including possible unintended consequences of a technology, the potential disproportionate advantages or disadvantages for certain groups or individuals and take into account the broader social context of the society in which it will operate.

“We foster a research environment that facilitates novel, interdisciplinary research.” In achieving these aims, the programmes will seek to fulfil the educational requirements for registration as a professional Engineer at CEng level for all MSc programmes. The programmes are designed to instil in graduates the ways of ‘thinking like an engineer’, as embodied in the Big Ideas, below, which will enable them to begin a professional career in engineering or technology. Systems thinking: is promoted through the students working in multidisciplinary groups solving problems which are most effectively approached by the synergistic integration of different technologies. This is promoted further at MSc level through the design of sophisticated systems and is directly addressed in individual and group projects. Understanding the social ‘system’ in which engineers operate is developed further at masters level and is embedded here in the modules such as Sustainable Business; Environmental Management and Policy; Prosthetics, Orthotics, Rehabilitation and Assistive Devices etc. Adaptive and adapting: ensuring that graduates of this programme have flexibility in their thinking and the ability to approach problems in a range of different ways is achieved by revisiting typical problems met at BEng level using more sophisticated approaches and more complex models to obtain improved performance. The ability and confidence to adapt components and elements of systems and to combine them in different ways is encouraged through designoriented laboratory and project work.

Problem-finding and solving: problem solving begins with domain specific and constrained problems but develops into less well defined scenarios in which students are not given complete or consistent information and so must identify and define the problem they are to solve. These problem finding skills are particularly strengthened through project work and group design/ innovation activities which require the ‘voice of the customer’ to be taken into account. At Masters level problem solving incorporates a research element, which is embedded in these programmes in the Research Skills module and in the project itself. Visualising and constructing: visualisation of solutions is promoted through the development of a range of types of mathematical, experimental, computer based and conceptual models. The extraction and visualisation of solutions in different formats and for different audiences is promoted through laboratory work, computer simulation exercises and design activities. Construction and evaluation of physical artefacts is a theme throughout the programmes which aims to give students confidence in their ability to apply of knowledge as well as producing pride and satisfaction. Improving: Engendering a mind-set in which opportunities for improvement and innovation are always sought is promoted by design and practical work and by consideration of existing products and how potential new or improved

products could be generated. To build these ways of thinking requires a progressive development of knowledge and understanding with associated tools and techniques. At the honours stage, students will already have developed specialist knowledge in current and developing areas of technology; they will be able to evaluate alternative solutions to technical problems in the wider context of the social, ethical, environmental and professional environment in which they will operate as professional engineers. MSc students will have greater opportunity for independent action, accepting responsibility, formulating ideas proactively, dealing with openended and unfamiliar problems, planning and developing strategies, implementing and executing agreed plans, leading and managing teams where required, evaluating achievement against specification and plan, and decision-making. The inclusion of such elements within the programmes should aid in preparing students for subsequent leading roles in technical and/or managerial activities. Periods of work in industry, through projects defined and led by companies will be available for some students to supplement formal study. • If you would like to know more: http://uniofhull.info/chemengman http://uniofhull.info/chemengtec

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COVER STORY - MARINE ELECTRONICS

Exclusive Interview: We Sit Down With SESâ&#x20AC;&#x2122;s Jeff Dixon to Get an In-Depth Look at Ships Electronic Services for the Marine Oil and Gas Sector Ships Electronics Services Ltd (SES) is a market leader in the supply, installation and maintenance of maritime communication and navigation electronics. Operating from eight strategic sites in the UK, the company has over 40 years of experience within the leisure, fishing, commercial shipping, military shipping and offshore oil industries. As dealer or distributor for many high quality manufacturers we have built an enviable reputation for customer service beyond expectations and are one of the few marine electronics companies to be certified to ISO 9001:2008.

OGI: Could you start by explaining Ships Electronic Services’ (SES) credentials and experience with regard to your products and services which are applicable to the Oil and Gas sector? Could you tell our readers the breadth of your experience, how long you have been active, and your reach? Dixon: SES is a UK National company with over 40 years’ experience within the Navigation and Communication marine markets including leisure, fishing, commercial and military shipping and the offshore oil and gas sector. We have nine strategically located coastal depots including Aberdeen. From these depots we operate sales and service with over 40 staff including highly trained service technicians. We can provide both onshore and offshore sales and service to the oil and gas marine markets. Our highly skilled technicians are capable of servicing the major brands of marine navigation and communication equipment within both the home territories and the overseas markets. Our technicians regularly work overseas on behalf of oil and gas marine operators to service equipment as far as Brazil and Singapore. We can attend both ships and offshore rigs and platforms. OGI: Could you explain in detail what solutions you offer? And to which type of companies are these solutions best fitted, within the oil and gas sector? Dixon: SES can offer turnkey solutions to a wide range of applications including new build projects where we provide an extensive range of navigation and communication products to suit the type, class and purpose of vessel and similarly for retro-fit projects. On a daily basis we are advising companies of varying regulations, of product upgrades including software and of any new enhanced products that are coming onto the market. We represent almost all major brands of marine navigation & communication manufacturers: RAYTHEON ANCHUETZ – Sole UK distributor and provider of sales & service. PRAXIS AUTOMATION – UK distributor for sales & service COBHAM (Thrane & Thrane) – UK overseas service centre (SAILOR brand) CLEAR-COM COMMUNICATIONS – UK distributor for marine KELVIN HUGHES – sales & service, APT for SVDR/VDR SAM ELECTRONICS – sales & service

COMROD ANTENNAES – UK distributor FURUNO – UK sales & service FLIR – UK sales & service ORLACO – UK sales & service ZENITEL – UK distributor, sales & service JOTRON – UK sales & service OGI: When working in the offshore environment, safety and training is a paramount concern to companies. Could you explain in detail the steps SES has taken over the years which to ensure the quality of your work, and could you elaborate on the training your employees have received which make the work they perform so diversified? Dixon: Our Customer Service team has gained an enviable reputation for its 24/7 service, the phones are manned by SES staff at all times to provide advice and technical assistance whenever it is needed. With its oil and gas base in Aberdeen, SES has been heavily involved in the oil and gas industry for over 40 years through the supply, installation and maintenance of

maritime communication and electronics. Our factory trained engineers can travel worldwide to offer owners the most cost effective service for their vessels The company’s expansion into the industry was highlighted with its First Point Assessment (FPAL) registration in 2010. FPAL works to identify, qualify, evaluate and monitor suppliers on behalf of its purchasing members. To further strengthen its commitment to the industry, SES engineers who work on offshore facilities now undertake RGIT Basic Offshore Induction and Safety Training. This means SES can offer offshore installation, project work, service and maintenance and full vessel or platform site surveys for all marine electronics on these facilities. SES’s unsurpassed reputation for the design, supply, installation and maintenance of maritime electronics, in addition to their 24/7 customer service, provides the oil and gas industry with a complete service.

OGI: When implementing an electronic and/or communications system for a client, what can the client expect in terms of support from SES throughout the life cycle of the implementation? For example does SES provide after sales service, or repairs? Dixon: SES can provide a one stop turnkey solution, where we design, provide line drawings, install and commission and provide after sales back up. SES handles all warranties on the equipment and services we have supplied, which vary in length, i.e. 1, 2 or even 3 years, depending on the manufacturer. We provide SBMC’s (Shore Based Maintenance Contracts) which means that we will look after equipment on an annual basis inspect and test equipment as necessary and provide certification of its suitability and performance. This is carried out for essential equipment and lifesaving products. OGI: From our own investigation, when an offshore oil and gas company decides to implement an electronic communication system there are many different moving parts. The first part of my question is how is a company’s needs accessed? For example does an offshore company come to you with a specific problem, which can be handled by a turnkey solution? Or is your work much more bespoke? Or both? Dixon: While a company’s requirements can be handled within a specific turnkey solution we often provide bespoke and tailored solutions to suit the application. The needs of each individual company

are assessed on a number of factors. The type of vessel is considered, the operation and function of the vessel, the area in which the vessel/offshore platform will operate or be located and the class that it operates under i.e. LLOYDS, DNV, BUREA VERITAS etc. These factors together with our extensive experience are considered before making recommendations. We will always provide equipment that we feel is suitable for the application and on which we can provide back up in the way of service and spare parts. OGI: Secondly, keeping with the same theme. Because of all the different possible solutions a company may require with their on-board communications and electronics, it’s easy to see why a company such as SES can be so helpful. I say this because it seems less painstaking for many companies to have all their potential solutions for different problems all come from one source. But does external factors such as regulation, safety, quality assurance, innovation play an evolving role in SES’s work? And if so could you describe how that works, with examples? Dixon: Most companies, particularly those in the oil and gas sector, are very diligent when it comes to health and safety procedures. We take pride in our policies and procedures toward health and safety, ISO etc. and are able to comply with even the most stringent certification requirements of our customers. Innovation, particularly in the communication sector, has made great strides in recent years. We have kept pace

“... both onshore and offshore sales and service to the oil and gas marine markets.”

with the growing technology that has happened, ensured that our sales and service staff are up to date and this coupled with the required safety factors, has allowed SES to grow with technology. Our clients trust us to give them the latest products that will enhance their business and in turn allow them to complete their daily work and tasks to the very best standards. OGI: Finally, could you enlighten our readers with a particular example and / or case study where you helped a client with your products and services? Dixon: We have a case study example with Bibby Offshore, Vessel; BIBBY POLARIS . This company had a Clear-Com communication system installed some time ago to assist in ROV operations. SES was called in to update the system which we retro-fitted with a modern and current system from Clear-Com. To keep customer costs to a minimum while not compromising the system quality we utilised existing cables on board the vessel wherever possible. We installed new communication stations in varying parts of the vessel including a connection to the bridge from the ROV control centre. We put in a new “Matrix” main frame which provided the multiple users the additional facility to communicate with designated stations and so improved the efficiency and flexibility of the system. In turn this improved the safety of the workers allowing operators to have a greater control over operations and supervisors to oversee the general ROV launches and re-embarkation. • http://www.clearcom.com/product/ partyline Please see also a published case study; http://www.clearcom.com/support/wellenhancer This Q&A was conducted by Emma Patten from Oil and Gas Innovation and Ships Electronic Services’ Jeff Dixon. If you would like to know about how Ships Electronic Service’s can help out your operations please use the contact details below: Ships Electronic Services (SES) http://www.ses-marine.com/ Tel: +44 (0) 1634 295500 sales@ses-marine.com service@ses-marine.com

