AsianOil Week 06

For analysis and commentary on these and other stories, plus the latest oil and gas developments, see inside…

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reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its contents

16 February 2011

Week 06

Issue 262

� News � Analysis

� Intelligence Published by

� NewsBase

COMMENTARY 2 � Reddy for action 2 � Abu Dhabi confirms ADOC role in raising

oil output 3 MARKET COMMENTARY 4 � Stoking the fire 4 PIPELINES & TRANSPORT 7 � Coastal signs US$88m vessel sales deals7 INVESTMENT 7 � Indonesia second bottom for oil and gas

investments 7 � Report sees tax incentives boosting

Malaysian investments 8 � IOC still keen on Turkish oil refinery 8 PERFORMANCE 9 � Ramba Energy makes surprise oil

discovery at West Java gas field 9 � EPIC full-year profit surges 38% 9 � Horizon Oil reports positive results from

PNG well 10 � Carnarvon Petroleum provides positive

Thailand update 10 POLICY 11 � ONGC share sale planned for March as

part of shake-up 11 � Petronas keeps a close eye on Sudan 11 � PTTEP and Petronas to expand joint gas

exploration 12 � Thai energy minister advocates alternative

energy projects 13 PROJECTS & COMPANIES 13 � Japanese major farms into Iraq’s Gharaf

oilfield 13 � Japanese consortium wins LNG plant deal

in Australia 14 � CGE ties up with Essar 14 � Dayang wins Petronas contract 14 � Premier to spud Vietnam appraisal well 15 NEWS IN BRIEF 16 TENDERS & CONTRACTS 22

NEWS THIS WEEK…

Reddy for action New Indian Petroleum Minister Jaipal Reddy outlined his action plan for the oil and gas industry in an exclusive interview with AsianOil.

� Reddy, who has replaced Murli Deora as Indian petroleum minister in a recent cabinet reshuffle, faces several major challenges both at home and abroad. (Page 2)

� Reddy said he would largely follow the policy framework that was laid out by Deora. (Page 2)

� Payment issues with Iran, the upcoming NELP-IX bid round and ongoing consideration of the Cairn-Vedanta deal are all pressing matters for the new minister. (Page 2)

Solid as ADOC Japan’s Abu Dhabi Oil Co. (ADOC) has solidified its position in Abu Dhabi, one of the country’s key strategic oil suppliers.

� ADOC has been granted an extension to three existing oilfields in Abu Dhabi. (Page 3)

Tax and spend A new report claims that Malaysia’s new tax incentives should encourage greater spending in the country’s oil and gas sector in 2011. (Page 8)

AsianOil

ASIA OIL & GAS MONITOR

AsianOil 16 February 2011, Week 06 page 2




The appointment of Jaipal Reddy as Indian petroleum minister in place of Murli Deora in the country’s recent cabinet reshuffle was an unexpected move.

Some political analysts in India believe Reddy was brought in because Deora was perceived to be lobbying on behalf of various corporate interests. However, others are less surprised by the appointment, noting that Reddy is an old ruling Congress Party hand and is known to be close to major players such as Sonia Gandhi and Indian Prime Minister Manmohan Singh.

Such ties could help Reddy to push through the crucial decisions that are necessary to shore up India’s energy security. But the minister will be hamstrung by the perennial problems that faced his predecessor, such as high oil prices and fuel subsidies.

Speaking to AsianOil in an exclusive interview, Reddy said he would follow the policy framework that was laid out by Deora, including the promotion of unconventional energy sources such as shale gas.

“I am not a new minister of a new government. I am a new minister in the same government ... whatever decisions were taken by Murli Deora ... were taken collectively by the cabinet.”

NELP-IX One immediate task for Reddy is to oversee the ninth bid round under the New Exploration Licensing Policy (NELP-IX). India hopes that this auction will see investment from super-majors such as BP, Chevron and ExxonMobil. The closing date for bids is March 18.

“Despite the successes of Reliance [in the KG basin] and Cairn [in Rajasthan], India needs to ramp up its hydrocarbon base given the rapidly rising demand and dependence on imports,” said Reddy. “We are looking to attract global energy players [that have been reluctant] to invest in India by removing policy uncertainties, promoting transparency and creating an open playing field.”

New Delhi is offering 34 exploration blocks in 10 sedimentary basins covering an area of about 88,807 square km. Under the NELP regime, 87 oil and gas discoveries have already been made in 26 exploration blocks. NELP-IX, however, could well be the last in the series, as the bidding process is scheduled to be replaced by the new Open Acreage Licensing Policy (OALP).

Cairn-Vedanta deal Another pressing matter for the new petroleum minister to deal with is Vedanta Resources’ bid to take over Cairn India. Reddy says he wants all issues relating to the proposed US$9.6 billion takeover “sorted” without “losing time.”

“My officials have been meeting the parties concerned, including ONGC, Cairn and Vedanta. The law ministry and the prime minister’s office are looking at the various aspects [of the deal]. We will go by the rule book,” Reddy said on the issue of the government consenting to the deal’s completion.

The minister added, however, that the government would seek to protect the interests of state-run ONGC, which has raised some questions regarding the deal. “Objections by ONGC need to be

tackled,” said Reddy.

Iranian issues Reddy admitted the relations with Iran were “not easy” because the country had been “isolated” by Western sanctions led by the US. The sanctions regime has created major problems for New Delhi with regard to paying Tehran for oil and fuel supplies.

“The most difficult part is finance, whether loans for investments or money transactions owing to the sanctions,” said Reddy, adding that Indian firms such as ONGC had been seeking advice on the issue from the government.

However, Reddy added that India remained committed to its relations with Iran and stressed that the latest payment issues would be resorted with Tehran without disruption to oil supplies.

The minister went on to say that India was still pushing for the Iran-Pakistan-India (IPI) gas pipeline to be built. But he stressed that the project had its “complications [because of] security and transit issues with Pakistan and dealing with Iran.”

Reddy did say, however, that India hoped for a “better result” with the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline project. “The success of TAPI could be a template for IPI. India needs to bolster every oil and gas source,” he said.

The ongoing issues with Iran allied with the slow progress on the Cairn-Vedanta deal and the upcoming NELP auction mean India’s new petroleum minister has a full in-tray. The next few months will determine if he is ready, willing and able.�

COMMENTARY

Reddy for action New Indian Petroleum Minister Jaipal Reddy faces several major challenges both at home and abroad as he takes office By Siddharth Srivastava � Jaipal Reddy replaced Murli Deora as Indian petrole um minister in the country’s recent cabinet reshuff le � Reddy told AsianOil he would largely follow the policy framework that was laid out by Deora � Issues with Iran, NELP-IX and the Cairn-Vedanta dea l are all pressing matters for the new minister





After months of waiting, Abu Dhabi Oil Co. (ADOC) has been granted a new concession agreement by Abu Dhabi’s Supreme Petroleum Council, and handed an extension to its existing oil rights in the emirate.

An oil operating company working in Abu Dhabi, ADOC is a subsidiary of Japanese refiner Cosmo Oil and various other Japanese partners.

It is the latest sign the UAE government is intent on expanding its oil production capacity by renewing concessions with established international partners, some of which date back 75 years.

It is also an endorsement of Japan’s own partnership with the UAE as the

biggest single buyer of Abu Dhabi crude, taking about 40% of the emirate’s total petroleum exports.

The new ADOC agreement covers three existing fields: Mubarraz, Umm al-Anbar and Neewat al-Ghalan, plus an additional, new concession area, the Hail field. It is valid for 30 years from December 6, 2012, after the expiration of the current accord.

ADOC will hold a 100% interest in the four fields covered by the new concession.

Cosmo leads the ADOC consortium with a 63% stake, and is joined by JX Holdings Inc.’s exploration unit with 31.5%, plus Tokyo Electric Power Co., Kansai Electric Power Co. and Chubu

Electric Power Co., each with 1.8%.

Potentials It is an important deal for the Japanese group, even though the fields are considered only minor compared to Abu Dhabi’s main offshore oilfields, Umm Shaif, Zakum and Upper Zakum.

The current output from Mubarraz is about 18,000 barrels per day (bpd), compared with more than 550,000 bpd pumped from Upper Zakum.

But it underscores Abu Dhabi’s continued belief in the Japanese market, and further entrenches an already strong and thriving trade partnership.

In 2009, Abu Dhabi signed a deal to store oil in Japan for marketing in the wider Asia-Pacific region.

The latest agreement for oil concessions freshens up this established relationship.

ADOC has been pumping oil from the Mubarraz, Umm al-Anbar and Neewat al-Ghalan fields for some time, under a 45-year agreement due to expire next year.

Going forward, the combined output from several undeveloped reservoirs within the Hail field could peak at a level matching ADOC’s existing production, the group said. The new field, Hail, is located adjacent to ADOC’s existing operating fields and includes some undeveloped reservoirs.

The Japanese group is now free to commence exploration work in the field.�

COMMENTARY

Abu Dhabi confirms ADOC role in raising oil output Japan’s Abu Dhabi Oil Co. has secured and extended its position in Abu Dhabi, one of the country’s key strategic oil suppliers By Andrew Mollet � ADOC has been granted an extension to three existin g oilfields in Abu Dhabi � The group will also develop a new field, Hail, as p art of its 30-year concession � Japan is Abu Dhabi’s single biggest oil customer, t aking 40% of its crude exports



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This will include drilling appraisal wells to develop and produce oil drawing on ADOC’s existing facilities in the area.

Significance “The new concession agreement symbolises the excellent bilateral relations between the UAE and Japan,” Cosmo Oil said in a statement.

“ADOC will commence exploration activities in the Hail field, which will include drilling appraisal wells, and will develop and produce crude oil in a highly efficient and cost-effective manner through full utilisation of ADOC’s existing facilities, taking into high consideration the protection of the environment in the area,” it added.

ADOC’s experience of more than 40 years in Abu Dhabi and the various environmental protection activities carried out by the company – utilising advanced technology such as zero gas flaring and sour gas injection into reservoirs – are additional factors that will continue to boost bilateral relations

between the countries. Sour gas injection is a process in which

dissolved hydrogen sulphide and carbon dioxide are recovered from extracted oil and pumped back underground.

The gases help to push out more crude and are eventually stored permanently in the depleted oilfield.

And challenges But the Japanese consortium will also face up to some of Abu Dhabi’s tough gas challenges too, as well as simply producing more oil.

