www.upstreamonline.com http://www.upstreamonline.com/ www.upstreamonline.com Oil players join for exports push http://www.upstreamonline.com/live/1381463/Oil-players-join-for-exports-push More than a dozen US operators work to reverse 40-year-old US ban Luke.Johnson@upstreamonline.com (Luke Johnson) http://www.upstreamonline.com/live/1381463/Oil-players-join-for-exports-push Fri, 24 Oct 2014 21:19:42 +0000 live Producers for American Crude Oil Exports, or Pace, is the first lobbying group to form on reversing the ban.

The group of 14 producers has "united to create an advocacy initiative to help repeal the outdated ban on crude oil exports," Daren Beaudo, a spokesman for ConocoPhillips, one of the member companies, told Reuters in an email.

The ability to export crude is "vital to the country's economic growth and national security, job creation, and strengthening our competitive position in the global marketplace," he said to Reuters.

Congress passed the trade restriction in the 1970s after the Arab oil embargo caused fears of domestic oil shortages.

Pace will face opposition from a group of four oil refiners called Consumers and Refiners United for Domestic Energy, or Crude, who want to keep the ban in place, saying that exports could add costs to their processing.

The US drilling boom of the past six years is expected to proceed and could soon make the United States the world's biggest oil producer, surpassing both Saudi Arabia and Russia. The boom has also created a glut of light crude in the Gulf of Mexico refining hub.

Oil producers say that glut will soon slow down the energy drilling revolution by depressing crude prices. On the other hand, some refiners say they are making changes to their plants that will soon allow them to process much of that crude.

The Obama administration and Congress can both take steps to reverse the ban, but there has been little action this election year. The Commerce Department earlier this year gave permission to two companies to export minimally processed condensate. But since then action on some two dozen requests for so-called commodity clarifications has been delayed.

Pa is comprised of Anadarko Petroleum, Chesapeake Energy, Concho Resourcesce, ConocoPhillips, Continental Resources, Devon Energy, Encana, EOG Resources, Hess, Laredo Petroleum, Marathon Oil, Noble Energy, Occidental Petroleum and Pioneer Natural Resources.

The refiners in Crude are: Alon USA Energy, PBF Energy, Delta Air Lines subsidiary Monroe Energy, and Philadelphia Energy Services.

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Halliburton urges judge not to grant BP retrial http://www.upstreamonline.com/live/1381454/Halliburton-urges-judge-not-to-grant-BP-retrial UK supermajor claims 'grossly negligent' ruling made on discarded evidence that Macondo operator introduced Luke.Johnson@upstreamonline.com (Luke Johnson) http://www.upstreamonline.com/live/1381454/Halliburton-urges-judge-not-to-grant-BP-retrial Fri, 24 Oct 2014 19:42:14 +0000 live The services giant said in a court filing that US District Judge Carl Barbier did not rely on excluded testimony when he judged BP to have been "grossly negligent" in the deadly 2010 Gulf of Mexico oil spill.

BP's own lawyers are responsible for trial testimony that the London-based oil company complains led to an unfair finding against it, according to Halliburton, the cementing subcontractor on the blown-out well.

"BP itself introduced the very testimony that it now claims was excluded and upon which the court relied to partially support its casing-breach findings," lawyers for Houston-based Halliburton said in the filing cited by Bloomberg.

BP "mischaracterises" the record of a 2013 trial over the spill "to remedy its own failed trial tactics", Halliburton added.

Barbier ruled last month that BP acted with gross negligence in drilling the Macondo well off the Louisiana coast. The well gushed more than 4 million barrels of crude into the Gulf, the worst offshore spill in US history.

The ruling exposes BP to potentially more than $18 billion in US pollution fines. That sum would be on top of the more than $28 billion BP has already paid for spill-related response, clean-up costs and damages.

Barbier determined the Macondo well failed in part because flawed drilling practices caused a breach to open in the metal casing lining the bottom of the well. That rupture prevented Halliburton's cement from properly sealing off the sides of the well, allowing hydrocarbons to escape into the pipe and flow to the surface, he said in a 153-page ruling.

BP claims Barbier improperly reached that conclusion by relying on testimony the he said he would not consider during the trial. The disputed testimony was provided by Gene Beck, a Halliburton expert witness, who had not addressed certain casing-breach causes in a report he wrote before the trial.

Halliburton said BP's lawyers probed Beck on the casing-breach theory during cross-examination, after Barbier said Beck could not discuss it.

"Beck's testimony was properly admitted, and the court's reliance on that testimony is sound," Halliburton said.

Lawyers for the US, which is suing London-based BP to recover damages to publicly-owned natural resources and for violations of the Clean Water Act, also say the disputed testimony was properly admitted at trial. They said in a separate court filing that it would not matter if that particular evidence was excluded now, according to Bloomberg.

"Ample other evidence supports the court's conclusion that BP damaged" the casing at the bottom of the well and ruined the cement job, US lawyers said in a filing opposing BP's retrial bid.

"Removal of one disputed point of testimony would affect at most only a few sentences" of the opinion and "would not change a single ultimate finding or conclusion".

Neither BP nor Halliburton commented when contacted by Bloomberg.

In Spetmeber, Halliburton reached an agreement to settle a "substantial majority" of the claims outstanding against it over the oil spill for around $1.1 billion including legal fees.

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US crude futures slide http://www.upstreamonline.com/live/1381465/US-crude-futures-slide Signs of rising global supply and a US contango structure threaten deeper losses Luke.Johnson@upstreamonline.com (Luke Johnson) http://www.upstreamonline.com/live/1381465/US-crude-futures-slide Fri, 24 Oct 2014 22:09:49 +0000 live US crude oil futures, meanwhile, continued to slide. Contracts for December delivery settled down $1.08 at $81.01 per barrel, dropping $1.74 since last Friday, Reuters reported.

Increased domestic crude stores have depressed the price of short-term futures contracts. The spread between December and January contracts narrowed to 24 cents, threatening to flip to a second-month discount, or contango, for the first time since early this year. The spread was at more than 80 cents a few days ago.

Global prices seesawed several times on Friday, initially battered by news that Iraq increased its oil supply in October, while Libya's output remains high, despite instability in both countries.

Oil traders said prices were reversing excessive gains made on Thursday, when the market spiked on news that Saudi Arabia had boosted production but cut supplies to the market in September, instead pumping barrels into storage.

