Asia Pacific

PTT Exploration and Production Public Company Limited (PTTEP) has announced yet another gas discovery from its first exploration well, Kulintang-1, in Block SK438, located off the coast of Sarawak, offshore Malaysia.

Phongsthorn Thavisin, CEO of PTTEP, disclosed that PTTEP, through its subsidiary PTTEP HK Offshore Limited (PTTEP HKO), commenced the drilling of Kulintang-1 wildcat well in Block SK438 in March 2021 and successfully drilled to a total depth of 2,238 metres in April 2021.

Block SK438 is located in the shallow waters, approximately 108 kilometres off the coast of Bintulu in Sarawak. PTTEP HKO is the operator with 80% participating interest while PETRONAS Carigali Sdn. Bhd. (PETRONAS Carigali) holds the remaining 20%. PTTEP expects to drill another exploration well in this block in the second quarter of 2021.

Block SK438 is adjacent to Blocks SK405, SK309 and SK311, SK314A, all of which are operated by PTTEP, with existing facilities nearby. The location, therefore, provides an advantage for future development including the potential for cluster development.

PTTEP’s Malaysian success story

This discovery is the latest of PTTEP’s continued success in Malaysia. Already this year the company discovered a significant oil and gas column of more than 100 metres from exploration well, Sirung-1, in Block SK405B; revealed a high quality gas reservoir from the Dokong-1 well in Block SK417; registered a new record for its largest ever gas discovery from the Lang Lebah-2 appraisal well in the Sarawak SK 410B Project; and announced the start-up of natural gas production from Rotan and Buluh deepwater fields of Block H which targets production capacity at 270 million standard cubic feet per day.

“The Kulintang-1 well adds to the consecutive discoveries PTTEP has made this year which demonstrate our significant exploration progress in Malaysia. The discovery highlights our strong partnership with PETRONAS and continuous efforts in applying new techniques and interpretation to identify opportunities in mature areas. We are determined to explore further and make more oil & gas discoveries in Malaysia to serve future energy demand,” said Thavisin.

Beacon Offshore and Claxton, the lead brand for the Acteon drilling and decommissioning business segment, have signed a master services agreement for the severance and recovery of more than 100 subsea wells in the Gulf of Thailand.

While detailed information of the agreement has so far been withheld, Sam Hanton, CEO of Claxton, stated, “The relationship with Beacon Offshore is a milestone for long-term collaboration in the region which was underpinned by significant effort and commitment by all parties.

“We are very excited about this project as it highlights Claxton’s rigless P&A capabilities and reflects the expertise of Claxton as a trusted partner in vessel-based decommissioning.”

Asia Pacific decommissioning

This is the latest agreement regarding decommissioning operations in Asia Pacific, a market which is expected to take off in the next few years largely due to the shared global desire to limit climate impact by ensuring abandoned wells are properly plugged and abandoned with infrastructure removed. While, traditionally, complicated government regulation and lack of experience has restricted such campaigns in the region, this problem is fast becoming too large to ignore, especially with a large number of fields approaching the end of their production life.

As Jean-Baptiste Berchoteau, Wood Mackenzie’s Asia upstream analyst, told Breakbulk last year, “With more than 380 fields expecting to cease production in the next decade, the magnitude and cost of work can no longer be ignored. Through learning from global decommissioning projects, the industry can adopt and adapt practices best suited for Asia-Pacific’s own set of challenges.”

Breakbulk noted that across the 380 fields there are 35,000 offshore wells, serviced by 2,600 platforms representing 7.5 million tonnes of steel and more than 55,000km of pipelines which will need to be retired in the forthcoming years – representing an enormous challenge which operators will have to deal with in order to meet their environmental commitments. Such a challenge, however, opens a very promising door for service providers such as Claxton who in the coming years will no doubt be called into action to conduct more decommissioning operations in this region.

 Reliance Industries Limited (RIL) and bp have announced the start of production from the Satellite Cluster gas field in block KG D6 located about 60km from the existing onshore terminal at Kakinada on the east coast of India in water depths of up to 1,850m.

RIL is India’s largest private sector company spanning hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, retail and digital services. Together with bp, the company has been developing three deep-water gas developments in block KG D6 – R Cluster, Satellite Cluster and MJ which are expected to produce a combined 30mn cu/m per day (around one billion cu/ft a day) of natural gas by 2023.