Abu Dhabi National Oil Company (ADNOC) has already established the presence of a deep gas field in rock formations below the Hail oil pools.

The trouble is the gas contains a high concentration of hydrogen sulphide.

The presence of the toxic and corrosive impurity makes the Hail gas technically challenging to produce.

Any gas leak could pose a serious threat to public health given the field’s proximity to coastal settlements.

Abu Dhabi Gas Liquefaction Company (ADGASs), an operating subsidiary of the government-owned ADNOC, launched a study of the feasibility of developing Hail gas in 2008, but no contracts were awarded for the project.

The inclusion of the Hail area in the new ADOC concession may indicate that the proposed sour gas development has been shelved, with the emphasis now on oil.

The fast-track development of the Shah sour gas project by ADNOC and the US’ Occidental Petroleum, however, could provide valuable insight into how to tap Hail gas safely and commercially.

Like other oil pumped in Abu Dhabi, Hail’s crude is also likely to contain hydrogen sulphide, although at a much lower concentration than in the underlying gas.

This highlights the importance of ADOC’s commitment to develop the oil in an environmentally responsible manner, which it has pledged.�

Only a week after it raised interest rates for a third time in as many months, China’s voracious appetite for crude oil imports remained undimmed this week.

While it is Chinese property prices and financial markets that are the main targets of the tightening of monetary policy, global markets have been anticipating that a dampening effect would be observed in the oil market as well. Not so far.

Real demand China’s January’s crude imports reached

around 5.3 million barrels per day, among the highest rates of crude importing ever seen in China.

Moreover, this is 20% higher than at around the end of 2009. It is only the start of the year, of course, and 2011 is perhaps still expected to see some moderation of growth, but there is little sign of it so far. It is becoming clearer that oil markets may not see any material effect from the stringent direction of monetary policy, and in fact may not see any effect at all.

Some of the reasons for this arise from

the fact that demand for oil is “real,” in the sense that it is derived from industrial demand, transportation and other similar activities. Power generation in China has also driven a surge in consumption of diesel, which has created a shortage in the country.

These facts are being noted in the context of the interest rate rise, and oil markets are perhaps quickly realising that oil demand in China is not going to be dented by changes in monetary policy.�

COMMENTARY

MARKET COMMENTARY

Stoking the fire China’s strong oil import data for January have reassured the market that despite stringent monetary policy the country’s oil demand remains stable By David Flanagan





More evidence of similar trends in other raw commodity markets is noted as well, such as copper and aluminium, where imports are also running at accelerating rates.

Beneath the veil Because of Asia’s crucial role in driving oil demand in 2010, oil traders have been waiting keenly to see what the likely trend will be for 2011. And the January figures point to a healthy pattern.

But, whatever China does in 2011, there are some other unknowns in its oil market presence. The precise nature of its oil imports is never completely clear. This is owing to its unknown storage position. In other words, little is known about what volumes China imports for storage.

It is well known that China has some form of reserve, but the terms of its management are not disclosed. Hence, monthly import volume is only ever one part of the picture. A slowdown in China’s economy could easily be disguised by the fact that crude oil and other commodities are being imported in part for storage.

But, whatever the precise position, China’s underlying demand for oil appears to be stable. As a result, oil prices were buoyed by the Chinese data during Week 7.

On other fronts Elsewhere, fears are emerging that the effects of Japan’s stimulus may be waning. Japan recovered strongly in 2010, and many market observers were surprised by its buoyant oil demand profile during the year.

But, Japan’s economy saw a sharp slowing in the closing weeks of 2010, and the outlook for 2011 is in some contrast to China’s, for example. Its debt overhang is stifling consumption and investment, which spells weak medium-term underlying conditions.

The stimulus package has perhaps only

bought Japan time, but it has managed to “wrong-foot” the market before, and could do so again.

On global markets, the resolution of the crisis in Egypt helped to contain the oil market from a more vigorous upsurge this week. Prices have been to some extent kept in check by the sense of relief felt by traders. But, they have also been left with a warning that political tensions in the Middle East are very real, and signs of similar instability have been seen in Iran and Algeria.

What really worries traders is the possibility that other oil-producing countries could be impacted by similar civil unrest as was seen in Egypt. This realisation is currently placing a floor under international crude oil prices.

On the markets On the Dubai Mercantile Exchange (DME), the Oman crude future for April began the week at US$96.24 per barrel.

Prices firmed slightly as the week progressed, driven by the lack of any apparent solution to Egypt’s crisis. The contract reached US$97.78 per barrel on February 10, then slipped back to US$97.65 by the weekend. A further modest fall on February 14 to US$97.15 reflected the market’s decision to refocus on fundamentals as the alarm from Egypt subsided. But, the upward pressure created by the first Chinese import data for 2011 helped prices up on February 15 to close at US$99.07 per barrel.

Global oil prices have stabilised slightly, and it may be that the contract will not move through the US$100

barrier. But it is possible. The spread between Brent futures and the Oman future, the so-called “Brent-Dubai swap” has narrowed, reflecting the weight attached to Asian demand as a driver of prices, relative to other demand sources.

January was a record month for DME, with the highest volumes traded on the exchange since its launch. DME’s chief executive, Thomas Leaver, said: “We will continue to work diligently … to consolidate our position as the benchmark for crude oil in the Middle East and Asia.”

On the Tokyo Commodity Exchange (TOCOM), crude oil futures for February delivery started Week 7 at 49,780 yen (US$594.19) per kilolitre on February 8. Prices moved higher by the weekend to close at 50,640 yen (US$604.39) on February 11. The contract gained more ground to close at 51,300 yen (US$612.27) on February 15.

Kerosene futures continued their habit of outperforming the market, rising from 65,280 yen (US$779.23) at the start of the week to close at 66,400 yen (US$792.6) on February 11, and at 66,800 yen (US$797.38) on February 15.

Petrol futures began the week at 59,790 yen (US$713.71), moved higher to 60,640 yen (US$723.86) at the weekend, and closed on February 15 at 61,200 yen (US$730.54).

Japan’s oil market certainly seems to continue to display a bullish character, which some may find at odds with underlying economic conditions. However, it may be that strong buying for stock replacement purposes is continuing. Kerosene stocks in particular were particularly low in Japan in the closing months of 2010. This rebuilding process may be taking longer than some observers may have expected.

In addition, Chinese imports of oil products may also be driving up TOCOM futures prices.�

MARKET COMMENTARY

Global oil prices have stabilised slightly, and it may be that the contract

will not move through the US$100 barrier





SETTLEMENT PRICES – DME OMAN FUTURES, February 15, 2011

Product Price at Dubai close (US$)

Change* (US$)

Oman crude Apr 2011 (bbl)

99.07 +1.92

Source: Dubai Mercantile Exchange (*Change on prev ious trading day’s close)

CLOSING PRICES – TOCOM FUTURES, February 15, 2011

Product Price at Tokyo close (yen)

Change* (yen)

Kerosene Mar 2011 kilolitre

66,800 -110

Petrol Mar 2011 kilolitre 61,200 -380

Source: Tokyo Commodity Exchange (*Change on previ ous trading day’s close, 1 barrel = 0.159 kilolitre )

MARKET COMMENTARY

Crude and Products Market Projections for Week 8 Chinese import figures for January 2011 gave a signal to the market that its demand for oil would continue in a

similar energetic pattern. The high volume during the month appears to be unaffected by monetary policy moves.

Oman futures rose on the news, and it looks likely that more evidence will emerge that demand for raw materials

and commodities will continue to climb in the early weeks of 2011.

In the meantime, prices in Week 8 for the Oman crude future ought to remain roughly stable.

In Japan, products prices appear unwilling to end their relentless rise. TOCOM futures appear likely to increase

modestly in the week ahead. Demand from China for Japanese exports of oil products may also be driving up the

market.

Price projection for April Oman crude futures for Week 0: US$97.00-101.00

Price projection for March TOCOM kerosene futures for Week 0: 67,500 yen (US$806.11)

Price projection for March TOCOM petrol futures for Week 0: 62,000 yen (US$740.83)�





Malaysian shipbuilder Coastal Contracts announced it had secured new vessel sales contracts worth a total of about 268 million ringgit (US$88 million) via its three wholly-owned subsidiaries.

The three subsidiaries are Coastal Offshore (Labuan), Pleasant Engineering and Thaumas Marine. According to Sabah-based Coastal, the new contracts are for the sale of seven offshore support vessels (OSVs), three tugboats and two oil barges.

Of the seven OSVs, six were purchased by New York-listed Tidewater Group, the world’s largest provider of marine support services for the offshore industry.

The other OSV was sold to Singapore-

listed Swiber Group, which offers a full range of offshore engineering, procurement, construction, installation and commissioning (EPCIC) and marine support services to support the entire spectrum of offshore oil and gas exploration projects.

Coastal did not disclose the buyers of the three tugboats and two oil barges.

Coastal currently has about 760 million ringgit (US$249 million) worth of vessel sales orders awaiting delivery to customers up to 2012, Coastal said. That number takes into account the new contracts.

“The revenue stream from the latest contracts is expected to contribute positively to the earnings per share and

net assets per share of the Coastal group for the financial years ending December 31, 2011, [FY11] and FY12,” the company said in a statement.

Coastal’s executive chairman, Ng Chin Heng, said: “These latest contracts will be the largest vessel sale orders for the Coastal group since December 2009, and will significantly replenish our vessel sales order book. We see this as a positive development and believe that it may just kick off the start of more contract inflows,” he said.

Looking ahead, the Coastal official said: “The long-term fundamentals of the OSV shipbuilding industry look positive.”�

Indonesia has been ranked the second least attractive destination for oil and gas investors in the Asia-Pacific region in a new study, which has listed widespread corruption, poor government transparency and a lack of skilled workers as reasons for the low ranking.

The report, by Canadian research organisation Fraser Institute, placed Indonesia 14th out of 15 states and territories, with only Timor Leste – its former province – ranking lower. This marked the second year in a row that Indonesia finished in 14th, although the addition of Timor Leste to the list this time moved the country up from last place.

Globally, Indonesia fared little better, ranking 111th out of 133 countries – lower than Papua New Guinea (PNG),

Philippines and Brunei Darussalam. In the study, the Fraser Institute said a

number of factors had contributed to the country’s poor performance, including “corruption and poor data access” and a shortage of skilled labour, adding: “terms are always being tightened, yet prospectivity is no better than in other countries.”