NEWS - NORTH AMERICA

Searcher Joins Seismic Bonanza in Mexico with 17,000km 3D Seismic Project

earcher Seismic is pleased to announce the South Campeche UltracubeTM 3D seismic reprocessing project offshore Mexico. The seismic project, totalling approximately 17,700km2, is a merge of three existing surveys. The Holok Alvardo 3D (2003), the Cequi 3D (2010) and the Boloi Norte-Balche-Xulum 3D (2003). Rachel Masters, Global Sales Manager for Searcher, said the project is located in one of Mexico’s most prominent offshore exploration areas, with several proven oil and gas discoveries. “The new 3D Ultracube extends over 260 km in the southern part of the Campeche Bay area and will provide new depth imaging of the Southern Campeche – Sigsbee Basin and also parts of the offshore Comalcalco Basin. “The southern part of Mexican Ridges in the Veracruz Basin are also covered by the new South Campeche Ultracube. “An important factor to note, in this low oil-price environment, is 75% of the South Campeche Ultracube is located in waters less than 1000 metres in depth; with the shallowest water depth being approximately 30 metres,” Ms Masters added. The South Campeche Ultracube includes coverage of areas in Rounds 2 and 3 and is competitively priced for oil companies to utilise in their exploration efforts. The project incorporates a very thorough pre-stack imaging and post-stack processing sequence staged in two parts. Firstly, the pre-processing produces high S/N ratio, broadband data and secondly, imaging using TTI Kirchhoff and RTM technologies to properly image the subsurface, often with extensive salt pillows and diapirs. ARES B approval has been granted and processing of the project will commence shortly. Fast track products are expected to be available in approximately 6 months and final volumes will be available in Quarter 2, 2017. •

U.S. Chemical Industry Investment Linked to Shale Gas Tops $164 Billion

he American Chemistry Council (ACC) today announced that U.S. chemical industry investment linked to plentiful and affordable natural gas and natural gas liquids (NGLs) from shale formations has reached $164 billion. Forty percent of the investment for the 264 projects – new facilities, expansions and factory re-starts – is completed or underway, while 55 percent is in the planning phase. ACC Senior Director of Energy Policy Owen Kean revealed the new figures at a Hudson Institute event, “America’s Future Natural Gas Economy: Promoting the Next Energy Breakthrough.” He appeared alongside Hudson Institute Senior Fellow Arthur Herman on a panel examining the role of natural gas in manufacturing. “U.S. chemical manufacturers rely on natural gas for heat and power, and it contains ethane, an NGL that serves as our main feedstock,” Kean said. “Dramatic supply growth has had an equally dramatic impact on U.S. natural gas prices. It’s a stunning reversal of fortune from just a few years ago, when the chemical industry was losing market share – and jobs – to competitors abroad. ACC analysis shows that $164 billion in capital spending could lead to $105 billion per year in new chemical industry output and support 738,000 permanent new jobs across the U.S. economy by 2023, including 69,000 new chemical industry jobs, 357,000 jobs in supplier industries and 312,000 jobs in communities where workers spend their wages. Much of the new investment is geared toward export markets, which can help improve the U.S. trade balance. “We need the right regulatory and policy approaches in order to fully realize the potential of shale gas as an engine of manufacturing growth,” Kean said. “Policymakers must avoid unreasonable restrictions on oil and gas production on public lands; keep oversight of production on private lands in the hands of the states; and expedite the construction and permitting of infrastructure, such as pipelines, needed to move natural gas and NGLs to market.” It’s also important to ensure a timely, transparent and efficient regulatory permitting process for shale-related manufacturing projects such as new factories and expansions. Companies and state agencies need clarity and certainty about the process and timing for obtaining permits. Legislation introduced in the House last month would help fix longstanding problems with the implementation process for new air quality standards. The data released today updates the ACC report, “Shale Gas, Competitiveness, and New U.S. Chemical Industry Investment— An Analysis of Announced Projects.” Published in May 2013, it examined nearly 100 chemical and plastics projects totaling $71.7 billion in potential investment announced as of March 2013. The figures are growing as new projects are announced. ACC analysis employs the IMPLAN input-output methodology, an economic model that quantifies interdependencies among industries or economic sectors. IMPLAN is used by government agencies including the Army Corp of Engineers, U.S. Department of Defense, U.S. Environmental Protection Agency, and over 20 others, and by over 250 colleges and universities, local governments, non-profits, consulting companies, and other private sector companies. •

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NEWS - NORTH AMERICA

Clean Diesel Delivers Greenhouse Gas Reductions Targets for Maryland

egislation signed by Maryland Gov. Larry Hogan on Tuesday will seek to reduce greenhouse gas emissions by 40 percent by 2030 relative to emissions generated in

2006. “As Governor Hogan signs legislation to cut greenhouse gas emissions from Maryland, clean diesel stands ready to deliver significant fuel savings and climate benefits to the state,” said Allen Schaeffer, Executive Director of the Diesel Technology Forum. “Diesel engines and the vehicles and equipment they power have been recognized for over a century for their efficiency,” said Schaeffer. “Thanks to enormous advances in clean diesel technology, engines that meet recent emissions standards result in near-zero emissions and provide further fuel economy benefits. These engines are ready to deliver significant fuel savings and greenhouse gas reduction benefits to Maryland and move the state closer to its emission reduction target. “Maryland is a leader in the adoption of clean diesel technology beating the national average for the share of these clean diesel commercial vehicles in operation. About one-third of the 128,000 diesel commercial vehicles in operation in Maryland as of 2015 were powered by the latest generation of new clean diesel technology available since 2010. “Nationwide, these clean diesel vehicles have saved 21 million barrels of crude oil thanks to advanced fuel economy improvements and eliminated 9 million tons of carbon emissions,” said Schaeffer. Transportation related emissions rank as the second leading source of greenhouse gas emissions in Maryland behind the electricity generating sector. Diesel commercial vehicles rank as the second leading source of transportation related greenhouse gas emissions behind gasoline powered passenger cars and light-trucks. Schaeffer said EPA regulations have resulted in new clean diesel technology and fuels that have significantly lowered particulate matter and NOx emissions by more than 95 percent compared to older diesel vehicles. New Diesel Engines Save Fuel & Reduce

Emissions “Today, 95 percent of large commercial vehicles come with a diesel engine and these vehicles are already saving fuel and reducing emissions and will continue to generate significant fuel savings and emission reductions helping reduce greenhouse gas emissions in Maryland,” said Schaeffer. Fuel economy rules established jointly by the U.S. Environmental Protection Agency and the Depart of Transportation for commercial vehicles manufactured beginning in 2014 are expected to save 530 million barrels of crude oil and reduce greenhouse gas emissions by 270 million tons by 2018. “Diesel will deliver the majority of these significant benefits as the powertrain is found under the hood of 95 percent of large commercial vehicles today and will continue to power these vehicles in the near future,” said Schaeffer. Proposed rules extending fuel economy requirements beyond 2018 are estimated to save an additional 1.8 billion barrels of crude oil and 1 billion tons of greenhouse gas emissions by 2027. Maryland Also a Leading State in Use of Clean Diesel Passenger Vehicles “The benefits of clean diesel in contributing to greenhouse gas reduction in Maryland extend beyond commercial vehicles,” said Schaeffer. “Maryland is a leading state for the adoption of clean diesel passenger cars with over 100,000 of these vehicles on Maryland roads today and the growing share of these vehicles in the state’s fleet can play a great role in saving even more fuel and reducing greenhouse gas emissions.” According to the U.S. Environmental Protection Agency, a clean diesel passenger vehicle can experience a 20 to 40 percent improvement in fuel economy relative to a comparable gasoline vehicle along with a 10 to 20 percent reduction in greenhouse gas emissions. “One of the great benefits of the diesel powertrain is its capability to demonstrate continuous improvement to further reduce greenhouse gas emissions,” said Schaeffer. “Already, large municipalities including the cities of San Francisco and Oakland and private fleets like UPS have committed to use greater quantities of bio-based diesel fuels that have shown enormous potential to reduce carbon emissions.” Biodiesel and renewable diesel fuels are recognized as advanced biofuels by the U.S. Environmental Protection Agency capable of reducing greenhouse gas emissions by at least 50 percent. •

NEWS - EUROPE

Jee Ltd Awarded North Sea Decommissioning Contract from Tullow Oil

ullow Oil has awarded a contract to Jee Ltd, the subsea engineering and training firm, to investigate the most appropriate options for decommissioning their Thames area assets. Awarded in February 2016, the contract relates to the decommissioning of the Horne, Wren, Wissey, Orwell and Thurne fields in the Southern North Sea. In order to decommission these assets, Tullow has submitted decommissioning programmes to the Department of Energy and Climate Change (DECC) which have been approved, along with a joint environmental impact assessment with Perenco (co-operators of the Thames field). Tullow has asked Jee to review the approach specified in their decommissioning programmes for these assets, and re-define the most appropriate decommissioning options for the subsea sections. The study, due to be completed over the next two months, will assess what infrastructure can be left in situ. In instances where removal is deemed necessary, Jee will look for process efficiency to reduce associated costs. Jee’s assessment will include decommissioning options for the associated components such as mattresses and grout bags. Jee has significant expertise in offshore decommissioning and in-depth knowledge of the subsea infrastructure in the North Sea from their long-term work with major operators in the region. With experience in assisting operators in providing fully considered studies to determine their decommissioning approach, Jee has also been involved in preparing and submitting derogation cases to DECC for consideration. Graham Wilson, Head of Late Life at Jee, commented “Leaving subsea infrastructure in situ, also referred to as derogation, can be the best option from a safety, environmental and economical perspective provided no increased risk to other users of the sea.” Jim Buston, Business Development Manager at Jee, commented “We are delighted to be working with Tullow Oil on a project which has the potential to save them, and indeed the taxpayer, millions of pounds in unnecessary removal of materials. At a time when budgets and spending are being cut across the board, pragmatic approaches to the challenges of decommissioning are of paramount importance. Derogation is just one way which we are working with our clients to look for economically and ecologically more sensible solutions”. •

World’s First ‘Offshore’ Aquaculture Development Project Receives Green Light from Norwegian Government The Norwegian Ministry of Trade and Fisheries has approved Norway’s first development concession enabling Ocean Farming AS, supported by Kongsberg Maritime AS, to build the world’s first automated ‘exposed’ aquaculture facility. Situated outside of Trondheim, this innovative new facility introduces a paradigm shift in salmon farming now, and other fish types in the future and is a significant step in Norway’s efforts to deliver technical solutions to address the impending global food gap challenge. The Ocean Farming facility is a new and innovative design, developed to overcome the challenges of more traditional inshore fish farming facilities by being located in deeper waters, further from the coast. The submerged, anchored fixed structure will float steady in the exposed ocean and is suitable for water depths of 100 to 300 meters, where the aqua biological conditions are more ideal for aquaculture on ‘the fish’s terms’. The benefits of offshore fish farms are numerous, with conditions more suited to nurturing healthy fish, such as steady currents that limit exposure to sea lice infection. The facility is fully automated with normal operation requiring a crew of just 3 – 4 people. It can also be remotely operated. The project combines the best of existing technology and solutions from the Norwegian fish farming industry and the offshore oil and gas sector. KONGSBERG is playing a key role by leveraging its position as a turnkey supplier of technology and engineering services for complex oil & gas production units, offshore vessels, fisheries and sensor systems for oceans research and environmental monitoring. In addition to technology integration KONGSBERG is providing EIT engineering services, including delivery and installation of the gensets and aqualight systems. The Kongsberg Maritime technology scope of supply for the fish farm itself includes the K-Chief 600 automation system controlling a large number of different systems. Other highlights of KONGSBERG’s role in the project include an extensive telecoms and positioning package, covering a range of products such as the Maritime Broadband Radio (MBR) for communication between offshore sites and to shore and precise Motion Reference Units (MRU). In addition, KONGSBERG is responsible for the AIS requirements of the project, through delivery of the AISBS610 system and associated AIS infrastructure. Other sensors include Tank Sounding and Water Ingress Detection. The subsea delivery is designed to accurately detect where the fish are in the vast water volume of the cage and how they move in order to ensure effective feeding. In addition, advanced 3D display of the fish and relevant environmental parameters will be provided to the operators. The project will be the first in the world to combine marine engineering, marine cybernetics and marine biology via a ‘big data’ approach fusing all the available underwater sensors and in this way offer decision support systems for the operators controlling and monitoring the feeding of the salmon and the overall physical environment of the sea. “The Ocean Farming facility introduces a paradigm shift in salmon farming now, and other fish types in the future. With greater focus on biology and nurturing healthier fish, the concept delivers significantly improved yields that will prove important in the decades to come as part of Norway’s strategy to leverage its aquaculture and offshore expertise to meet the challenges of accelerating population growth and the pressures this places on the world’s food supply chain,” comments Egil Haugsdal, President, Kongsberg Maritime.