"There's just no shortage of oil anywhere in the world," said Sal Umek of the Energy Management Institute in New York. "Demand is not really robust, and you're going to get the intermittent spell of short-covering."

Brent crude for December delivery settled at $86.13 per barrel, down 70 cents for the day and 3 cents below last Friday's settlement price, off an intraday low of $85.29 a barrel.

Saudi Arabia, the world's top exporter, previously sent signals it is comfortable with markedly lower oil prices and willing to maintain high supply levels to compete for market share.

"Saudi Arabia ... doesn't mind oil going a little bit lower," said Tariq Zahir, an analyst at Tyche Capital Advisers. "With all the production increase in the United States, we are their biggest competitor right now. But they have enough cash to deal with prices going lower."

The US dollar has rallied against other currencies on a improving economic outlook, rising nearly 8% in the third quarter and peaked earlier this month at a four-year high, offsetting some losses in the dollar-denominated crude prices for oil exporters.

On Friday, the dollar and equity markets fell on news that an American doctor in New York city had contracted the Ebola virus while working in West Africa.

Opec will meet on 27 November to review its output target for the first half of 2015. So far, only a few members have called for a cut.

Money managers raised their net long U.S. crude futures and options positions in the week to 21 October, the US Commodities Futures Trading Commission said in a data release on Friday after crude futures settled.

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Pemex widens third-quarter loss http://www.upstreamonline.com/live/1381440/Pemex-widens-third-quarter-loss Executives maintain Mexico projects attractive despite falling crude prices Kathrine.Schmidt@upstreamonline.com (Kathrine Schmidt) http://www.upstreamonline.com/live/1381440/Pemex-widens-third-quarter-loss Fri, 24 Oct 2014 16:20:28 +0000 live Average Mexican oil prices were down 8.4% to an average of $92.08 in the three months to September, compared to $100.53 in the year-ago period. The movement has mirrored global declines of some 25% since June that have left the global Brent benchmark trading in the mid $80s per barrel range.

The state-led giant reported a loss of $4.4 billion in the third quarter, a decline of 52.5% compared to the year-ago result. Revenue fell 0.7% to $30.2 billion compared to the 2013 period.

Pemex executives on conference calls Friday morning downplayed concerns that falling oil prices might derail investor interest in the market.

"We don’t have any risk that any of the projects we are developing will not be profitable," exploration and production director Gustavo Hernandez said. "The risk is minimal."

Mexico last year passed reforms to end Pemex's 76-year monopoly and open its oil industry to private participation, with the country's first-ever acreage bid offering planned for next year.

The pricing impacts added more impact to a downtrend in the company's crude output, which was down 4.3% to 2.398 million barrels during the quarter. That was in line with expected cuts previously disclosed due to worse-than-expected natural declines and measurement errors that counted some water as oil.

Gas production was up 1.2% overall to 6513 MMcfd thanks to strength in non-associated gas production in the country's Burgos region.

Operations were also on the down trend, with the average number of active wells down 3.9% to 9450 from the year-ago quarter. Well completions were also down 11.5% to 162 and drilling teams decreased to 115 from 165 a year ago.

Pemex is also set to offer farm-outs on some of its prime acreage such as deep-water oil finds Trion and Exploratus in the Perdido fold-belt, the Kunah-Piklis deep-gas field and the Ayatsil-Tekel-Utsil heavy-oil complex.

Mature-field offerings will include the onshore areas of Rodador, Ogarrio and Cardenas-Mora as well as offshore areas Bolontiku, Sinan and Ek.

The economics of those projects will be maintained even with lower oil prices, Hernandez said. "The projects that we will include in the farm-outs don’t have this problem."

Executives in discussions with analysts mentioned break-even figures of just over $20 per barrel for overall projects and below $50 per barrel for deep-water projects allowing for a "considerable margin".

Officials did, however, acknowledge problems could emerge if things got worse.

"If this trend were to continue we could see some projects with higher costs involved being delayed," treasurer Rodolfo Campos said.

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Potential Petrox purchase expires http://www.upstreamonline.com/live/1381466/Potential-Petrox-purchase-expires Canadian junior will not buy certain producing properties in Alberta after negotiations end Luke.Johnson@upstreamonline.com (Luke Johnson) http://www.upstreamonline.com/live/1381466/Potential-Petrox-purchase-expires Fri, 24 Oct 2014 22:20:02 +0000 live The company said in July that it had entered into a "highly conditional and non-binding letter of intent" to exclusively negotiate on a deal for the properties until 2 September.

Petrox warned at the time that there was no assurance than a binding agreement would be reached.

Had the deal gone through, Petrox would have secured from an unnamed seller production of about 1376 barrels oil equivalent per day, consisting of 5.5 million cubic feet per day of gas and 460 barrels per day of liquids.

Petrox said it "intends to continue its search for viable producing oil and gas properties for potential acquisition".

It added that its discussions to complete an arm's length business combination with a private entity based in Shanghai, China are ongoing.

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US rig count rises by nine http://www.upstreamonline.com/live/1381449/US-rig-count-rises-by-nine Permian and Eagle Ford lead the way as Baker Hughes weekly tally hits 1927 Luke.Johnson@upstreamonline.com (Luke Johnson) http://www.upstreamonline.com/live/1381449/US-rig-count-rises-by-nine Fri, 24 Oct 2014 17:51:43 +0000 live Both oil and gas rigs rose this week, with oil-directed units up by five and gas rigs up by four. That brought the total number of oil rigs to 1595 and the gas-rig count to 332.

The big Texas plays saw the biggest increases. Both the Eagle Ford and the Permian basin jumped by seven rigs for respective totals of 216 and 568.

Statewide, Texas added a net total of eight rigs for a weekly tally of 906. New Mexico gained five rigs, crossing the century mark to 103.

The Haynesville shale and the Utica shale were the only other regions to see net multi-rig moves. The Haynesville lost a pair for 40 and the Utica gained two for 49.

Arkansas gained two rigs for 12 and Louisiana lost one for 110. Ohio gained two for 44. West Virginia was up three on 36 and Pennsylvania lost three for 52.

The Marcellus was flat on 81.

The Williston basin lost one for 192.

North Dakota lost one for 180.

California gained two for 46. Alaska gained one for eight.

The US Gulf of Mexico lost a pair of rigs for 53.

Canada was up nine on 426.

