Oil Review Middle East 5 2014

www.oilreview.me

VOLUME 17 | ISSUE 5 2014

Serving the regional oil & gas sectorsince 1997

77

The evolution ofreliable offshorecommunications

Training and certification are often provided onthe job, but online or ‘distance’ qualificationsplay a role too. In this issue we profile somerecent initiatives.See page 60

Covering Oil, Gas andHydrocarbon ProcessingUK £10, USA $16.50

Iraq’s oil ambitions under fire

Protecting IP rights forshale gas technology

Encouraging prospects inthe drilling sector

The growing demand foron-site power

Achieving optimaloperational safety

Acoustic sensingtechnology for subsea

ORME 5 2014 Cover_ORMETHREE05COVER.qxd 8/18/2014 11:57 AM Page 1

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Editor: Louise Waters

Editorial and Design team: Bob Adams, Prashant AP, Hiriyti Bairu, Sindhuja Balaji, Andrew Croft, Ranganath GS,Rhonita Patnaik, Louise Quick, Prasad Shankarappa, Zsa Tebbit, Nicky Valsamakis and Ben Watts

Publisher: Nick Fordham

Advertising Sales Director: Pallavi Pandey

Magazine Sales Manager: Camilla Capece +971 4 448 9260 +971 4 448 9261 [email protected]

International Representatives

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South Africa Annabel Marx (27) 218519017 (27) 46 624 5931 [email protected]

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Head Office: Alain Charles Publishing LtdUniversity House, 11-13 Lower Grosvenor Place, LondonSW1W 0EX, United Kingdom +44 (0) 20 7834 7676 +44 (0) 20 7973 0076

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© Oil Review Middle East ISSN: 1464-9314

www.oilreview.meemail: [email protected]

Issue 5 2014 oilreview.me 3

Serving the world of business

I AM DELIGHTED to be taking on the role of editor of the Middle East’s leadingmagazine for the oil and gas industry. Despite the conflict and upheaval thatcontinues to beset the region, there is much to be positive about in the oil andgas scene. The rig count continues to rise steadily, indicating a healthy level ofexploration and development activity, while new frontiers continue to beexplored, creating increased supply opportunities and the potential forcollaborative partnerships to exploit the latest technologies.

In this issue, as always, we bring you news on oil and gas developents inthe region, as well as on the latest technological innovations, along withfeatures and analysis on topical issues. And watch out for an increasedfocus on HSEQ – we will soon be adding a dedicated area on our website.Please do get in touch with your news and feedback, and I welcome anythoughts and contributions for future issues. E-mail: [email protected]

Editor’s note

Exploration & Production

4 Developments

A detailed round-up of the latest E&Pnews from around the region.

Gas

14 Developments

The latest news including an update onIran’s South Pars gas field.

Calendar

20 Executives’ Calendar

Event listings plus profiles of ManamaEnergy Forum Debates and ADIPEC’s‘Women in Industry’ event.

Analysis

22 Recruitment in the online age

A look at the best ways to use e-mail injob applications.

24 Iraq’s oil ambitions under fire

Lynda Davies reports on the attempts ofIraq’s oil industry to carry on withbusiness as usual.

28 Encouraging drilling prospects

ahead

The Middle East rig count is on the up,and there is a demand for newtechnology to improve performance andcope with complex drilling challenges.

32 Investing in far-reaching potential

DHL’s Energy Sector president SteveHarley outlines the rationale behindcompany’s regional focus.

Petrochemicals & Refining

34 The chemical industry’s

sustainability journey

John Pearson, CEO of Chemical IndustryRoundtables LLC, discusses theindustry’s push for sustainability.

Health & Safety

42 Operational safety and

overcoming human error

Overcoming the challenges to achieveoptimal health and safety onsite.

44 Risk management in a

changing world

SSDS Risk Management generalmanager Carl Moon discusses theimportance of an effective riskmanagement strategy.

Technology

46 Intellectual property: The catalyst

for shale

Overcoming the challenges to achieveoptimal health and safety onsite.

48 Enhancing offshore rig

communications

Nicholas Newman discussesdevelopments and assesses the availableoptions.

50 Meeting on-site demand for power

The increase in the number of projects inremote locations is creating newchallenges.

54 Acoustic sensing technology

OptaSense chief technology officer DrDavid Hill discusses the uses of DAStechnology.

Training & Development

60 Meeting the region’s training needs

The role of online learning.

Innovations

63 Industry developments

A round-up of the latest productadvancements in oil and gas.

70 Rig count / Project databank

Arabic

4 News

7 Analysis

Contents

S01 ORME 5 2014 - Start_Layout 1 8/18/2014 5:04 PM Page 3

ANALYSTS ARE SUGGESTING aninvestment in developing shale gasreserves in Saudi Arabia could boost itseconomy and serve growing electricityneeds in the Kingdom as well.

Shale gas refers to pockets of naturalgas trapped in dense, impermeablesedimentary rock. Production of shaleinvolves intense seismological study,complex extraction systems andmultifaceted distribution infrastructures.Development of shale depends onavailability of resources and supportivefiscal measures.

In March 2013, Ali Al-Naimi, thepetroleum and mineral resources ministerof Saudi Arabia, announced plans to drillseven test wells to extract shale gas aspart of a programme to develop theKingdom’s unconventional oil and gasreserves. He has forecast 600 trillioncubic feet (tcf) of shale reserves in theKingdom, equivalent to more than 100mnbarrels of oil. Saudi Arabia's shale reservesexceed those of Mexico (545 tcf), Australia(437 tcf) and Russia (287 tcf).

Saudi Arabia has identified substantialshale gas formations in the northwest ofthe country, the South Ghawar (theworld’s largest conventional oilfield) andthe Rub’al-Khali.

Meanwhile, the Kingdom issimultaneously experiencing a surge indomestic electricity demand. Anestimated 27mn people are currentlyusing up to 49GW of electricity,according to Saudi Arabia's Electricity andCo-generation Regulatory Authority.

The demand for power is posing achallenge for the government. In order toprovide power, the Kingdom has beenburning oil and gas that could beexported, leading to a loss in exportrevenues.

Developing unconventional resourceslike shale gas could provide an innovativesolution to address increasing domesticelectricity demand. It provides resourcesto produce electricity, while freeing upthe existing oil reserves for export.

DANA GAS HAS reported a net profit of 70 per cent in Q22014. The company made US$46mn in the quarter, up fromUS$27mn during same period last year.Production across the group rose by 17 per cent on a year-on-year (YoY) basis. In addition, higher realisedhydrocarbon prices during the period led to a growth inrevenue, stated officials from the company. The rise inproduction in Egypt and the Kurdistan Region of Iraq, alongwith high energy prices and reduction in cost of salescontributed to the growth in revenue and gross profit. During the first half of 2014, profit from operations increased by 68 per cent to US$91mn, compared toUS$54mn in first half of 2013. The gross revenues and profit were US$367mn and US$172mn respectively.The average overall production volumes increased by 17 per cent in Q2 2014 to 72,200 boepd comparedto 61,700 boepd in the same period last year. Dana Gas Egypt experienced a continued upturn in averageQ2 production to 42,950 boepd – a 25 per cent increase vis-à-vis the 34,300 boepd achieved in Q2 2013.Patrick Allman-Ward, CEO of Dana Gas, said, “Dana Gas has continued to deliver impressiveproduction growth and consistent operational and financial performance despite ongoing challengesin our key markets. This is the result of a business strategy that has focused on operational deliverywhilst addressing the issue of unpaid receivables from our government clients and diversifying ourbusiness exposure.“We continue to focus on diversification, and are progressing the development of the Zora field in theUAE and reviewing other new business development opportunities,” Allman-Ward added.

DNO INTERNATIONAL HAS announced that it plans todrill two oil and gas exploratory wells in onshore Oman’sBlock 36 in 2015.

The Norwegian oil and gas company said that thedecision would add to its existing programme ofappraisal, development and production activities as itseeks to target a sizable portfolio of hydrocarbonassets in the sultanate.

Block 36 is a 18,000 sq km frontier exploration blocklocated in the Rub Al Khali basin. According to DNOInternational, two of the three exploration wells drilledpreviously on the block have indicated the presence of source rock – commonly found in oil andgas fields around the Arabian Peninsula. All three exploration wells had hydrocarbon shows.

“The company has completed reprocessing of the existing 2D seismic data and continuesto identify prospects on the block. Acquisition of new 2D seismic data over prospective areaswill commence in Q3 2014, while preparing to drill two exploration wells in 2015,” the Oslo-based firm stated.

DNO has a 75 per cent participating interest in the block, which was acquired last year, viaa farm-in agreement with Allied Petroleum.

Saudi Arabia recommended to invest in shale gas

RUSSIAN COMPANY GAZPROM Neft has started drilling an exploration well at the ShakalBlock in the Kurdistan Region of Iraq.

The company added that it would also commence drilling on a second exploration wellin the block. The project will study two oil reservoirs in the Shakal Block, including flowtesting. Gazprom Neft said that both wells will be nearly 3.5 km deep and well testingwould be completed by late 2014 or early 2015.

Canada’s Grey Wolf will serve as the contractor of the project. Earlier, 2D seismicsurveys were conducted covering an area of more than 1,000 linear kilometres at theShakal Block, where an exploration well has also been drilled.

The Russian company is also conducting geological surveys of the Halabja Block, whereit is planning 2D seismic surveys covering 1,000 linear kilometres in 2014, and will bedrilling the block’s first exploration well in 2015-2016. It is also involved in the developmentof the Garmian Block where the deposit is currently undergoing further exploration andpreparation for full scale development.