“To succeed in placing fish farming in exposed areas as a viable solution to address the food gap challenge, we need to integrate and harmonise a wide range of maritime and offshore technologies, for the fish farm itself and the new vessels that will serve it. This is a unique, highly technical project where we will transfer our technology base and knowledge of developing for oil & gas production units and the most sophisticated vessels to provide high levels of automation and control,” adds Thor Hukkelås, Principal Engineer Aquaculture Operations, Business Development, Kongsberg Maritime. •

NEWS - EUROPE

First Steel Cut on Maersk Oil’s Culzean Gas Megaproject Topsides

abrication of the billion dollar topsides destined for the Maersk Oil operated USD 4.5 billion UK North Sea megaproject, Culzean has begun. The steel-cutting ceremony for the first of the three topsides modules took place at the Sembcorp Marine Offshore Platforms (SMOP - formerly known as SMOE) Admiralty Yard in Singapore today (7 April). Culzean is the largest hydrocarbon discovery in the UK North Sea for over a decade. The field is approximately 145 miles east of Aberdeen and is expected to produce between 60,000 - 90,000 boepd at plateau production, producing for at least 13 years. The project was sanctioned in August 2015. Maersk Oil’s coventurers in Culzean are JX Nippon Exploration & Production (UK) Limited (34.01%) and BP (Britoil) (16%). “Starting the fabrication of the topsides is an important milestone. When the field begins to produce in 2019, Culzean will become a key contributor to Maersk Oil’s ambition to become a Top 5 operator in the North Sea in the 2020s, and provide around 5% of UK gas demand at peak production. Maersk Oil and coventurers’ investment will also support employment in both the UK and Asian supply chains,” said Maersk Oil Chief Executive Jakob Thomasen, speaking at the ceremony in Singapore. “Our focus for the next three years is working with our partners and suppliers to deliver the project from fabrication right through to commissioning safely, on time and within budget,” says Thomasen. The contract with SMOP, worth over USD 1 billion including long lead items, was awarded in September 2015. The contract includes the building of the Central Processing Facility plus two connecting bridges, Wellhead Platform and Utilities & Living Quarters Platform Topsides for the Culzean Field Development. The platforms will be built with enhanced digital and monitoring capability. “We will be harnessing technology to develop a 21st century facility with the ability to remotely monitor critical equipment 24 hours a day, and enable offshore colleagues to access real time data and immediate technical evaluation and onshore support. The technology will minimise time spent on plant and enhance safety and efficiency. Maersk Oil estimates this digital toolkit can save more than USD 10m annually,” says Martin Urquhart, Culzean Project Director. •

DEA Awarded Two Licences Offshore Denmark - Becomes Operator for First Time The Danish Energy Agency has awarded DEA Deutsche Erdoel two licences in Denmark. The concession area of about 530 square kilometres is located in the southern Central Graben in the western part of the Danish North Sea. The German upstream company DEA, based in Hamburg, applied for two concessions as part of the 7th licensing round in October 2014. Together with the Dutch exploration and production company Dyas and the Danish state-owned company Nordsøfonden, DEA was recognised when awarding the licences and is now an operator in Denmark for the first time with a share of 50% each in licences 8/16 and 9/16. ‘We’re delighted to have been awarded these two licences as a positive supplement to our portfolio and that we’re now also represented as an operator in Denmark’, emphasises the Head of the Germany/Denmark Division, Uwe Balasus-Lange. The main geological target in the concession area is Lower Cretaceous sandstones. It is supposed that they contain oil, which will be verified in the next few years through seismic investigations and exploration drilling. In addition to DEA, 15 other E&P companies applied in the 7th licensing round in Denmark. The concession areas are in the Central Graben, where most of Denmark’s current productive fields can be found. DEA’s upstream activities mainly focus on the core countries Norway, Denmark, Germany, Egypt and Algeria. Recently, DEA succeeded in taking an initial step in accelerating its growth strategy with the completion of an acquisition in Norway, which includes among others shares in more than 40 licences and significant production volumes from producing oil and gas fields. DEA has participated in exploration and production licences in Denmark since 1995 and has been producing oil in the Danish North Sea as a partner since 2003. DEA has a share of around 44% in the oil field Cecilie and a 43% holding in the offshore field Nini in the North Sea. •

NEWS - ASIA PACIFIC

Wood Group Boosts Vibration, Dynamics and Noise Engineering Service with SVT Engineering Consultants Acquisition

ood Group has acquired SVT Engineering Consultants (SVT) based in Australia. This acquisition marks a significant step for Wood Group in providing a global vibration, dynamics and noise (VDN) engineering service line. SVT, a privately-owned company with headquarters in Perth, provides piping and rotating equipment vibration, noise, integrity engineering and asset integrity services. The company was formed to pioneer the application of sound and vibration technology in the Australian resource sector. SVT’s client base now covers the onshore and offshore oil and gas market including Liquefied Natural Gas (LNG), as well as mining, power and utilities sectors. Managing director Stewart Wharton will continue to lead the 110-strong team of personnel across SVT’s offices in Perth and Brisbane. SVT will operate within the Wood Group Kenny business. SVT further expands the global technical expertise, which Wood Group established with the acquisition of Calgarybased BETA Machinery Analysis in June 2015 and augmented by an expert team which was established in Southampton, UK, at the end of 2015. The acquisition also enhances the geographic footprint of Wood Group’s VDN service, making it a truly global offering. Bob MacDonald, CEO of Wood Group Kenny, said: “Australia is one of the world’s largest producers and exporters of minerals and is on the cusp of becoming the world’s largest LNG producer. SVT builds on our asset integrity management service line as part of our strategy to enhance our vibration, dynamics and noise capability to support the operational phase of Australia’s LNG and mining infrastructure for decades to come. SVT is a natural strategic fit augmenting, yet broadening, our existing spectrum of specialist technical services to the energy, industrial and renewable markets, where we have an industry leading capability.” Stewart Wharton, managing director of SVT, said: “Joining Wood Group means we can offer our specialist services to an enhanced global client base and we look forward to being part of the company’s international network. The depth of expertise Wood Group has in vibration, dynamics and noise, including specialist tools and software for data analytics, will open up new opportunities for our services. We are focused on solving difficult problems in the oil and gas, mining and utilities sectors and we share Wood Group’s culture and values which strongly emphasise safety.” •

MEO Australia Reports Positive Results From Beehive Prospect

EO Australia Limited (“MEO”) (ASX: MEO) advises that positive results are being achieved from the seismic reprocessing and inversion study currently underway over the Beehive prospect in WA-488-P (MEO 100%). Beehive is a potentially giant, dual objective, oil prone prospect in the Bonaparte Basin located in 40m water depth next to the producing Blacktip field. The Carboniferous age objective is a 180km2 isolated carbonate build up with 400m of mapped vertical relief, analogous to the giant Tengiz field in the Caspian Basin. This play type is undrilled in the Bonaparte Basin. Beehive is defined by a tight grid of pre-existing 2D seismic data, which MEO has recently commenced reprocessing in order to de-risk the prospect. Prospective Resources Cautionary Statement: The estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Future exploration appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons. Results of the preliminary reprocessing undertaken by MEO show a significant improvement in seismic data quality. This result is leading to a stronger interpretation of key elements of the Beehive prospect, namely: • Clearer definition of the edge of the Carboniferous carbonate build up unit, which is the predicted reservoir at Beehive, • The encasing units, which are predicted to seal the Beehive prospect, appear increasingly bland, which is more likely to be a shale sequence with good sealing properties. Comparison of original and reprocessed seismic data showing improved data quality resulting in better definition of key elements of Beehive Prospect MEO Managing Director & CEO Peter Stickland commented: “The Beehive prospect is one of the largest hydrocarbon structures in Australia. The results to date from the current reprocessing of seismic data across the Beehive prospect have exceeded our expectations. The improvement in data quality is significant and it appears to strengthen key elements of the Beehive interpretation. The reprocessing and inversion are on track to be completed by mid-2016, which will enable a full update of the characterisation of Beehive. MEO will then seek a farmin partner to fund further exploration of the Beehive prospect.” •

NEWS - ASIA PACIFIC

McDermott’s Flagship Derrick Lay Vessel 2000 Formally Named in Keppel Singmarine Shipyard Ceremony

cDermott International, Inc. (NYSE:MDR) today formally named its flagship Derrick Lay Vessel 2000 (DLV 2000) during a ceremony at the Keppel Singmarine Shipyard in Singapore. Mrs. Brenda Cuthbertson, wife of 38-year McDermott employee and Asia Area Vice President Hugh Cuthbertson, serves as the vessel’s godmother and named the DLV 2000 with the traditional breaking of champagne during the ceremony. The ceremony was attended by invited guests, McDermott and Keppel executives and employees and was followed by guided tours and lunch on the vessel. The DLV 2000 is a class 3 dynamically positioned vessel combining a 2,200-ton revolving crane with a deepwater under deck S-lay pipelay system configured to install pipelines with diameters ranging from 4.5 to 60 inches in water depths up to 10,000 feet. The vessel can accommodate up to 400 personnel to facilitate large hook-up and commissioning projects, has a fast transit speed and incorporates a large, 43,000 square foot open deck to allow the transportation and assembly of large subsea structures; enabling safe and efficient stand-alone operations in remote areas. “The DLV 2000 will add high-end capabilities and increased versatility to McDermott’s global fleet by utilizing a single vessel