The paper also warned potential investors that “profit-sharing contract terms are not always honoured”, but it is “impossible to sue the government”.

In particular, Indonesia’s main oil and gas bill was singled out for criticism, with the number of taxes due during exploration thought to be excessive. Under a previous law, overseas firms were only required to pay tax after they found and produced oil and gas.

The level of bureaucracy was also questioned, with investors required to meet a number of government offices before permission could be granted. The previous law called for a single meeting and the signing of a profit-sharing contract (PSC) with the national oil company, Pertamina.

The legislation, known as Law No.22/2001, was described as legally “flawed and paralysed” by the report because of Indonesia’s Constitutional Court’s removal of several main articles that conflict with the country’s 1945 constitution.

“Unfortunately, both the President and the Minister of Energy and Mineral Resources of the country do not take any action to fix the situation,” it added.�

PIPELINES & TRANSPORT

Coastal signs US$88m vessel sales deals

INVESTMENT

Indonesia second bottom for oil and gas investments





Malaysia’s new tax exclusion incentives, alongside a management restructuring of national energy company Petronas, will lead to a significant increase in activity in the country’s oil and gas sector in 2011, a new study by market research firm Frost & Sullivan has said.

The report, released in Singapore on February 7, went on to say that this would include more strategic collaborations in joint venture developments with fellow ASEAN countries, a greater number of acquisitions of proven or marginal fields, rapid investments in new technology to tap into new oil and gas boundaries, and an Enhanced Oil Recovery (EOR) drive to improve on the nation’s reserves recovery ratio and reservoir management

practices. This was attributed to Malayasia’s new

Economic Transformation Programme, which aims to turn Malaysia into a high-income economy by 2020, and features a number of measures designed to promote diversification in the energy industry.

“The Malaysian governments has announced revisions in its Petroleum Income Tax Act, with new tax exclusion incentives to be given to domestic investments in order to attract [money] into the oil & gas sector,” said Razeen Khalid, Frost & Sullivan’s Asia Pacific programme manager.

“This incentive is expected to bring in foreign investments for the capital-intensive deepwater projects as well as attract private investors for smaller,

marginal field initiatives,” he continued. In addition, Petronas’ newly

restructured board of directors and management committee “consists of more leaders familiar with the industry”, Razeen said, which will lead to a greater focus on domestic exploration, development and production activities.

“Malaysia’s rising economy brings the nation closer to being a net importer of oil, putting a need for bigger reserves discovery,” he added.

“In view of this, the government and Petronas have aligned a capital expenditure allocation of approximately 40 billion ringgit [US$13 billion] for 2011. This huge domestic investment will benefit local oil and gas service providers and contractors of all sizes.”�

India’s flagship refiner-marketer, state-owned Indian Oil Corp (IOC), is conducting feasibility studies for a US$5 billion refinery in Turkey, India’s Junior Trade Minister Jyotiraditya Scindia said this month.

IOC “is looking at setting up a 15 million tonne per annum refinery company in Turkey. They are evaluating the feasibility of this,” Scindia said. He added that IOC and state-owned explorer Oil and Natural Gas Corp. (ONGC) were also looking at oil and gas exploration opportunities in Turkey.

IOC had earlier planned to construct a refinery with Turkey’s Calik Holding at the Mediterranean port of Ceyhan, where pipelines carrying Iraqi and Azeri crude terminate. However, the plans could not be implemented owing to the 2008 global financial crisis. Investment in a pipeline project also did not materialise.

Scindia did not mention whether IOC and Calik would be partners.

Potentially, ONGC could explore off the Black Sea coast, where US firm Chevron and Brazil’s Petrobras have been scouting for gas.

Only tiny amounts of oil and gas are available in Turkey, forcing the country to import 95% of its hydrocarbon needs. However, observers say that IOC will only be able to pull off the project if its finances are sound.

As things stand, crude oil prices at US$100 per barrel will hit the IOC bottom line, as it is forced to sell fuel (diesel, cooking gas and kerosene) at below cost, as part of India’s official policy to protect the poor and check inflation. Such under-recovery has forced IOC to postpone a follow-on public offer of shares originally scheduled for January that would have fetched US$5-6 billion. Last month, IOC’s chairman, B M Bansal, said: The “government has decided this is not the right time to divest,” and “will decide on the share

sale within three to four months.” New Delhi intends to sell a 10% stake

in IOC, while the company will offer an equal number of new shares. IOC is the country’s largest state-owned company in the downstream sector, operating 10 of India’s 18 refineries and controlling about three-quarters of the domestic oil pipeline transportation network.

The company has earmarked US$1 billion for overseas acquisitions in the exploration and production sector.

“We are looking for good-quality assets abroad,” Bansal said last September. IOC refineries in India include the 8.5 million tonne per year (171,000 barrel per day) facility at Mathura (Uttar Pradesh) and a 12 million tonne per year (241,000 bpd) unit at Panipat (Haryana). IOC already maintains an international profile in places as diverse as Libya, Iran, Yemen, Nigeria, Venezuela, Gabon and Timor-Leste.�

INVESTMENT

Report sees tax incentives boosting Malaysian investments

IOC still keen on Turkish oil refinery





Singapore Exchange-listed Ramba Energy has announced a surprise discovery of oil at a gas field in West Java in Indonesia.

In an announcement the company said the oil discovery was made by its wholly owned subsidiary, Ellipse Energy Jatirarangon Wahana (EEJW) during a work-over at the Jatirarangon gas-producing field (Jati Block) in Cikarang, West Java.

The Jati block has been in commercial gas production since October 2004 and currently supplies gas to Perusahaan Gas Negara (PGN) under a contract which lasts until 2014. EEJW operates the Jatirarangon block and holds a 70%

working interest. The other 30% working interest is

owned by Wahana Sad Karya as a non-operator.

Ramba said that the current flow rate from the JRR-3 ST well tested at 90 barrels of oil per day and 500,000 cubic feet (14,160 cubic metres) of gas per day.

Prior to the workover, JRR-3 ST had been shut-in. But owing to the oil discovery, the company has now decided to forego the perforation of the Cibulakan and Cisubuh zones in the well.

Daniel Jol, Ramba’s commercial director, said: “This is an unexpected surprise and we are delighted with this find. The presence of oil may potentially

change the economics of the Jatirarangon block.”

However, further in-depth geological, geophysical and reservoir studies, seismic acquisition, as well as a well-intervention programme, will be considered before the true potential of the discovery can be determined, he added.

The studies will be carried out in consultation with Indonesian state oil and gas company, Pertamina. Among the key objectives of the workover, which began December 2010, was the perforation of the gas prospective zones at the Baturaja, Cibulakan and Cisubuh zones.�

Malaysian oil and gas services company Eastern Pacific Industrial Corp. (EPIC) said that its group pre-tax profit surged 38.4% in the fiscal year ended on December 31, 2010, from a year earlier.

EPIC, operator of the Kemaman Supply Base (KSB), a major petroleum supply base, as well as the Kemaman Port in Terengganu, posted a group pre-tax profit of 75.392 million ringgit (US$24.68 million) in the last financial year, compared with 54.459 million ringgit (US$17.83 million) a year earlier.

The company’s group revenue soared 28.2% to 235.136 million ringgit (US$76.97 million) in the last fiscal year, compared with 183.466 million ringgit (US$60.05 million) a year earlier.

“The increase in both revenue and profit before tax was mainly owing to increases in port operations and oil and gas activities,” EPIC said in a statement.

The company’s group revenue in the

fourth quarter of the last fiscal year totalled 53.311 million ringgit (US$17.45 million), up 7.6% from 49.545 million ringgit (US$16.22 million) a year earlier.

The company’s group pre-tax profit in the October-December period amounted to 18.117 million ringgit (US$5.93 million), up 47.6% from 12.275 million ringgit (US$4.02 million) a year earlier.

EPIC painted a rosy picture of its performance prospects in the current fiscal year. “Barring any unforeseen circumstances, the directors are confident

that the group will be able to achieve satisfactory results for the financial year ending December 31, 2011, compared to 2010,” the company said.

EPIC provides energy-related services and facilities, tubular threading and maintenance services and sludge management services to the oil and gas industry. The company also offers port services, ICT services, fabrication services and other services to its customers.

KSB is located in the Petroleum Development Zone in Kemaman, Terengganu. According to EPIC, KSB hosts more than 250 services companies supporting the petroleum industry with services such as fabrication, engineering works, manufacturing and assembly, wire line and rigging, equipment testing and inspection, handling and supplies, amongst others.�

PERFORMANCE

Ramba Energy makes surprise oil discovery at West Java gas field

EPIC full-year profit surges 38%

“The increase in both revenue and profit before tax was mainly owing to

increases in port operations and oil and gas

activities”





Horizon Oil has announced positive results from its Stanley-2 well, located in PRL4 onshore Papua New Guinea (PNG) in the Toro formation.

The oil exploration, development and production company has operations in China, New Zealand, PNG and the US.

The well is located around 1.6 km south-east of the Stanley-1 discovery well, drilled in 1999. The Stanley-2 well

was designed to appraise the gas/condensate accumulation. The estimate of the most likely recoverable resources in the primary Toro formation reservoir is roughly 300 billion cubic feet (8.5 billion cubic metres) of gas and 9 million barrels of condensate.

Stanley-2 was spudded using a Parker Rig 226 and drilled to a total depth of 3,173 metres. Pressure measurements of

the prospective zones have been acquired and a core cut in the lower part of the Toro formation.

This was found to contain 23 metres of net gas pay, in line with the pre-drill prognosis. In a statement the company said that the reservoir quality was “significantly better than in the Stanley-1 well.” A second pay zone was encountered below the Toro, containing 43 metres of net gas pay.

Pressure measurements indicate that the Toro and the Kimu sands at Stanley-2 are in connection with each other.

“This suggests that the gas/condensate ratio of 30 barrels per million cubic feet [28,320 cubic metres] measured during the testing of Stanley-1 will persist throughout the accumulation,” the company said the statement. The forward plan is to drill the second producer well, Stanley-4, from the current surface location to a bottomhole location around 1 km south-east of Stanley-2.