DNO International to drill two onshore wells in Oman in 2015

Gazprom Neft begins exploration in KurdistanRegion of Iraq’s Shakal Block

Dana Gas profits rise 70 per cent in Q2 2014

An onshore oil well in Oman

E&P

Saudi Arabia has 600 tcf ofidentified shale reserves

Dana Gas made US$46mnnet profit in Q2 2014

4 oilreview.me Issue 5 2014

S02 ORME 5 2014 - E&P 01_Layout 1 8/18/2014 2:17 PM Page 4


THE INTERNATIONAL ENERGY Agency(IEA) has turned to OPEC to balance themarket for the rest of 2014. In its latestmonthly report, IEA raised the call onOPEC by a combined 400,000b/d for Q3and Q4 to 30.8mn b/d. This compareswith previous forecasts of 30.7 b/d and30.5mn b/d, respectively.

For 2015, the call has been raised by100,000 b/d to 29.9mn b/d, stated thereport.

OPEC members have provided a majorshare of the world’s output growth in July,raising its output by 300,000 b/d to 30.44mnb/d, said IEA. Global supply was up 230,000b/d in July to 93mn b/d, with higher OPECoutput offsetting lower non-OPEC supply.

The current insurgency in Iraq hasn’tcaused a significant disruption in oilsupplies. Despite the loss of the Baijirefinery, operations in the south of Iraqhave continued as normal. Aside from acouple of small fields being shut in, oilproduction in the Kurdistan Region of Iraq(KRI) had progressed as usual.

In Libya, exports have resumed fromthe port of Ras Lanuf, which should freeup storage and allow fields to ramp upproduction. Gerhard Roiss, head ofAustria's OMV, said that the company hadresumed lifting cargo from Libya.

”While the situation across these keyproducer countries remains more at riskthan ever, the market appears confidentthat OPEC can deliver the productionincrease needed from it to meet risingdemand expected in the second half ofthe year," stated the report.

In fact, OPEC's crude supply in July hita five-month high with a boost from SaudiArabia of 10mn b/d – the highest figuresfrom the Kingdom since September 2013.

Therefore, with the market wellsupplied – even with an oil glut reportedin the Atlantic basin – much attention hasbeen focused on future demand growth.

KUWAIT HAS RECEIVED bids from fourinternational consortia for theengineering, procurement andconstruction (EPC) of the Al Ratqaheavy crude project.The Ratqa project is part of efforts tomeet Kuwait’s target of producing fourmillion bpd of crude by 2020. OPECmember Kuwait’s current productionstands at around three million bpd, ofwhich around around two-thirds isexported.Among the four bidders, UK’s Petrofacsubmitted the lowest offer. The bidswere submitted by the Central TendersCommittee to the government-ownedKuwait Oil Company (KOC). Otherbidders included Italy’s Saipem and South Korea’s SK Group and the GS Group. Quoting an unnamedKOC official, the newspaper said that Petrofac submitted the lowest bid of US$4.25bn for the contract,while SK Group made the second lowest bid of US$4.64bn. Saipem submitted a bid of US$6.2bn, whileSK Group presented the highest bid of US$6.5bn.All the bids were, however, below US$7.1bn budgeted by KOC for the first phase of the project, whichis expected to produce around 60,000 bpd of heavy crude from the Al Ratqa field.According to the state-owned firm, KOC has formed a team to study the bids and the contract will besigned before the end of 2014. The project is expected to be completed within three-and-a-half years,in addition to a 10-month period for trial operation.

SERICA ENERGY HAS announced thecommencement of drilling operations inthe Sidi Moussa Licence offshoreMorocco.

The semi-submersible rig Noble PaulRomano had spud the SM-1 well in earlyAugust, according to operator GenelEnergy. The well, located approximately 60km off the west coast of Morocco, inwater depths of 990m, is expected totake two to three months to completeoperations.

Serica Energy holds a five per centinterest in the Sidi Moussa Licence andcarries the drilling costs of the well up toa gross cap of US$50mn with anexpected limited contribution above thislevel, the company said.

Tony Craven Walker, CEO of Serica Energy, said, “The SM-1 is well placed to test thecarbonate reservoir potential in the Sidi Moussa Licence. Serica Energy is largely carriedon this frontier exploration well. Morocco is still underexplored and the potential is therefor a material oil find.”

OPEC members can help balance oil market

RUSSIAN OIL MAJOR Lukoil’s international marketing and trading arm Litasco has chartereda crude carrier to receive the first batch of oil extracted from the West Qurna-2 oilfield in Iraq.

The vessel will spend several days at the Basra port to load one million barrels of oil,Lukoil said. This exercise is part of the recovery of Lukoil’s costs from Phase-1 of the WestQurna-2 oilfield, which is currently producing 280,000 bpd.

Andrey Kuzyaev, vice-president of Lukoil, said, “The loading of this crude carrierprovides further evidence of the reliable partnership between Lukoil and the Iraqi side indeveloping the country’s oil industry.”

Lukoil’s crude carrier is the first to transport buy-back oil that belongs to Lukoil, in linewith the terms of the West Qurna-2 service contract, company officials said.

Serica Energy begins drilling offshore Moroccan licence

Lukoil’s crude carrier to receive oil from Iraqi oilfield

Kuwait receives four bids for Al Ratqa project

The well is located in water depths of 990m

E&P

The IEA has called on OPEC to increaseoil production

Kuwait produces three million bpd




SINGAPORE'S COSCO CORPORATION Limited's subsidiary CoscoDalian Shipyard Co. Ltd has secured contracts exceeding US$470mnto build four subsea supply vessels for Maersk.

The contract, however, excludes owner-furnished equipment fromMaersk Supply Service AS (MSS) – part of the AP Moller-MaerskGroup, stated Cosco Corporation officials.

The vessels have been scheduled for delivery in Q4 2016. In addition, MSS has also secured options from the Singaporean

company for two more subsea vessels, whose delivery is scheduledin the first half of 2017.

Cosco Corporation wins US$470mncontract to build subsea vesselsfor Maersk ABU DHABI NATIONAL Oil Corporation (ADNOC) and Kuwait Petroleum

Corporation (KPC) are in talks with India to hire a part of its storagefacilities, which are currently under construction.India, which is 79 per cent dependent on imports to meet its crude oilneeds, is building underground storage facilities at Visakhapatnam in thestate of Seemandhra and at Mangalore and Padur in the state of Karnatakato store about 5.33mn tonnes of crude oil.Dharmendra Pradhan, India’s oil minister, said, “The national oil companiesof the UAE and Kuwait have expressed their interest to store about twomillion tons of crude oil in the caverns.”The storages at Visakhapatnam, Mangalore and Padur are reportedlyenough to meet the nation’s oil requirement of about 10 days.Official sources said that the 1.33mn ton storage in Seemandhra will beready by September/October this year while the 4mn ton facilities inKarnataka will be completed by mid-2015.With the commissioning of Visakhapatnam storage, India is likely to joinnations like the US, Japan and China that have strategic reserves.Originally, India Strategic Petroleum Reserves Limited (ISPRL), the state-owned firm building the strategic stockpile, was to build the Visakhapatnamfacility by October 2011 while the Mangalore storages were to be mechanicallycompleted by November 2012. The storage at Padur was scheduled forcompletion in December 2012. However, construction was delayed.The facilities in Vishakhapatnam, Mangalore and Padur will costUS$169mn, US$200mn and US$275mn respectively.

ADNOC and KPC to lease India’s oilstorage facilities

E&P

Cosco will deliver thevessels in Q4 2016




IRAQ IS PLANNING to export 2.4mn bpd of Basra Light crude inSeptember 2014, up from 2.2mn bpd from July 2014.

Despite insurgency in the country, crude exports have increasedand this could weigh on global oil prices.

Additional supply of Basra Light crude could also weigh onMiddle East grades, which are facing stiff competition from cheaperbarrels flowing in from Africa and Latin America, added the report.

The spot market for Basra Light crude has been muted in Asiain the past two months due to a possible disruption in supplyowing to political factors. Iraq plans to export 71.895mn barrels ofBasra Light crude in September. Buyers from China were due topurchase 21mn barrels. In August 2014, Iraq had scheduled toexport 2.225mn bpd, sharply down from the initial July programmeof around 2.8mn bpd.

AN OIL TANKER carrying 670,000 barrels of crude has departed fromLibya's Ras Lanuf terminal, becoming the first shipment since the port wasreopened a year after a series of blockades by protestors.

A spokesperson for the state-run National Oil Corporation confirmedthat the vessel was carrying Siritica crude. It was chartered by theAustrian firm OMV and was travelling to Malta in Italy.

A second shipment is expected shortly, added the spokesperson. Ras Lanuf is Libya's third largest port and has a capacity to load 220,000

barrels a day. Libya is a key member of OPEC and used to produce nearly1.6mn barrels of oil per day prior to the downfall of Muammar Gaddafi'sregime, stated Reuters.

Currently, the country produces 450,000 barrels per day. The shipment has been considered a positive sign for the Libyan

economy, which is recovering from a series of political upheavals. AReuters report added that four out of five eastern oil ports were shut off byfederalist rebels, cutting the country’s production by nearly half.

Even though the government negotiated with the rebels to free theports, technical glitches had delayed their reopening.

THE OIL FIELD Get Together (OFG) is set to celebrate as it hosts its50th oil and gas networking event in Dubai on 28 August.

Hosted at Ruth’s Chris Steak House in Dubai Marina, the OFG hasbeen running for almost five years since its conception in 2009.

Antonio Lagrutta, general manager of Ruth’s Chris Steak House,said, “We are honoured to host the OFG’s monthly get together. Ithas been a fantastic event thus far, where we see decision makersand oil field professionals come together month after month.”

A leading monthly event for the UAE’s oil and gas industry, OFGprovides attendees with the opportunity to network in an informal

environment with other like-minded industry professionals and suppliers.In a relaxed setting, guests can enjoy a three-course dinner at the

Marina’s award-winning restaurant.Additionally, attendees can benefit from complimentary valet

parking, Internet and business centre facility.

The next event will be held on 28 August 2014, from 12 noon-3pm atRuth’s Chris Steak House, The Address Dubai Marina. Places cost AED250 per registration and AED 300 on the door; for reservations contactthe restaurant on +971 4 4549538.