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Eagle Ford spreads wings to the east http://www.upstreamonline.com/live/1381450/Eagle-Ford-spreads-wings-to-the-east Operators prove up large eastern extension of the formation once thought uneconomic Kathrine.Schmidt@upstreamonline.com (Kathrine Schmidt) http://www.upstreamonline.com/live/1381450/Eagle-Ford-spreads-wings-to-the-east Fri, 24 Oct 2014 18:35:38 +0000 live For the full story, read Friday's edition of Upstream.

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Sandridge preps water disposal IPO http://www.upstreamonline.com/live/1381446/Sandridge-preps-water-disposal-IPO Independent looks to cash in on flowback infrastructure Luke.Johnson@upstreamonline.com (Luke Johnson) http://www.upstreamonline.com/live/1381446/Sandridge-preps-water-disposal-IPO Fri, 24 Oct 2014 17:13:16 +0000 live The US independent could sell up to $100 million in shares of the proposed master limited partnership MidCon Midstream but did not set a definitive number of shares or share price in its filing.

Sandridge built out an extensive produced water gathering and disposal business during its development of the company’s large position in the Mississippi Lime tight oil play in Oklahoma and Kansas.

In total, MidCon Midstream will take away water from more than 1600 well locations through 425 miles of gathering lines and dispose of it through 80 disposal wells with a capacity of 1.2 million barrels of water per day.

Analysts estimated the business could be worth about $750 million based on reported revenue of $64 million and estimated earnings of around $45 million.

“We view the news as a slight positive for Sandridge given the additional liquidity expected to be generated from the transaction,” analysts at Capital One Southcoast said in a note, but added that concerns remain about Sandridge’s ability to cover its spending with existing cashflow.

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Vaalco doubles up Angola commitment http://www.upstreamonline.com/live/1381441/Vaalco-doubles-up-Angola-commitment Africa-focused player takes decision to ensure rights to Block 5 do not expire next month Luke.Johnson@upstreamonline.com (Luke Johnson) http://www.upstreamonline.com/live/1381441/Vaalco-doubles-up-Angola-commitment Fri, 24 Oct 2014 16:19:10 +0000 live According to a "subsequent exploration phase" (SEP) signed by Vaalco, the operator will be required to drill a total of four wells by 30 November 2017, including the two it already committed to drill by the end of next month.

A $10 million assessment ($5 million net to Vaalco) applies to each of the four commitment exploration wells, if any, that remain undrilled at the end of the exploration period in 2017.

State player Sonangol is a partner in the wells.

The SEP also requires the partners to acquire a 3D seismic programme covering six hundred square kilometers, though that obligation has been satisfied with an already completed seismic programme covering 1058 square kilometres over the outboard portion of the block, Vaalco said.

Vaalco got rights to Block 5 through a production sharing agreement signed in 2006.

For the first well, Kindele-1, Vaalco has contracted Transocean semi-submersible GSF Celtic Sea. It will operate the rig on a dayrate of $338,000 through February of next year. It is due to arrive on location in mid-December.

The pre-salt Kindele well is targeting the Mucanzo sand in the Pinda group with a planned total depth of 2250 metres in a water depth of 101 metres.

Vaalco said it took the decision "in part to remove uncertainty that the primary term of the exploration license would be extended" by the Angolan government before the 30 November 2014 expiration date.

"We believe entering into the SEP is a sound strategy for the company," saidchief executive Guidry.

"Although the SEP comes with additional commitments, we believe this is a coveted block with potential in the deep syn-rift and sag play. 

"The SEP allows Vaalco and its partner to properly assess the results of the current seismic reprocessing that is being merged with previously licensed seismic data through pre-stack depth migration. This will help us determine the best opportunities in the pre-salt horizons."

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Petrobas finds Lontra gas pay http://www.upstreamonline.com/live/1381410/Petrobas-finds-Lontra-gas-pay Brazilian giant confirms Espirito Santo basin gas and condensate find Bill.Lehane@upstreamonline.com (Bill Lehane) http://www.upstreamonline.com/live/1381410/Petrobas-finds-Lontra-gas-pay Fri, 24 Oct 2014 13:39:21 +0000 live The Rio de Janeiro-headquartered state oil giant said that the 4-GLF-42-ESS probe, known as Lontra, ”confirmed the presence of gas and condensates, as supported by log data and cable tests performed at the well”.

Hydrocarbon-bearing reservoirs were identified at 3055 metres in depth and well drilling operations ceased at 3238 metres, Petrobras said.

The well was drilled in 1319 metres of water at Petrobras' wholly-owned Golfinho production concession, which is situated 81 kilometres off the city of Vitoria in Espírito Santo state.

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Apollo snaps up Express Energy Services http://www.upstreamonline.com/live/article1381443.ece Private equity giant buys provider of casing and tubular running, completions and production services Luke.Johnson@upstreamonline.com (Luke Johnson) http://www.upstreamonline.com/live/article1381443.ece Fri, 24 Oct 2014 16:29:00 +0000 live Express offers six service lines, including casing and tubular running, completions and production services across the US.

In total, the company has 1700 employees in more than 30 locations.

"Apollo is one of the largest and most successful private equity firms in the world and possesses the type of deep energy expertise that we believe will enhance the value of Express Energy Services," said Express chief executive Darron Anderson said .

"We are proud Apollo has chosen Express as a platform for oilfield services and are thrilled to partner with them to further develop and grow our business."

Terms of the deal were not disclosed.

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Spain fights Canaries referendum http://www.upstreamonline.com/live/1381431/Spain-fights-Canaries-referendum Madrid government appeals against planned vote on Repsol’s impending offshore drilling plans Eoin.Ocinneide@upstreamonline.com (Eoin O'Cinneide) http://www.upstreamonline.com/live/1381431/Spain-fights-Canaries-referendum Fri, 24 Oct 2014 14:59:54 +0000 live Spain’s government has sought to thwart an attempt by the Canary Islands to hold a referendum next month on whether or not to allow Repsol’s drilling plans off the islands to go ahead.

The Canary Islands government recently set its sights on a referendum on 23 November to decide on Spanish state player Repsol’s plans, with the first of two wildcats set to be spudded next month.

The government in Madrid on Friday, however, launched an appeal in the Constitutional Court against the planned referendum, having previously labelled it as illegal.

Repsol has fought for years to press ahead with its exploration plans off the islands of Fuerteventura and Lanzarote, in August seemingly gaining victory when it was given the green light by the Spanish government.

The drillship Rowan Renaissance has been lined up to drill the first well on the Sandia prospect, with a date in November still in the offing. The well will target up to 838 million recoverable barrels of oil, with a mean of 330 million barrels.