Horizon Oil’s CEO, Brent Emmett, said: “This is a very good result and has met or exceeded the criteria that Horizon Oil required to make a field development decision … it is too early to comment on a resource/reserve revision, although I expect that there will be a material increase to the current figures.”�

Thailand-focused Carnarvon Petroleum has announced a positive update to its Thai operations.

The company said that at its onshore L33/43 and L44/43 concession joint venture, in which it holds a 40% interest, it had proposed a firm capital budget of US$26 million (net) in 2011. Pan Orient

Energy (POE) is the operator of the JV in the concession.

In January 2011, Carnarvon averaged 1,300 barrels per day in net Thai oil sales. There is also around 1,200 bpd (net) of additional production capability that is currently shut-in at the WBEXT-1A, WBEXT-1, and WBEXT-1B wells.

In a statement, Carnarvon said that the budget would “incorporate up to 34 development, appraisal and exploration wells onshore Thailand.” The company is targeting an annual production of 1-1.5 million barrels of oil per year (2,740-4,110 bpd) from the two concessions.�

PERFORMANCE

Horizon Oil reports positive results from PNG well

Carnarvon Petroleum provides positive Thailand update





The Thai drilling programme of 34 wells is intended to grow both reserves and production and will be focused over several areas. The base capital programme for 2011 of 34 wells is centred on one drilling rig operating in Concessions L44/43 and L33/43.

Appraisal and development will be carried out on 75% of the wells, while roughly 25% of them will be exploratory in nature. This is pending the award of a new production licence by the Thailand Department of Mineral Fuels (DMF).

Two drilling rigs are currently

operating for Carnarvon in Thailand, with one at the L44/43 concession and another one at L20/50. The second drilling rig will complete the firm’s two-well programme at L20/50 during the first quarter.�

The new chairman of India’s state-owned Oil and Natural Gas Corp. (ONGC), A K Hazarika, has confirmed that a planned share sale in the company may open on March 15. ONGC has mandated six banks for its follow-on public offer to raise about US$3 billion.

The government is planning to divest 5% of its 74.14% stake in the company. The move is part of a wholesale shake-up in the ownership and management of India’s largest oil and gas exploration and production company. The shake-up is expected to have repercussions in Cairn Energy’s proposed sale of 60% of its stake in its Indian unit, Cairn India.

London-listed mining company

Vedanta Resources plc is interested in acquiring the stake and in August 2010 proposed acquiring 51%-60% of Cairn India for between US$8.5 billion and US$9.6 billion in a bid to widen its footprint in the energy sector.

However, ONGC maintains it has pre-emptive rights in the blocks held by Cairn India, which are part of the proposed deal. ONGC has a stake in eight out of the 10 oil and gas properties held by Cairn India. Its key assets are the massive oilfields in the northwestern state of Rajasthan, which produce 125,000 barrels per day, around 17% of India’s total crude output.

ONGC pays a 100% royalty to the

government on oil output from these blocks and seeks to share this more evenly, before the government approves the Cairn-Vedanta transaction.

In a statement to local media, Indian Oil Minister Jaipal Reddy said that his government would support the Cairn-Vedanta deal in principle, although “some of the concerns of ONGC need to be addressed legitimately and substantially before clearing the deal.”

Cairn Energy’s CEO, Bill Gammell, said the company would not extend the deadline for the proposed sale beyond April 15.�

Malaysia’s national oil company (NOC) Petronas is “closely monitoring” the situation in Sudan following the national referendum in favour of splitting the country into two.

Petronas has major interests in several onshore blocks in the African country. The blocks are spread across the line along which the country is to be divided. The state-owned firm also operates retail fuel stations and port terminals in Sudan.

In 2010, crude oil from Sudan

contributed 26% of Petronas’ total overseas production, which has become an increasing source of revenue.

“We are closely monitoring the development with regard to the referendum and we have been taking adequate steps and actions to serve our rights and interests best,” Petronas said in a statement on Sudan last week. The firm’s partners in Sudan include China National Petroleum Corp. (CNPC) and Sinopec, plus local Egyptian firms.

Malaysia has maintained close ties with Sudan’s northern-based government but must now “build a similar relationship with authorities in the South ahead of the secession,” said a report in The Star newspaper, which quoted official government news agency Bernama. “We have had and are in continuous discussions and high-level engagements with all relevant officials and parties, including with the government of South Sudan,” the Petronas statement said.�

PERFORMANCE

POLICY

ONGC share sale planned for March as part of shake-up

Petronas keeps a close eye on Sudan






The secession of the South is expected to take place in mid-2011.

The petroleum revenue rights of North and South Sudan are among a number of major problems that have first to be resolved before the split.

Elsewhere in North Africa, Petronas

said it had evacuated employees and their families from Egypt because of the political unrest there. Petronas has several onshore and offshore interests in Egyptian exploration blocks with partners such as Shell and BG Group. It is also involved in the construction and

operation of a liquefied natural gas (LNG) plant in the country.

Petronas said it had contributed US$650,000 towards the Malaysian air force’s cost to fly other Malaysian citizens out of Egypt.�

Thailand’s PTT Exploration and Production (PTTEP) said it was in talks with Malaysia’s Petronas on the possibility of expanding natural gas exploration in the Malaysia-Thai Joint Development Area (JDA) in the Gulf of Thailand.

PTTEP is promoting the move as its seeks to meet rising natural gas demand in Thailand, the company’s CEO, Anon Sirisaengtaksin, said last week.

The Malaysia-Thai JDA was established in 1979 to satisfy overlapping sovereignty claims by the countries over

hydrocarbon resources in the area. “PTTEP is planning to produce

petroleum in the Gulf of Thailand as long as we can. Some may expect natural gas to be exhausted in the next 20 years. With new technology, we expect to extend the production period longer than that,” Sirisaengtaksin was quoted as saying by Reuters.

PTTEP has earmarked a budget of up to 20 billion baht (US$649.6 million) to explore for gas in its fields, including those in the JDA. However, the company has not concluded its talks or agreed

details on the proposal with Petronas, he said.

PTTEP, which is a subsidiary of PTT, Thailand’s largest oil and gas conglomerate, and Petronas’ E&P arm Petronas Carigali have been involved in the MTJDA-B17 joint project. The project consists of the B-17, C-19 and B-17-01 blocks and covers an area of 8,000 square km.

PTTEP International (PTTEPI) and Petronas Carigali JDA (PC JDA) were awarded exploration rights for the B-17 and C-19 blocks in 1994, and for the B-17-01 block in 2004.

PTTEPI and PC JDA established Carigali-PTTEPI Operating Company (CPOC) in 1994 as the operator of the joint project. PTTEPI and PC JDA hold stakes of 50% each in CPOC.

In February last year, PTTEP said that the MTJDA-B17 joint project had started natural gas production at the Muda and Jengka fields, with supplies to be directed to Thailand. PTTEP also said at the time that CPOC had found natural gas and crude oil in several fields, namely Tapi, Andalus, Tanjung, Muda and Jengka.

Sirisaengtaksin said last week that the joint project produced about 335 million cubic feet (9.5 million cubic metres) per day of natural gas last year, which accounted for 10% of Thailand’s domestic consumption of the fuel.�

POLICY

PTTEP and Petronas to expand joint gas exploration





Thai Energy Minister Wannarat Channukul said that spending tens of millions of US dollars on subsidising the retail price of diesel was “nonsensical.” The minister said the money should instead be used to fund alternative energy projects.

The Thai government has spent over US$130 million since mid-December 2010 on keeping the diesel price below US$1 per litre while crude oil prices climbed to over US$100 per barrel. On February 11, a top government committee decided to continue the subsidy regime, which Wannarat said could cost the country a further US$400 million.

In a public statement, the minister warned that the government would have no money left to support alternative

energy research and development if diesel prices continued to be held below 30 baht (US$1) per litre. “We have to face the truth that global oil prices will tend to rise, so we must adjust,” he said last week.

However, the National Energy Policy Committee, which is chaired by Thai Prime Minister Abhisit Vejjajiva, ignored Wannarat’s warning and agreed to extend the diesel subsidy until mid-April.

The extension was made “because of continuing volatility in the global oil price,” said Abhisit.

He added that the subsidy support fund had reserves of US$750 million but if it fell below 10 billion baht (US$326 million) the government would have to “reconsider” the diesel subsidy.

The state oil fund is also subsidising

imported liquefied petroleum gas (LPG), compressed natural gas (CNG) for vehicles, E20 gasohol and E85 gasohol at a total cost of US$195 million per month, the energy ministry confirmed.

The diesel subsidy was introduced on December 17, 2010, to contain rising inflation. At the time, Wannarat said the subsidy, which is 8.5% of the retail price, would be removed once allocated funds had been used up. However, the subsidy has been extended twice since then and is being propped up using additional state finance.

Thailand’s state-controlled oil group PTT is also suffering losses to its profitability by subsidising imports of LPG and other fuels.�

The state-run Japan Oil, Gas and Metals National Corporation (JOGMEC) has said it expects to provide about 16.3 billion yen (US$198 million) of capital in 2011-2012 to Iraq’s Gharaf oilfield development project.

According to a Reuters report on February 11, JOGMEC said it would take a stake of less than 50% in a subsidiary of Japan Petroleum Exploration Company (Japex), which has a 30% stake in the project. The consortium is led by Malaysia’s state oil firm Petronas, which holds a 45% stake in the oilfield development and production service project. Iraq holds a 25% stake in the consortium, which expects to invest up to US$8 billion, and anticipates oil

production to start in 2012 at 50,000 bpd, rising to 230,000 bpd of plateau output from 2016. Although it sits on the world’s third largest crude oil proven reserves, Iraq’s oilfields have suffered years of neglect. This has been compounded by the effects of the widespread violence and the sabotage to hydrocarbons infrastructure in the wake of the 2003 US-led invasion, which has seen Iraq unable to reach even its pre-war output levels of oil. Gharaf is one of series of oilfields that are now being rehabilitated as a result of deals struck with foreign oil companies in 2010, via two oil auctions.

The ultimate aim is to boost Iraq’s oilfields in a bid to attain a massive 12

million bpd national crude production capacity within the decade, rivaling the top Middle East producer Saudi Arabia.

The Gharaf consortium reportedly paid a signature bonus of US$100 million and will receive a remuneration fee of US$1.49 for each additional barrel produced over 35,000 bpd.