Iraq to increase export of Basra Light crude

OFG celebrates 50th oil and gas networking dinner

Libyan port exports first shipment ofcrude for a year

The OFG has been running since 2009

E&P

Iraq has hiked itscrude exports

Ras Lanuf port hasreopened after a year


The networking event attracts industry professionals and suppliers


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MOL KALEGRAN LTD., has announcedthat it has reached an agreement withthe Kurdistan Regional Government’s(KRG) Ministry of Natural Resources onits field development plan (FDP) in twodiscovery areas.

The FDP relates to two commercialdiscovery areas in the Akri-Bijeel block,the Bijell and the Bakrman areas, withthe approved two-phase developmentprogramme enabling operator MOLKalegran to determine key factors suchas the recovery factor.

MOL Kalegran said an extended welltesting facility with 10 mboepd capacityhas already been producing without anydisruption on the Bijell area. Theoperator is also set to add furthertemporary, rented facilities to helpramp up production from both areas to35 mboepd in 2015, before increasingproduction from the block to minimumof 50 mboepd by 2017-18.

MOL group executive vice-presidentfor E&P, Alexander Dodds, said theagreement marked “a very importantstep for the whole group in such animportant region, which would not havematerialised without the support of theMinistry of Natural Resources”.

HE Dr Ashti Hawrami, minister fornatural resources for the KRG,remarked, “This will greatly contributeto the production target set by theministry of one million barrels of oil perday – this is an excellent contribution tothe exchequer.”

OIL AND GAS facilities service provider Petrofachas been awarded a contract worthapproximately US$8.5mn to provide maintenancebuild capabilities to the BP-operated Shah Deniz2 project in the Caspian Sea. Plant Asset Management, Petrofac’s assetperformance management consulting business,will be responsible for delivering the contract,which covers onshore, offshore, and pipelineassets in the Azerbaijan sector of the Caspian forone of the world's largest gas developments.Steve Johnson, vice president of Plant AssetManagement said, “We are thrilled to besupporting BP with one of its most ambitiousprojects and for the further opportunity tohighlight the skills of our high calibre consultants,engineers, developers, and analysts.”Due to be completed in 2018, the contract is partof a long-term project to open a new SouthernGas Corridor and see Shah Deniz 2 add a further16 bcm of gas production per year to the currentnine bcm produced by Shah Deniz Stage 1,

according to Petrofac.Plant Asset Management’s services on theproject will include the development of reliabilityand maintenance strategies, validation of the

master equipment list, creation of a maintenanceassignment, and the development ofcomputerised maintenance management systems(CMMS) data.

ABU DHABI NATIONAL Energy CompanyTAQA has announced record oil and gasproduction, having achieved a net profit ofUS$140mn for the first half of 2014, upfrom a loss of US$18mn in the sameperiod last year.

Averaging at 158,000 boepd, the firstsix months of 2014 saw a 24 per centincrease in the company’s production on tothe first half of 2013.

TAQA chief operating officer, EdwardLaFehr, said, “We are starting to see theresults of our focused strategy bearing fruit.”

The growth in fuel production, alongwith the increased price of gas in North America, contributed to boosting TAQA’s revenues toUS$3.1bn. As a result, the company is boasting its highest ever EBITDA (earnings before interest,taxes, depreciation, and amortization), of US$2.2bn, up 42 per cent on the first half of 2013.

LaFehr stated, “Greater efficiencies and cost control, combined with a conservative viewon growth projects and acquisitions, will ensure we can deliver our commitment to reducedebt and improve financial performance.”

MOL and KRG in FDP agreement

OIL SEARCH LIMITED carried out planned blowout preventer (BOP) tests at the Taza-2 wellin the Kurdistan Region of Iraq.

The tests ensured stabilisation of the hole and helped treat mud losses that wereencountered last week, the company said.

Once the oil well has been declared stable by relevant authorities, the hole will beenlarged, giving way for a more comprehensive testing programme, officials from OilSearch Limited added. The Papua New Guinea-based oil company has already reached atotal depth of 4,200 metres through a 6.12-inch hole.

The Taza-2 well is located 10km northwest of Taza-1 and is designed to appraisehydrocarbon-bearing intervals encountered by Taza-1 like the Jeribe and Euphratesformations. It would also explore deeper tertiary and cretaceous targets including theShiranish formations.

Total E&P KRI, the Kurdistan Regional Government (KRG) and Oil Search Limited areoperating on the Taza-2 block.

TAQA reports record production for first half 2014

Oil Search Limited executes BOP tests at Iraqi well

Petrofac awarded US$8.5mn maintenance contract for BP’s Shah Deniz 2

TAQA averaged 158,000 boepd in the first half of 2014

E&P

Petrofac will provide maintenance support to Shah Deniz 2



S04 ORME 5 2014 - GAS 01_Layout 1 8/18/2014 2:23 PM Page 13

OIL MINISTER BIJAN Namdar Zanganehrevealed Iran is set to increase natural gasproduction by 200mn cu/m by March 2016.

The increase in natural gas output willeradicate Iran’s need to import the productfrom Turkmenistan.

Iran holds the second biggest natural gasreserves in the world with approximately 33plus trillion cu/m of extractable deposits.

The country uses the gas it imports fromTurkmenistan to its northeastern provinces,

which are far from Iran’s southern gas-producing regions.

Zanganeh said that he will request formeasures to be put in place for the exportof products and engineering services toTurkmenistan, as Iranian companies havethe means to carry out projects worthUS$700mn to US$1bn.

Iran is Turkmenistan's second biggesttrade partner following Russia.

Zanganeh highlighted his ministry's

ability to carry on supplying gas to thecountry's loyal customers.

Furthermore Iran’s deputy oil minister forinternational affairs and trade, Ali Majedi,announced that the demand for Iraniannatural gas in the Gulf is increasing.

He revealed that negotiations regardingIranian gas exports are currentlyunderway Oman, as well as Kuwait, AbuDhabi, and Dubai.

Majedi told Iran Daily, “Kuwait and theUAE need Iran’s gas for desalination andtheir gas demand is less compared to thatof other importers of Iranian gas, such asIraq and Turkey.”

Iran and Oman signed a US$60bnagreement in August 2013, under which Iranwill deliver gas to the sultanate for 25 years.

As part of this agreement and in linewith a deal sealed in March this year, Iranwill supply 10bn cu/m of natural gas toOman annually. The project is expected tocome on stream within three years.

Iran to increase natural gas output

Iran has approximately 33 plustrillion cu/m of extractable deposits

BP HAS SAID it will invest US$10bn into gasexploration in Egyptian fields, which have beenestimated to hold 141bn cu/m of gas reserves.Egypt’s Prime Minister Ibrahim Mahlab hasannounced the finalisation of the investment dealthat will see work begin in gas fields capable ofproducing 20 per cent of Egypt’s total daily gasoutput.The US$10bn capital will be invested over the nextfour to five years, according to local news reports.The fields, which were discovered by BP, have thepotential to produce 33,980 cu/m per day –equivalent to 20 per cent of Egypt’s current dailygas production.BP currently produces close to 15 per cent ofEgypt’s oil output and close to 30 per cent of thecountry’s gas production with its partners. Thenew gas deal will help Egypt tackle its energy

difficulties with the country requiring natural gasfor power generation to cover nationwide powershortages, as well as reverse the deterioration inlocal gas production.Mahlab added that BP had also been working to

invest in explorations in the Nile Delta, Suez Canaland the Mediterranean.Egypt’s consumption of natural gas has beenprojected to increase by 12.5 per cent to 157.7mncu/m per day in the 2014-15 fiscal year.

BP deal to invest US$10bn in exploration of Egyptian gas fields finalised


Gas

The new deal could help Egypt tackle its energy difficulties



XODUS GROUP HAS joined forces with Qatargas to provide vibration engineering servicesat onshore and offshore facilities.

Qatargas awarded Xodus group the contract in Qatar, which is believed to be worth inthe region of US$1mn.

The contract is for a Technical Services Vibration Programme at the Qatargas QG1, QG2and QG3&4 LNG Facilities, Ras Laffan refinery and associated offshore assets.

Working alongside Chiyoda Almana Engineering, Xodus will seek to setup a long-termpiping integrity management programme to evaluate and reduce vibration in all of theQatargas facilities, both onshore and offshore.

“Our specialist vibration expertise is ideally suited to some of the challenges facingoperators in Qatar and across the region,” said Colin Manson, CEO of Xodus Group.“Eliminating vibration supports integrity management plans and can deliver significantasset cost savings. In partnership with Chiyoda Almana, we look forward to working withQatargas to address integrity issues to assist production.”

Xodus, which provides integrated oil and gas services covering surface and subsurface,launched its Dubai office in 2012 and has grown to more than 100 people in the MiddleEast as demand for its integrated services rises with oil and gas operators.

The UK-based company recently launched new offices in Abu Dhabi, UAE and Erbil,Kurdistan, and is working on setting up a Qatar office later this year.

BAM HAS DRIVEN the first pile at a new liquefied natural gas (LNG) jetty in Aqaba, Jordan.BAM International, BAM Contractors from Ireland and Jordanian joint-venture partner MAGEngineering & Contracting won the engineering, procurement and construction (EPC) of the LNG jettyin November 2013.BAM Infraconsult has been working on the design of the civil works.The work involved for the newLNG jetty includes the building of a 100 metres trestle on steel piles, a concrete off-loading platform of20 metres by 20 metres, four mooring dolphins and two breasting dolphins. In addition to this a 700metres long gas pipeline to the shore tie-in point will be constructed, as well as associated controlequipment and instrumentation.The substructure works for the terminal building are nearly finished, while construction on theadministration building has begun.The joint venture completed the New Port in Aqaba for the same client at the start of this year and theextension of the container terminal for APMT and ADC in 2013.The LNG project will commence as planned and the hand-over to Aqaba Development Corporation(ADC) is set to take place in April 2015.