The primary objective of ­Miocene-age turbidites sits at 1955 metres below sea level, with the secondary Paleogene-Cretaceous sandstone objective at 3092 ­metres.

The Chirimoya prospect is set to be the second target across the nine blocks, with other targets indentified including Zanahoria, Platano, Cebolla and Naranja.

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WoodMac: ‘US energy independent by 2025' http://www.upstreamonline.com/live/1381386/WoodMac-‘US-energy-independent-by-2025 Increased efficiencies in vehicle sector and application of new upstream technologies key to market development Eoin.Ocinneide@upstreamonline.com (Eoin O'Cinneide) http://www.upstreamonline.com/live/1381386/WoodMac-‘US-energy-independent-by-2025 Fri, 24 Oct 2014 11:58:33 +0000 live A lifting of a crude oil export ban would benefit upstream producers and oilfield services companies, while the country’s vehicle fleet could be set to become 40% more efficient by 2030, the industry market research group said in a report on Friday.

The boom in shale gas and tight oil production in the US has pushed it towards becoming a net energy exporter, with intended liquefied natural gas import terminals being converted into LNG export facilities.

“The US will achieve energy independence by 2025, which will mark the first time since 1952 that the US will export more energy than it imports, according to WoodMac’s Global Trends Service.

Senior analyst James Brick said: “A country can achieve energy independence through two channels, it can either produce more or consume less, and the US is doing both.”

“Over the last seven years, the US has added 3 million barrels per day of tight oil and 27.5 billion cubic feet per day of shale gas to the global energy mix, a spectacular 42% increase in US oil and gas production.”

Oil demand is on the wane in the US primarily as a result of efficiency gains in the transport sector.

WoodMac said the uncertainty facing the US energy market is simply when precisely it will achieve energy independence: before or after 2025.

One significant factor would be the lifting on the current ban on crude oil exports, it said.

“If crude oil exports resulted in US producers receiving an additional $5 per barrel, production could increase by 350,000 to 450,000 barrels per day,” WoodMac continued.

“It’s likely that upstream producers would generally benefit the most via increased volumes and higher prices,” Brick said.

“Oilfield service companies and rig manufactures would also benefit from the additional investment.”

In any event, the continuing unconventionals drive is set to push output up, with WoodMac’s own estimate of 10.3 million bpd by 2030. This could be increased a further 3 million bpd “as a result of the application of technologies such as enhanced oil recovery and refracturing,” it said.

WoodMac sees the US vehicle fleet becoming 40% more efficient by 2030, possibly even faster. “Any improvement in vehicle efficiency or lower vehicle miles travelled per capita would reduce US oil demand and, consequently, net oil imports.”

Brick concluded: “Irrespective of the timing of independence, the US has started its transformation from energy consuming giant to prominent exporter.

“With this role shift comes obvious economic benefits but also shifting risks and new responsibilities.”

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Statoil bags new Oz award http://www.upstreamonline.com/live/1381336/Statoil-bags-new-Oz-award Norwegian giant expands acreage Down Under with offshore permit on North West Shelf Steve.Marshall@upstreamonline.com (Steve Marshall) http://www.upstreamonline.com/live/1381336/Statoil-bags-new-Oz-award Fri, 24 Oct 2014 08:37:44 +0000 live The Norwegian state-owned giant will gain 100% ownership of the 13,000 square-kilometre WA-506-P concession, located about 300 kilometres off Western Australia in a water depth of 1500 to 2000 metres, to add to its existing onshore and offshore assets Down Under.

The company already operates onshore assets in the Northern Territory’s South Georgina basin and has a partnership interest in four BP-operated offshore permits in the Great Australian Bight.

“This award adds another large acreage position with high-impact potential to our global portfolio, in line with our exploration strategy. This is an untested part of a prolific basin, offering significant upside potential,” said Statoil’s senior vice president for exploration in the Eastern hemisphere, Erling Vaagnes.

Statoil’s work commitment for the licence, awarded under the country’s 2013 exploration acreage release, covers acquisition of 2000 kilometres of 2D seismic and 3500 square kilometres of 3D data within a three-year term.

It will then decide whether or not carry out exploration drilling based on analysis of the acquired seismic data.

Vaagnes said the work programme for the frontier area in the northern part of the Carnarvon basin was supported by a stable regulatory framework and attractive fiscal terms in Australia.

Large gas discoveries have been made in other parts of the basin, which has multiple fields in production with established infrastructure.

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Butch 'still a goer' for Centrica http://www.upstreamonline.com/live/1381419/Butch-still-a-goer-for-Centrica UK operator scanning development optons despite appraisal disappointment: report Steve.Marshall@upstreamonline.com (Steve Marshall) http://www.upstreamonline.com/live/1381419/Butch-still-a-goer-for-Centrica Fri, 24 Oct 2014 14:00:13 +0000 live The UK operator is targeting investments of between Nkr4 billion and Nkr8 billion ($600 million and $1.2 billion) to exploit the North Sea find with the aim of bringing it online in 2018 or 2019, news site Offshore.no reported.

Options on the table are subsea tiebacks to either the Talisman Energy-operated Ula or BP's Gyda host platforms located nearby, a wellhead platform linked to either of the latter two facilities, or a standalone mobile offshore drilling and production unit.

Centrica is pushing ahead with the project despite coming up dry with wells drilled at the Butch South West and East prospects earlier this year, bucking the trend of project postponements by other operators due to high costs and falling oil prices.

The Butch Main discovery, made in late 2011 in Centrica-operated production licence 405, contains light crude in the Upper Jurassic reservoir of the Ula formation.

A company spokesman told the publication it intends to proceed with the development on the basis of the current resource estimate of between 27 million and 51 million barrels of oil equivalent, giving no indication that further exploration wells were planned.

Centrica operates PL 405 with a 40% stake and is partnered by Faroe Petroleum (15%), Suncor (30%) and Tullow Oil (15%).

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De Beers order sparkles for Kleven http://www.upstreamonline.com/live/1381378/De-Beers-order-sparkles-for-Kleven Diamond giant signs up at Norwegian yard for one vessel to hunt for underwater minerals Eoin.Ocinneide@upstreamonline.com (Eoin O'Cinneide) http://www.upstreamonline.com/live/1381378/De-Beers-order-sparkles-for-Kleven Fri, 24 Oct 2014 11:07:58 +0000 live Luxembourg-based De Beers has ordered an MT 6022-design, high-specification unit at Kleven Vert in Ulsteinvik, with delivery to take place in June 2016.