Wood Group Intetech Launches Enhanced Corrosion Software Wood Group Intetech (WGI), a leading asset integrity specialist serving the global energy industry, is launching a new version of its ECE® software in response to client demand. ECE® is an established tool for corrosion analysis and materials selection. The latest version – ECE® 5.3 – includes a bulk calculation feature, which will enable users to simultaneously upload multiple data streams, saving valuable time in the data transfer process. Customers can upload the inputs and access the results in a user-friendly Excel format – increasing ease of use. Founder and Managing Director of Wood Group Intetech, Dr Liane Smith, says: “ECE® is enabling clients to evaluate critical operational decisions and prioritise budget spend at a time when industry resources are limited. The combination of our in-house expertise and large user group feeding into the development process ensures we continue to provide solutions that address the challenges of clients worldwide.” WGI is experiencing consistent demand for ECE® with over 80 customers worldwide currently utilising the software.•

on projects requiring a combination of pipelay and heavy lift with appropriate deck space for structures and offshore workforce accommodation that would normally require multiple vessels; therefore, enabling a more efficient operation for our customers and a larger market access for McDermott,” said David Dickson, McDermott’s President and Chief Executive Officer. “Through the long established relationship between Keppel and McDermott, the DLV 2000 has been built to a world class specification and on budget,” Dickson said. “The vessel represents a strategic component of McDermott’s long-term plan to deliver the best in class projects to our global customer base.” The DLV 2000’s first assignment is scheduled offshore Western Australia on the INPEX Ichthys LNG Project. The DLV 2000 is expected to join the project in May 2016 for several months as part of McDermott’s work program by providing heavy construction support for the subsea system. Work is scheduled to be performed in conjunction with McDermott’s other new subsea installation vessel, the Construction Support Vessel 108 (CSV 108), which is working successfully on the project. The CSV 108 is expected to undergo an upgrade later in 2016 to install a Vertical Lay System and Reel Deployment System for use on the project and will then be referred to as the Lay Vessel 108 (LV 108). Additionally, the DLV 2000 is scheduled to support the transportation and installation contract awarded by Woodside Energy Limited for the Greater Western Flank Phase 2 subsea pipeline and installation project in Western Australia. •

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NEWS - RUSSIA & CIS

Successful Stimulation Campaign in Georgia

rontera Resources Corporation (AIM: FRR), an independent oil and gas exploration and production company, today announces an operations update for its work in the South Kakheti Gas Complex’s Oil Window initiative, situated within its upstream portfolio in the country of Georgia, as well as a new issue of equity in support of ongoing operations. Oil Window Operations Update: As previously announced on 21 March 2016, operations commenced and have now been completed within the central portion of the South Kakheti Gas Complex related to a multi well frac campaign. Early results from these operations have demonstrated that the Company’s most recent well-completion designs have provided successful reservoir stimulations to wells that were not able to previously produce. In addition, in the case of a producing well, existing production has been successfully increased by a factor of approximately five times. Specifically, in the case of wells T-33 and T-36 that were drilled in 1979 during the Soviet era and abandoned because they were deemed to be “dry holes”, Frontera’s hybrid-unconventional reservoir analysis resulted in well-stimulation/completion designs that have achieved production of approximately 1520 bbls per day, per well from wells that never produced in the past. Most significant is the Company’s technical conclusion that since the applied stimulations were relatively small in size and only focused on a single oil bearing zone (Zone 9), this result now provides an important calibration whereby internal modeling now indicates that with future larger size stimulations production can be increased significantly, per well, for only this Zone 9. In the case of a currently producing well, Niko#1, the applied well-stimulation/completion design resulted in an increase

in production from approximately 15 bbls per day to 80 bbls per day from only Zone 9. Once again, since the applied stimulation was relatively small in size and only focused on a single oil bearing zone, internal modeling now indicates that future larger stimulation designs can also be expected to deliver significantly larger results. With the addition of this most recent frac campaign to a larger database of wells that the Company has fraced over time, technical results from campaign to campaign have demonstrated a successful learning curve that the Company believes is the basis for large-scale development. With this in mind, the next related frac campaign is anticipated to commence within the next 90 days. Overall, the successful results from the most recent campaign have served to further refine and validate technical assumptions related to Frontera’s progress towards large-scale exploitation of the significant associated oil-in-place volumes related to this area of the Complex. As previously announced, Frontera has designed a 175 well plan for the central portion of the Complex that will employ multi-zone vertical well completions. This plan is anticipated to exploit approximately 690 million bbls of original oil in place associated with Netherland, Sewell & Associate’s independent assessment related to the area of current Oil Window operations at the Complex. Issue of Equity: 120,000,000 new ordinary shares in the Company (“New Ordinary Shares”) have been issued to certain strategic service providers of the Company for procurement of approximately $750,000 of oil field services to be provided to the Company in its ongoing operations including workover, drilling, logging, completion and transportation services. Application will be made for the New Ordinary Shares to be admitted to trading on AIM, which is anticipated to occur on or around 12 April 2016 (“Admission”). The New Ordinary Shares will rank pari passu with existing shares of common stock of the Company. Following Admission, the Company will have 3,896,363,695 ordinary shares in issue with voting rights. The Company does not hold any ordinary shares in treasury and accordingly there are no voting rights in respect of any treasury shares. The aforementioned figure of 3,896,363,695 ordinary shares may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company, under the disclosure requirements applicable to the Company. Steve C. Nicandros, Chairman and Chief Executive Officer, commented: “The results of our most recent stimulation campaign at the South Kakheti Gas Complex’s Oil Window are extremely exciting. The technology that we have successfully employed with our low-cost in-house stimulation capabilities have allowed us to yield results that are consistent with technical analogues of hybrid-unconventional reservoir plays in the United States that have been successfully developed in a similar manner. It is technically significant to appreciate that we have achieved such good results from small-scale stimulations into our most recent single-zone completions. Based on the results we have achieved, we now feel technically confident to scale-up the size of our stimulation designs in order to achieve considerably larger production outcomes. When combined with planned multiple zone completions, we believe that this provides the basis for developing the giant oil-in-place volumes that our historical work has identified. ” •

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NEWS - AFRICA

First Gas Production from Kilwani North Aminex PLC, the Africa-focused oil and gas production and development company (LSE: AEX, ISE: AEX), is pleased to announce first gas production from its Kiliwani North gas field in Tanzania. The Kiliwani North Development Licence is operated by a wholly-owned subsidiary of the Company with a 55.575% working interest (expected to reduce to 51.75% as a result of a partial disposal announced on 4 April 2016) and the field will provide the Company with its first significant African production revenues. Initial production commenced from the Kiliwani North-1 well (“KN-1”) on 4 April. KN-1 is tied into the regional pipeline infrastructure and will deliver gas to the new adjacent Songo Songo processing plant, ultimately serving the local power market. Production is expected to build up to an anticipated production rate of 25-30 mmcfd(approximately 4-5,000 barrels of oil equivalent per day gross) (“Commercial Production Rate”) over the next 90-100 days. All gas produced during the build-up to full production rates will be paid for under the terms of a recently signed Gas Sales Agreement signed with the sole buyer, Tanzania Petroleum Development Corporation (“TPDC”). Aminex will receive US$3.00 per mmbtu (approximately US$3.07 per mcf) with expected net cash revenues of US$10-15 million per annum. Aminex will receive all revenue in United States Dollars and the contractual gas price of US$3.00 per mmbtu will be adjusted annually by applying an agreed United States Consumer Price

Index. The gas price is not linked to any commodity price so importantly is unaffected by current commodity market conditions. The gas delivery point is to be at the outlet flange of the Kiliwani North wellhead and, by selling the gas at the wellhead, the joint venture partners will not be liable for pipeline transportation and processing fees. Initial production rates will be carefully managed to allow for testing and commissioning of the gas processing plant and pipeline, while recording critical pressure and flow rate measurements to determine the optimal flow rate to maximize the life of the reservoir. Together with TPDC the Company plans to conduct a well test during the production build up to determine the optimal flow rate. It is this optimal flow rate that will become the Commercial Production Rate and the Company intends to flow gas at this rate for as long as possible prior to a natural decline in production. KN-1 represents contingent resources (2C) of gross 28 billion cubic feet gross. With first production complete Aminex expects to book reserves for Kiliwani North later this year. Aminex CEO, Jay Bhattacherjee, commented: “This is a significant moment for Aminex, its shareholders and Tanzania, and is the culmination of a tremendous amount of hard work by all involved. First gas at Kiliwani North marks the transition of the Company from developer to producer in Africa and sets us on the path for growth as we begin to generate cash. The Company looks forward to its exciting appraisal and development programme in the Ruvuma Basin which will potentially add further revenues in due course.” •

Solo Oil Signs SPA for Kiliwani North, Tanzania Solo today announces that further to the agreements previously announced with Aminex plc (“Aminex”) to acquire a further interest in the Kiliwani North Development Licence (“KNDL”) Solo has now executed a Sale and Purchase Agreement (“SPA”) for the acquisition of a 3.825% interest in Kiliwani North Development Licence (“KNDL”) to Solo Oil plc (“Solo”) for a total cash consideration of US$2.16 million. Under the terms of the SPA Solo’s interest will increase through three payment tranches to Aminex, linked to project milestone, for the total agreed cash consideration: Initial investment of US$566,802 for an additional 1% interest on signature of the SPA, increasing Solo’s total interest from 6.175% to 7.175% A second investment of US$708,502 for a further 1.25% interest within 15 days of the first US dollar payment being received for gas from Kiliwani North-1 (‘KN-1’). Solo’s total interest will increase to 8.425% A third investment for the balance of US$892,712 for an additional and final 1.575% interest within 15 days of the commercial operations date being declared, taking Solo’s total and final interest to 10%. If any payment is missed then that payment option, and only that option, will be automatically cancelled. Payment of the second and third investments will require further funding from cash flow or otherwise to be arranged by Solo. Following full payment of the consideration, Solo’s interest will increase from its current 6.175% to a 10% interest in KNDL. As announced on 11 February 2016, the transaction represents the part exercise of its pre-existing option to acquire a further 6.175% interest. The remaining entitlement under the option agreement has now expired.

The KN-1 well, which is now ready to begin production, has been ascribed gross contingent resources (2C) of gross 28 billion cubic feet by LR Senergy and the Company expects to book reserves from this well by the year-end. Gas from KN-1 will be sold to the Tanzania Petroleum Development Corporation (“TPDC”) under a gas sales agreement (“GSA”) at the wellhead for an agreed price of US$3.00 mmBTU (approximately US$3.07 per mscf), payable in US dollars. The gas price is not linked to any commodity price so is unaffected by current commodity market conditions. Gas will be processed at the new Songo Songo Island gas plant and will ultimately be transported by pipeline to Dar es Salaam, where it will be sold into the local Tanzanian market. Neil Ritson, Solo’s Chairman, commented: “Solo is delighted to increase its exposure to the KNDL project with commencement of production imminent. The project offers a revenue stream that will increase through the commissioning process and into commercial production under the GSA which has take-or-pay provisions and is paid in US Dollars guaranteed by a consortium of banks. By linking the acquisition of our additional interest to project milestones we have been able to further de-risk the investment.” Current participants in the Kiliwani North Development Licence, following TPDC back in, are: Ndovu Resources Ltd (Aminex) 55.575% (operator), RAK Gas LLC 23.75%, Solo Oil plc 6.175%, Bounty Oil & Gas NL 9.5% and TPDC 5%. On completion of the payments envisaged by the SPA Aminex will hold 51.75% and Solo will hold 10%. •

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Exclusive Interview: We Speak With Scale Protection CEO Ole Drønen, on Avoiding Production Decline Solutions which provide more accurate knowledge of the scale deposited within the well.