AZERBAIJAN’S GIANT NATURAL gas fieldShah Deniz, located in the Caspian Sea,boasts a reported average daily gasproduction of more than 27mn cu/m.

Gas production at the site is carried outacross five wells, and in Q1 2014 theaverage daily volume of gas production atthe field was 26mn cu/m and theequivalent of 49,330 bbl of gascondensate.

A representative from the state energycompany SOCAR told media, “Thevolume of gas production in the field ishigh. It is now at the level of 27.3-27.4mncu/m per day.”

As a comparison, in 2013approximately 9.8bn cu/m of gas and19.6mn bbl of gas condensate wereproduced at the Shah Deniz field. Whilein 2012 saw 7.73bn cu/m of gas and1.8mn mt of gas condensate beingproduced.

Discovered in 1999, the Shah Denizgas field is one to the world’s largest gas-condensate fields with estimated gasreserves of 1.2 trillion cu/m.

Previously, in 2013 Azerbaijan agreedto sell more than 10bn cu/m of naturalgas a year from the second phase of itsShah Deniz development to ninecompanies in Europe.

Xodus Group wins Qatargas engineering contract

RASGAS COMPANY LIMITED (RasGas)recently set-up a relationship buildingmeeting with five key members from Qatar’sGeneral Directorate of Civil Defence.“RasGas is always seeking out new ways toenhance our mutual efforts to build a safeand secure community which is essentialfor business and the nation as a whole,”said Jassim Al Baker, head of logistics,RasGas. The workshop in RasGas’ West Bayheadquarters involved presentations whichlooked at the business flow and the roleeach party plays in creating a mutually-beneficial work relationship.“The workshop provided me and my teamwith very unique insights into RasGas’business needs and areas in which we cansupport one another during our routineinspections, warehouse and store functionsas well as safety systems and chemicalspermissions. RasGas revealed that in the future it willhost similar workshops with othergovernment ministries and agencies.

Azerbaijan’s Shah Denizincreases gas production

RasGas strengthensties with civil defence

BAM begins construction on Jordanian LNG project

Gas

Xodus will work alongside ChiyodaAlmana Engineering on the contract

BAM has driven the first pile at anew liquefied natural gas (LNG)

jetty in Aqaba, Jordan




PARS OIL AND Gas Company (POGC) hasannounced that construction on Phase 15and 16 of its third gas processing plantcovering the South Pars gas field is 95per cent complete, with the plantexpected to come online in August.The first and second plants will handle25mn cu/m of sour gas a day, while thethird plant is currently undergoing pre-commissioning stages, according toPOGC, a subsidiary of the National IranianOil Company (NIOC).The company reported that together thethree gas plants will process at least40mn cu/m a day in winter.Ultimately, the development of the SouthPars gas field under Phase 15 and 16intends to process 56.6mn cu/m per day,75,000 bpd of condensate, and 363 mtper day of sulphur.According to reports, the two phases willalso generate more than one millionmetric tons per day of Liquefiedpetroleum gas (LPG), propane, and

butane as well as one million metric tonsof ethane per day, primarily to be used aspetrochemical plant feedstock.Furthermore, offshore and onshoreinstallations of the two phases involvetwo drilling platforms, each with 11 wells.Previously, Iran finished installing fiveoffshore platform in several phases in thegiant South Pars gas field, located in thewaters of the Gulf, in four months. Thefive platforms involved in Phase 15, 16,12b, 18A, and 12C of the gas field wereinstalled during between 21 March to 22July 2014.The South Pars gas field, split into 28phases, is situated in the Gulf on thecommon border between Iran and Qatar,and is estimated to hold 14 trillion cu/mof gas as well as 18bn bbl ofcondensates.Measuring a total area of 9,700 sq km,3,700 sq km of the gas field covers Iran’sterritorial waters, while the remaining6,000 sq km is located in Qatar’s

territory, also known as the North Dome. The overall gas field is estimated to hold51 trillion cu/m of natural gas and some7.9bn cu/m of natural gas condensate,according to the International EnergyAgency (IEA).Additionally, official Iranian Customsreports revealed that Iran’s year-on-yearexports from the South Pars natural gasfield rose 49 per cent over the last Iraniancalendar month.

Pars Oil and Gas Company to start operations of third gas plant

BRITISH COMPANIES STAND to benefit from the expected upturnin contracting activity in the Middle East and North Africa, saidNeil Golding, head of oil and gas at the Energy IndustriesCouncil (EIC), at a briefing in London hosted by British Expertiseand the Middle East Association in July.Giving an analysis of current and planned developments in theregion, Golding commented that contracting activity in theregion (EPC and FEED awards) has reduced year on year from 65awards in 2010 to 40 in 2013, reflecting the impact of the ‘ArabSpring’ as well as the slowdown in new field discoveries. “Looking at the tendering exercises taking place, the numbercan be expected to rise again – good news for the UK supplychain,” Golding said.In the five years from 2010-2014 the UAE recorded the mostcontract awards (72) followed by Iraq (55), Iran (32), and SaudiArabia (22), according to the EIC’s tracking database. Iraq topsthe list in terms of current capital expenditure, with aroundUS$160bn worth of projects underway, followed by Iran and theUAE. Highlighting some areas of future development, Goldingcommented that unconventionals are a key growth area, withSaudi Arabia looking to exploit its shale gas reserves, as well astight sands. “Between now and 2020 a full value supply chain is expected tobe developed involving site development, rig preparation,drilling, fracking, completions, well tie-in, production andmaintenance, offering tremendous opportunities,” hecommented. Algeria, with 950 tcf of unconventional reserves, is expected tolaunch a licensing round soon for shale gas, he said, whileJordan is also looking to exploit its significant shale deposits,with the possibility of production commencing by 2018.Enhanced oil recovery (EOR) is another focus of development,notably in Oman, as well as in Saudi Arabia’s and Kuwait’s heavy

oilfield developments, while huge opportunities will arise fromSaudi Arabia’s offshore Red Sea exploration and developmentprogramme, where several wells are planned of which four willbe in deep water – new territory for the Kingdom.Iran could potentially offer big opportunities when it opens up,Golding added, in view of its need to acquire westerntechnology to upgrade its aging infrastructure.The gathering also heard from Robert Rakison, partner atMcGuire Woods, who spoke on the opportunities arising fromthe offshore developments in the Eastern Mediterranean,highlighting the good fit with the North Sea capabilities of UKcompanies. Recent discoveries have pushed total recoverablenatural gas resources to 38 trillion cubic feet, enough to meetdemand for the next forty years. The political situation,however, requires a ‘modus vivendi’ to enable extraction andfacilitate the development of the necessary cross border energyinfrastructures, Rakison commented.

Good prospects for UK companies in the Middle East oil and gas sector

The EIC's tracking databaserevealed that the UAE was thelocation in Middle East of themost contracts awardedbetween 2010-2014


Gas

The plants will process 40mn cu/m of gas a day



CALENDAR 2014

Executives’ Calendar 2014

SEPTEMBER 2014

2-3 3rd PMI AGC DMS Energy Forum Debates MANAMA www.dmsglobal.net

14-16 IDOC ABU DHABI www.idoc-uae.com

16-19 Cairo Energy CAIRO www.cairoenergy.com

16-18 Plastics & Petrochem Arabia DAMMAM plaschem.4p-arabia.com

OCTOBER 2014

15-16 Iraq International Oil & Gas Expo BAGHDAD www.ifpiraq.com

19-21 Ethylene Middle East Technology MANAMA www.ethylene-me.com

26-28 Negotiation in Oil & Gas DOHA www.cwcschool.com

28-29 Offshore Energy AMSTERDAM www.offshore-energy.biz

NOVEMBER 2014

3-5 SABIC Technical Meeting JUBAIL www.sabic.com

10-13 ADIPEC ABU DHABI www.adipec.com

24-26 SAOGE DAMMAM www.saoge.org

DECEMBER 2014

2-5 OSEA 2014 SINGAPORE www.osea-asia.com

4-7 Basra Oil & Gas BASRA www.basraoilgas.com

Readers should verify dates and location with sponsoring organisations, as this information is sometimes subject to change.

ADIPEC HAS LAUNCHED a new a series of eventsdedicated to women working within the oil and gassector. The ‘Women In Industry’ series will takeplace ahead of and during ADIPEC 2014, which iscelebrating its 30th anniversary this year.

The first event in the series, scheduled to takeplace on 1 September 2014 in Abu Dhabi at Li Beirut,Jumeirah at Etihad Towers, will bring togetherwomen working within the oil and gas industry,providing attendees the opportunity of meeting withindustry peers in an exclusively femaleenvironment. Among the topics up for discussionwill be how best to address the gender imbalance

within the sector, as well as how women canactively encourage opportunity and reduce barriers.

The second event in the series will take place atthe same venue on 13 October 2014 with a panel setto discuss themes such as ‘Achieving CEO orMember of the Board status’ and the possibilitiesand opportunities available to women within the oiland gas sector.

Meanwhile, an onsite event will take placeduring ADIPEC 2014 on 11 November during thesecond day of the event and will feature an in-depth look at the role women have played in theenergy industry since 1984.

ADIPEC’s ‘Women in Industry’ series of events to address gender imbalance

ADIPEC will return to Abu Dhabi NationalExhibition Centre in November 2014

BAPCO HAS BEEN named as the DiamondSponsor for the 3rd PMI AGC DMS EnergyForum Debates, which will take place at theGulf Hotel in Manama, Bahrain, from 2–3September 2014.

Mohammed Loch, President and CEO ofevent organisers DMS Global, commented,“The Project Management Institute is theleading body for project managementstandards, which already gave the event

huge technical credibility. BAPCO takingthe lead as the Diamond Sponsor now givesthe event the industry credibility it deservesand will no doubt inspire the whole projectmanagement community to take part in thisunique gathering.”