The value of the contract, which is expected to be firmed up in the first quarter next year, was not disclosed by Kleven.

Much of the specialist equipment will be supplied and installed by De Beers following delivery, Kleven chief executive Stale Rasmussen told Upstream.

The vessel will be DP3 unlike the four-point mooring design of other such marine mineral exploration vessels on the market today, he said.

It will operate in waters around 100 metres deep and will take samples from the seabed that will be taken on board via a pipe. They will then be processed at a De Beers plant and, if sufficient mineral traces are found, a separate production vessel will be brought onto the field.

De Beers has not pencilled in any optional units at Kleven.

This is the first such order for Kleven in this market segment, and Rasmussen believes there are many more opportunities in the market for more units.

The yard group’s order book is now up to 18 vessels totalling some Nkr12 billion ($1.82 billion).

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Four face off for Chevron's Captain award http://www.upstreamonline.com/live/1381357/Four-face-off-for-Chevrons-Captain-award Engineering players in race for pre-FEED contract for UK North Sea EOR project Eoin.Ocinneide@upstreamonline.com (Eoin O'Cinneide) http://www.upstreamonline.com/live/1381357/Four-face-off-for-Chevrons-Captain-award Fri, 24 Oct 2014 09:57:20 +0000 live Read the full story in this week's issue of Upstream.

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Sanctions 'not relevant' for RWE Dea deal http://www.upstreamonline.com/live/1381429/Sanctions-not-relevant-for-RWE-Dea-deal Norwegian oil minister in riposte over decision on takeover by Fridman-backed LetterOne Steve.Marshall@upstreamonline.com (Steve Marshall) http://www.upstreamonline.com/live/1381429/Sanctions-not-relevant-for-RWE-Dea-deal Fri, 24 Oct 2014 14:28:27 +0000 live The clearance granted this summer by the Petroleum & Energy Ministry has created controversy due to the imposition of sanctions on Russia over its alleged military backing for separatists in eastern Ukraine and earlier annexation of Crimea.

While Fridman is currently not on the list of sanctioned individuals, there are concerns in political circles the ministry’s decision could create a difficult situation in the light of the restrictive trade measures in the energy, banking and defence sectors.

LetterOne is set to step into 33 licences – including five operatorships – held off Norway by RWE Dea, which has also recently participated in the landmark Alta find in Lundin Petroleum-operated production licence 609 where the German partner holds a 30% stake.

However, Petroleum & Energy Minister Tord Lien, quoted in an e-mail to news wire NTB, said Luxembourg-registered LetterOne “will not be a player on the Norwegian continental shelf, but the owner of the parent company RWE Dea Norge”.

He added the restrictive measures applied to activity in Russia and “would not be relevant for activity off Norway”, echoing an earlier statement by the Foreign Ministry.

Labour Party parliamentary representative Per Rune Henriksen was reported to have submitted a written question to the minister on whether his ministry would review its decision in the light of sanctions.

Centre Party representative Marit Arnstad, a former oil minister, claimed the matter should first have come up for discussion by the Conservative-led government before a decision was taken.

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'Swords drawn' at Noreco http://www.upstreamonline.com/live/1381404/Swords-drawn-at-Noreco Major shareholders clash over board make-up at struggling Norwegian minnow ahead of EGM Steve.Marshall@upstreamonline.com (Steve Marshall) http://www.upstreamonline.com/live/1381404/Swords-drawn-at-Noreco Fri, 24 Oct 2014 12:34:25 +0000 live The Oslo-listed company, saddled with more than Nkr3 billion ($455.3 million) in debt, is in danger of failing to meet its loan obligations by the end of the year as it faces a liquidity crisis after production outages on a number of fields, including Huntington off the UK in which it is a partner.

Noreco recently recorded hefty resource write-downs totalling Nkr800 million on both Huntington and the Oselvar field off Norway, and is currently in talks for a “strategic solution” that could involve a sale of the company or some of its assets.

It is also in discussions with shareholders and bondholders on a financial restructuring that will be necessary even if the ongoing strategic process is successful.

However, the company’s two biggest shareholders – Erik Henriksen’s Sabaro Investment and Staale Kyllingstad-led IKM Industri-Invest, with respective stakes of 47.51% and 26.45% - apparently have clashed over nominations for a new board to be elected at an extraordinary general meeting on 27 October.

It follows the resignation earlier this month of Henriksen as a director and associate Morten Garman as chairman.

Garman, a lawyer and member of the nomination committee, voted against nominee Ole Rettedal, chief executive of IKM, while voting for the remaining four candidates – including Henriksen as chairman - who were nominated by himself.  

Another director nominee, Andreas Greve-Isdahl, is an advisor to Sabaro, while the remaining two nominees are independent.

This would have effectively left second-largest shareholder IKM without any representation on the board.

However, the move was overruled with a casting vote from nomination committee leader Tom Henning Slethei, who had nominated Rettedal, to secure the latter’s place on the five-member board.

Slethei admitted to financial news site DN.no there had been “disagreement” in the nomination committee ahead of the EGM.

Noreco’s two major shareholders have seen the value of their stock plummet on the company’s troubles.

There are now fears a default on a bond loan of around Nkr500 million due in December could force Noreco into bankruptcy and consequent asset sales unless an alternative agreement can be reached with bondholders.

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Impact nets offshore Africa block http://www.upstreamonline.com/live/1381205/Impact-nets-offshore-Africa-block UK explorer to re-examine block off Guinea-Bissau and Senegal where Ophir drilled in 2011 Eoin.Ocinneide@upstreamonline.com (Eoin O'Cinneide) http://www.upstreamonline.com/live/1381205/Impact-nets-offshore-Africa-block Fri, 24 Oct 2014 07:39:43 +0000 live The Africa-focused explorer has taken 85% and operatorship of the AGC Profond block covering some 6700 square kilometres. Senegal-registered Enterprise AGC will hold the remaining 15%.

Impact has been granted an initial three-year exploration period in which it will reprocess and interpret existing data and possibly shoot more seismic.

An exploration well may be spudded towards the end of the period, or possibly within the renewal period, which is two years.

The block, which lies in waters of between 1000 and 3000 metres deep, is west of the Dome Flore and Dome Gea oilfields and adjacent to Impact’s Block 4B off Guinea-Bissau.