Reserves at the field are estimated at 900 million barrels. Illustrating the progress that some foreign majors have already made, BP said in January that it had met a major milestone in the re-development of the super-giant Rumaila field in southern Iraq, by increasing production by more than 10% above the 1.066 million bpd initial production rate agreed in December 2009.�

POLICY

Thai energy minister advocates alternative energy projects

PROJECTS & COMPANIES

Japanese major farms into Iraq’s Gharaf oilfield





A consortium of two Japanese firms has won a front-end engineering and design (FEED) contract for a new medium-scale liquefied natural gas (LNG) plant in Australia.

Hitachi and Toyo Engineering said the contract had been awarded by Eastern Star Gas (ESG), an Australian natural gas and coal-bed methane (CBM) developer.

Under the contract, the Japanese consortium is to provide FEED work for the new electric-motor-driven LNG plant in Newcastle, New South Wales.

Hitachi and Toyo Engineering

launched a joint feasibility study on the new LNG plant in May 2010. The Japanese firms said the FEED work would involve optimisation, design and detailed costing of the LNG project, including the LNG storage tank, jetty and loading facilities. The FEED work is due to be completed by the end of 2011.

The Japanese firms said the US’ Chart Energy & Chemicals would support them by providing its proprietary IPSMR process technology and core equipment for the gas liquefaction process.

The Japanese team did not disclose the

value of the FEED contract with ESG. The Australian company plans to make a final investment decision (FID) on the LNG plant construction project by the first quarter of 2012 and start exporting the cleaner-burning fuel in 2015.

The new plant will have an initial production capacity of 1 million tonnes per year of LNG. The annual production capacity is to be raised to 4 million tonnes in the future, the Japanese firms said.�

Australia’s Clean Global Energy (CGE) has signed a binding heads of agreement (HoA) to provide its underground coal gasification (UCG) technology and expertise to India-based oil and gas multinational, Essar Group.

CGE said that the key terms of the agreement were confidential, but explained that the February 10 agreement entailed the delivery and operation of a pilot and subsequent commercial UCG Syngas plant. Using a Technology Licence Agreement (TLA), CGE will hand over operations of the plant to Essar within 3 years of commissioning the commercial plant.

CGE reported that the TLA would be triggered if Essar were granted one or more UCG blocks by Coal India Limited (CIL), its subsidiaries or any other body

corporate or government authority. While the final bidding approvals are not yet complete, CGE said that both companies were “confident” of obtaining approved UCG blocks. The Australia-based company is currently assisting Essar to complete the bidding approval process, during which it will generate fee-based income under the HoA.

John Harkins, CGE’s chairman, said: “We believe the partnership with Essar has the potential to generate major revenue for our company through licensing fees that represent the significant value of our UCG technology, service fees to build and operate the UCG Syngas plant, and royalty income from delivered Syngas product to be sold by Essar. We expect to be generating the first licence and service fees in the next

six months.” CGE said that Essar would free-carry it

for 20% equity through to a commercial UCG Syngas plant, at which time CGE will pay for that equity at cost, which should have a valuation of at least US$100 million based on NPV modelling.

It said the anticipated revenue streams involved licensing and project management fees worth US$50-60 million during design, construction and commissioning, and production royalties of US$15 million to US$20 million after achieving commercial production.

“Licence fees are per project and we expect to enter into more technology licence agreements under similar terms and conditions,” Harkins said.�

Another Malaysian domestic business has won a substantial contract to provide offshore services to oil and gas giant Petronas.

Dayang Enterprise has been awarded a five-year contract worth US$262 million to provide structural maintenance in three domestic areas of Petronas’ operations,

including in Sarawak and Sabah. In early February, Petronas awarded

first contracts for work on waning marginal domestic offshore fields to�


Japanese consortium wins LNG plant deal in Australia

CGE ties up with Essar

Dayang wins Petronas contract





local firms Kencana Energy and SapuraCrest Petroleum under a new system designed to stimulate new production.

The new service contracts give Petronas ownership of production but pay redevelopers an agreed price for oil or gas. The contracts, which include government tax benefits, have been created as Malaysia’s oil and gas production slowly declines.

Dayang, which describes itself as one of Malaysia’s leading brownfield and topside maintenance businesses, was tipped to be on the verge of a major contract in January by a number of local

analysts, including the RHB Research Institute, because of its recent good performance. Dayang also operates a fleet of vessels through its subsidiary DESB Marine.

“Dayang appears to be focusing on regular offshore maintenance work, while some of its local rivals, like Kencana, are more keen to move into the new, financially risky marginal field reinvigoration work,” Bangkok-based analyst Sar Watana told AsianOil.

In December, however, Dayang announced it would sell its 40% stake in Syarikat Borcos Shipping of Sarawak, which operates a fleet of more than 30

oilfield services vessels, to AWH Equity. Dayang said it intended to use the

US$44 million from the sale as working capital to pursue new contracts in its brownfield speciality role.

The contract with Petronas will involve working on offshore sites in Sarawak and Sabah on Borneo as well as platforms closer to peninsular Malaysia. Some of the work will be on a call-up arrangement.

Dayang said the deal would make a positive contribution to its earnings and profitability for the current financial year ending in December.�

UK exploration and production firm Premier Oil has begun drilling at its CRD-2X appraisal well in the Nam Con Son Basin, offshore Vietnam.

On February 10, Pan Pacific Petroleum (PPP), Premier’s joint venture partner in the project, said that the semi-submersible Ocean General had arrived on Block 07/03, and was preparing to commence drilling of the well.

CRD-2X aims to evaluate the oil and gas discovery made by the CRD-1X well on the Ca Rong Do prospect in June 2009.

At the time, PPP described the find as “very encouraging for future exploration” because of multiple leads and prospects in the block, with Premier Oil estimating “mid-point” discovered resources at 60 million barrels of oil equivalent.

When drilled, the CRD-1X well tested two reservoir zones, which flowed oil at a combined rate of 3,265

barrels of oil per day plus 8.1 million cubic feet (229,400 cubic metres) of gas per day, through a 48/64-inch choke. No water was produced from either zone.

Spanning 1.2 million acres (4,855 square km), Block 07/03 is located near a number of oil and gas discoveries, lying

directly south of BP’s producing gas fields (Lan Tay and Lan Do) and south-east of Premier’s Dua and Chim Sao discoveries. If commercial, Ca Rong Do, meaning Red Emperor, could be a standalone development, or tied back to Dua or Chim Sao, both of which are

currently being developed. The Nam Con Son Basin

and Natuna Sea region is considered a key point of focus for Premier. Alongside Chim Sao and Dua, which are slated to begin production in 2011, the company also operates the Tuna production-sharing contract (PSC) in the East Natuna Sea and its successful Anoa gas field in West Natuna, where the Naga, Iguana & Garah Baru fields are also under development.

Premier operates Block 07/03 with a 30% interest, along with partners PPP (5%), Pitkin Petroleum (40%), Pearl Oil (15%) and PetroVietnam (10%).�


Premier to spud Vietnam appraisal well





OIL

Moody’s gives stable outlook to AP E&P sector Moody’s Investors Service says that the outlook for Asia Pacific’s oil and gas exploration and production (E&P) sector is stable. “A significant rebound in oil prices since their trough is supporting growth in the profits and cash flow of E&P players,” says Renee Lam, a Moody’s Vice President and Senior Analyst. “The oil price recovery has been driven by financial investment demand, as well as physical oil stock demand,” says Lam, who was speaking on the release of Moody’s latest outlook – which she authored – on the sector. Moody’s rates eight E&P companies in Asia Pacific (range: B2 to Aa3), and two integrated oil and gas companies which have heavy exposure to E&P (A1 and A3). Furthermore, continued strong demand growth in non-OECD countries, especially from China and India, provides medium- to long-term support to oil and gas prices. China’s oil demand is forecast to grow at a CAGR of 6.35% over 2010-2011, such that its portion of global demand will increase to 10.7% in 2011. However, continued acquisitions and capital expenditure remain a key risk. “Many Asian E&P players are sovereign-owned, directly or indirectly, and they are keen to boost reserves through acquisitions for strategic reasons,” says Lam. There is also a trend to purchase unconventional assets – such as shale gas and oil sands – as most global oil and gas reserves are approaching maturity, and technological advancements have been improving the project economics of the business. “These unconventional assets require higher up-front capital investments and a longer exploration and development period before commercial production is realised,” says Lam.

Moody’s also believes that the sector will face increasing cost pressures. “With the recovery in oil prices, Asian companies will have their cash margins squeezed due to an increasing cost base, although they enjoy better cost structures when compared to their US and European counterparts,” says Lam. Finding and development costs will increase, driven by the growth in investment and capital expenditure budgets. Debt issuance is also expected to rise. “As most of these E&P players will increase their investments in the next 18 months, we expect the sector’s leverage to increase,” says Lam. Finally, regulatory issues, particularly on pricing and environmental concerns, will continue to impact the sector.

NEWSBASE, February 16, 2011

OVL annual plan ONGC’s international arm, ONGC Videsh Ltd (OVL), plans to spend Rs 86.8 billion on its E&P projects worldwide during the year 2011-12. Out of the total plan outlay, the company plans to finance Rs 52.3 billion from its internal resources and the remaining Rs 34.8 billion will be raised by borrowing from banks and other financial institutions. The company expects to earn revenues of Rs 140 billion during the next financial year.

OVL, February 14, 2011

OVL to exit Egypt ONGC Videsh Ltd (OVL) has decided to withdraw from two major E&P ventures in the politically torn country of Egypt. These blocks include the North East Mediterranean Deepwater Concession (NEMED) and North Ramadan Block 6. OVL had discovered gas in the NEMED block, while oil had been struck in North Ramadan Block 6. However, both these discoveries were too small to be commercialised, forcing the E&P major to relinquish these blocks.

INDIANPETRO, February 14, 2011

Eni to exit Rajasthan block India’s Directorate General of Hydrocarbons (DGH) has recommended that Eni (India) Ltd should be allowed to exit Rajasthan onland block RJ-ONN-2003/1, after completing the first phase of explorations. The regulator has also said that the Italian multinational E&P major should be exempted from its unfinished contractual obligations for this phase of explorations.

IP, February 14, 2011

No term hitting value: Cairn Cairn India today said it would not accept any government condition that will negatively impact its value, in any acquisition deal with Vedanta. “The Cairn India board of directors has stated that any condition tied to the approval of the transaction, which can negatively impact the value of the company, cannot be accepted,” the company said in a press statement here.