Abdul Majeed Al Gassab, President ofthe PMI AGC Bahrain Region, remarkedthat the addition of BAPCO as DiamondSponsor of the event would encourage

more sponsors to come forward. Al Gassab said, “The PMI AGC is

confident that participating organisationswill not only gain important recognition anddistinction for their involvement in theconference, but will also enjoy a primeopportunity to interact face-to-face withclients, suppliers, key decisions-makers,influential leaders, industry experts, andpotential business partners.”

BAPCO to be Diamond Sponsor of Manama Energy Forum Debates




IT IS THE nature of the energy businessesthat online applications for new positionsare now the norm. Technicians and otherprofessionals within the oil and gas

industry are usually too busy or too remotelylocated to use any other means. And skilledpersonnel within the industry move aroundthe world rapidly, in and out of North Africaand the Gulf, rarely being available for face-to-face interviews except by localagencies/representatives.

Dealing efficiently with the conventionale-mail application is covered here. Somerecruiters go further and delve into the worldof social networking to corroborate and fillout the details. This is generally not advised.First, there may be unwanted legalimplications. Second, many good applicantsfor new positions work in countries wheresocial networking is strictly controlled, oreven prevented altogether. Not relying onthe system at all means that a level playingfield is created.

Online agencies tell job applicantsrepeatedly to ensure their c.v. (curriculumvitae) or resumé is as perfect as possible.Sometimes the result is that presentationtakes precedence over substance. And whatthey often fail to point out is that mostapplications are ‘scanned’ quickly on screen(well under half a minute) and moved onfrom immediately; only a selected few gothrough to the next stage and are readthoroughly. That’s when the covering letter(always essential) is inspected too.

So, in the absence of a standardapplication form, the skilled recruiter knowsto look out for the following features in anonline application:- Conventional presentation as an attached

Word document in .doc or .docx format;beware of fancy material within time-consuming PDF’s which suggests anunprofessional approach. Tidy layout is alwaysgood, with bullet points used to separateshort sentences containing only relevantinformation. Photographs are not appropriateunless asked for.- Just two pages of typescript that present

the essential data in a logical sequence, whichvaries from country of origin to country(usually nationality/contactdetails/training/work experience with thelatest most fully outlined first in the

sequence/personal background data). Thereshould be no surplus words.- Keywords such as conventional terms for

previously-held standard job positions (andcountry locations) presented early within eachsection, as this shows that the applicantknows how rapid filtering works, relyingheavily on the use of conventional onlinesearch terms.- A brief personal statement which shows

what an ambitious applicant could bring to thisindividual vacancy, separating them positivelyfrom the rest. Many applicants send preciselythe same details for all positions tried for, aclear sign of an unprofessional approach. Thecovering letter should display this informedattention to detail too.- Pay particular attention to spelling, but make

allowances for the fact that many applicantswill not be using their first language. Multiplelinguistic abilities are always an asset; theydisplay flexibility.

- Consistency matters. Has the applicantexplained any (long) employment gaps? Doesthe document ‘hold up’ (i.e. do differentsections complement one another)?- Some recruiters say that a few relevant

numbers always help, e.g. a record of howthe applicant performed previously. Obviouslyfor a technical position this is hard todemonstrate, but even a note about size ofwork team helps. Such data tends to bememorable because it is tangible. If it backsup a claimed achievement, all the better. - Supply of references is inappropriate at the

initial online application stage, butwillingness/ability to supply them is vital (oftenstated in the covering letter, which shouldalways be retained).- Finally, use your instincts, but back up the

rejection of a 7/10 scorer with a second look!And remember that an applicant whomanages to fill the gap between modesty andbragging is usually worth consideringseriously.

Very few technical positions in the MENAregion do not require fluency in informationand communications technologies these days.A well presented online e-mail application isan excellent way of founding a successfulemployer-employee relationship that willfurther the commercial and technical interestsof all the parties concerned. ■

E-mail is the standard method of personal approach within theenergy industries these days. We look at the best ways to use itin the initial candidate-filtering stage.

Recruitment in

the online age

A well presentedonline e-mail application isan excellent way of foundinga successful employer-employee relationship”


Analysis

Attention to detail and consistency are two of the basic points that applicants for jobs within the oiland gas sector should ensure they address


S06 ORME 5 2014 - Analysis 01_Layout 1 8/18/2014 12:25 PM Page 23

DESPITE THE DEEPENING crisisfollowing the Islamic State (IS)militants-led insurgency, whichbegan in the north of the country in

June, Iraq’s southern oil production andexports have so far remained unaffected bythe escalating violence and fighting. Oilproduction in the Kurdistan Region of Iraq,according to the Kurdistan RegionalGovernment (KRG), has also so far remainedunaffected by the advancing IS militants.

Many market participants now appear tobelieve the insurgents will be contained innorthern Iraq, especially in the wake ofrecent US air strikes. There appears to bemore uncertainty over longer termproduction targets, however.

“While recent events have introduced ahigh level of uncertainty in the country, it isabove all a lack of infrastructure andinstitutional deficiencies that are putting thebrakes on production growth,” said oneanalyst.

Iraq’s southern oilfields account for morethan 70 per cent of the country’s crude oilproduction and since 2 March 2014 federalIraq has had to depend on exportinfrastructure in the south to handle all of itsoil exports following damage to its northernpipeline.

Oil exports from the southern portsreached 75.7 million barrels (averaging 2.44mbd) in July, up from 72.8 million barrels(2.42 mbd) in June, according to StateOrganisation for Marketing of Oil (SOMO)data on Iraq’s Oil Ministry website. In May,exports reached 80 million barrels (2.58mbd), the highest since 2003, according toOil Ministry spokesperson Assem Jihad.Much of the 70,000 b/d increase in Mayover April was on account of thecommissioning of a third single pointmooring (SPM) at Basra. The dip in June,Jihad said, was due to maintenance andexpansion work at one of the berths at al-Basra Oil Terminal.

The closure on 2 March of the northernpipeline, which runs from Kirkuk to theTurkish Mediterranean port of Ceyhan,caused the country’s exports to dip to anaverage 2.397 mbd in March from 2.8 mbd(78.4 million barrels in total) in February.Repeated sabotage attacks and damage bymilitants finally forced pumping through the

pipeline to be halted. Repairs to the pipelinewere abandoned amid the latest insurgencyby IS militants.

The Kirkuk-Ceyhan pipeline has anameplate capacity of 1.6 mbd, but evenbefore the 2003 war, operational capacitywas limited to 0.9 mbd. Since 2003,capacity has been much lower at around400-500,000 b/d, with Iraqi exports throughthe pipeline falling to around 250,000 b/d in2013, according to the International EnergyAgency (IEA).

Since early January, following the launchof its own pipeline the semi-autonomousKurdistan Region of Iraq has been using theTurkish section of the federal northernpipeline to transport crude produced withinits regional borders to Ceyhan.

Production outlookIraq’s crude output, including production in theKurdistan Region of Iraq, in July wasestimated at around 3.15 mbd. Output in thefirst half of this year was running at anaverage 3.3 mbd, according to the US EnergyInformation Administration (EIA). In 2013, Iraqproduced around three million barrels a day onaverage, a slight increase on 2012’s output of2.952 mbd. Exports last year averaged 2.979mbd, according to IEA data.

Iraq’s Oil Ministry in December 2013 wastargeting oil production of 4.1 mbd for 2014,with about 3.7 mbd of that to come fromsouthern operations where new fieldscoming on stream were expected to add500,000 b/d of output. The Oil Ministry hassince conceded, however, that the country isunlikely to reach that figure.

Iraq’s oil production surged to a 35-yearhigh of an average 3.6 mbd in February, buthas since fallen back amid some technicalproblems in the south and a fall in domesticcrude use following the closure of the310,000 b/d Baiji refinery in the second halfof June after it was attacked by IS militants.According to the EIA, the refinery wasprocessing around 200,000 b/d of crude.

An increase in Iraqi oil exports in May 2014 has been attributed to the commissioningof a third SPM at al-Basra Oil Terminal

As the crisis currently engulfing Iraq threatens the country’s long-term future, its vitaloil industry is attempting to carry on with business as usual. Lynda Davies reports.

Iraq’s oil ambitions

under fire

A lack ofinfrastructure andinstitutional deficiencies areputting the brakes onproduction growth”


Analysis


On account of the recent insurgency, the EIA in July reduced itsforecast production growth in Iraq by about 0.3 mbd for both 2014and 2015. The US energy department said it did not expect Iraq’scrude production to exceed 3.3 mbd, its average level during the firsthalf of 2014, during the short-term outlook period.

Iraq’s own national longer-term output targets remain unchanged,with the country’s Oil Ministry in early June targeting production of8.4 mbd “sometime” after 2018, updating a previous productiontarget of nine million barrels a day by the end of the decade. Thisfigure is a scale-down from earlier projections of 12 mbd by 2020.Even if the southern oil installations remain safe from damage,however, many industry players and analysts believe this latestlonger-term target to be overly optimistic.

The IEA in June cut its estimate of Iraq’s oil production capacitygrowth by 470,000 b/d, and now expects capacity to reach 4.54 mbdby 2019.

“Production of 8.4 mbd is clearly unattainable, but this is mostlydue to bureaucratic delays on field development and exportprojects,” said Robin Mills, head of consulting at Manaar EnergyGroup.

“I don’t give single-point forecasts from the IEA or anyone elsemuch credence, because six million barrels a day by 2020 is clearlyachievable under a government of reasonable competence,” Millsexplained. “But the political situation is too unclear for us to knowwhether this will be achieved.”

Inadequate export infrastructureContinued substantial investment in infrastructure in Iraq’s southernexport infrastructure to remove potential bottlenecks is critical if thecountry is to meet its steep production increase targets. The southernoil fields have often been forced to curtail production as the countryhas struggled to complete projects to expand storage and exportcapacity. Problems have been especially acute when tankers have beenprevented from loading by bad weather.

But infrastructure constraints are being addressed, withexpansion of offshore crude loading capacity having made the mostprogress. In addition to the existing onshore al-Basra oil terminal andthe Khor al-Amaya terminal, crude oil can be handled at the threeSPMs, the first two of which were put into operation in early 2012.