OGI: Could you start by explaining Scale Protection’s credentials and experience in the field of well intervention and analysis? Could you tell our readers the breadth of your experience, how long you have been active, and your worldwide reach? Drønen: Scale Protection is a recently started company; however, we have an experienced team that previously worked with major operators and service companies, approximately 20-30 years each. A major part of our experience lies within reservoir/production and well engineering. Scale deposition in wells is a major cause of premature production decline worldwide. It causes loss of billions of USD every year due to chemical prevention, lost production and failures in well equipment. An optimal strategy and use of new technology to limit the losses due to scale is vital. Scale Protection’s focus within this area is to provide innovative technology and methods for monitoring, which will result in a more cost effective prevention. With the team’s background and

competence, we understand where and how we can help the operators improve their scale management, both related to monitoring and prevention. We do not focus on how to enhance the chemicals themselves, rather how they can be utilized in a cost effective manner. OGI: Could you explain in detail the different solutions your company offer the oil and gas industry? What are the primary applications for these solutions? Drønen: Existing monitoring, such as water composition and residual inhibitor present in produced water, cannot be used conclusively concerning scale deposition in a well. The main reason for this is that existing methods cannot distinguish between scale deposited in the reservoir or inside the wellbore. Our solution will be supplementary monitoring and provide a more accurate knowledge of the scale deposited within the well. With such information, the prevention plan will be more cost effective, because inhibitor will be used only when needed, not too late and not too frequent. We are in the process of developing

several innovative tools to reach these goals. The Bulk Scale Analysis is already in commercial use, and several downhole tools are ready for pilot testing. OGI: One of the solutions mentioned is the Bulk Scale Analysis (BSA). Could you elaborate on what the different tenets of is solution? For example, it would be helping to hear more about your tailor made software, Bulk Scale Trending and the BSA workflow. Drønen: By use of Electron Microscope, thousands of single particles are analysed for composition, area and morphology. These data are used for calculations of the amount of the different types of scale present at the filter. Our tailor made software, Bulk Scale Trending, performs the calculations and present the results. Operators can then trend the amount of the scale minerals in produced water, such as Barite, Calcite, etc., which can show if it is necessary to squeeze inhibitor into a well, or if this can be deferred and maybe completely skipped. In combination with additional data, more accurate well information may be

interpreted, such as failure in inhibitor placement, information about where the scale deposit takes place. In summary, BSA is a low cost tool, with the potential to save the field owners for substantial wasted prevention costs and well damage costs, because of lack of prevention. OGI: Could you talk a bit about the Scale Monitoring tool (SMT) and Corrosion Monitoring Tracer (CMT) What purposes do these technologies serve and how does they function Drønen: The scale-monitoring tool is based on use of tracer technology. It will provide a direct downhole measurement of scale deposition and indicate the placement of injected inhibitor along the wellbore. Leakage of tracer from the tool into the well flow, and measurement of the same tracers from topside sampled water is used in this process. The scale detection tracer, Scale Alarm Tracer, is constructed so that it will leak into the wellbore until scale deposition takes place. Lack of tracer in the produced water is a clear sign of scale depositing at the tool, and is then a warning that the well needs prevention. The other tracer, Scale Inhibitor Tracer, has different properties since it will

The Corrosion Monitoring Tracer

For more information about Scale Protection’s solutions please go to: www.scaleprotection.com/ or e-mail: omd@scaleprotection.com not leak into the well flow unless it is contacted with injected inhibitor. For example, in a case where tracer is installed at the toe of the well, this tool will show if the inhibitor has reached all the way along the wellbore. These tracers can be installed retrofit, either combined or separately. The Corrosion Monitoring Tracer is a similar tracer technology, where the tracer is installed in an initially sealed chamber. The thin section part will corrode and cause tracer to leak into the well flow. Therefore, this will give an estimated metal loss rate without any intervention or logging operations needed.

OGI: Finally, could you provide our readers with one example or case study where Scale Protection’s products and services helped a client? Drønen: Bulk Scale Analysis is used extensively in Norway. Some operators are managing their squeeze frequency, from the data provided by BSA. After one year in operative use, one of our clients have proved at least a 10% reduction in squeezes. The gain of this reduction is in the range of 10 times the analysis cost. The tools have so far not been deployed in wells as they recently have been developed and tested onshore. The next step is to test them in pilot wells. •

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E&P

Standard Products, Bespoke Design, Unique Solutions

stablished in 2001 and headquartered in Gdansk, Protea engineers and manufactures a wide range of specialist handling equipment for global customers working in the offshore and onshore energy industries. Current clients include Aker Solutions, Heerema, Helix Wellops, Siemens, Statoil, Total and Transocean. They value Protea’s ability to rapidly deliver high quality handling equipment tailored to their specific needs, on a turnkey basis and at an affordable price. Over the years, Protea has delivered a wide variety of equipment but its core products are Pedestal Cranes, BOP cranes, Winches and Custom Handling Systems. To date, the company has delivered pedestal cranes from 4t SWL to 50t SWL and recent deliveries include the supply of a pair of 50t SWL Proteus Ram Luffing cranes cranes for installation on a Statoil FSU. “The Proteus Ram Luffing Crane draws on the knowledge that my colleagues and I have gained from over 37 years of designing, building and operating offshore lifting equipment,” explained Tomasz Paszkiewicz, Protea’s CEO. “We have achieved exceptional performance whilst minimising overall weight, and complying with EN 13852-1 Offshore Cranes standard, DNV N Class standard, the latest NORSOK regulations and STATOIL’s internal requirements – they are probably the highest specification offshore cranes that have been delivered to date.” The quality of Protea’s process’ and facilities at its state of the art production facility in Southern Poland have been recognized by API, DNV and LR. In parallel, Protea has just delivered its 23rd Blowout Preventer (BOP) crane for installation on an offshore drilling rig. With load capacities of up to 550t SWL, they showcase Protea’s ability to deliver high capacity complex equipment for use in a hazardous and challenging offshore environment. Protea winches have also been supplied for use in a wide variety of marine applications - robust and reliable, they are available with hydraulic, electrical or pneumatic drive systems. “We are

Protea’s state of the art fabrication facility.

particularly proud of our pneumatic winches which are now in use on a number of offshore production facilities” highlighted Graham Manning, Global Sales Manager. “The Protea pneumatic drive system ensures precise and reliable load control and that the equipment can be used in hazardous areas as per ATEX regulations. The applications for this drive technology are extensive – for example we have previously delivered a Coiled Tubing Handling system featuring a pneumatic winch and have recently developed a selfpropelled transport trolley with integrated pneumatic drive system.” Drawing on it existing products and technology, Protea also delivers custom solutions to meet specific customer requirements. Previous projects have included vehicle Launch and Recovery Systems, Well Intervention Handling Equipment and most recently a suite of tooling to allow the mechanical connection of offshore pipe lines. “These projects are typically about packaging our core products and technology to meet a new challenge. We pride ourselves on being able to rapidly deliver turnkey solutions from a blank sheet of paper – from concept development, detail design and build, through to extensive pre-delivery testing at our production facility” explained Head of Project Management - Dawid Kurdys. Looking to the future, Protea continues to invest in R & D to develop innovative products to meet new challenges and specific market opportunities. These include a revolutionary heavy lift cargo crane that will be constructed from S960 grade steel. “The use of extra high strength steel results in a weight saving of up to 40% in comparison to a conventional cargo crane – this saving in weight translates directly

Heavy Lift Cargo Cranes.

to an increase in cargo capacity which is a very attractive proposition for this market” commented Tomasz. In another innovation, the crane features a fully electric drive system to provide efficient and precise operation of all crane functions and reduce energy consumption by approximately 20% - lifting power with efficiency. At the other end of the scale, Protea has also developed an all new 2t SWL service crane targeted at the growing offshore wind industry. The compact 2t SWL crane is an ideal lifting solution for light lifting and handling operations on unmanned platforms such as offshore wind turbines. Back to the present, Protea is in the final stages of delivering 2 gantry cranes for the Yamal Gas LNG terminal located in North Russia. The key challenge for this project is that the cranes have to work in very low temperatures (down to -50 degrees centigrade) in a Zone 1 hazardous area. The project once again demonstrates Protea’s capability to deliver unique solutions tailored to its customer’s specific requirements. • For more details of Protea and its products please visit www.protea.pl

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E&P

Rockhopper Makes Acquisition of NonOperated Production and Exploration Assets in Egypt Rockhopper Exploration plc (AIM: RKH), the oil and gas exploration and production company with interests in the North Falkland Basin and the Greater Mediterranean region, is pleased to announce amended terms for the acquisition of a portfolio of non-operated production and exploration interests in Egypt (the “Interests”) from Beach Energy Limited (“Beach Energy”) (the “Acquisition”).

he Company originally announced that it had agreed terms with Beach Energy on the Acquisition in August 2015. However, due to the exercise by one of the partners of pre-emption rights on the Abu Sennan concession, as announced in September 2015, it was not possible to complete the Acquisition on the original terms. The Company believes the amended terms of the Acquisition, announced today, which now exclude any share consideration, represent a material improvement in the prospective value of the transaction for Rockhopper shareholders. Sam Moody, CEO, commented: “A patient approach to this transaction has paid dividends for Rockhopper and we are delighted to have reached agreement with Beach on the amended terms of the acquisition of Beach Egypt. We believe this deal is a strategically important step, perfectly suited to the current economic environment for the industry, where low cost, cash generative assets are increasingly important. With the upfront cash consideration payable broadly flat and reducing in the event of the Proposed Dover Transaction, the implied transaction multiple falls to US$2.7 per barrel of oil equivalent. With low unit cash operating costs at approximately US$8 per barrel in 2015, we expect this portfolio to be net cash flow positive, even in the current oil price environment, and upon completion of the transaction expect operating cash flows from Egypt and our existing Italian assets to broadly cover Group overheads going forward. The Acquisition also represents the

continuation of Rockhopper’s strategy to build a full cycle E&P company focused on its two core areas and represents the Company’s entry into Egypt, a prolific hydrocarbon province.” The Abu Sennan concession is located in the Abu Gharadig basin in the Western Desert. The concession was signed in June 2007 with first commercial production achieved during 2012. Unit cash operating costs were approximately US$8 per barrel in 2015. The concession remains underexplored with significant exploration and appraisal upside providing opportunities for near-term production additions. The concession partners are

Kuwait Energy (50% and operator) and Dover (28%) (before completion of the Proposed Dover Transaction referred to above). The El Qa’a Plain concession is located on the eastern shore of the Gulf of Suez and contains a number of oil leads identified on existing 2D seismic data. The concession was signed in January 2014. Approximately 470 sq km of 3D seismic plus 35 km of 2D seismic has recently been acquired and is currently being processed. The drilling of an exploration well is planned in 2017. The concession partners are Dana Petroleum (37.5% and operator) and Petroceltic (37.5%). •

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T D O H EN D O N ATT C A S E DI GHTS ATC I L FL AL R FO

Society of Petroleum Engineers

Annual Technical Conference and Exhibition

26–28 September 2016 • Dubai World Trade Centre • Dubai, UAE • www.spe.org/atce/2016

Society of Petroleum Engineers

Annual Technical Conference and Exhibition 26–28 September 2016 Dubai World Trade Centre Dubai, UAE

Channelling knowledge. Connecting the world.