It was previously held by a consortium led by Ophir Energy, while drilled the Kora-1 wildcat in the northern part of the block in 2011. The well had estimated potential reserves of about 450 million barrels.

“The well was located on the crest of a salt piercement feature and encountered claystone and inter-bedded limestones rather than the prognosed sandstone reservoir facies,” Impact said on Friday.

“However, Impact believes that the block remains very prospective – particularly for Cretaceous fans, which have been the target for recent successful drilling in Cairn’s Senegal Sagomar licence located to the north of the AGC Profond block.

“The licence area immediately to the east of the AGC Profond block has been awarded to Oryx Petroleum.”

Impact chairman Mike Doherty said of the latest award: “The recent discovery in the Sangomar licence, announced by Cairn, has highlighted offshore Senegal as a very prospective region for good quality oils.”

Earlier this month Cairn Energy made a significant deep-water oil discovery at the Fan-1 wildcat in the Sangomar block, hitting 29 metres of net oil pay in Cretaceous sandstones. According to Cairn, the discovery could hold 950 million barrels of oil in place, broadly in line with pre-drill estimates.

Impact has operations in South Africa, Guinea-Bissau, Gabon and Namibia.

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Sechin: ‘Rosneft to press ahead in Arctic’ http://www.upstreamonline.com/live/1381333/Sechin-‘Rosneft-to-press-ahead-in-Arctic’ Chairman of Russian oil behemoth insists company can go it alone on Arctic drilling despite sanctions Eoin.Ocinneide@upstreamonline.com (Eoin O'Cinneide) http://www.upstreamonline.com/live/1381333/Sechin-‘Rosneft-to-press-ahead-in-Arctic’ Fri, 24 Oct 2014 08:23:29 +0000 live Sanctions from the US and European Union in the wake of Russia’s annexation of Crimea from Ukraine earlier this year have in part targeted drilling in the Russian Arctic.

This has recently led ExxonMobil to take a step back from its drilling partnership with Rosneft in the Kara Sea. Rosneft subsequently rushed to declare an oil and gas discovery at its East Prinovozemelsky 1 block, with Sechin saying oil was observed in a core sample taken from the Universitetskaya-1 well during drilling.

On Friday, however, Sechin vowed that the state-owned oil behemoth would not be put off its Arctic drilling plans, insisting the company can go it alone if international partners are unwilling to join it in the region.

"We will continue drilling in any case, on our own, always and everywhere,” Reuters quoted Sechin as saying.

“If partners can take part - that's good, if they can't - we will carry on alone.”

Rosneft and indeed Sechin himself have found themselves targets of the sanctions. The company is reportedly looking for around $48 billion in financing from the National Welfare Fund as the sanctions impact its financial position.

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CNOOC 'eyes Barents seismic' http://www.upstreamonline.com/live/1381334/CNOOC-eyes-Barents-seismic Chinese giant shows interest in Arctic acreage off Norway ahead of upcoming round: report Steve.Marshall@upstreamonline.com (Steve Marshall) http://www.upstreamonline.com/live/1381334/CNOOC-eyes-Barents-seismic Fri, 24 Oct 2014 08:27:46 +0000 live The Chinese state-owned giant’s overseas arm CNOOC Ltd has submitted an inquiry to the Norwegian Petroleum Directorate (NPD) about the price of 2D seismic packages on offer for the south-east Barents Sea and the area off Jan Mayen island, Bloomberg reported.

The emailed inquiry, made by a UK-based contract analyst with Canadian player Nexen that was acquired by CNOOC last year, was disclosed to the news wire by the NPD under a freedom-of-information request.

CNOOC Ltd’s interest in getting its hands on the seismic packages, being touted for a price of Nkr12 million ($1.8 million) apiece, could be the precursor for a bid in the round that, if successful, would make it the first Chinese company to acquire exploration acreage off Norway.

A keenly awaited announcement of blocks to be offered in the licensing tender is expected to be made in the fourth quarter, with awards likely to be made in 2016.

The government will offer 34 blocks or part-blocks in an area of the south-east Barents formerly disputed with Russia that is being opened up for exploration, out of a total of 61 tracts – 54 in the Barents and seven in the Norwegian Sea – to be unveiled.

The south-east Barents and area around Jan Mayen are estimated to hold untapped resources of 1.9 billion boe and 566 million boe, respectively, out of total undiscovered volumes of 18.5 billion boe off Norway, according to the NPD.

CNOOC Ltd’s move comes amid an apparent thawing of frosty diplomatic relations between the two countries after Beijing reacted angrily to the 2010 award of the Nobel Peace Prize to Chinese dissident Liu Xiaobo by the Oslo-based Nobel committee.

Norway’s Conservative-led government, elected last year, has made improved relations with China a key foreign policy goal, even to the point of ignoring the visit of Tibetan leader Dalai Lama – another Nobel laureate – to the country earlier this year.

CNOOC Ltd is already teaming up with Norway’s state oil holding company Petoro on exploration off Iceland after taking a stake in a licence in the Dreki area together with local player Eykon Energy, marking the first Chinese foray in Arctic waters.

Compatriot state giant China National Petroleum Corporation last year signed a partnership pact with Russian state-owned Rosneft for joint exploration and development of three blocks in the Barents and Pechora seas off Russia.

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Ross Offshore lands Norway transport contract http://www.upstreamonline.com/live/1381353/Ross-Offshore-lands-Norway-transport-contract Services player hired by Lundin Petroleum and Det Norske for collaborative project Bill.Lehane@upstreamonline.com (Bill Lehane) http://www.upstreamonline.com/live/1381353/Ross-Offshore-lands-Norway-transport-contract Fri, 24 Oct 2014 09:48:58 +0000 live Using its Bergen base, Norway's Ross Offshore will provide booking services for offshore personnel flights to both companies under the contract, which is for three years with three two-year extension options.

Ross Marine & Logistics vice president Jarle Magne Vespestad said the contract was in line with the company’s strategy to create a marine and logistics centre for operators on the Norwegian continental shelf.

The contract follows another secured off Norway last month by Ross Offshore from the UK’s Centrica for consultancy services within drilling and well, subsea, logistics and marine operations.

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Statoil charts Hansteen spin-offs http://www.upstreamonline.com/live/1381363/Statoil-charts-Hansteen-spin-offs Academic bodies to map economic ripple effects of Norwegian Sea field Steve.Marshall@upstreamonline.com (Steve Marshall) http://www.upstreamonline.com/live/1381363/Statoil-charts-Hansteen-spin-offs Fri, 24 Oct 2014 10:17:44 +0000 live Statoil aims to carry out an assessment of the economic ripple effects of its Aasta Hansteen project in the Norwegian Sea under a collaboration with local academic institutions.