Export capability increased this year with the start-up of a newcentral metering and manifold platform, which facilitates exportsthrough the SPMs. The third SPM (number 4) was opened in June,taking nominal southern export capacity up to nearly 4.3 mbd;however, while each SPM has a design capacity of 850,000 b/d each,they operate at less than half of this capacity due to a lack of pumpingcapacity, inadequate storage tank capacity, and other issues.

The current situation in Iraq is threatening to redraw the country's borders


Analysis


According to Mills, the three SPMscannot load simultaneously due to a lack ofpumping capacity so currently serve as aback-up to each other for logistics ormaintenance issues.

The new metering and manifold platformwill hook up to two more SPMs (numbers 1and 5) to the pipeline system. These SPMsare in place but are currently dormant,although one of these is due to beginoperations by the end of this year.

The Oil Ministry puts the current handlingcapacity of the southern oil export facilitiesat three million barrels a day. A number ofanalysts have, however, said that actualoperational capacity is lower.

“Surge export capacity is [currently]some 2.9 mbd, but realistic sustainedmonthly export capacity seems to be around2.7 mbd,” said Mills, adding that weatherstoppages remained a problem.

The lack of sufficient oil storage at theFao terminal, as well as the limited pumpingcapacity, is a particular problem. The Faoterminal is a critical link between theonshore fields and the offshore loadingfacilities, but delays in constructingadditional adequate capacity necessitatedthe construction of interim pipelines to theSPMs bypassing the terminal. Consequently,oil is pumped into tankers directly more than100 km offshore and any delays to loadingdue to bad weather or other problems canforce production stoppage at the oilfields.

An additional one million barrels of oilstorage capacity was commissioned at theFao terminal in January 2013, taking totalstorage capacity at the terminal to 6.5 millionbarrels, a little more than two days worth ofproduction. A further two million barrels ofstorage capacity was targeted to be in placeat the end of 2013, but it is unclear whatprogress has been made on this plan.Ultimately, Iraq is targeting 15 million barrelsof storage capacity in the south.

Removal of these bottlenecks andbringing online new capacity from theadditional SPMs is critical if Iraq is to meetits goal of ramping up the export capacityof southern terminals to eight millionbarrels a day later this decade, and isespecially critical if federal Iraq has toremain solely dependent upon the southernfacilities to get its oil to world markets.

Jordan pipe dreamsIn an effort to reduce its dependency onthe southern oil terminals, Iraq has beenlooking at building alternative exportinfrastructure. In April 2013, Baghdadsigned an signed an initial frameworkagreement with Jordan for the Jordaniansection of a 1,680 km double pipeline torun from Basra to Jordan’s Red Sea port ofAqaba and in September shortlisted 12international companies and consortia tosubmit bids for the Jordanian section.

Despite the deteriorating situation innorthern Iraq, the project appears to be stillon the agenda for the two countries, withIraqi and Jordanian officials on 6 August“officially” announcing the pipeline projectduring a two-day investment forum inBasra. Iraq plans to build a 680 km pipelinefrom Basra to Haditha in the northern Anbarprovince, areas of which are now under thecontrol of IS militants. The Iraqi section ofthe pipeline would link up with theproposed Jordanian pipeline at Haditha.

Analysts have, however, pointed to thehuge issues of security on the plannedroute for the Iraqi section of the pipeline,with large sections of it needing to passthrough western Iraq, which are currentlyunder the control of IS militants. Not onlywould ensuring the safety of constructionpersonnel in the region be a majorchallenge, but so too would safeguardingthe security of the pipeline once built.

Kurdish oil ambitionsThe Kurdistan Region of Iraq, which hasbeen in a dispute with the Iraqi centraladministration for years over its desire toexport oil independently, at the beginningof this year began pumping crude thoughits own recently completely pipeline. The300,000 b/d capacity pipeline runs fromDohuk to Fishkabour near the Turkish

border where it connects with the existingIraqi federal pipeline to the TurkishMediterranean port Ceyhan. In mid-July,Kurdish Peshmerga forces took control oftwo oil fields near Kirkuk.

The initial volumes that flowed acrossTurkey to Ceyhan remained in storage untilMay when a tanker loaded with more thanone million barrels of Kurdish crude set sailfrom the port on 22 May. Since then, theKRG has shipped four and, according tosome reports, five further cargoes of crudefrom Ceyhan.

The KRG has been selling its oilindependently of Iraq’s federal governmentsince 2012, transporting initially smallquantities of condensate, and then in 2013,small volumes of crude by truck to theTurkish port of Dörtyol. In mid-July, KurdishPeshmerga forces took control of two oilfields near Kirkuk.

Since the start of the KRG’s crudeexports from Ceyhan, Iraq’s centralgovernment has stepped up its efforts toblock independent oil sales by the regionalauthority. At the time of writing, only oneof the cargoes ex-Ceyhan was reported tohave been fully offloaded so far.

Nevertheless, the KRG’s Ministry ofResources has indicated it aims to increasecurrent oil export volumes to Turkey to400,000 b/d by the end of this year. Someanalysts have, however, questioned thefeasibility of the KRG’s export ambitions.

“The 400,000 b/d depends on the statusof the Turkish export pipeline and on thelink from Kirkuk,” Mills said. “I think thetarget will prove ambitious. Actual exportswill be much lower unless the KRGestablishes a reliable tanker export routeand gets paid. This also depends on therole the Kurds play in the new Iraqigovernment, when formed.” ■

Iraq’s federal government and the Kurdistan Region of Iraq have been locked in a dispute for yearsover the autonomous region’s desire to export oil independently

Surge export capacityis some 2.9 mbd, butrealistic sustained monthlyexport capacity seems to bearound 2.7 mbd”


Analysis


•

•

•

•

S07 ORME 5 2014 - Drilling Sector Survey_Layout 1 8/18/2014 12:27 PM Page 27

IF THE RIG count is anything to go by, theMiddle East is experiencing something ofa drilling bonanza. Figures produced byBaker Hughes show that the Middle East

rig count has risen steadily since 2009 tostand at a monthly average of 411 fromJanuary to July 2014.

Saudi Arabia tops the list with a rig countof 108, and continues to offer huge drillingpotential in view of its large scale expansionin exploration and development of itsunconventional resources to boost gasproduction, as well as its frontier Red Seaexploration and drilling operations.

Boasting a rig count of 94, Iraq,notwithstanding the current unrest in thenorth of the country, offers enormouspotential given that a high proportion of itsreserves are yet to be exploited.

Rig counts are rising steadily in Kuwait,Oman and Abu Dhabi, which will require asubstantial expansion of its rig fleet to meetits production target of 3.5 mn bpd by 2020,while Qatar is planning massive investmentin its Bul Hanine offshore oilfield to counterproduction decline, with plans to drill around150 new wells between now and 2028.

Elsewhere, Morocco plans to drill around30 oil and gas wells this year as part of itsfrontier exploration programme, whileAlgeria’s recent announcement that it willinvest $100 billion to increase its oil and gasoutput from 2014-2018 looks certain to boostdrilling activity.

Figures from some of the leading oilfieldservice providers reflect this picture, withHalliburton recording a 24% increase in itsMiddle East and Africa drilling and evaluationrevenue in the second quarter of 2014.

Innovative drilling methodsThere is an increased emphasis in the regionon innovative drilling methods and technology,to meet demands for improved efficiency andperformance, as well as to cope with thecomplex drilling challenges posed by the driveto exploit ‘difficult’ resources such as tightgas, sour gas, shale gas and heavy oil.

“Most of the "easy oil" has already beendeveloped,” says Ibrahim Al-Alawi, deputyCEO of Abu Dhabi based AlMansooriSpecialized Engineering. “High H2S, highertemperatures, higher pressures, and tighter

formations require the use of specializedtechnology. Horizontal drilling has prettymuch become the standard in the GCC.There appears to be growing interest inmanaged pressure drilling (MPD) andunderbalanced drilling (UBD) across theregion.” These techniques control pressuregradients to reduce fracturing and otherpotential challenges to drilling efficiency.

Horizontal drilling has been usedextensively in Oman’s Khazzan gas field, oneof the largest unconventional tight gasaccumulations. Here BP has used hydraulicfracturing and advanced hard rock drillingtechnologies to unlock tight gas in hot lightreservoirs. Drilling and stimulating horizontalwells with the appropriate fracturingtechniques results in faster well productivityand a better cost per barrel than would beobtained with vertical wells, according to BP.

Ahmet Aki, regional technical sales andmarketing manager, Halliburton, commentsthat extended reach drilling, deep

exploration and unconventional drilling areexpected to increase.

“Traditionally, the Middle East, particularlySaudi Arabia, has been the first to deploydrilling technologies pioneered in NorthAmerica or elsewhere, including triallingtechnologies that are not yetcommercialised,” he says, while BakerHughes comments in its latest quarterlyreport, “Products and services we recentlyintroduced to improve the economics ofNorth American shale production are nowfinding homes in the Middle East, Argentina,North Africa, Russia and China.”

The region is increasingly pioneering itsown R&D and producing its own technology.Saudi Aramco for example is developing low-cost drilling microchip sensor technology,which combines a new mobile, reliable andminiature sensor system for downholedrilling measurements with an application foracquisition of temperature and pressure dataalong the entire wellbore. There is muchscope for cooperation in R&D andtechnology transfer with the region.

Challenges include higher dog-legrequirements in mature/conventional fields,faster well delivery, and reduced NPT, saysAhmet Aki. Initiatives introduced by

The Middle East rig count has been on the rise since 2009

Encouraging drilling

prospects ahead

Most of the easy oilhas already been developed”


Drilling



Halliburton to address these challenges include capability/reliabilityimprovements, the introduction of rotary steerable systems (RSS)and motorized RSS, increased focus on service quality, andestablishing Halliburton’s Drilling Engineering Solutions fordelivering optimised drilling performance.