Both of the developments will utilise the existing hub infrastructure in the KG D6 block. RIL is the operator of the block with a 66.67% participating interest, while bp holds a 33.33% participating interest. It had originally been scheduled to start production in mid-2021.

The Satellite Cluster is the second of three scheduled developments to come onstream, following the start-up of R Cluster in December 2020. R Cluster is located at a water depth of greater than 2,000m, is the deepest offshore gas field in Asia, and is expected to reach plateau gas production of about 12.9mn cu/m per day in 2021.

Mukesh Ambani, Chairman and Managing Director of Reliance Industries Limited, commented, “We are proud of our partnership with bp that combines our expertise in commissioning gas projects expeditiously, under some of the most challenging geographical and weather conditions. This is a significant milestone in India's energy landscape, for a cleaner and greener gas-based economy. Through our deep-water infrastructure in the Krishna Godavari basin we expect to produce gas and meet the growing clean energy requirements of the nation.”

bp Chief Executive, Bernard Looney, added, “This start-up is another example of the possibility of our partnership with RIL, bringing the best of both companies to help meet India’s rapidly expanding energy needs. Growing India’s own production of cleaner-burning gas to meet a significant portion of its energy demand, these three new KG D6 projects will support the country’s drive to shape and improve its future energy mix.”

Together the R Cluster and Satellite Cluster are expected to produce about 20% of India’s current gas production. The third KG D6 development, MJ, is expected to come onstream towards the latter half of 2022.

Petronas, a global energy solutions company, has awarded an exclusive three-year contract to Welltec, a provider of robotic well solutions, appointing them as sole provider of downhole conveyance and powered mechanical services in the eastern and western regions of Malaysia.

Commenting on the contract, which officially commenced on 1 April, Espen Dalland, Area Vice-President for the Asia-Pacific Region at Welltec, said, “It’s a great team effort that has led to the award of this exclusive long-term contract with Petronas, and Welltec has demonstrated a strong ability to deliver – even through a challenging 2020 – high quality services in a safe manner to the largest assets in the country at a very cost-effective rate.”

“This winning combination is the foundation for Petronas awarding us an even larger work scope for the next three years, where we will continue to deliver world-class technology and services.”

Confirming a strong relationship

The new deal covers the entirety of Petronas’ intervention operations, highlighting the confidence that the company has for Welltec’s fleet and technological capabilities which has been manifested across a successful and longstanding relationship.

Alex Nicodimou, Vice-President of Sales & Marketing at Welltec, added, “This is a fantastic win for us. Petronas is a key customer in the region who over recent years have moved more and more towards an integrated approach for interventions. The fact they have provided us 100% of their intervention work speaks volumes about their belief in our technology and ability to deliver. We’re looking forward to continuing to support them to the best of our abilities.”

Welltec continue admirable performance

The award of such a promising contract should be of no surprise to anyone who has tracked the progress of Welltec over the last few months. The company reported a revenue decline of less than 15% in 2020, which was comparatively low compared to the rest of the industry and also maintained operating earning margins close to 40%, which was among the best across the industry. At the start of the year the company also announced a substantial agreement with Equinor for the long-term provision of integrate wireline services to key platforms across the Gullfaks and Stratfjord fields which will run for at least five years, with the potential to run for more than ten.

The company will also seek to continue this strong performance under new leadership as Founder and CEO of Welltec, Jørgen Hallundbæk, has announced his retirement from the management team to be replaced as CEO by Peter Hansen, the former COO of the company.

Preparing to facilitate what he believes will be a bright future for the company, Hansen commented, “Together with our global teams, I look forward to continuing to contribute to the development of Welltec. We are global leaders in our service and products categories and are determined to strengthen our positions further. We have expanded our business potential by investing in geothermal and carbon capture and storage technology development. Combined with our core services and products, we believe that this creates a solid platform for the future.”

The Tui oil field, located 50km offshore Taranaki Coast in New Zealand has been marked for decommissioning since production ceased in 2019, and it appears progress is finally being made on the project.

The Tui oil field

The Tui oil field started production in July 2007 with a healthy production capacity of approximately 50,000 barrels of oil a day. In March 2017 Tamarind Taranaki increased its stake in the Tui oil field permit to 100% and spent the next few years attempting to improve oil recovery to extend its life. Unfortunately in November 2019 an oil sheen, caused by a damaged subsea flowline, was observed alongside the floating production storage and offloading (FPSO) unit, the Umuroa, and so production from the field was ceased.