The state-owned giant is looking to boost the local economy, mostly in the Hordaland region, to the tune of Nkr450 million ($68.4 million) through targeted investment of Nkr32 billion on the gas and condensate field project that is currently under development.

The Knowledge Park at regional centre Bodo will join forces with Nordland University to map regional and national ripple effects until the end of 2019, two years after scheduled start-up of the field that will be developed using the world’s biggest spar platform, with gas to be exported along the new Polarled pipeline.

The Statoil effort is in line with the government’s northern policy to promote the growth of regional business through offshore development as the industry pushes northwards into Arctic waters.

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Ophir adds to Gabon acreage http://www.upstreamonline.com/live/1381203/Ophir-adds-to-Gabon-acreage London-listed player takes two extra PSCs taking its Gabon portfolio to six blocks bianca.bartucciotto@upstreamonline.com (Bianca Bartucciotto) http://www.upstreamonline.com/live/1381203/Ophir-adds-to-Gabon-acreage Fri, 24 Oct 2014 06:55:11 +0000 live Blocks A3 and A4 are outboard of the company’s existing acreage in the North Gabon basin, both in water depths of between 2000 metres and 2500 metres.

The company holds a 100% interest and operatorship of the blocks, with the government of Gabon holding the right to acquire a 20% interest in each block.

Block A3 is known as the Nkouere PSC and covers an area of 675 square kilometres, while Block A4 will be called the Nkawa PSC, covering an area of 2085 square kilometres.

Based on analysis of its 2014 North Gabon drill campaign, chief executive Nick Cooper said the company was more confident of the prospectivity on the deep-water distal margin of the North Gabon basin.

“This frontier play is untested in the West Atlantic margins, and Ophir with the award of these blocks, together with our existing North Gabon acreage, is now able to embark in the next phase of Atlantic frontier exploration,” he said.

Ophir pointed to the Cretaceous section, where it says a proven oil-prone source rock is overlaid by a series of deep-water sands.

“This offers a petroleum system with the potential for large stratigraphic and structural traps,” Ophir said in a release.

The company added this frontier play was unexplored in the West Atlantic margin, and said Ophir was well-positioned to “chase the play”.

Ophir is in the process of acquiring 8600 square kilometre worth of 3D seismic on its existing blocks, but will now extend that out to cover the new blocks.

The company now holds six blocks in Gabon.

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UK's Horse Hill-1 hits oil http://www.upstreamonline.com/live/1381204/UKs-Horse-Hill-1-hits-oil Weald basin venture uncovers pay but fails to impress market with size of onshore find bianca.bartucciotto@upstreamonline.com (Bianca Bartucciotto) http://www.upstreamonline.com/live/1381204/UKs-Horse-Hill-1-hits-oil Fri, 24 Oct 2014 07:21:13 +0000 live Venture partner Solo Oil announced an oil accumulation had been discovered in the Upper Jurassic Portland sandstone.

Solo previously reported the Portland sandstone had been found to have oil shows in cuttings and elevated gas readings during drilling.

These were confirmed by an independent petrophysical analysis of electrical logs acquired in the well.

A preliminary estimate of 3.1 million barrels of oil in place has been calculated in the upper Portland, with a further 16.8 million barrels in untested potential in a separate lower sand in the Portland interval.

Further analysis is being carried out to shore up the amount of recoverable oil in the well.

Solo chairman Neil Ritson said these well results added significant upside.

"We are now looking forward to drilling the Triassic, which is a new and untested exploration target in the area and which, if successful, may contain appreciable volumes of gas,” he said.

The Triassic-aged target will take about two to three weeks to reach.

Angus Energy is the largest shareholder in Horse Hill Developments, which is gaining a 65% share in PEDL 137 in return for fully carrying licence holder Magellan Petroleum.

Angus Energy owns 40% of Horse Hill Development, alongside UKOG (20%), Stellar Resources (10%), Solo Oil (10%), Doriemus (10%), Alba Mineral Resources (5%) and Regency Mines (5%).

The stock market appeared unimpressed with the size of the discovery, with several of the listed explorers' shares declining in value in morning trading on London's Alternative Investments Market following the announcement.

Solo Oil was trading down 11% while Doriemus was down 22%, UKOG was down 28% and Stellar Resources was down 22%.

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Ezra sees revenues rise http://www.upstreamonline.com/live/1381199/Ezra-sees-revenues-rise Gross profits up but last financial year's higher one-off gains means net profit after tax is down Josh.Lewis@upstreamonline.com (Josh Lewis) http://www.upstreamonline.com/live/1381199/Ezra-sees-revenues-rise Fri, 24 Oct 2014 01:38:09 +0000 live The company posted a net profit of US$54 million for the 12 months to 31 August, down 16% on last year's US$64.1 million.

Hitting net profits was due to higher other operating income the previous financial year, with one off gains helping the company generate an additional US$105.2 million, compared to just under US$7.2 million over the recent financial year.

Gross profits were up 34% year-on-year, coming in at US$226.9 million compared to US$169.2 million.

Helping drive this figure was a rise in revenue from just under US$1.3 billion to nearly US$1.5 billion.

Driving the increase was the US$252.7 million rise in revenue from Ezra's subsea services division, Emas AMC, which generated US$1 billion over the financial year.

Ezra's backlog currently stands at about US$2.4 billion, with most contracts scheduled for execution over the next 12 to 18 months.

Looking ahead, the company said it would focus on steady growth, executing its backlog and deploying its vessels to capitalise on the longer term industry capital expenditure trends and opportunities.

 

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Oil dips on NY Ebola news http://www.upstreamonline.com/live/1381201/Oil-dips-on-NY-Ebola-news First case of deadly disease in New York hits risk appetite as overnight gains reverse Josh.Lewis@upstreamonline.com (Josh Lewis) http://www.upstreamonline.com/live/1381201/Oil-dips-on-NY-Ebola-news Fri, 24 Oct 2014 04:36:27 +0000 live The first confirmed case in America's largest city has renewed fears about the spread of the virus, prompting a tumble in US stock futures, while Asian shares also lost ground.

"Such news is not good for risk assets, with investors looking for a flight to safety. This could curb travel and that's how it could feed through to the oil markets," said Ben Le Brun, market analyst at OptionsXpress in Sydney.