Baker Hughes reports strong demand for its FASTrack™logging-while-drilling (LWD) fluid analysis and testing service, theindustry’s first commercial service capable of retrieving fluidsamples during the drilling process, in the UAE, while its AutoTraKCurve™ rotary steerable system which drills more than one mileon a well in a single day, is being used in Egypt, Kuwait and SaudiArabia. The company’s SureTrak™ steerable drilling liner service,which makes it possible to drill in trouble zones while reducing thetime and risk in drilling and completing a well, has beensuccessfully deployed in Saudi Arabia.

Access to skilled personnel However, as in many other areas throughout the industry,recruitment and retention are an issue. “The biggest challenge fordrilling contractors is hiring and retaining staff,” says Ibrahim Al-Alawi. “Personnel competencies for successful deployment andeffective use of technologies present primary challenges,” saysAhmet Aki. Halliburton’s regional office cooperates closely with itshead office in Houston to develop competency programmmes,training and assessments.

Other multinational industry operators are also establishing andexpanding training facilities, often in collaboration with localMinistries, NOCs or institutions. Examples include Petrofac’s newConstruction & Drilling Training Centre at Saudi Petroleum ServicesPolytechnic, Dammam, Saudi Arabia, whose wide range of coursesincludes drilling and workover training, enabling local personnel tobe trained to internationally accredited standards. There is clearlypotential for increased collaboration in this area. ■

Personnel competencies for effective use of technologies presentprimary challenges

As in many other areas throughout theindustry, recruitment and retention are an issue”


Drilling



THIS YEAR SEES the completion ofDHL’s US$177mn two-yearinvestment which it has channelledinto developing business in the

Middle East. The main benefactors of thisfinancial push include the UAE, Saudi Arabia,and Egypt, which have welcomed five newfacilities and offices between them.

Saudi Arabia has seen the creation ofthree new facilities and gateways inDamman, Riyadh, and Jeddah, while inEgypt DHL has opened a new office in Cairothat will serve as its country head office,gateway, and service centre. Furthermore,as a result of a US$27mn investment, DHLlaunched its largest ground operationsfacility in the Middle East and North Africa(MENA) region, occupying 17,265 sq m inMeydan, Dubai.

Speaking to Steve Harley, president ofDHL’s Energy Sector, it is clear that thisheavy investment is not solely an effort todevelop business in the fuel-rich Middle Eastitself, but to benefit from the businessopportunities and potential to be found inthe emerging markets that surround it.

“The Middle East, and particularly theUAE, is a focus area for logistical support fora much wider region. If you consider whatwe can do using the UAE as a hub, we cansupport oil and gas operators in East Africa,even through to West Africa, through toIndia,” Harley explained.

As the number of air, land, and oceanroutes between the Gulf and its distantneighbours in Africa and Asia continues togrow, the Middle East is finding itself ever-increasingly an important strategic gatewayinto these promising markets.

Harley said, “The communications interms of air routes and ocean routes into thekey oil and gas locations are increasinglystrong from here; you’ll see flights going tomany more destinations in Africa, [and] you’llsee shipping lines increasing their frequencyinto East Africa.”

It is worth noting that, in line with thereport BP Energy Outlook 2035, globalenergy consumption will rise by 41 per centover the next 21 years and 95 per cent ofthat growth will come from rapidly growingemerging economies.

It is with this prospect of steadilygrowing oil and gas exploration andproduction in the emerging economies thatDHL could be establishing a means of easilyaccessing these regions in order to takeadvantage of future business opportunities.

“The discovery of huge new oil and gasreserves in East Africa has meant there’smore capacity required for air and ocean[routes] into Africa from here [the Gulf],”confirmed Harley.

DHL has 15 dedicated company aircraftflying in and out of the Middle East,supporting the firm’s approximate 260service centres and 5,000 employeesworking in the region. Furthermore there arethe thousands of commercial flights thatDHL can take advantage of.

According to Harley, all-in-all DHL runs120,000 airfreight shipments through theMiddle East, as well as more than 55,000containers through the UAE every year.

DHL is, ultimately, a customer servicecompany and, as such, it is clear thecompany is keen to be active across a wideregion, ready to take up business in anyregion, at any time, and under anyconditions.

Harley said, “We go where ourcustomers go so we’re very focussed onwhat our customers are doing, particularly inthe upstream oil and gas business. We willfollow them where they need our logistics

DHL Energy Sector president Steve Harley

Following a two-year multi-million dollar investment by delivery and logistics solutions providerDHL into the Middle East, the company’s Energy Sector president Steve Harley spoke to Oil Reviewabout the intentions behind the regional focus. Louise Quick reports.

Investing in

far reaching potential

Using the UAE as ahub we can support oil andgas operators in East Africa,even through to West Africa,through to India”


AnalysisDHL boasts 15 dedicated company aircraft supporting its 5,000employees working in the Middle East (Photo: Russavia)


requirements, so if they go to East Africa then we go to East Africa,if they want to go to Yemen, we go to Yemen.”

But with certain Middle East countries struggling with politicalinstability and conflict, this begs the question as to how far DHL’swillingness to follow its customers’ needs actually stretches.

This is a particularly significant question when considering theoil and gas industry, because many of these unstable countriesalso play an important role in the global energy sector, such asIraq. This too, however, is where a well-established businesspresence can help.

When asked about working in conflict and difficult-accessregions, Harley explained, “In most of these locations […] we’vebeen there for many years, so we already have local knowledge,we’ve got legal entities and local expertise. We’re not necessarilygoing into those places just because there’s a new project orbusiness with an oil and gas company.”

Looking at business in Egypt and Iraq in recent years, he said, “Inthe case of Egypt, we’ve been doing business there in oil and gasfor a long time, and we continue to do business there pretty muchas normal I’d say. The security concerns are probably more aroundplaces like Iraq where we, again, follow our customers if ourcustomers are working or operating oil fields there.”

The DHL sector president, however, did add that politicalconsiderations are an important factor and ultimately the companywill not work in regions where it is not safe or suitable.

“We have to look after our staff and make sure they’re safe andsecure. It’s not just about the security of our cargo, it’s about thesecurity of our staff,” he confirmed.

With a determination to maintain consistently high standards ofoperations throughout the Middle East, surely DHL must channel anequally high level of energy into its health and safety standards?

Internally, DHL has developed what Harley described as‘increasingly standardised global health and safety policies’ whichare supported by a team of experts sourced from the variousrelevant industries. In fact DHL is so confident in its health andsafety standards that it is also in a position to provide customerswith training and monitoring on the subject as a service.

“We are one of the world’s biggest transport companies sodrivers’ safety is critical to us and is critical to many of ourcustomers. They look to us to provide support in the health andsafety training management of that,” Harley said. “That’s not onlyabout training people to drive safely, it’s also about monitoring howmany accidents they have and taking corrective action.”

DHL recently provided health and safety services to aninternational oil and gas company, (which cannot be named for legalreasons), working on a project in Oman. As well as a number ofother services, including managing its supply chain for the oilexploration and drilling programme, the company utilised DHL inorder to improve its health and safety standards on the project.

“The result of doing all that was that there were far less roadaccidents and we were actually commended by the operator forwhat we did there in terms of reducing loss time injury frequencyrate,” stated Harley.

Surprisingly for a international company, working in an increasingnumber of industries, DHL has proven it not only understands thedifficulties and challenges posed by the Middle East’s energysector, but in fact knows how to use them to its own advantage,whether that is expanding the services it can offer or expandingacross more borders. ■

It’s not just about the security of ourcargo, it’s about the security of our staff”


Analysis


IN MAY 2014, sustainability writer AlexSteffen stated: “What happens in [the]next 40 years [is] critical for all humanityfor centuries to come. What happens in

[the] next 10 years sets the range of what'spossible.” He could have added that thechemical industry’s sustainability journey iscrucial to what happens in the next 10 years,and whether the world can avoid misstepson the road to a sustainable future. For, afterdecades of progress in improving its ownsustainability profile, the chemical industry ispositioning itself to be the enabler of adecade of sustainable development for itselfand for downstream industries.

But even as it does so, new challengesare emerging – not least challenges to itstraditional business model – and the industry,traditionally slow to change, is faced withhaving to act quickly and concertedly toaddress them and their implications.

The journey so farThroughout its sustainability journey, thechemical industry has brought a unique andscientific perspective to the table. With thelaunch of the global iniative Responsible Carein 1985, it was one of the first industries tolaunch a rigorous program aimed at improvinghealth, safety and environmentalresponsibility. The years since have seen rapidprogress, encompassing plant safety, productstewardship, reduction in emissions and waterconsumption, energy efficiency, and socialresponsibility to a diverse set of stakeholders.Each of these areas of improvement, in turn,has led to wave of advancements.

The most recent ‘sustainability wave’ isproving to be more far-reaching than theactions of the past. Whereas sustainabilitywas previously viewed as a series of discreteactions to reduce impacts and improveenvironmental and social performance, manychemical companies are now makingsustainability concerns the core or theirstrategies and business plans. Perhaps the

most forward-thinking are BASF, DSM andDow. In the GCC region, SABIC from SaudiArabia and Borouge from UAE are at theforefront by analyzing their businesses interms of the sustainability footprint of theirproduct line-ups. In companies such as theseinvestment decisions, research anddevelopment planning, mergers andacquisitions, and a host of other business

decisions are all now prioritised according towhether they advance each of the threepillars of sustainability: economic,environmental, and social.

Most importantly, the chemical industryhas realised that its own performance is onlya part of its effect on global sustainability.The biggest impact that it can have is on thesustainability of other industries that use itsproducts and urgently require new chemicalsand materials that make their performancebetter—this can affect practically everymanufacturing industry today. Since analysishas shown that chemical processesthemselves generally account for only 20-30per cent of the footprint of finished products,the job of the chemical industry will be toinnovate new chemicals and materials thatmake the products of downstream brandowners more sustainable.

