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Tuesday, 25 April 2017 21:26

Senex reports Q3 results

During the Q3 2017 financial year, Senex Energy recorded 14% lower sales revenue of AU$11 million but achieved a few corporate developments by pursuing new opportunities.

Sales volumes for the March quarter were 170,000 bbl, down 15% from the previous quarter due to temporary mechanical issues on several wells, the Brisbane-based company said.

In February 2017, Senex sanctioned its first major investment in the Western Surat gas project in Queensland, Australia.

The firm committed $50 million to a 30 well drilling campaign across the onshore Glenora and Eos blocks, expected to produce 10 TJ/d by mid-2018.

This investment will also cover appraisal activities to be undertaken in other parts of the Western Surat gas project acreage later in 2017, facilitating staged full field development.

Drilling will commence on the Eos block in May 2017 and run over the course of the calendar year, Senex said, adding that first wells are expected to come online in mid-2017.

Construction of gas and water handling infrastructure will be undertaken in parallel, including the refurbishment of the existing dam located on Eos for use during Phase 2.

Senex is progressing material gas opportunities in the onshore Cooper basin in Queensland. During the March quarter, it commenced drilling of the Silver Star-1 well as part of a $105 million unconventional exploration program with Origin Energy. Currently, a 1500m horizontal section is being drilled.

In February 2017, the group announced it had formed a strategic relationship with specialist energy investor EIGGlobal Energy Partners. EIG became a substantial shareholder in Senex, holding 12.2% of Senex’s issued share capital. A total of $55 million was raised through the institutional placement to EIG.

The duo plan to work together to develop and expand Senex’s upstream positions in both the Surat and Cooper basins, including agreeing on a funding model to accelerate development of the Western Surat gas project.

In addition, Senex has placed bids for newly released Surat and Bowen basin acreage and signed a new long-term sale and purchase agreement for Cooper basin oil, with the South Australian Cooper basin joint venture comprising of Beach Energy, Santos and Origin.

In the first half of FY17 ending 31 December 2016, Senex saw a 38% year-on-year decrease in oil and gas revenue. Earnings dropped to $22.8 million, primarily driven by low oil prices, and production was 410,000 boe, down 24% as a result of natural field decline and significantly lower capital expenditure over the previous two financial years.

Image: Work underway at the Western Surat gas project / Senex

Sunday, 23 April 2017 23:01

Reliance starts Sohagpur production

Indian energy company Reliance Industries commenced commercial production from its coal bed methane (CBM) block SP (West)–CBM–2001/1 and is currently supplying CBM for commissioning of the Shahdol Phulpur pipeline (SHPPL).

Reliance said the production from its Sohagpur CBM fields will gradually ramp-up in the next 15-18 months making the firm among the largest unconventional natural gas producers in India.

CBM is an environmentally friendly natural gas extracted from coal-bed and has become an important source of unconventional gas in many parts of the world.

Reliance was awarded the license to explore two adjacent CBM blocks SP(West) and SP(East) with an area of 995sq km in the round one of CBM block bidding by the government of India in 2001.

The Mumbai-based company has drilled more than 200 wells connected to two gas gathering stations in the first phase of development. It expects to drill another 600-800 wells and develop associated infrastructure over the next phases of development.

Reliance Gas Pipelines, a wholly owned subsidiary of Reliance, laid the 302km Shahdol Phulpur gas pipeline that connects the Sohagpur CBM fields from Shahdol to GAIL's HaziraVijaipur-Jagdishpur (HBJ) pipeline network at Phulpur.

With this new pipeline network, these CBM gas fields are now connected with the Indian Gas Grid, Reliance said. 

Wednesday, 19 April 2017 20:47

Woodside Q1 revenue dips

Woodside’s revenue for the three months ending 31 March 2018, fell to US$895 million from $982 million a year earlier, and production fell to 21.4 MMboe from 24.2 MMboe. 

Operationally, however, the firm’s North West Shelf onshore and offshore gas facilities achieved over 98% reliability, and production uptime for the Australian portfolio was over 90%.

During the quarter, Woodside executed mid-term liquefied natural gas (LNG) sales and purchase agreements for up to 16 cargoes from its portfolio for delivery in the period 2017-19.

It continued appraisal of the SNE field in Senegal, production testing of the Thalin field in Myanmar, and Pluto LNG expansion studies to develop concept options by mid-year.

CEO Peter Coleman said the first quarter demonstrated progress against the company’s 2017 priorities. “We continue to work with the Wheatstone operator on final onshore and offshore commissioning activities ahead of expected first LNG mid-year,” he said.

“Woodside’s significant appraisal and exploration programs in Senegal and Myanmar are underway. In Myanmar, our interpretation of seismic data has identified an additional low-cost exploration target with upside potential in block A-6, which contains the Shwe Yee Htun-1 discovery. This increases our Myanmar firm well schedule for 2017 to five.

“Operational performance remains strong with the North West Shelf gas facilities and the Nganhurra FPSO achieving 98% reliability during the quarter. Pluto production was approximately 5% lower than expected; a positive outcome given the significant weather impacts experienced during the quarter,” he explained.

Image: Woodside

Tuesday, 18 April 2017 22:19

CNPC OKs Chengzhuang block development

China National Petroleum Corp. (CNPC) has approved the overall development plan for the prolific Qinshui basin, Chengzhuang cooperative coal bed methane block (GCZ block), located in the Shanxi province onshore China.

The GCZ block with an area of 67sq km and situated approximately 20km south of the Greka Shizhuang south main block, is a joint venture between CNPC and London-listed Green Dragon Gas.  

CNPC has 53% operating interest in the production sharing contract while Green Dragon holds the remaining 47% stake.

To-date, 114 wells have been drilled on the acreage. The C$53.80 million development plan includes the drilling of an additional 147 production wells in 2017 and 2018. CNPC will invest $28.51 million and Green Dragon $25.28 million.

According to Randeep Grewal, chairman and founder of Green Dragon, this a significant step forward for the company and a further realization of their strategy of progressing resource base through long-term production. 

He said the GCZ block overall development plan, while only 0.44% of the group’s total acreage, it fairly represents the profit potential of Green Dragon's asset portfolio.

“In this investment, $45.5 million was invested between 2009-16, during which 114 wells were drilled and on commencement of production, the costs were recovered leading to net cash flow returned as dividends to the parent from October 2015. Green Dragon has been carried for all development capex and cost in relation to GCZ,” he added.

Upon the successful completion of the development plan, the 2016 estimated current probable reserves at GCZ of 15.7 Bcf are expected to be migrated to 1P reserves, bringing total 1P reserves to 29 Bcf.

Furthermore, the estimated gross annual production of 3.01 Bcf in 2017, is expected to increase to 3.23 Bcf in 2018. This comprises of 2.64 Bcf from existing wells and 0.59 Bcf from new wells. 

Image: Green Dragon employee in China / Green Dragon