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26–28 September 2016

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E&P

DR 750 P Offshore Reeling Cable for Maritime Use Cable manufacturer SAB Bröckskes presents a new marine cable for the market. According to the manufacturer it is a DNV-GL approved reeling cable, called DR 750 P offshore, with applications for ships and also for offshore use. The robust construction with reference to the international standard IEC 60092 for ship cables is appropriate for reeling applications with high mechanical stress. The DNV-GL approval in addition to the excellent mechanical characteristics offer highest reliability in application. Notable characteristics of the cables are: • Flame retardant and self- extinguishing. • Halogen free acc. to IEC 60754-1. • Oil and chemical resistant. • MUD resistant. • Weather resistant. • Reduced outer diameter. • Low cable weight . • Suitable for winding stress at low temperatures. • High reeling and unreeling strength. • DNV-GL certificate-no. TAE 0000002 Application fields Possible application fields of the DR 750 P Offshore are offshore cranes, deck machines, working platforms, lifts, lifting and conveyor technique on ships and offshore facilities. The SAB cable has already proven itself in practise with extreme environmental conditions. Due to its oil and chemical resistance this robust cable has already been used, for example, in engine operated rail bound transport vehicles on oil producing ships. Not at least due to the prevailing extreme environmental and weather conditions in its worldwide application, the DR 750 P offshore is especially appropriate because of the extremely robust construction. Within a temperature range between -40°Cup to + 60°C under dry and damp

climatic conditions, the cable can be used for many marine applications. Special solutions for special applications The production possibilities of SAB not only cover basic types of cables with standard dimensions, but also special cables which are designed according the individual requirements of the customer. Cable manufacturer SAB Bröckskes is a worldwide leading manufacturer of cables and wires, cable harnessing and temperature measuring techniques. More than 60 years of experience in cable manufacturing as well as in temperature measuring techniques have propelled the company from a one man business to a company with almost 500 staff members. The strength of SAB Bröckskes is not only the manufacturing of standard cables

CEO_Peter Bröckskes and Sabine Bröckskes-Wetten

but also the construction of special items. Every year SAB manufactures more than 1500 special cables on customer´s request. For more information on how SAB Bröckskes can help you with your operations please get in contact with us. •

SAB Bröckskes GmbH & Co. KG

Sacir Adrovic adrovic@sab-broeckskes.de Tel. +49 2162/898146 www.sab-cable.com

E&P

Whole Life of Concrete Mattresses – Initial Specification to Final Disposal Concrete mattresses are large concrete structures typically used to stabilise subsea pipelines, umbilical’s & cables. This is achieved by adding global weight and hydrodynamic edge optimisation to resist wave and current actions. They also provide protection from dropped objects.

here are an estimated 40000 concrete mattress that have been installed over the years in the North Sea region. The decommissioning of the North-Sea Oil and Gas industry has now begun in earnest and according to Decom North Sea (DNS), 10% of the current infrastructure has now been removed. Studies indicate that around 5% of previously installed mattresses have been removed to date. Pipeshield are a leading global designer and supplier of mattresses, and this gives us the edge in offering a whole life solution for mattresses. We are able to achieve this by initial detailing and specification to optimise the product used, numbers installed and minimisation of scour throughout the life of the field, to the point of decommissioning where the mattresses are removed as efficiently as possible. Pipeshield can also organise responsible on-shore disposal identifying the potential reuse and circular economy applications for the mattresses. Efficient Design of Mattresses Pipeshield are an ‘intelligent’ supplier to the Oil & Gas industry with over 16 years global trading experience. We can verify the sub-sea stability of all products and offer design optimisation to field layouts using our Patented N2 edge blocks to maximise stability of each individual mattress. We have extensively tested our designs in the wave and flume tanks of HR Wallingford. Our products have been verified by third parties such as Lloyds and Exxon Mobil, whom ultimately had our products installed into some of the toughest seas on Earth, ie offshore Northern Canada

Mats as Trackway.

Decommissioning of Mattresses Department of Energy and Climate Change (DECC), were previously stipulating that all items installed would have to be removed. Their position softened in the current climate to a project based assessment as to leaving discreet infrastructure such as mattresses in place if where the situation of removal would cause greater environmental destruction than being left in-situ. In 2015 following an interactive process involving DNS, Zero Waste Scotland and Industry Consultants conducted an economic and environmental assessment of the condition of the mattresses and identified the best techniques for their recovery.

The recovery of mattresses during decommissioning is currently undertaken by either Divers or ROVs in a reverse process of installation. Coupling the rope lifting loops of individual mats to hooks mounted on a spreader frame and then lifting it from the sea-bed through the wave zone back to the deck of a vessel. Some points to consider are: • Decommission Works using Divers are highly weather dependant. • The time required to raise and lower the crane hook even through 30m of water if there are a large number of mats can account for significant amounts of project time.

• Once recovered, how will the products be returned to land and subsequently recycled. • Once deployed existing lifting points are difficult to re-certify. Pipeshield have now brought 2 innovative products to market to counter these issues: The first is a fleet of high payload Deployment/ Wet Store and Recovery frames that are capable of safely transferring 60T of mattresses through the wave zone, in a single lift. This allows for faster handling on the sea-bed using a fewer number of lift points onto the frame and then a single lift retrieval to the surface, using certified lift points. Pipeshield recently worked closely with Deep Ocean to undertake this method of recovery for 30no. Mattresses in the shallow waters of Gwynt y Mor Windfarm. The High Voltage cable was live at the time the works were undertaken. So an ROV was used to attach the lift points for underwater handling onto the Wet Store Frame and final hook up for removal back to the surface. Deep Ocean then used Pipeshield’s complete on-shore disposal service that started at the point of vessel un-loading at Liverpool Dock onto Pipeshield’s organised transport and ended with a short report as to the certified method of disposal. The second product is the proprietary mattress grab claw “Perseus” * Patent applied which has been specifically designed to pick up mattresses with a pay

Perseus: the Grabber.

Retrieved Mats.

load of up to 23T. When deployed it is manoeuvred to the edge of the mattress and the hydraulic rams rotate the fingers to securely grasp the edge of the mattress. The mattresses can be lifted directly to the deck of the vessel or to just handle them on to the Wet-Store Frame for recovery at a later point. On-shore Disposal Pipeshield offer a full on-shore disposal service for offshore concrete products by:• Re-use of the whole mattress

• Re-cycling by crushing or • Final disposal in Landfill The majority can be re-used and repurposed through our established network of receivers where the whole mattress is primarily used as geotechnical improvement for trackways, farm roads and surfacing in yards. As pre-cast offshore concrete product are generally specified as higher grades ensure long lives in a harsh physical and chemical environment. We have found that the individual concrete blocks are generally in a remarkably good condition, but the interconnecting polypropylene ropes can degrade due to UV exposure, when stored on-shore. Crushed concrete as a product has a wide range of long accepted practical Civil Engineering applications and demand prevents it from entering landfill. The final solution is the least desirable, landfill. Our current disposal regime has resulted in us sending 0% of mattresses to land fill and 100% being re-used or recycled. Conclusion Pipeshield offer whole life solutions for the stabilisation of oil and gas pipeline assets. From initial specification to the removal, decommissioning and disposal, ‘ We have it covered’. • Pipeshield International Ltd. http://www.pipeshield.com/

MIDSTREAM & PIPELINES

EIA: Logistical Challenges Result in ShipTo-Ship Transfers of U.S. Propane Exports U.S. propane exports have increased significantly over the past three years, but only after market participants overcame several transportation challenges to reach export customers. The first challenge was to build sufficient export capacity, which has mostly already taken place. The second challenge is how to economically transport large quantities of propane over long distances. The current solution to the logistics challenge has resulted in import and export data abnormalities, and may indicate that U.S. propane exports have a larger market share in Asia than previously reported.

n 2015, the United States exported 220,000 barrels per day (b/d) of propane to Asia, the largest regional destination for U.S. propane. Discounted prices for U.S. propane compared with prices in Asia—typically determined by Saudi Aramco’s monthly contract price (ACP)—create opportunities for exporting U.S. propane to Asia. Demand for propane in Asia is driven largely by an expanding petrochemical industry that uses propane as a feedstock, as well as other industrial and consumer heating and cooking demand. Transporting large quantities of propane over long distances requires specifically designed refrigerated ships, the largest and most economical of which are Very Large Gas Carriers (VLGC). As most of the U.S. propane export capacity is located along the U.S. Gulf Coast, the fastest and most direct route to Asia is via the Panama Canal. Alternatively, vessels must sail east, across the Atlantic Ocean, then either through the Suez Canal or around the southern tip of Africa, and then cross the Indian Ocean to reach Asian destinations, adding significant voyage time and costs. However, only a very limited number of VLGCs, with a narrower, more upright hull design, are able to pass through the current Panama Canal lock dimensions. This situation will change after a new larger set of Panama Canal locks open later this year. One method used to cut voyage times and costs within the constraints imposed by the existing Panama Canal locks involves a ship-to-ship transfer, where the propane cargo of one vessel is transferred to another. Transfers on the Atlantic Ocean side of the Panama Canal likely involve moving cargo from a ship

too large to transit the canal onto a slightly smaller ship that can make the passage. Once through the canal, the smaller ship will either continue on to Asia or transfer the cargo back to a larger ship to complete the journey. The additional cost associated with using multiple vessels in ship-to-ship transfers is mitigated by cost and time savings from transiting the canal rather than taking longer alternative routes that avoid it. The ship-to-ship transfer activity is represented in propane trade data two ways. U.S. export data show increased propane exports to countries in the Caribbean and Central America where the ship-to-ship transfers are taking place, but which do not have sufficient domestic demand for, nor the infrastructure to store and distribute such large quantities of propane. In Asia, the activity can result in irregularities in import and export statistics among several countries. U.S. Customs and Border Patrol documentation requires the final destination of an export, if known. Despite this requirement, some of the propane cargoes exported from the United States, which will undergo a shipto-ship transfer, will cite the jurisdiction

of the transfer, not the cargo’s actual final destination. In 2014 and 2015, the United States exported 31,000 b/d and 23,000 b/d of propane, respectively, to Panama. However, the National Energy Secretariat of Panama reported total national propane consumption of only 1,671 b/d in 2014 and 1,736 b/d in 2015.Similarly, Aruba, an island nation of approximately 100,000 people and no major source of demand (such as a petrochemical facility or a propane-fired power plant), imported 23,000 b/d of U.S. propane in 2015. Tracking ship movements using Automated Identification System (AIS) data corroborates multiple trade press reports of ship-to-ship transfers taking place in the territorial waters of Panama, Aruba, and the Dominican Republic. Not all cargoes that undergo ship-toship transfers are destined for Asia. The ports and territorial waters of Panama, Aruba, and the Dominican Republic are also likely locations for large cargoes of propane to break-bulk, dividing large cargo into several smaller ones that better accommodate the demand and infrastructure in the Caribbean and Central America. •