The planned decommissioning project

With production at an end, it was time to retire the field and so a decommissioning programme was planned to enact this. This would require the demobilisation of the FPSO Umuroa and the plugging and abandonment (P&A) of eight subsea wells and associated subsea structure.

Initially, the first phase of decommissioning included FPSO disconnection and removal, cleaning of flowlines and safely leaving them on the seafloor with additional vessels required for handling flowlines, umbilicals, mooring lines and tugs to hold the FPSO in place during disconnection operations.

The second phase of the project included the P&A of wells to avoid the leakage of hydrocarbons into the marine environment, as well as the removal of the remaining subsea infrastructure.

The New Zealand Government takes over

These plans, however, would never come to fruition as on 11 November 2019, the field operator Tamarind Taranaki announced that it may be insolvent and swiftly put the company into administration, with liquidation following in December 2019.

With the operator unable to carry out the decommissioning, the New Zealand Government received the Tui assets and picked up the project to remove the Umuroa FPSO vessel and decommission the field. The Ministry of Business, Innovation and Employment (MBIE) therefore signed an agreement with BW Umuroa Pte Ltd (BWU), the owner and operator of the Umuroa, to demobilise and disconnect the vessel from the Tui field before carrying out P&A and decommissioning work on remaining associated infrastructure.

An update on these operations has been provided by Lloyd Williams, Project Director for the Tui oil field decommissioning, in an interview with ‘Stuff’. Williams commented that since work began in January, following an underwater survey of the infrastructure, around 14km of flowlines have been successfully flushed.

Now this has been completed, attention has turned to disconnecting the production lines (flowlines, umbilical cables and gas lift lines) from the FPSO vessel. Work began in late March and once completed, the lines will be lowered to the sea floor before the mooring system anchoring the Umuroa will be detached.

Williams continued that this will allow the Umuroa to be removed from the field, which is expected to occur in May. New Zealand Petroleum and Minerals have also noted that four vessels have already been selected for this task, with two already arriving at the port of Taranaki.

Outlining the next stages Williams comments that once these phases had been carried out it would then be time to completely remove the subsea equipment before, finally, the P&A of the five production and three exploration wells can be undertaken.

PTT Exploration and Production Public Company Limited (PTTEP) have announced a successful oil and gas discovery from the Sirung-1 exploration well in Block SK405B, offshore Sarawak in Malaysia, that was drilled by PTTEP Sarawak Oil Limited, a subsidiary of PTTEP.

Block SK405B is located in shallow waters approximately 137 km off the coast of Sarawak. PTTEP Sarawak Oil Limited is the operator with 59.5% participating interest, with MOECO Oil and PETRONAS holding a 25.5% and 15% interest respectively.

PTTEP Sarawak Oil Limited commenced the drilling of the Sirung-1 wildcat well in January 2021. The well was drilled to a total depth of 2,538 m where it encountered a significant oil and gas column of more than 100 metres, in the clastic reservoirs. An appraisal well is scheduled in the near future to assess the upside resources.

Drilling for long-term growth

The achievement is the latest outcome of PTTEP’s ‘Execute strategy’ which focuses on building reserves for long-term growth.

“The Sirung-1 exploration well marks PTTEP’s third discovery offshore Malaysia following SK410B’s Lang Lebah and SK417’s Dokong. PTTEP also plans to explore nearby prospects in the PSC next year. The achievements have strengthened our investment base as we continue to expand our exploration horizon in Malaysia,” commented Phongsthorn Thavisin, CEO of PTTEP.

Apart from the Sarawak SK405B, there are also SK410B, SK314A, SK438, SK417, PM407 and PM415, all still in the exploration stage. Major projects in PTTEP’s portfolio in Malaysia include the producing assets in Block K, SK309, SK311, the Rotan-Buloh field in Block H and the jointly operated gas fields with PETRONAS Carigali in the Malaysia-Thailand Joint Development Area. PTTEP is also a joint investor with PTT, through the PTT Global LNG Company, in the MLNG Train 9 Project, an LNG liquefaction plant in Sarawak.

China National Offshore Oil Corporation Limited (CNOOC) have announced that the Caofeidian 6-4 oilfield, located in the Midwest of Bohai, has commenced production.

