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By Rita Tubb, Managing Editor
MMS Forecasts Production Increases From Deepwater Gulf Areas
The Minerals Management Service (MMS), Gulf of Mexico Region, has released new oil and gas daily production rate projections to 2005. The MMS report, Daily Oil and Gas Production Rate Projections From 2002 Through 2006, Gulf of Mexico Outer Continental Shelf, is forecasting a daily oil production rate of between 2 and 2.47 million barrels by the end of 2006, and a daily gas production rate of between 10.97 and 16.39 Bcf by the end of that year. These represent high case and low case scenarios. MMS Director Johnnie Burton called the new projections “a healthy, sizeable increase in the range of possible oil production. Should the high case estimates be reached in 2006, we will see a 160-percent increase in oil production from the Gulf in the period 1995-2006.” Oil production has been rising steadily in the Gulf since 1995. Burton said “should the high case projection be met in 2006, oil production would be at almost 2.5 million barrels a day vs. 945,000 barrels in 1995.” Gulf oil production was an estimated 1.5 million barrels a day in 2001. Gulf deepwater oil production surpassed shallow-water production in March 2000. According to these forecasts, as much as 77 percent of daily oil production in the Gulf and 26 percent of daily gas production could come from deepwater Gulf leasing areas by 2006. Deepwater is defined as water depths 1,000 feet or greater. The outlook document, (OCS Report MMS 2002-031), is available from the Public Information Office of the MMS Gulf of Mexico Region, as well as at the region website at www.gomr.mms.gov. There is no charge. Copies can be ordered by calling 1-800-200-GULF. MMS is the federal agency in the Department of the Interior that manages the nation’s oil, natural gas and other mineral resources on the outer continental shelf in federal offshore waters. The agency also collects, accounts for and disburses mineral revenues from federal and Indian leases. These revenues totaled $10 billion in 2001 and $120 billion since it was created in 1982. Annually, nearly $1 billion from those revenues goes into the Land and Water Conservation Fund for acquisition and development of state and federal parks and recreation lands.
Natural Gas Provisions In Maritime Bill An Issue Between House and Senate
The House included an amendment in the maritime security bill it passed on June 5 which extends provisions of the Deepwater Ports Act to natural gas. That 1974 law now applies only to petroleum. The House bill—called the Maritime Transportation Antiterrorism Act (H.R. 3983)—would create a regulatory infrastructure for the transport and delivery of natural gas to offshore offloading terminals in the United States. The bill also includes a provision directing the secretary of Transportation to work with the secretary of the Interior to “establish and enforce such standards and regulations as may be necessary to assure the safe construction and operation of oil or natural gas pipelines on the Outer Continental Shelf.” Neither of these provisions are included in the Senate Maritime Anti-terrorism bill passed by that chamber by a voice vote on Dec. 20, 2001. The natural gas provisions will be an issue as the House and Senate meet in a conference committee to work out differences between the two bills.
First Direct Shipment Of Russian Crude Arrives Off Texas Coast
and it is home to a $15 billion petrochemical complex that is the largest in the nation and second-largest in the world. As a gateway to the Gulf of Mexico, the Port of Houston is a natural point of entry for Russian crude oil with easy access to U.S. markets.” The recent delivery is the first of five or six that will be arriving here this year, according to Mikhail Brudno, vice president of Yukos. The 200,000-metric ton shipment arrived in the Port of Houston aboard the supertanker Astro Lupus. Brudno said the shipment had been purchased by ExxonMobil Corp. and another buyer, whom he declined to identify. Yukos announced in May that it would send its first tankers to the United States this summer. That announcement followed a summit meeting in Moscow, at which Presidents Bush and Putin signed an energy cooperation statement. Michael Smith, assistant secretary of energy for fossil fuels, told a news conference that Russia needs to increase its share of world oil exports and the United States must diversify its sources of oil. “I hope this will be the first of many shipments in the future,” Smith said. Russia currently accounts for only a small percentage of U.S. imports, and oil is its chief export. Bruce Misamore, chief financial officer for Yukos, said the company’s production jumped 17 percent last year, to 1.1 million barrels per day, prompting it to find an additional market for its crude. He said output was expected to grow 20 percent this year, to 1.4 million barrels per day. But shipping to the United States is costly because of Yukos’ lack of infrastructure - primarily deepwater ports - and increased transportation needs. The company will need to add infrastructure before it can really dent the U.S. market. Yukos could put the Druzhba-Adria oil pipeline into operation, which would allow Russian oil to be shipped from the Omisal port in Croatia. Otherwise, Yukos would need a set price for its oil that would cover transportation costs. Misamore said officials haven’t decided what they would do during short-term price decreases.
