Oil and Gas Industry Roundup: May 2017

Oil and Gas Industry Roundup May 2017 (2)Every month we share the latest news and updates from the oil and gas industry in a bitesize roundup. This month we look at the Quad 204 project in the west of Shetland which has just produced first oil and the Gemini windfarm that has just been built off the coast of the Netherlands. We have also summarised one of the latest Energy Industries Council report about the future of oil and gas companies, as well as Trump’s latest plans to sell off half of the US’s oil stockpile. 

We hope you enjoy this month’s industry roundup. 

BP Begins Production from West of Shetland Quad 204 Project Bp-West-Shetland-Quad-204-Project-Industry-Roundup-Renown-Oil-And-Gas

One of Britain’s leading oil and gas companies, BP, have announced first oil from the multi-million-pound Quad 204 project.

The project, which is led by BP in a joint venture with Shell and Siccar Point Energy, is taking place in the redeveloped Schiehallion Area, west of Shetland, UK.

Quad 204 is part of BP’s plans to double its UK North Sea production by 2020. It is the third of seven major Upstream projects BP will be undergoing in 2017. It is expected that production of this particular project will result in 130,000 barrels of oil being produced per day at peak production.

The old subsea facilities were replaced with the Glen Lyon FPSO (floating, production, storage, and offloading) vessel, and 20 new wells were created in order to increase the potential of the site to the UK Continental Shelf. It is estimated that the lifespan of the fields has been extended to 3035 and possibly beyond.

Bob Dudley, BP’s group chief executive has said: ‘The start of production from Quad 204 – one of the largest recent investments in the UK – is an important milestone for BP, marking a return to growth for our North Sea business.’

 

Huge North Sea Offshore Wind Farm Now at Full Tilt Gemini-Windfarm-Netherlands-INdustry-Roundup-Renown-Oil-And-Gas

An impressive windfarm has been built off the coast of the Netherlands as part of the Dutch Government’s commitment to producing at least 14% of their energy from renewable sources by 2020.

Gemini Windpark is estimated to be one of the largest windfarms in the world. Located about 53 miles off the northern coast of the Netherlands in the North Sea, 150 turbines are in operation to meet the energy needs of about 1.5 million people.

According to a 2016 report, the Netherlands still remain dependant on fossil fuels, equating for about 95% of the country’s energy supply. It is estimated that at its maximum operational capacity, the Gemini windfarm will supply 845,000 Dutch households.

 

Oil and Gas Companies Turning to Innovation, Instead of ExportEIC-Report-Innovation-Not-Export-Industry-Roundup-Renown-Oil-And-Gas

A recent report from the EIC (Energy Industries Council) has found that companies operating in the oil and gas industries are investing in innovation, rather than export to survive the downturn.

Since the crash of the oil prices three years ago, only 8% of companies turned to exporting. Most companies saw exporting as a very difficult and ‘risky’ option and believed it would be more worthwhile to work with their core customers and invest in new technologies, innovations, and collaborations.

CEO of the Energy Industries Council, Stuart Broadley, has said how concerned he is about the government’s attitude to the industry and their focus on exporting and why it may not work. He said, ‘British businesses aren’t resourced or able to invest in that two or three-year cycle and are instead focusing on the UK and that creates future risk. The companies have a very short-term view right now of what they have to do to survive.’

Mr Broadley believes that there needs to be more support and focus on providing these companies with funding so that they can attend international trade shows and increase their chances of exporting, particularly as the date of Brexit looms ever closer.

It is however impressive that oil and gas companies are adapting to the changes. Despite being an industry renowned for its lack of innovation, 78% have invested in new technology in an effort to make themselves more relevant.

 

Trump Plans to Sell Half of the US’s Oil StockpileTrump-Plans-To-Half-Oil-Stockpile-Industry-Roundup-Renown-Oil-And-Gas

President Donald Trump has proposed to sell off half of the US’s strategic oil reserve as part of a plan to trim their national debt.

As part of the White Houses’ first complete budget proposal released this month, it is estimated that they would raise $500 million in the 2018 financial year by draining the strategic petroleum reserve, and as much as $16.6 billion in oil sales over the next decade.

The US currently holds a Strategic Petroleum Reserve of 687.7 MMbbl of oil in Texas and Louisiana. The reserve is always readily available for natural disasters and unplanned incidents. Trump’s plan to sell half the stockpile would risk breaching the legally required threshold of 450 MMbbl.

This proposal in conjunction with Trump’s other plans, such as allowing drilling in national reservations (You can read more about this in last month’s oil and gas roundup) has caused much controversy throughout the country. The federal government’s role in energy markets is expected to likely face opposition in Congress.

 

We hope that you’ve enjoyed this month’s industry roundup. Please join us again at the beginning of July where we will be talking about all of the latest stories and updates from the oil and gas industry in June. In the meantime, for daily news and updates, follow us on Twitter and LinkedIn where we post regularly. 

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