Drone Service Company Sharper Shape Closes $3.25 Million in Funding From Australia and Europe

oday, Sharper Shape, the global market leader of automated drone-based asset inspections, has announced US$3.25 million in new funding (€2.9 million) led by Straightforward Capital, a European venture capital firm with thorough experience in the energy sector. In addition to financing from Straightforward Capital, the funding includes strategic investment from partners of an Australia-based global performance improvement consulting company, Partners in Performance (PIP). With this investment, PIP is able to extend its service offering for its energy customers to include Sharper Shape’s automated asset inspection and analyses. And, Sharper Shape will now have access to over 400 PIP consultants worldwide. The companies are already collaborating in the U.S. via the EEI Sharper Utility partnership. The Edison Electric

Institute (EEI) and Sharper Shape are demonstrating and developing commercial services based on longdistance drone flights for electric companies. “Sharper Shape’s unique services, which combine long-distance drone survey flights and automated data analysis, will provide unprecedented efficiency gains to electricity grid operators,” said Andrej Srsen, Straightforward Capital’s managing director. “Sharper Shape’s versatile software solution, proven for the electricity industry, scales directly to other industries such as railways, oil and gas, and wind power plants.” The funding will be used to strengthen Sharper Shape’s global delivery capacity and its investments in R&D. “With these investments we can take the next steps in rolling out our service globally and continue to lead the development of automated drone-based

asset management,” said Tero Heinonen, CEO of Sharper Shape. “This funding, combined with our innovative partnership with EEI, will accelerate commercial longdistance drone inspections for the utility industries in the U.S. and worldwide.” U.S.-based drone service company Sharper Shape provides fully automated inspection and maintenance planning services for infrastructure asset owners. Our Next Eagle® solution is the world’s first automatic asset inspection solution utilizing UAV, which drastically reduces inspection and maintenance costs for high value assets such as power lines, pipelines, railways and more. Straightforward Capital is a venture capital company that helps companies to unleash their growth potential. Our funds play an active role in companies’ strategic planning and development. •

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PROCESSING

Using Rheology to Optimize the Performance of EOR Fluids Although the price of crude oil has dropped significantly in the past couple of years, the longer term predictions suggest that it may settle in the region of US$50 – 70/bbl, a figure that still encourages the exploitation of existing oilfields, with infrastructure already in place, rather than new reservoirs [1]. As a result chemically enhanced oil recovery (EOR) is expected to rise significantly over the coming years, increasing the impetus to develop fluids that will perform optimally. Rheological characterization can play an important role in progressing this goal.

n this article we take an introductory Authors: John Duffy, Product Marketing Manager, Malvern Instruments and Rafael look at work carried out by TU Hincapie, Clausthal University of Technology. Clausthal to develop an improved understanding of the mechanisms of EOR by polymer flooding, and the and interactions with the pore geometry HPAM solutions in EOR applications relevance of fluid rheology. Example of a specific reservoir is the key to avoiding The viscosity of an HPAM (Partially data illustrates the insight that rheology issues such as pore blocking and excessive Hydrolyzed Polyacrilamide) solution provides and its application in optimizing polymer loss, and achieving beneficial in brine was measured as a function of technical and economic performance. fluid performance. shear rate using a rotational rheometer Applying rheology (Kinexus, Malvern Instruments). The The application of polymers in EOR Study of the complex flow behaviour and molecular weight of the HPAM was The implementation of chemical ~26MDa; concentration 2000ppm. The EOR technology can extract an interactions between polymer solutions brine solution had a concentration of additional 20% of the oil remaining and porous media calls for complementary 4g/l and measurements were carried in a reservoir following primary and measurement methods, with rotational out at 22oC. The results obtained were secondary recovery. Polymer flooding rheometry a primary investigative compared to data generated using is a technically proven and widely used tool. Rotational rheometry allows the measurements from GSG micromodels process and involves injection of an measurement of bulk shear viscosity as of the pressure requirements for injecting aqueous polymeric solution with a a function of shear rate, characterizing the EOR fluids throughout the porous viscosity close to that of the oil to improve the non-Newtonian viscosity profile of media, at different flow rates. From these fluid mobility within the reservoir. The the fluid, and the investigation of linear data it is possible to generate values of inclusion of polymers enhances the viscoelastic behaviour via small amplitude apparent viscosity in situ, using Darcy’s fluid injection profile, making it more oscillatory testing. Furthermore, by diffusion law [3]. stable and consistent, thereby improving measuring the normal stresses generated under rotational shear, rotational The results demonstrate good agreement displacement efficiency. rheometry can provide additional insight in the mid shear range (see figure 1), Both biopolymers and synthetic into the flow induced (non-linear) elastic highlighting the validity of Darcy’s law polymers can be suitable for EOR, though response of the polymer. for estimating viscosity in-situ for a synthetic polymers are often preferred Complementary rheological techniques porous structure. However, discrepancies on the grounds of cost, temperature and are evident at higher shear rates where salinity tolerance. Chosen polymers tend include microfluidic methods for the the apparent viscosity starts to increase to be relatively high molecular weight, study of high shear and extensional above 50 s-1. with good viscosifying power a pre- behaviour, and microrheology by dynamic The fact that the ‘shear thickening‘ requisite for economic use. Solutions are light scattering, for investigating flow relatively concentrated and consequently characteristics over very short timescales. phenomenon (increasing viscosity) at exhibit non-Newtonian shear rate- Micromodels are also used extensively for high shear is observed with the model dependent viscosity, and viscoelasticity. the microvisual study of EOR fluid flow data but not on the rheometer suggests it Due to their high molecular weights through representative porous media, is related to the geometric configuration these polymers can also generate large with glass-silicon-glass (GSG) models of the rock rather than being an intrinsic extensional stresses along the flow axis, offering a range of advantages for this feature of the solution. The extensional stresses that arise from acceleration/ as the fluid traverses pores via narrow application [2]. connecting channels. Understanding the Experimental study: using rotational deacceleration of the fluid through the geometric arrangement of pores flow behaviour of the polymer solution rheometry to elucidate the behaviour of

can be extremely significant for high molecular weight polymers and can lead to elastic behaviour that would not be observed with standard shear viscosity measurements alone. Figure 2 shows how shear stress and normal stress for the HPAM solution vary as a function of shear rate. Shear stress increases non-linearly with shear rate as would be expected for a non-Newtonian shear thinning liquid. However, the normal stress (N1) profile is very different, with normal stress remaining relatively constant up to a shear rate of approximately 50 s-1 but then showing a steady increase. This increase is indicative of tension within the polymer chains above a threshold shear value that corresponds exactly with the point at which apparent shear thickening is observed with the micromodel data. These results therefore suggest that the extra pressure required to maintain fluid flow in the pore structure above 50 s-1 is due to elastic effects arising from stretching of the polymer rather than an increase in the shear viscosity. This has been confirmed by measurements on a microfluidic extensional rheometer. Such stretching likely plays an important role in the recovery performance of EOR fluids and their degradation, with excessive stretching and chain breakage associated with a breakdown in performance. This topic is the subject of further studies by the group who are using gel permeation chromatography in conjunction with the methods previously

Figure 1: Steady shear viscosity measured using a Kinexus rheometer compared with apparent viscosity measurements obtained with GSG micromodels for a HPAM polymer solution, at 2000 ppm in 4 g/l brine, 22 ºC.

outlined to gain further insight into the fate of polymer-based EOR fluids within the reservoir. In conclusion The ability of rheology to comprehensively characterize the behaviour of EOR fluids, most crucially viscoelasticity and response to extensional stress, directly supports optimization studies. Recent advances in rheometer design make it substantially easier to carry out such investigations and increase the value of the technique for EOR applications. Applying rheology and physical micromodelling, in tandem, differentiates inherent features of the

fluid from performance critical behaviours related to its interaction with the complex pore structure of the reservoir, providing insight that can be used to enhance performance. In this way rheology facilitates the development of EOR fluids that deliver the technical and economic performance needed for today’s demanding oil extraction environment. References: [1] S. Milmo ‘Chemical Attraction’ The Chemical Engineer, Feb 2016 [2] Ganzer, L., Wegner, J. and Buchebner, M., 2014. Benefits and Opportunities of a “Rock-on-a-Chip” Approach to Access New Oil - Oil Gas-European Magazine 39, p 43-47, Urban-Verlag Gmbh P.O Box 70 16 06, D-22016 Hamburg, Germany, 2014 [3] Yongpeng Sun, Laila Saleh and Baojun Bai (2012). Measurement and Impact Factors of Polymer Rheology in Porous Media, Rheology, Dr. Juan De Vicente (Ed.), ISBN: 978-953-51-0187-1, InTech, DOI: 10.5772/35715. Available from: http://www.intechopen.com/ books/rheology/polymer-rheology-inporous-media To find out more about TU Clausthal’s work on EOR fluids please go to: http:// bit.ly/OilRheo

Figure 2: Steady shear stress and first normal stress difference measured using a Kinexus rheometer for HPAM polymer solution at 2000 ppm in 4 g/l brine, 22 ºC.

For more information about Malvern Instrument’s solutions please go to: http://www.malvern.com

PROCESSING

Retubing – Sometimes It Can Be Like a Houdini Act Depending on the process conditions, the choice of materials, the structural details of the installation and the equipment and the state of maintenance, corrosion should never be allowed to happen. When corrosion does happen, it is difficult to deal with because it affects the way the equipment operates. And it is even more difficult when some or all of the equipment needs to be replaced. In the best-case scenario, the equipment is situated in a very accessible location with plenty of space around it, and the process can be easily suspended or diverted so that the equipment can be upgraded. But this rarely happens in real life! So what would you do if you were faced with this problem?