In early July, the first-ever direct shipment of crude oil from Russia to the United States arrived in the Gulf of Mexico off the Texas coast near Galveston Island. The crude was shipped by the Yukos Oil Company, Russia’s largest fully privatized integrated oil company. “It’s fitting that the first direct shipment of Russian crude oil to the United States comes via the Port of Houston,” James T. Edmonds, Port of Houston Authority chairman, said in a welcoming address at the port. “This is the eighth-largest port in the world,
Improved Hydrotesting Method For New Subsea Pipelines
In the ever-changing pipeline industry, improved hydrotesting of subsea pipelines seems to have remained unchanged for several years. Now, BJ Process and Pipeline Services (BJ PPS) has developed UPDATE, an underwater pipeline data acquisition and transmission equipment system which will dramatically reduce costs by revolutionizing the pipeline
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industry’s approach to critical hydrotesting of newly installed subsea pipelines. Developers say UPDATE is the first system of its kind designed to monitor and transmit pressure and temperature data of an underwater pipeline during the hold period of a hydrotest, while the marine support vessel is free to travel as much as six miles for the testing site. The system, which comprises both underwater and surface components, measures and stores data which is transmitted to the surface assembly on a supporting marine vessel. It also incorporates a fail-safe memory card from which information may be downloaded, even if all battery life has expired. Typically, the hydrotesting procedure calls for the use of divers and a marine support vessel which must remain stationary for the standard 24hour pressure hold phase while data is transmitted from the pipeline through a line to the surface assembly onboard. As a result, the cost of a traditional hydrotest is substantially greater because it ties up the use of an expensive marine vessel. “It is standard industry practice to carry out a 24-hour pressure hold phase during an underwater pipeline hydrotesting oper-
ation while the pipeline is being tested for its ability to withstand a constant level of pressure,” said Paul Sergeant, area support engineer for BJ PPS. “With UPDATE, this same marine vessel can carry out other productive operations while serving as a data acquisition equipment support vessel throughout the entire hold period. This is where the true cost savings lie.” Designed for extreme conditions, the system was rigorously tested throughout 2001, and already has firm commitments to be used extensively on behalf of clients throughout the 2002 season. UPDATE is designed to operate in extreme environmental conditions and difficult acoustical terrain. The North Sea, particularly in the shallower regions, can be a difficult acoustical environment because it affects the ability to effectively transmit signals. The acoustic equipment is multi-modulation so that the modulation can be changed during operation to deal with variable conditions. UPDATE can also transmit commands or data with any implemented modulation at a data rate of 20 bits/sec or greater, and is built to retain data and continue to operate, even in the event of a power outage. Subsea components operate at depths of up to 6,500 feet with ambient
temperatures in the 00C to +350C range, and seabed components are built to run in water currents of up to five knots.
NKK Begins Pipe Deliveries For Australian Pipeline
The first shipment of pipe for a new pipeline off the northwest coast of Australia was recently shipped from NKK’s yard. The shipment was the first of 83 miles of 42-inch UO welded line pipe that will be used during construction. The Japanese supplier is providing 85,000 tons of X65-grade UO pipe for the project. Delivery is to be completed in six months. Woodside Energy Ltd., the operator for the North West Shelf venture, will lay the natural gas trunkline that will extend from two offshore gas platforms to an onshore processing plant on the Burrup Peninsula. Pipeline commissioning is slated in early 2004. According to NKK officials, the line pipe being supplied is highly resistant to corrosion, making it ideal for sour gas applications in Australia’s North West Shelf natural gas development project. The 42-inch size provides sufficient capacity to supply existing customers and to provide for substantial growth in gas supply demand for gas-related industries in Western Australia. P&GJ
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