CNOOC holds a 100% interest in the oilfield, which has an average water depth of about 20m, and acts as the operator. In addition to fully utilising the existing processing facilities of Nanpu 35-2 oilfield and Qinhuangdao 32-6 oilfield, a new central platform has been built on the field as part of the project. A total of 42 development wells are planned, including 30 production wells, 12 water injection wells and water source wells. The project is expected to reach its peak production of approximately 15,000 barrels of crude oil per day in 2023.

Guided by the vision of green development, Caofeidian 6-4 oilfield will actively promote green and low-carbon production. After putting into production, the project will achieve zero discharge of production and living sewage into the sea. With the introduction of onshore power engineering, it is estimated that about 16,000 tons of standard coal will be saved, and about 40,000 tons of carbon dioxide will be reduced annually.

Sustaining a strong performance

The news surrounding the Caofeidian 6-4 oilfield closely follows the release of CNOOC’s 2021 business plan and strategic strategy which provided a brief overview of its performance last year. Against the challenges caused by Covid-19, such as the huge impact from low oil price, the company invested a great deal into further reducing costs and enhancing efficiency, promoting reform and innovation, ensuring safety in production and above all growing its oil and gas reserves and production. As a result of this, CNOOC recorded a net production record high of approximately 528mnboe in 2020.

Following this, the company is seeking to strengthen this resource base even further and has planned to drill 217 exploration wells and collect approximately 17,000 sq km of 3D seismic data. Additionally, CNOOC expects 19 new projects to come on stream, such as the Lingshui 17-2 gas fields development, the Lufeng oilfields regional development, the Buzzard oilfield phase II in the UK and Mero I oilfield in Brazil. CNOOC is targeting a net production of 545-555mnboe in 2021 and estimates it will achieve 590-600mnboe and 640-650mnboe in 2022 and 2023 respectively as a result of these ventures.

Xu Keqiang, CEO of CNOOC, said, “In 2021, under the theme of high-quality development, the Company will be committed to steadily increasing its oil and gas reserves and production, focusing on investment efficiency, maintaining its cost competitiveness, while actively pursuing the concept of green and low-carbon development, to create excellent returns for our shareholders.”

With the Caofeidian 6-4 oilfield commencing production, and potentially reaching a peak production of 15,000 barrels of crude oil per day by 2023, it appears CNOOC have made a strong start in their attempts to meet their forthcoming targets over the next few years.

Aquaterra Energy, a company focused on delivering offshore engineering solutions, has secured a multi-million-dollar riser contract with a marine vessel owner and operator, for deeper water well intervention projects mainly in the Asia Pacific region.

Aquaterra Energy will deliver a large-bore (7 3/8”) AQC-CW completions and workover riser system with automated handling package that will operate in water depths of up to 1,500m. The system has been designed to withstand repeat make and breaks, whilst offering a gas tight metal-to-metal seal. The solution can be operated from a lightweight intervention vessel, a semisubmersible or from a jack-up rig as a surface riser, open water subsea riser or as a landing string.

The NACE compliant technology and unique pipe to connector attachment eliminates welding – making the riser lighter offering enhanced water depth deployment capacity. In addition, the ability to pressure test each connection upon make up provides enhanced environmental reassurance against well bore fluid discharge.

Aquaterra Energy will manage the entire project scope via its in-house engineering and project management teams. Throughout the project, Aquaterra Energy will provide fatigue utilisation and management through riser monitoring hardware to extend asset life, as well as automated hands-off connector makeup and umbilical handling equipment to improve safety and enhance offshore efficiency.

Successful spell continues for Aquaterra Energy

James Larnder, Managing Director of Aquaterra Energy said, “This project marks a key milestone in our Asia Pacific success story, whilst also diversifying our AQC riser offering into deeper water operations. All our systems are intelligently engineered to be efficient with no wasted materials and a focus on quick connection to reduce operational time whilst assuring integrity. Importantly, these efficiencies also support our own and our customers’ decarbonisation efforts.”

The company supports customers across the globe in the North Sea, South East Asia, the Caribbean, West Africa and Australia. While Covid-19 may have hindered much of the industry last year Aquaterra Energy continued its impressive workload with the award of several substantial contracts such as the front end engineering and design contract from DeNovo Energy for a second Sea Swift platform offshore Trinidad and Tobago and the commission to construct a platform for Chevron offshore Angola. The company has also continued investment in its product line such as the QuikDeck underdeck access system which, the company claimed, had already helped secure new work worth more than £1mn. With the penning of this new contract in Asia Pacific there appears to be no sign that the company is slowing down in 2021.