PTI, February 14, 2011

Save on royalty: ONGC Refuting the claims made by Cairn India, ONGC has said the government will save US$2 billion if royalty paid on the prolific Rajasthan oilfields is allowed to be cost-recovered. ONGC owns a 30% stake in the Barmer oilfields and pays royalty to the state government not just on its share, but also on the balance 70% owned by Cairn India. Over the life of the field, ONGC estimates it will pay over US$3.15 billion in royalty on behalf of Cairn India.

ET, February 14, 2011

Sasol may buy into CIL South Africa’s Sasol has expressed its willingness to acquire a minority stake in a joint venture (JV) with Indian state-owned miners Coal India Ltd (CIL) and NMDC Ltd to produce liquid fuel�

NEWS IN BRIEF






from coal, a little over a year after it formed a-50:50 venture with Tata Steel Ltd for a similar project. Sasol is pursuing global opportunities to commercialise its coal-to-liquids technology. The company’s readiness for a second joint venture was conveyed during coal minister Sriprakash Jaiswal’s recent visit to South Africa, according to Partha S. Bhattacharyya, CIL’s chairman.

LIVE MINT, February 9, 2011

RIL Mahanadi drilling Reliance Industries Ltd (RIL) is likely to embark upon an ambitious five-well drilling programme in its Mahanadi deepwater contract area MN-DWN-2003/1 ahead of schedule. Top company sources said that the proposed drilling programme – under Phase-I of Minimum Work Programme (MWP) – may get underway by August 2011.


ONGC mobilises rig ONGC’s tender evaluation committee has recommended extension of the mobilisation date of the 300-feet, cantiliver-type, jack-up rig – dubbed Deepsea Fortune – for the seventh time, along with the levy of liquidated damages (LD). There would, however, not be any additional impact of LD on the contractor, Jagson International Limited, as the 5% LD leviable under the contract has already been exhausted.

ONGC, February 14, 2011

Cairn completes seismic surveys Cairn recently completed a large cache of time-lapse seismic surveys at Ravva. The seismic programme – shot over 280 sq km – made use of 4D technology. Besides monitoring of fluid movements, 4D seismic analysis allows pressure changes in petroleum reservoirs during production, thus contributing to improved recovery rates.

BL, February 14, 2011

Cairn mobilises land rig Cairn Energy India Ltd (CEIL) has mobilised a jack-up rig at its Ravva block, located in the East Coast of India, for a fresh drilling programme. A senior Cairn executive said that a five-well drilling programme is currently underway in the contract area. One well has already been drilled under the infill campaign, sources added.


Cairn contests ONGC claim ONGC’s claim that it will incur an actual loss of US$3.16 billion on the Barmer oil block in Rajasthan has been contested by its partner Cairn India, which says the state-owned oil firm will only lose about US$564 million. ONGC says the 6.5 billion barrels block in Barmer district is a losing proposition for it on account of the over US$3 billion royalty it will pay on behalf of Cairn India over the life of the field.


GAS

IPI work completion Iran on Tuesday said 90% work on the Iran-Pakistan-India gas pipeline was complete within its territory and it was open for having trade arrangements with any country in the energy sector. Iran’s Ambassador to India Seyed Mahdi Nabizadeh said work was also in progress on the Pakistani side and it was ready to start 50 per cent of the total 60 mcm capacity once the pipeline was in place.


Oil linked price for TAPI gas Turkmenistan is seeking a price linked fuel oil or naphtha for the natural gas it plans to sell to India through a US$ 7.6 billion pipeline passing through

Afghanistan and Pakistan. Official sources said Turkmengas, the national oil firm of Turkmenistan first sought a price linked to fuel oil but later changed it to naphtha reasoning that natural gas was meant to replace these liquid fuel power plants.

HINDU, February 14, 2011

IFFCO purchases spot R-LNG Fertiliser giant Indian Farmers Fertiliser Cooperative Limited (IFFCO) recently chose to purchase R-LNG on the spot market from GSPC in the face of falling supplies from RIL’s KG-D6 block. The gas will be purchased at the rate of US$11.08 per MMBTU. The company was facing a shortage of around 0.2 mmscmd in KG-D6 gas supply for its plant in Kallol.

IFFCO, February 14, 2011

NTPC Nigeria venture NTPC may revive its plans to set up coal and gas-based power projects in Nigeria, a proposal scrapped by the company earlier due to a delay in finalising a partner for the proposed venture in the African nation. “NTPC may look at Nigeria for coal and gas-based projects ... They are likely to revisit the proposal,” a senior Power Ministry official told PTI.


Natural gas discovered in Myanmar A natural gas well with a production capacity of 2.1 million cubic feet per day has been found in Pale Township in Monywa District, Sagaing Division, the state-run newspaper The Mirror reported on Monday. Myanmar Oil and Gas Enterprise and its partner Sinopec International Exploration and Production Corporation (SIPC) found natural gas at Thingadon Test-well No. (1), which is located about 10 miles to the east of Kyaw Village in Pale Township in the Mahutaung Region.�

NEWS IN BRIEF






Officials said the well had a production capacity of 2.1 million cubic feet of natural gas per day.

MIZZIMA, February 14, 2011

India, Turkmenistan disagree Turkmenistan and India are at odds over how to set the prices for gas that will be pumped through the proposed Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline, media sources reported on Tuesday. India has rejected Turkmenistan’s idea to link the price of natural gas transported by the pipeline to oil or naphtha, the United Press International (UPI) news agency reported on Tuesday.

CAN, February 15, 2011

East Natuna gas reserved for domestic consumption Gas pumped from the East Natuna block will be allocated for domestic use only, the government says. Coordinating Minister for the Economy Hatta Rajasa said gas from the block would be exported only if there was a production surplus. “I am sure that we can still export the East Natuna gas as the reserve is so huge,” he said as quoted by Kontan.co.id. The East Natuna block was originally called the Natuna D Alpha block. State-owned oil and gas firm PT Pertamina and PT Total E&P Indonesie and PT Petronas Niaga Indonesia are jointly running the block, whose gas reserve is estimated at 222 trillion cubic feet (TCF).

THE JAKARTA POST, February 9, 2011

Further drilling could take place in Maui Shell Todd Oil Services says further drilling could take place as early as next summer, if a new exploration well near the Maui gas field proves successful, Radio New Zealand reported.

The single well is on the Ruru prospecting block, 40km offshore from South Taranaki. It's next to the Maui gas field, which is due to run out in about ten years. CEO Rob Jager says there are still opportunities to get more gas out of Maui and extend the field's life He will know in a couple of months whether there's any oil or gas there. The drill ship Noble Discoverer is contracted for one well. Jager says New Zealand has to compete with the Bass Strait in Australia and the North West Shelf to attract drilling operators.

RADIO NEW ZEALAND, February 15, 2011

SERVICES

EMS awarded API certifications Singapore’s EMS Energy Limited said its subsidiary, Engineering & Marine Services (Pte) Ltd (EMS), has been awarded several American Petroleum Institute (API) certifications. The API certifications that EMS has received cover the following: API Specification Q1, API Specification 4F for Substructures at PSL 1 (refers to Drilling and Well Servicing Structures) and API Specification 2C for Offshore Pedestal Mounted Cranes. With the certifications, EMS has been authorised by API to use the official API Monogram and APIQR marks. EMS has been manufacturing quality products for oil and gas assets worldwide since 1977. In recent years, the company has successfully delivered several drilling modules and offshore cranes that comply with API standards. As the Company’s new products will henceforth bear the API monogram, it will provide an added quality assurance that is easily recognised by international customers with whom the Company is targeting to expand its business. “The award of the API certification will further strengthen the confidence and enhance the trust placed in the products and services that EMS offers to its valued

customers globally. More importantly, the API certification will also allow us to expand our market to customers that we previously have not worked with”, said Mr Ting Teck Jin, Executive Chairman and CEO of EMS Energy.


High pay for contractors Australian energy companies are paying engineers, geologists and other contractors 35% more this year as liquefied natural gas ventures fuel competition for labour, the UK’s largest recruiting firm said, according to Bloomberg. Contractors in Australia are receiving A$1,080 a day, on average, compared with A$800 a day last year, Matt Underhill, a Sydney-based managing director of oil and gas for Hays Plc, said. That’s almost A$22,000 a month, assuming 20 days’ work. Average salaries for “professionals” in the Australian oil and gas industry for 2011 are 90% above the global mark, rising 5% to US$143,700, compared with a little-changed US$75,813 worldwide, Hays found in a survey conducted in September and October. The more than $30 billion in Queensland state coal-seam gas-to-LNG ventures approved by BG Group Plc and Santos Ltd. are set to increase labour demand and drive up pay further. “That’s going to put everything into overdrive,” Underhill said.

BLOOMBERG, February 11, 2011

L&T receives order Engineering major Larsen & Toubro on Monday said it has received Rs.11billion order from Gujarat State Electricity Corporation (GSECL) for setting up a 375-MW gas-based power plant at Dhuvaran, near Baroda. The project will be executed by the gas-based power projects business unit of Baroda-based L&T Power, L&T said in a statement. L&T will procure advance gas turbines and high-efficiency steam turbines for the plant from Siemens AG, Germany.


NEWS IN BRIEF






Seadrill under fire Seadrill, a Norwegian firm, has drawn criticism for returning to Burmese waters in February 2011 to do drilling work for Thailand’s state-owned oil company, PTTP. According to Burma’s state owned the New Light of Myanmar, Seadrill’s new ‘jack-up’ rig, the West Juno, was set to arrive in Burmese waters in mid-January to commence drilling for PTTEP, the international exploration wing of Thailand’s state-owned oil firm which holds concession in blocks M-7 and M-3 for a 4 month period.

