January’s top news stories

5 February 2019 (Last Updated February 12th, 2019 14:19)

Shell completed the $578m sale of shares in New Zealand upstream business, Medco reached a $511.3m agreement to acquire Ophir Energy. Offshore-technology.com wraps up the key headlines from January 2019.

January’s top news stories
The OMV head office in the Hoch Zwei skyscraper in Vienna. Credit: DanielZanetti.

Shell sells stakes in New Zealand upstream business to OMV for $578m

Royal Dutch Shell completed the $578m sale of its shares in New Zealand upstream business to integrated oil and gas company OMV.

The business consists of joint venture (JV) interests in Pohokura (48%) and Maui (83.75%) fields, as well as Tank Farm assets.

Prior to the acquisition, OMV held 26% in Pohokura and 10% in Maui. The company now assumes operatorship in both JVs.


Medco to acquire Ophir Energy for $511.3m

Medco Energi Internasional reached a £390.6m ($511.3m) agreement to acquire the entire issued and to be issued ordinary share capital of upstream oil and gas firm Ophir Energy.

Medco will fund the acquisition from its existing cash resources and the proceeds of a credit agreement entered with Standard Chartered Bank.

It will be implemented via a court-sanctioned scheme of arrangement under Part 26 of the Companies Act 2006.


Decommissioning oil and gas platforms could cost UK taxpayers £24bn

Government watchdog the National Audit Office (NAO) published a report warning that decommissioning the UK’s oil and gas platforms could cost the government £24bn.

According to the report, HM Revenue & Customs (HMRC) estimates that it will repay £12.6bn to operators in taxes previously collected as part of the decommissioning process.

A further £11.1bn of tax income will also be spent due to the expenditure of the decommissioning process reducing taxable profits.


Lundin chooses TechnipFMC for North Sea development

Oil and gas exploration and production company Lundin Norway awarded oilfield services provider TechnipFMC a substantial integrated engineering, procurement, construction and installation (iEPCI) contract.

The contract consists of iEPCI orders for the Luno II and Rolvsnes developments, located in the North Sea, at a water depth of 110m. The Luno oilfield estimated reserves of between 40 and 100 million barrels of oil equivalent (Mboe), while the Rolvsnes field has estimated reserves of 3-16Mboe.

The iEPCI contract covers the delivery and installation of subsea equipment, including rigid flowlines, flexible jumpers, umbilicals and subsea production systems. The contract is worth between $250m and $500m, according to TechnipFMC.


US imposes sanctions on Venezuelan oil firm PDVSA

The US imposed new sanctions on Venezuelan oil firm Petroleos de Venezuela (PDVSA) in a bid to increase pressure on President Nicolas Maduro to cede power to the opposition.

The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated PDVSA according to Executive Order (EO) 13850 for operating in the Venezuelan oil sector.

PDVSA is a primary source of income and foreign currency for Venezuela.


Oil giant Baker Hughes GE pledges zero emissions by 2050

At this year’s Annual Meeting in Florence, Baker Hughes, a GE company (BHGE), announced that it would reduce its emissions of CO2 equivalents to net zero by 2050. The company committed to further investments in advanced technologies to help its customers reduce their emissions across the supply chain.

BHGE started considering its CO2 emissions in earnest in 2012 and had already reduced them by 26%. It will now aim to achieve a reduction of 50% by 2030, by reducing emissions by around 3% annually before making further reductions throughout its supply chain to virtually eradicate it’s emissions in the following 20 years.

This will be achieved through a range of initiatives across its manufacturing, supply chain, logistics, energy sourcing and generation sectors. These include new technologies such as its Lumen methane monitoring and inspection solution and its fully hydrogen powered NovaLT gas turbine generator technology.


East Timor approves proposal for stake acquisition in Sunrise project

East Timor President Francisco Guterres approved a proposal that allows the use of the country’s petroleum fund for a $650m buyout of Royal Dutch Shell and ConocoPhillips’ stake in the Greater Sunrise gas project in the Timor Sea.

Last month, Guterres vetoed the decree saying it could allow misuse of the petroleum funds and called for its revision. It subsequently won support from the parliament.

According to East Timor law, a bill can be vetoed only once by the president, who must then approve it after it obtains the vote of approval from the parliament.


OGTC and University of Aberdeen launch National Decommissioning Centre

The Oil & Gas Technology Centre (OGTC) and the University of Aberdeen opened the new National Decommissioning Centre (NDC) in North-East Scotland’s Energetica Corridor.

The £38m global technology R&D hub will help the oil and gas industry deliver the cost reduction target set by the regulator Oil and Gas Authority in 2016.

It combines industry expertise with academic excellence and aims to work in collaboration with companies to focus on reducing costs, extending field and asset life, as well as transforming the traditional approach to decommissioning.


BP plans major expansion at Atlantis field in US Gulf of Mexico

BP announced plans for a major expansion at the Atlantis field in the US Gulf of Mexico where the presence of an additional 400 million barrels of oil was revealed.

The company also identified significant additional oil resources that are expected to create further development opportunities around its production hubs.

As part of the $1.3bn Atlantis Phase III development, a new subsea production system will be constructed from eight new wells that will be tied into the existing platform located 150 miles south of New Orleans.


Norway’s DNO increases bid for Faroe Petroleum to $816m

Norway’s DNO announced an increased and final cash offer to £641.7m ($816m) for the acquisition of UK-based Faroe Petroleum, raising its offer to 160p per Faroe share from 152p.

Last November, Faroe rejected DNO’s £610m ($778m) hostile bid, saying it as inadequate and opportunistic.

Reuters quoted DNO executive chairman Bijan Mossavar-Rahmani as saying in a statement that while the company ‘does not overpay for assets’, it was in the interest of most parties to raise its offer.