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Sunday, 04 June 2017 21:11

Petronas records higher Q1 profit

Petronas ended Q1 2017 recording an increase in profit after tax of more than 100%, thanks to higher oil prices and improved margins from its upstream and downstream business units.

Profit for the March quarter amounted to RM10.3 billion compared to RM4.6 billion in the same period last year.

Revenue grew by 25% to RM61.6 billion from RM49.1 billion recorded in Q1 2016.  

Internal efforts to reduce cost and improve efficiency, Petronas said, continued to allow the group to reduce controllable operating expenditure from RM11.4 billion to RM11.1 billion.

Capital investments in Q1 totaled RM11.9 billion, mainly attributable to the Refinery and Petrochemical Integrated Development project in Johor.

Despite the positive results, the Malaysian oil major continues to maintain a conservative outlook for the remainder of 2017.

President and group CEO Datuk Wan Zulkiflee Wan Ariffin said strong performance in Q1 was driven largely by transformation initiatives which continue to gain traction.

“This has strengthened internal collaborations across our upstream and downstream businesses, resulting in improved plant utilization rates, production and the overall creation of substantial value,” he said.

Oil production for the quarter, however, reduced to 2.4 MMboe/d from 2.5 MMboe/d in Q1 2016, owing to lower output in Iraq, lower demand in Turkmenistan and declining production in the Malaysian-Thai Joint Development Area, and Egypt.

Petronas’ liquefied natural gas (LNG) sales volume for the quarter was marginally higher by 0.15 million tonnes as compared to Q1 2016 mainly attributable to higher volume from the Gladstone LNG (GLNG) project in Queensland, and Train 9 in Bintulu.

The firm also commissioned its Terengganu Gas Terminal four months ahead of schedule which is expected to boost the development of Malaysia’s offshore gas fields with high carbon dioxide (CO2) content.

Last year, Petronas’ profit grew by 12% to RM23.5 billion from RM20.9 billion recorded in 2015, due to lower operating expenditures and tax expenses partially offset by lower average prices.

The group’s revenue for 2016 dipped by 17% to RM204.9 billion from RM247.7 billion in 2015.

Image: Petronas

Thursday, 01 June 2017 20:27

Keppel closes deal with Borr Drilling

Keppel FELS said it has signed the relevant agreements with Borr Drilling to novate the construction contracts of the five jackup rigs currently being built by Keppel for Transocean to Borr Drilling.

The Singaporean shipbuilder said Borr Drilling, a Norwegian contractor, will take over the contracts from Transocean and undertake the remaining payment installments.

The price for each rig, which includes the milestone payments already made by Transocean, is US$216 million, compared to the original contract price of $219 million. Borr Drilling will make a down payment of $275 million within two weeks. 

The KFELS Super B Class jackup rigs, designed to operate in 400ft water depth and drill to 35,000ft, were originally slated for delivery between 2016 and 2017 but had been deferred by Transocean to 2020. 

However, based on the new agreements, the first three rigs will now be delivered in Q1 2018, Q2 2018, and Q3 2019 respectively, while the remaining two rigs is scheduled for delivery in 2020.

Last month, Keppel secured an SG$103 million deal with another Norwegian contractor, Stolt-Nielsen Gas B.V., to build two liquefied natural gas (LNG) carrier vessels by Q2 and Q3 2019 respectively.

Each vessel will have a capacity of 7500m3, and come equipped with engines that can run on both diesel and LNG. The carriers will have a class notation for bunkering which adds to their versatility to not only transport but also provide LNG bunkering services if required.

Read more:

Keppel inks deal with Borr Drilling for Transocean rigs

Transocean delays five jackups

Image: KFELS B Class jackup / Keppel Offshore & Marine

Wednesday, 31 May 2017 22:20

Armour buys QGC’s Surat basin interest

Armour Energy said it has acquired QGC’s interest in ATP 647 on the Roma Shelf of the Surat basin in Queensland.

The Brisbane-based company said it now holds 100% of ATP 647 which is located to the east of its PL 227 block and the Myall Creek field.

An independent review of Armour’s Surat basin assets showed 2P petroleum reserves of 56.8 PJ of gas, 565,000 bbl of condensate and 117,000 tonnes of liquefied petroleum gas in place.

With the acquisition of ATP 647, the firm will be able to further expand the mature, but undeveloped, wet gas conventional and tight wet gas plays in Permian and Triassic reservoirs of the Bowen‐Surat basin.

The existing Myall Creek East 1 well, located in the southwest corner of block ATP 647, is currently suspended and is considered a candidate for stimulation and potential connection into the Myall Creek field gathering system and compressor station.

“This will provide Armour with another low-cost operation to add to our growing portfolio on the Roma Shelf, and provide it with reserve growth and further production capacity to supply the domestic market,” the firm said in a statement. 

Last December, Armour announced its plan to restart gas production at the Kincoara project located in the Roma Shelf. It consolidated the initial three-phase program into a two-phase plan.

Phase one is the commencement of gas production ramping up to 9 TJ/d. First gas production is targeted to be achieved by mid Q1 2017, and the balance of the restart to be completed by the end of Q2 2017.

Phase 2 will involve the drilling of new wells plus workovers and stimulations of existing wells to achieve a ramp up of gas production to 20 TJ/d over a period of 12-18 months from first gas production.

Gas produced from Kincoara will be sold to Australia Pacific LNG over a minimum five-year period. It will be transported via the Roma Brisbane pipeline at Wallumbilla.

In March, Armour executed a connection agreement with the APA Group securing access to the pipeline for a ten year term and provide connection for up to a 30 TJ/d gas flow rate. 

Image: Map of Armour's Roma Sheld leases / Armour

The Inpex-led Ichthys liquefied natural gas (LNG) project welcomed the safe arrival of the central processing facility (CPF), a large semi-submersible platform, in the Australian waters of the Browse basin.

The massive CPF, Ichthys Explorer, weighing 120,000 tonnes and with topsides measuring 130m by 120m, reached final destination, 220km off the north coast of Western Australia, where it will be located for 40 years,

“The safe completion of the 5600km tow of the Ichthys Explorer from South Korea to the Ichthys field, located 450km north of Broome, is another significant milestone for the Ichthys LNG project,” said Louis Bon, managing director, Ichthys project.

After the Ichthys Explorer is safely moored in the 250m deep waters of the Ichthys field, hook up and commissioning will begin. The CPF is the central hub for initial offshore processing of all well fluids delivered from an extensive, 130km network of subsea well infrastructure.

Gas from the CPF will be sent through an 890km subsea pipeline to the onshore LNG facility, at Bladin Point, near Darwin for processing. Most condensate and water from the CPF will be transferred to a nearby floating production, storage and offloading facility, the Ichthys Venturer.

The Ichthys LNG project is operated by Inpex (62.245%) alongside major partner Total (30%) and the Australian subsidiaries of CPC Corp. (2.625%), Tokyo Gas (1.575%), Osaka Gas (1.2%), Kansai Electric (1.2%), Jera (0.735%) and Toho Gas (0.42%).

It involves producing and shipping approximately 8.9 million tons of LNG and 1.6 million tons of liquefied petroleum gas per year, along with around 100,000 bbl/d of condensate at peak. 

Image: Ichthys Explorer sail away / Inpex

Read more:

Ichthys CPF en route to Western Australia

Ichthys LNG one step closer