MIZZIMA, February 14, 2011

Keppel to build harsh class jackups Keppel FELS Limited has secured a contract to build two enhanced KFELS Super A Class harsh environment jackup rigs from a subsidiary of Ensco plc at a shipyard price of about US$440 million. These rigs are scheduled for delivery in the second and fourth quarters of 2013. As part of its contract with Keppel FELS, Ensco has options to order two more similar jackup units. Mr Dan Rabun, Chairman and CEO of Ensco plc, said, “The new rig orders reflect our commitment to continually high-grade our fleet. Operators’ requirements will continue to increase over time and it is Ensco’s strategy and intention to maintain our position at the high end of the premium jackup market. “Keppel-designed rigs, which make up about 20 percent of our current jackup fleet, have been delivering exceptional performance. The new KFELS Super A Class rigs, which are being customised to Ensco’s requirements, will give us even more high-specification assets to match the drilling demand for increased drilling capabilities in each market.” Mr Tong Chong Heong, CEO of Keppel Offshore & Marine, said, “The KFELS Super A Class hails from our proven KFELS MOD V-A Class jackup, which has been widely deployed by our international customers, including Ensco.

This new generation rig is a showpiece of our cumulative experience in designing and constructing cutting-edge harsh environment solutions. “In choosing to build up to four units of this innovative design, our faithful customer Ensco has given strong endorsement to the KFELS Super A Class, which is well-suited for operating conditions in the UK, Danish and Dutch sectors of the North Sea. We are pleased to take our partnership with Ensco to the next level and support its ongoing enhancement of an already advanced drilling fleet.” A viable and cost-effective solution for harsh environments and cold climate areas, the new KFELS Super A Class boasts the distinctive qualities of Keppel FELS’ proven jackup rig designs. The KFELS Super A Class rig can operate in water depths of 400 feet and drill to depths of 40,000 feet. It features advanced automated drilling systems with 2.5 million pounds of static hook load, a spacious deck and comprehensive amenities for the comfort of a 150-person crew. It also has an offline stand building capability to handle drill pipes efficiently, boosting overall rig performance and productivity. For enhanced operational safety, the KFELS Super A Class is equipped with the latest pinion overload detection, rack phase difference detection, and brake failure and overload protection devices, thus meeting even the stringent Health, Safety and Environment (HSE) standards of various sectors in the North Sea.


Keppel wins two rig contracts Keppel Offshore & Marine Ltd (Keppel O&M), through its subsidiary Keppel FELS Brasil, has secured two contracts totalling R$500 million (approx. US$297.64 million) - one from Single Buoy Moorings Inc. (SBM), and another from the joint venture company MODEC and Toyo Offshore Production Systems (MTOPS).

Mr Chow Yew Yuen, President (The Americas) of Keppel O&M, said, “Keppel has worked closely with various international drillers and fleet owners operating in Brazil for some 30 years. Today, in replicating Keppel O&M’s proven systems and practices in Brazil, we are able to offer a full range of offshore solutions in construction, conversion, repair and modification, as well as the fabrication and integration of production topsides, among others. “We are heartened that SBM and MTOPS have reaffirmed our position as the choice solutions partner in Brazil’s offshore and marine industry with these contracts to fabricate and integrate modules for their latest FPSOs. As we grow our competencies and track record as the most established shipyard in Latin America, we will continue to nurture win-win relationships with our valued customers. We see the market improving and our yard has the capacity and capability to take on more jobs.” Keppel FELS Brasil’s contract with SBM is for the fabrication and installation of topside modules on the Floating Production Storage and Offloading (FPSO) vessel Cidade De Paraty, which was awarded in association with Queiroz Galvão Óleos e Gás S.A. (QGOG) and is currently undergoing conversion at Keppel Shipyard in Singapore. Mr Chow added, “Like our recent delivery of P-57, this project demonstrates the synergy of the Keppel O&M shipyards in providing a comprehensive suite of services to our customers and brings to bear our near market, near customer strategy.” Work is expected to commence at Keppel FELS Brasil’s BrasFELS shipyard in Angra dos Reis, Rio de Janeiro in the first quarter of 2011. The vessel is scheduled to arrive in the first quarter of 2012 with delivery in the fourth quarter of 2012. The work scope will include the fabrication and installation of six process modules and a riser gantry as well as the installation and integration of another six process modules supplied by SBM.�

NEWS IN BRIEF






The FPSO Cidade de Paraty will be deployed in the pre-salt region of the Santos Basin and will have a production capacity of 120,000 barrels of oil per day, and be able to compress 5 million cubic metres of gas per day. In its contract with MTOPS, a joint venture company between MODEC and Toyo Engineering Corporation, BrasFELS will undertake the module fabrication and integration of the FPSO Cidade de Sao Paulo MV23, which was awarded in association with Schahin Engenharia S.A. Work is expected to begin at BrasFELS in the first quarter of 2011. The yard’s scope includes the fabrication of topsides modules such as riser manifolds, laydown areas and the flare tower, as well as the assembly and integration of fabricated pancakes/skids. To be completed in the 4Q 2012, the FPSO will be deployed in the pre-salt region of the Santos Basin. The FPSO will have a production capacity of 120,000 barrels of oil per day, and be able to compress 180 million cubic feet of gas per day and store 1,600,000 barrels of oil. Ongoing at BrasFELS is the upgrading and repairing of Noble’s Brazil-based drillships with delivery stretching into 2012.


Drydocks World names seismic vessels Drydocks World said the ultra-modern high ice class seismic vessels Polarcus Alima and Polarcus Samur were named in the presence of key personnel from both organisations and specially invited industry dignitaries at its Dubai shipyard. The two vessels are part of a series of six built for Dubai based geophysical operator Polarcus. Three vessels belonging to the series have been delivered. “The vessels use highly advanced green

technology, which we have been advocating through our highly successful new building programme as we are acutely sensitive about our environmental obligations. We have proved once again that our engineering and construction capabilities are among the best for highly specialised vessels that address niche markets. Seismic technology is constantly evolving and improving and we are fully equipped to adapt and address the challenging construction needs,” said Khamis Juma Buamim, Chairman of Drydocks World and Maritime World. Polarcus Alima incorporates sophisticated seismic technology and is capable of towing 12 streamers, with a 100 metre lateral separation between streamers. It is a 3D/4D seismic vessel built to the highly merited Ulstein SX134 design and ULSTEIN X-BOW® hull. It includes all the latest marine equipment and innovative efficiency enhancing features. It is suitably equipped with environment friendly systems such as diesel-electric propulsion, high specification catalytic converters, double hull and water treatment systems. Polarcus Samur is built to the Ulstein SX133 design with an ULSTEIN X-BOW® hull. The original 6 streamer version was upgraded to an 8 streamer version that is capable of towing both conventional and wide tow spreads. It is equipped with the most advanced seismic technology commercially available and is highly environment friendly complying with DNV clean design notation that stipulates defensive design, accident prevention and consequence limitation requirements, thus providing additional environmental protection. The vessels are fully equipped for controlling and limiting operational emissions and discharges. These cover fuel tanks’ protection from grounding damage, handling of ballast water, fuel oil, sewage and garbage, have environment friendly antifouling, have controlled

combustion machinery emissions, safe use of refrigerants and have a Green Passport Inventory for recycling the ship. Drydocks World is engaged in addressing the wide-ranging needs of the industry through a new building programme involving its yards in Dubai-UAE, Nanindah, Graha, Pertama, in Indonesia and Singapore.


PETROCHEMICALS

Pertamina to export more lubricant State owned oil and gas firm Pertamina says its lubricant exports would to increase to 546,000 kiloliters this year, up from 458,000 kiloliters last year. Pertamina marketing and trade director Djaelani Sutomo said Wednesday the company would continue to improve its lubricant quality to meet overseas demand. Pertamina’s lubricant has been exported to Australia, the United Arab Emirates, Singapore, Myanmar, China and Japan.

THE JAKARTA POST, February 14, 2011

Panipat naphtha plant dedicated India’s largest Naphtha Cracker plant at IOC’s Panipat Complex was dedicated to the nation by petroleum minister S Jaipal Reddy. The Naphtha Cracker Complex, built at a cost of Rs 144.39 billion, will provide significant impetus to IOC’s ambitious foray into petrochemicals. The naphtha would be sourced from IOC’s Gujarat Refinery in western India and Panipat and Mathura Refineries in north. The Naphtha Cracker Unit at Panipat will produce 800 KTA of Ethylene and 600 KTA of Propylene.


NEWS IN BRIEF






REFINERIES

Refining capacity rise India’s annual crude refining capacity is expected to rise 240 million tonnes in two years, Oil Secretary S. Sundareshan said on Tuesday. He also said the country could be exporting 80-90 million tonnes of oil products annually in two years’ time.

REUTERS, February 15, 2011

Oil refiner expects better diesel market Formosa Petrochemical Corp, the nation’s only publicly traded oil refiner, expects the diesel market to improve this year as economic growth boosts demand for fuel. This should be a “better year” for the diesel market than last year, Lin Keh-yen, a company spokesman, said yesterday. “It’s a bull market for diesel.” Diesel accounted for 24 percent of Formosa Petrochemical’s sales in the first nine months of last year and was the biggest single revenue source, according to a Nov. 4 company presentation to analysts. The fuel producer rose 0.6 percent to close at NT$91.10 in Taipei trading, after declining as much as 2.8 percent. While the outlook for the full-year has improved, the profit in Asia for turning crude oil into diesel will probably slide from the current US$18 a barrel in the coming months as fuel demand for heating drops, Lin said. The company’s Mailiao refinery can

process 540,000 barrels of crude oil a day. Formosa Petrochemical owns three naphtha processing plants with a combined annual capacity of 2.935 million tonnes of ethylene, a raw material for plastics, chemicals and synthetic fibers. The Directorate General of Budget, Accounting and Statistics last month revised its GDP growth forecast for Taiwan for this year to 5.03 percent from a November estimate of 4.51 percent because of the global economic recovery.

TAIPEI TIMES, February 16, 2011

FUEL

No fuel price hike Customers of auto fuels can get some respite, with the fuel prices likely to remain at the same levels for the moment. The Petroleum Minister, Jaipal Reddy, said on Tuesday, “Since prices are going up we can’t decrease petrol prices. But we are also not going to increase price of any commodity at the moment.” “There is no proposal given to oil companies to increase petrol prices at the moment,” he said.

BL, February 15, 2011

Fuel taxes maybe tweaked India, struggling to balance between cutting its costly fuel subsidies and curbing inflation, may tweak fuel taxes in the February 28 budget to cushion the blow of rising global crude prices on state-run oil retailers, officials said.

Tackling the current informal structure of fuel subsidies would help investors put a better valuation on proposed share sales for Indian Oil Corp (IOC) and ONGC.