"We could also be seeing some profit-taking after very strong overnight gains."

The front-month contract of international oil benchmark Brent was down 61 cents at $86.22 a barrel early on Friday.

Brent settled $2.12, or 2.5%, higher on Thursday, its largest percentage gain in a day since 12 June. US crude for December delivery fell 70 cents to $81.39 a barrel, after closing $1.57 higher, its largest daily gain since 16 September.

Oil markets had risen sharply on news that crude supplies to the market from Saudi Arabia, the world's top oil exporter, fell to 9.36 million barrels per day in September, down 328,000 bpd from August, according to an industry source.

This comes after Opec's September world oil report that Saudi pumped 9.7 million bpd, up from 9.6 million bpd in August. The difference could be due to how much oil was put into storage.

Broadly stronger than expected economic data from the Eurozone also provided some support.

"Certainly this was the good news that the market was looking for after news on weakening demand. And I think with the majority of the market in a short position, any positive news will give a major reaction to the upside. It's all over to the Opec meeting now," Le Brun of OptionsXpress said.

The 12-member Opec will meet on 27 November to review its output target of 30 million bpd for the first half of 2015. So far, only a minority of members have called for an output cut, including Libya.

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Karoon nearing Santos spud http://www.upstreamonline.com/live/1381196/Karoon-nearing-Santos-spud Australian company expected to start drilling at the Kangaroo oilfield next month Josh.Lewis@upstreamonline.com (Josh Lewis) http://www.upstreamonline.com/live/1381196/Karoon-nearing-Santos-spud Fri, 24 Oct 2014 00:04:58 +0000 live The Australian company revealed on Friday that it had taken possession of the semi-submersible Olinda Star from Brazilian state-run player Petrobras.

The rig is now being moved from Brazil's Campos basin to the Santos basin where it is expected to spud the Kangaroo-2 appraisal well on Block BM-S-68 in the second week of November.

The probe is being drilled to determine the reservoir continuity to the south of the Kangaroo discovery well which hit a 25-metre proven, gross, oil column in Eocene aged rocks last year.

Karoon says it expects the appraisal well to intersect a 350-metre plus gross hydrocarbon column.

Kangaroo-2 will be drilled about 300 metres updip from Kangaroo-1 and will be designed to confirm the size of the oil column and to determine the reservoir continuity and properties in an updip setting.

Karoon estimates the Kangaroo discovery could hold 135 million barrels of contingent resources, with further upside to be assessed after the appraisal programme.

Karoon said on Friday that information from the appraisal well would be “crucial” for assessing the commerciality of the Kangaroo field and would be the basis for the front-end engineering and design phase of the project.

Following Kangaroo-2, Karoon plans to use the Olinda Star to drill the Kangaroo West well in Block BM-S-69, which could add additional oil resources.

Karoon has previously estimated Kangaroo West-1 to hold a mean prospective resource volume of more than 150 million barrels.

 

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Ezra bags $70m in new work http://www.upstreamonline.com/live/1381200/Ezra-bags-70m-in-new-work Subsea division Emas AMC awarded several contracts Josh.Lewis@upstreamonline.com (Josh Lewis) http://www.upstreamonline.com/live/1381200/Ezra-bags-70m-in-new-work Fri, 24 Oct 2014 02:10:14 +0000 live The contracts awarded to Emas AMC will see it carry out the subsea installation of umbilicals. flowlines and jumpers, as well as provide services to support rigs.

Ezra did not name the clients in Friday's announcement but did reveal that work had already started on several of the projects, with the remaining contracts slated for offshore execution between now and the second quarter of 2015.

The announcement of the awards came the same day the company released its financial results for the year ending 31 August, with strong performance from Emas AMC helping drive an 18% overall rise in revenue.

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Ex-BG man launches Houston LNG start-up http://www.upstreamonline.com/live/1381186/BG-veteran-launches-Houston-LNG-start-up Former COO kicks off new liquefied natural gas business eyeing mid-scale exports Kathrine.Schmidt@upstreamonline.com (Kathrine Schmidt) http://www.upstreamonline.com/live/1381186/BG-veteran-launches-Houston-LNG-start-up Thu, 23 Oct 2014 21:48:10 +0000 live Through his new company, Parallax Energy, Martin Houston aims to build "mid-scale" LNG export facilities with capacities of between 1.5 million to 2 million tonnes per annum.

He says potential customers are increasingly keen on buying volumes of less than 1 mtpa.

Parallax's first proposed export project, Live Oak LNG, includes an $800 million facility in Louisiana, with first LNG seen in 2019.

"It's less capital-intensive, it's able to move quicker, it's got a lot of advantages," Houston told Upstream in an interview.

"We're taking very simple technology and peeling this right back to the basics. We're able to take out a lot of clutter."

He adds that the aim is to get "a very low unit cost".

"That's what it's all about for us."

A second similar project is also under development with further details to be released in due course.

Houston says Parallax operates under the idea of "design it once, build many times".

Parallax also has an upstream affiliate, Millenial, which is currently pursuing non-operated stakes in largely unconventional onshore oil plays.

Millenial could also see expansion through acquisitions or become a vehicle to build feedstock for the LNG projects, Houston adds.

Financing is among the company's challenges, but about $82 million in private capital has so far been raised for E&P projects and $60 million for the LNG business, Houston added.

Houston is also working to launch a marketing, logistics and optimisation business called Parallax Gas Supply Trade.

The chief executive spoke to Upstream in Parallax's new office in downtown Houston, where employees were putting the finishing touches on furniture and working out the details for an upcoming launch reception.

The company also counts other former BG staff among its partners, such as Howard Candelet, the UK company's former vice president of global LNG operations.

Houston, who stepped down about a year ago after a 30-year career at BG, kicked off his LNG trajectory in 1993 as Trinidad asset manager, overseeing the pioneering Atlantic LNG development, which entered production in 1998.

He was also instrumental in helping BG book the first 3.5 mtpa of capacity from Cheniere Energy's Sabine Pass export project in 2011 - the first modern liquefaction facility to be built in the US and scheduled to come online in 2016.

Parallax is launching as a wide range of other US LNG export proposals - made possible by cheap and abundant shale gas - move through the US regulatory and development pipeline.

Still, Houston says he has had "a number of live and active discussions" with potential customers.

"It's competing in a crowded space, so for us...low-cost is everything," he said. "We believe that the world needs a lot more LNG."

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