Corrosion: You can’t afford to bury your head in the sand Corrosion is the chemical degradation of materials due to a chemical reaction with their environment, particularly the degradation of metals as a result of electro-chemical reactions. The best known types of corrosion are the degradation of metal surfaces by oxygen and water in the air, as in the way iron becomes rusty and copper turns green. Corrosion can also occur in a watery environment and at high temperatures, and it can even affect ceramic materials and even plastics. Corrosion causes a loss of strength because the corrosion products (oxides and salts) are much weaker than the metal. As the corrosion products crumble away, the metal parts become thinner. This can even cause holes to develop in metal surfaces. An additional problem is that the corrosion products occupy a greater volume than the metal. And because the materials expand, the structure can become distorted. Corrosion causes safety risks (the failure of (supporting) structures) and can ultimately cost a lot of money. To illustrate this: around the world, over 5 tons of steel are “lost” through corrosion every second. The costs of these losses are estimated at 2% of Gross National Product. When corrosion occurs, it is often the result of changing process conditions, careless or unprofessional maintenance, the wrong choice of materials (design errors) or structural faults. In every case, as long as the source of the corrosion is not identified or

Picture 1: Difficult maintenance conditions in district heating plant. tackled, the corrosion will continue to be a problem. Situation: Retubing corroded pipes under Houdini conditions This case involves a district heating plant in Utrecht in the Netherlands, which keeps homes warm and comfortable during the colder days of the year. When the plant was originally built, the equipment was installed first and then the building was constructed around it, as one can see in picture 1. However, possible major maintenance due to corrosion was not taken into account during that initial

installation phase. And, sure enough, corrosion gradually developed in the heat exchanger pipes. This system is always switched off during the summer period (when no heating is required). But there some water was left behind in the system, which also contains oxygen. So it was just a matter of time before corrosion would set in. The 4600 12-metre pipes had to be retubed on-site. However, the heat exchanger was in a location that was difficult to reach, with limited space to work in and no way of expanding it. And the project also had an extremely short throughput time – just 6 weeks.

Picture 2: Schematic 2D drawing of the maintenance location.

The client even considered demolishing the wall in the right hand-side of picture 2 so that it could replace the pipes or demolish even more walls to hoist the heat exchanger out of the building and then perform the necessary maintenance there. Solution: If the mountain won’t come to Muhammad…… Bronswerk did not think it was necessary to break down the walls so it came up with a creative solution. Bronswerk positioned itself in the right way and choose exactly the right tools that were needed to repair the 4600 pipes. It created special hoisting equipment to hoist the pipes in and out of the heat exchanger from above. It

dismantled the skids and heat exchangers behind the target heat exchanger (on the left-hand side of picture 2) to create more space for the pipes. Then the old pipes were cut loose, removed from the heat exchanger and removed from the plant. Before pulling through the pipes, the two heads were first removed from each pipe. The 4600 pipes resulted in 9200 pipe panel joints. On one side, the pipe panel was pulled through at the back and on the other side it was pulled with a hydraulic pipe-puller. This posed a number of challenges, such as corroded pipes breaking off while being pulled. The new pipes had to be positioned exactly in the right way, taking into

Picture 3: Schematic 3D drawing of the maintenance location.

account the 14 baffles through which those pipes had to be pulled. That is why the new pipes were positioned nearby the duct (at the bottom of picture 2.) so that they could be directly hoisted and pulled through. This was possible because of the before mentioned additional space that was created as result of dismantling the heat exchanger and the skid. Still, a couple of pipes needed to be installed aslant because of obstruction still caused by the dismantled heat exchanger and skid. Taking into considering the short throughput time for the project, the work had to be done 24/7, in shifts. Conclusion Thanks to its creative, smart solution and perseverance as well as the decision not to demolish any walls, Bronswerk saved the district heating plant an enormous amount of civil engineering and/or construction costs. Its unique approach also minimised the system downtime, saving the plant a significant loss of revenue. Once again, Bronswerk proved that it is a reliable partner and can be trusted to perform high-quality maintenance work. It also showed that it does not shy away from difficult and demanding working conditions, that it is always positive and flexible, and that it can finish the work in the shortest possible throughput time. The end result? The installation was realigned with the design specifications and the integrity of the asset was restored to a reliable level. • For more information please contact: Bronswerk BV - The Netherlands / femke@bronswerk.com

PROCESSING

CITGO Lemont Refinery Promotes STEM Education in Illinois With Project Infinite Green CITGO Petroleum Corporation employees from the Lemont Refinery served as mentors teaching interactive workshops on diverse energy sources and sustainability to local middle and high school students as part of Project Infinite Green. This innovative, locally based afterschool program offered middle- and high-school students the opportunity to learn about science, technology, engineering and mathematics (STEM) from industry experts both inside and out of the classroom.

ounded in 2011, Project Infinite Green engages students from sixth to twelfth grade in twice-weekly classes and fieldwork studies focused on the energy industry. Throughout the fall semester, five CITGO Lemont Refinery employees prepared and presented lessons at Lemont High School, Old Quarry Middle School and St. Cyrils Middle School on geology, molecular structure, the refining process and environmental stewardship that emphasized the science and business of sustainability “We want to spark our children’s interest in STEM-related subjects and encourage academic exploration on a local level,” said Catherine Greenspon, co-founder of Project Infinite Green. “One thing that makes this program so special is the community involvement. The realworld experience that CITGO mentors have brought to the students involved in Project Infinite Green is priceless.” CITGO is both an active participant and founding partner of Project Infinite Green, providing input in the sections related to the refining industry as an important part of the energy mix and the measures it takes to protect the environment. Since the program’s creation five years ago, CITGO employees have dedicated their time to teaching at Lemont-area schools. The company donates annually to Project Infinite Green and this year’s support from CITGO went toward the cost of the curriculum, supplies and other program expenses for the academic year. This partnership reflects a broader initiative by CITGO to provide students with opportunities in STEM education, specifically in the communities in which the company operates. “Programs such as Project Infinite Green are a vital part of

building enthusiasm for STEM-related fields among our students,” said Jim Cristman, vice president of the CITGO Lemont Refinery. “The refining industry provides great career opportunities for our future leaders. However, fewer students plan to pursue college or graduate degrees in this field. CITGO strives to empower tomorrow’s workforce through our partnership with Project Infinite Green because it equips participants with the tools they need to be successful in a career in energy.” Project Infinite Green introduces students to scientific research and environmental solutions that challenge them to think analytically and work collaboratively. For their capstone project, student teams develop practical business plans that incorporate diverse and sustainable energy sources, based on their coursework throughout the academic year. The

program’s curriculum complements what the students are learning in school and meets Next Generation Science Standards (NGSS) goals. The CITGO Lemont Refinery, which has been in operations for more than 90 years, supports various programs that encourage STEM education. Earlier this year, employees volunteered at Old Quarry Middle School in Lemont to present information on the refining process, environmental stewardship and career opportunities within the petroleum refining industry to approximately 300 eighth grade students. Employees also serve as judges for science fairs and participate in LEGO® Robotics programs. Ongoing support from CITGO for educational initiatives inspires students to challenge themselves academically and explore career possibilities they may have otherwise not considered. •

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HEALTH & SAFETY

IPAA: Obama Administration’s Offshore Rule Reduces Safety, Hurts Offshore Energy Production The Obama Administration’s final offshore well control rule could reduce offshore worker safety and hurt future U.S. offshore energy development, according to Dan Naatz, Senior Vice President of Government Relations and Political Affairs for the Independent Petroleum Association of America (IPAA).

“Offshore producers share the government’s goal of enhancing offshore safety and companies continue to work every day to make operations as safe as possible. However, after years of the U.S. oil and natural gas industry sharing technical information and areas of concerns in the form of formal comments, letters, and meetings with the Obama Administration, we are disappointed in the final outcome that federal regulators took on this offshore rule. This longanticipated rule, half a decade in the making, was the federal government’s chance to get it right – to implement new offshore operating standards that would balance workable safety measures with the continued development of America’s rich energy resources. Instead, today’s highly prescriptive rule could result in unintended negative consequences leading to reduced safety, less environmental protection, fewer American jobs, and decreased U.S. oil and natural gas production. “It is imperative that any changes to the current offshore regulatory framework must not compromise the safety of our workers, our environment, and our communities. Federal regulators should seriously reconsider the long-term impacts of this burdensome rule on the uninterrupted supply of affordable, reliable U.S. energy that so many Americans will need for decades to come.” IPAA and a number of its industry trade partners shared the expertise of over 300 engineers and technical experts from more than 70 companies in their formal comments to the Department of the Interior on its proposed offshore well control rule. Last fall, IPAA President and CEO Barry Russell warned in the Houston Chronicle that the federal government’s offshore well control rule will impose

new and unattainable costs on industry – an industry already under stress from the current low commodity price environment – while potentially reducing safety offshore. Last week, seven trade associations sent a joint letter to federal regulators reiterating several significant concerns and potential negative economic impacts the proposed rule could have on the future of U.S. offshore oil and gas development.

The Independent Petroleum Association of America (IPAA) is a national upstream trade association representing thousands of independent oil and natural gas producers and service companies across the United States. Independent producers develop 90 percent of the nation’s oil and natural gas wells. These companies account for 54 percent of America’s oil production, 85 percent of its natural gas production, and support over 2.1 million American jobs. •

HARD WORKING ENGINEERS We have turned things around before. No matter what the oil price is: The world needs energy. It is at times like these new technology and new processes see the light of day. Together we have turned things around before â&#x20AC;&#x201C; by innovating, reducing costs, and working in a smarter way. We are all adjusting once again, to make sure we can succeed in the new market reality. And we know we can do what it takes. Now is the time to get together and prepare for the future. ONS 2016 provides you with the latest insights, the new technology â&#x20AC;&#x201C; and future business opportunities. This is the place to be. Welcome to the leading energy meeting place.

www.ons.no New conference feature: Build your competence at our new Technical Sessions!

UPCOMING EVENTS ADIPEC 2016

7-10 November 2016 Abu Dhabi, UAE https://www.adipec.com/

Oil Sands Trade Show 2016

Fort McMurray, Canada 13-14th September http://oilsandstradeshow.com/

Offshore Technology Conference 2-5 May 2016 Houston, Texas, USA 2016.otcnet.org/

OGU

18 – 20 May 2016 Tashkent, Uzbekistan http://www.oilgas.uz/

Caspian Oil and Gas 2016 01 - 04 June 2016 Baku, Azerbaijan www.oilgas-events.com/Caspian-OGExhibition

RPGC

27 – 29 June 2016 Moscow, Russia www.mioge.ru/ru-RU/congress/rpgc.aspx

Offshore Northern Seas 29th August – 01 September Stavanger – Norway www.ons.no

27th SMM

6 - 9 Sept 2016 Hamburg Germany www.smm-hamburg.com/en/

KIOGE

4 – 7 Oct 2016 Almaty, KZ. www.kioge.kz/en/

MANGYSTAU OIL & GAS

8 – 10 Nov 2016 Aktau, KZ www.oilgas-events.com/Mangystau-Exhibition

OSEA 2016 International Conference 29 Nov – 2 Dec 2016/17 Marina Bay Sands, Singapore osea-asia.com/

22nd World Petroleum Congress Turkey www.21wpc.com/ 09-13th July 2017

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25th - 26th May 2016 | The Waldorf Hilton, London

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