MC, February 15, 2011

Indonesia may delay subsidised fuel restrictions The government may postpone the introduction of a policy to restrict the distribution of subsidised fuels, to avoid unrest, a legistator says. Satya W. Yudha, a member of House of Representatives Commission VII overseeing energy, said increases to global oil prices had forced the government and the House to rethink social impacts that the policy might have. “The restriction may cause unexpected unrest, because the prices of non-subsidised fuels have climbed steeply over the last several months,” Satya said Wednesday, on the sidelines of a hearing with the Energy and Mineral Resources Ministry. He added that the House could ask the government to delay implementation of the restriction to seek better mechanisms to control the distribution of non-subsidised fuels. “If the government insists on not subsidising non-subsidised fuels, I’m afraid it will anger private car owners,” he said. Under the restriction policy, the government plans to only allow motorcycles, public transportation vehicles and fishing vessels to purchase subsidised fuels.


NEWS IN BRIEF





PROJECT Indonesia Compressor Module Development Project Sector Upstream Location Asia, Indonesia , East Kalimantan / Timur Region Project Holder/Operator Total Scope of work EPC - Engineering, Procurement & Construction Contracts Current /Past Phase Job contracts had been won Contract Value Estimate Over US $ 290 million Start up Timing From 2010 Development Stage Operational Project Brief The project is associated with the development of T unu phase 9 facilities Future & Poten tial Sales Prospects

LSTK - Lump Sum Turnkey Contracts MC - Multi Contracts IPP - Independent Power Project Contracts O&M - Operations and Maintenance Contracts TC - Term Contracts

PROJECT India Compressor Project Project Sector Upstream Location Asia, India , Offshore Area Project Holder/Operator ONGC - Oil and Natural Gas Corporation Scope of work MC - Multi Contracts

Current /Past Phase Job contracts had been on completion stages Contract Value Estimate Over US $ 785 million Start up Timing From 2010 Development Stage Operational Project Brief The project is associated with the development of Bombay / Mumbai High

South f ield Future & Potential Sales Prospects

FC - Framework Contracts LSTK - Lump Sum Turnkey Contracts IPP - Independent Pow er Project Contracts O&M - Operations and Maintenance Contracts TC - Term Contracts PMC - Project Management Contracts

PROJECT Indonesia Upstream Development Project Sector Upstream Location Asia, Indonesia , East Kalimantan / Timur Region Pro ject Holder/Operator Total Scope of work EPC - Engineering, Procurement & Construction Contracts Current /Past Phase Job contracts had been on completion stages Contract Value Estimate Over US $ 490 million Start up Timing From 2010 Development Stage O perational Project Brief The project is associated with the development of Tunu Field Future & Potential Sales Prospects

LSTK - Lump Sum Turnkey Contracts MC - Multi Contracts IPP - Independent Power Project Contracts O&M - Operations and Maintenance Co ntracts TC - Term Contracts

TENDERS & CONTRACTS






PROJECT Australia Enhanced Recovery Project Project Sector Up stream Location Asia, Australia , Western Area Project Holder/Operator Chevron Scope of work CD - Conceptual Design Contracts Current /Past Phase The project ha d been on drilling & a ppraisal phase Contract Value Estimate Over US $ 95 million Start up Timing From 2010 Development Stage Operational Project Brief The project is associated with the CO2 development of Barrow Island

Carbon reinjection and e xplorati on facilities Future & Potential Sales Prospects

PreFEED - Preliminary Design and Engineering Contracts FEED - Front End Engineering Design Contracts EPC - Engineering, Procurement & Construction Contracts EPCC - Engineering, Procurement, Construction a nd Commissioning Contracts EPCM - Engineering, Procurement, Construction & Management Contracts EPIC - Engineering, Procurement, Installation & Commissioning Contracts

PROJECT India Aromatics Project Project Sector Down stream Location Asia, I ndia , Gujarat District Project Holder/Operator ONGC - Oil and Natural Gas Corporation Scope of work FS - Feasibility Study Contracts Current /Past Phase The application for planning consent had been presented Contract Value Estimate Over US $ 1 billion Start up Timing From 2010 - 2011 Development Stage Operational Project Brief The project is associated with the Gujarat a romatics development of

o lefins factory Future & Potential Sales Prospects

PreFEED - Preliminary Design and Engineering Contract s FEED - Front End Engineering Design Contracts EPC - Engineering, Procurement & Construction Contracts EPCC - Engineering, Procurement, Construction and Commissioning Contracts EPCM - Engineering, Procurement, Construction & Management Contracts EPIC - En gineering, Procurement, Installation & Commissioning Contracts

PROJECT Thailand PTT Construction Project Sector Down stream Location Asia, Thailand , Rayong District Project Holder/Operator PTT Phenol Scope of work EPC - Engineering, Procurement & Construction Contracts Current /Past Phase Job contracts had been on completion stages Contract Value Estimate Over US $ 22 5 million Start up Timing From 2010 Development Stage Operational Project Brief The project is associated with the development of p henol complex Future & Potential Sales Prospects


TENDERS & CONTRACTS






PROJECT Singapore Bulk Polymers Project Project Sector Down stream Location Asia, Singapore , Jurong Island Area Project Holder/Operator Teijin Chemicals Scope of work O&M - Operations and Maintenance Contracts Current /Past Phase Job contracts had been on completion stages Contract Value Estimate Over US $ 2 3 5 million Start up Timing From 2010 Development Stage Operational Project Brief The project is associated with the development and e xpansion of

p olycarbonate complex Future & Potential Sales Prospects

FC - Framework Contra cts LSTK - Lump Sum Turnkey Contracts MC - Multi Contracts IPP - Independent Power Project Contracts TC - Term Contracts PMC - Project Management Contracts

PROJECT Australia Clean Fuels Project Project Sector Down stream Location Asia, Australia , North ern Area Project Holder/Operator DCF - Darwin Clean Fuels Scope of work FS - Feasibility Study Contracts Current /Past Phase The project had been on planning phase Contract Value Estimate Over US $ 485 million Start up Timing From 2011 Development S tage Operational Project Brief The project is associated with the development of Port Darwin

condensate p rocessing unit Future & Potential Sales Prospects

PreFEED - Preliminary Design and Engineering Contracts FEED - Front End Engineering Design Contrac ts EPC - Engineering, Procurement & Construction Contracts EPCC - Engineering, Procurement, Construction and Commissioning Contracts EPCM - Engineering, Procurement, Construction & Management Contracts EPIC - Engineering, Procurement, Installation & Commis sioning Contracts

PROJECT India Compressor Station Development Project Sector Mid stream Location Asia, India , Uttar Pradesh Region Project Holder/Operator GAIL - Gas Authority of India Limited Scope of work FS - Feasibility Study Contracts Current /Past Phase The project had been on planning phase Contract Value Estimate Over US $ 1.5 billion Start up Timing From 2013 - 2014 Development Stage Operational Project Brief The project is associated with the development of Jagdishpur to Haldi a

gas p ipeline Future & Potential Sales Prospects

PreFEED - Preliminary Design and Engineering Contracts FEED - Front End Engineering Design Contracts EPC - Engineering, Procurement & Construction Contracts EPCC - Engineering, Procurement, Construction a nd Commissioning Contracts EPCM - Engineering, Procurement, Construction & Management Contracts EPIC - Engineering, Procurement, Installation & Commissioning Contracts

TENDERS & CONTRACTS






PROJECT Papua New Guinea Pipeline Project Project Sector Mid stream Location Asia , Papua New Guinea , Southern Highlands Region Project Holder/Operator Santos / ExxonMobil / Oil Search / Nippon Oil Corporation / Government of

Papua New Guinea / AGL Scope of work EPIC - Engineering, Procurement, Installation & Commissioning

Contracts Current /Past Phase Job contracts had been on tendering & b idding phases Contract Value Estimate Over US $ 980 million Start up Timing From 2014 - 2015 Development Stage Operational Project Brief The project is associated with the PNG LNG development of Southern

Highlands to Port Moresby Gas Pipeline Future & Potential Sales Prospects


PROJECT India Onshore Oil Terminal Development Project Sector Mid stream Location Asia, India , Tamil Nadu District Project Holder/Operator CPCL - Chennai Petroleum Corporation Ltd Scope of work EPCM - Engineering, Procurement, Construction & Mana gement

Contracts Current /Past Phase Job contracts had been on completion stages Contract Value Estimate Over US $ 145 million Start up Timing From 2011 - 2012 Development Stage Operational Project Brief The project is associated with the development o f Manali refinery SPM

and p ipeline Future & Potential Sales Prospects


PROJECT Bangladesh Receiving Terminal Project Project Sector Mid stream Location Asia, Bangladesh , Offshore Area Project Holder/Operator BPC - Bangladesh Petroleum Corporation Scope of work CD - Conceptual Design Contracts Current /Past Phase The project had been on pla nning phase Contract Value Estimate Over US $ 120 million Start up Timing From 2014 - 2015 Development Stage Potential Project Brief The project is associated with the developme nt of Bangladesh oil import

t erminal Future & Potential Sales Prospects

Pr eFEED - Preliminary Design and Engineering Contracts FEED - Front End Engineering Design Contracts EPC - Engineering, Procurement & Construction Contracts EPCC - Engineering, Procurement, Construction and Commissioning Contracts EPCM - Engineering, Procure ment, Construction & Management Contracts EPIC - Engineering, Procurement, Installation & Commissioning Contracts

TENDERS & CONTRACTS






COURSES

AsianOil 16 February 2011, Week 06 Back Page

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HEADLINES FROM A SELECTION OF NEWSBASE MONITORS THIS WEEK

Oil and Gas Sector

AfrOil Madagascar Oil faces an audit of its work and the l oss of most of its licences.

ChinaOil Chinese hackers have been accused of stealing sensi tive financial information from major Western oil firms.

EurOil Australian-based European Energy has launched an IP O to raise funds for exploration in the Czech Republi c.

FSU OGM The US is reportedly offering Ukraine the technolog y needed to launch shale gas extraction.

GLNG India is in talks with Qatar over importing an extr a 15 million tonnes per year of LNG.

MEOG Noble Energy has said it hopes to develop the Levia than gas field off Israel by 2016.

NorthAmOil Hercules has struck a deal to buy bankrupt Seahawk' s shallow-water drilling fleet.

Unconventional OGM PetroChina is to buy a 50% stake in Encana’s Cutban k Ridge assets in Canada for over US$5 billion.

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