John Pearson, CEO of Chemical Industry Roundtables LLC, speaking at the Gulf Petrochemicals andChemicals Association’s (GPCA) Sustainability Conference

Is the development of the chemicals industry crucial to the future of global economic sustainability,and what challenges does the industry’s push for sustainability face? John Pearson, CEO ofChemical Industry Roundtables LLC and program developer for the Gulf Petrochemicals andChemicals Association’s (GPCA) Sustainability Conference held in Dubai, reports.

The chemical industry’s

sustainability journey

The most recentsustainability wave’ isproving to be more far-reaching than the actionsof the past”


Petrochemicals

S09 ORME 5 2014 - Petchem 01_Layout 1 8/18/2014 2:36 PM Page 34


There are many examples of what thismeans in practice, but the automobileindustry provides a good example. A moresustainable automobile industry relies on theuse of new light-weight plastic and carbon-fibre composite materials with propertiesbetter than traditional metal components.This enables manufacturers to reduce overallvehicle weight and improve fossil fueleconomy. In the development of electricvehicles, the automobile industry will bereliant on the development of newmembrane materials from the chemicalindustry. Without rapid development ofplastics, carbon fibre, and membranechemistry, the vehicle industry will not beable to achieve all of its sustainability goals.

Can the chemical industry help sectors likeautomotives get onto the right path in the next10 years, as Steffen’s statement demands? Itwill not be an easy path ahead, because:• The mindset of a traditional industry has

to change from that of commoditychemical and plastics supplier tospecialty materials innovator.

• Chemical industry assets currently in theground are devoted to the old businessmodel of lowest cost production fromfossil feedstock sources. How toreconfigure them to be the flexibleinstruments of sustainable innovation isnot yet obvious. In the future,acceleration of mass consumption maynot be the goal.

• While there are signs that investors arebecoming more conscious ofsustainability concerns, and about 11 percent of US assets under managementare now in funds that stress sustainablegrowth, many analysts still drive theindustry towards better quarterly resultsrather than towards sustainability. Thesharp focus on access to low-costfeedstock in North America, for example,is tending to overshadow longer-termfactors in sustainability.

• The chemical industry has limitedexperience of working hand-in-hand withbrand-owning and consumer-facingcompanies. Aligning the sustainabilityobjectives of brand owners with what ispossible in chemical industrydevelopment will be a major challenge forboth sides, while the chemical industry’srecord of communicating its progress tothe public is patchy at best.

• Breakthrough scientific research anddevelopment takes time. New methodsof accelerating research are needed.IBM’s recent discovery of newrecyclable, self-healing plastics wasassisted by processing data in a methodthat the company calls ‘ComputationalChemistry’. More innovation of this type,using big data to help speed up research,as well as high-throughput research and

development (R&D) techniques will beneeded. But so will more inter-companycooperation and, perhaps, more trust inopen innovation and shared ownership ofintellectual property. R&D is expensiveand a large number of companies arecompeting for market shares in thechemical space.

• There is little history of industries thathave gone from commodity to specialtyproducers and few business models tofollow.

Challenges to the old orderAs if these challenges were not enough tocontend with, relatively new analyses ofsustainability are throwing up newchallenges to the traditional chemicalindustry. A key example is the ‘CarbonBubble’ report from Carbon Tracker, a groupof UK-based economists, who are alsospeaking at the second GPCA SustainabilityConference this year.

Carbon Tracker looked at a key element ofa sustainable future that mitigates theeffects of climate change, from the angle ofrisk assessment and noted among othersthat the world can only afford to emit 886bnmt of CO2 in the first 50 years of the centuryif it is to avoid increasing climate change. Bythe end of 2011, however, one third of thoseemissions have already occurred with noevidence of slowdown.

Carbon Tracker also noted that companieswhose valuations rely on their exploitable

fossil reserves may be considerablyovervalued since those reserves may neverbe exploited, because of climate changeconcerns. Carbon Tracker cautions that abubble may be forming in the valuations offossil-based energy companies.

If governments, NGOs, brand owners,and the public were to get behind CarbonTracker’s concerns the effect on the chemicalindustry could be devastating. Not onlywould a radical shift be required in sources ofchemical feedstock sourcing towardschemicals made from bio-sources and thosethat include CO2 itself as a feedstock, but thechemical industry’s chief sustainabilityargument – that it makes the provision ofnecessary energy more efficient by using theby-products of the energy industry – wouldbe harder to justify. And chemical companiesmight see their valuations fall with those ofthe energy industry.

Towards a circular economy?The net result of Carbon Tracker’s thinking andthat of other sustainability commentators isthat the role of enabler to other industries,while essential to global sustainability, maynot be sufficient for the long-termsustainability of our planet and its people.

The more effective way forward wouldbe to aim for a circular chemical economy,one in which chemicals and materials aremade up of biological ‘nutrients’,components from the biosphere that areprocessed into products then returned tothe biosphere without causing harm, andtechnical ‘nutrients’, components that are ineffect endlessly recyclable at high quality.

It is debatable whether this is apractical way forward for the chemicalindustry, but we can expect that populardemand in this direction will only grow.Despite investing heavily in R&D, thechemical industry still has a long andpotentially bumpy journey ahead. ■

According to Carbon Tracker, the world can only afford toemit 886bn mt of CO2 in the century's first 50 years if it is toavoid increasing climate change (Photo: Bilfinger)

R&D is expensive anda large number of companiesare competing for marketshares in the chemical space”


Petrochemicals




OMAN OIL REFINERIES andPetroleum Industries (ORPIC) hasselected the LyondellBasellSpheripol polypropylene processtechnology for the Liwa PlasticsProject (LPP) to be built in Sohar.The project is expected to begin in2018.

Henk Pauw, general manager atORPIC LLP, said, “We selected theLyondellBasell Spheripol processfor its ability to cost-effectivelyproduce a wide range of high-quality products that aredemanded by our customersthroughout the Middle East andSoutheast Asia.”

The Spheripol process willassist in manufacturing enhancedhomopolymer, random andheterophasic copolymers, OmanDaily Observer reported.

LyondellBasell said that it is a licensor of polypropylene andpolyethylene technologies with more than 250 polyolefin processlicenses.

Oman’s ORPIC awards technologycontract to LyondellBasell

Once complete, the LPP will produce1.4mn tonnes of polyethylene andpolypropylene each year

EGYPT HAS PROPOSED the ideaof three petrochemical projectsworth US$540mn to the UAE,according to the Ministry ofPetroleum.

The projects — all in the NorthAfrican country — includeestablishing a factory to producebio-ethanol from molasses, theoutput of which would reach100,000 tonnes of molassesannually. The project will see aninvestment of US$250mn. It is likelyto be implemented in the next fiscalyear (FY), according to a Ministry official.

Another proposal is to build a factory for the production of bio-ethanol from rice straw, with a capacity of 100,000 tonnes of rice strawproduced per year. The investment in this project would be US$$240mnand will be implemented through the FY 2016/17, the official added. Thethird project will focus on increasing polyvinyl chloride (PVC)production, used in making pipes, with the target implantation date asFY 2016/17. Close to 40,000 pipes would be produced annually, with theinvestment in the project estimated at US$50mn.

The UAE is currently evaluatingwhich project to go forward within the coming period

Egypt proposes petrochemicalprojects to UAE


Petrochemicals


SAUDI ARABIA CONTINUES to be the GCC’slargest petrochemical producer with an annual244mn cu/m of capacity, a report from NationalCommercial Bank reveals.

The expansion in ethylene production capacityhas resulted in Saudi Arabia being the third largestproducer worldwide, accounting for 11 per cent ofglobal ethylene capacity, the bank’s economicsdepartment research team added.

The Saudi Arabian petrochemicals industry is,however, not expected to see a massive rise inoverall petrochemicals capacities until the Sadarapetrochemicals complex comes onstream in 2016.

The researchers stressed that the petrochemical sector in the Kingdomremains well-positioned regionally and is driven globally by a positive demandoutlook. But they also said that the recent discovery of North American shale

gas and oil is likely to have an effect on theKingdom’s petrochemical sector in its trajectorytoward remaining upstream or moving downstream.

Ethylene is a key building block in thepetrochemical industry. In recent years, the worldhas witnessed its largest ethylene capacityexpansion, growing at a compound annual growthrate (CAGR) of four per cent between 2007 and2012, to reach 55mn cu/m in 2012. But the GCCcapacity addition in the same year trendeddownwards by 13 per cent.

The majority of capacity additions within theGCC between 2007 and 2012 took place in Saudi Arabia, which accountedfor 64 per cent of the regional capacity additions.

With 49.5mn cu/m per year, Saudi Arabia was the largest ethylene producer inthe region, accounting for 72 per cent of the regional ethylene capacity in 2012.

The majority of Saudi Arabia’s non-oil exportsconsists of petrochemicals, which includedownstream plastic production and buildingmaterials

Saudi Arabia still ‘largest petrochemical producer in GCC’

OMAN’S DUQM REFINERY and PetrochemicalIndustries Company has issued a tender for theconstruction of a new refinery at the SpecialEconomic Zone Authority at Duqm (SEZAD).

According to the Omani company, the projectis part of a comprehensive development plan inthe economic zone, which is a leading strategic

project with the aim of generating a quantumjump in the national economy.

The laying of the groundwork is expected tostart in Q1 2015 and be completed by Q1 2016. Thework involves digging over 14 metres and layingthe foundation for the construction of the refineryslated to commence in 2016.

The groundwork is the initial step of the projectand the construction work will start as soon asthis stage is completed, the zone authority said.

Duqm is touted as Oman’s next industrialcentre, with investments of up to US$15bntargeting petrochemicals and infrastructuredevelopment over the next 10 years.

Omani refinery floats tender for construction


Petrochemicals


RELIABILITY INOIL WELL CEMENTS

Oil Well Cement (OWC) produced by Oman Cement Company (S.A.O.G) under accurate temperatures is an obvious choice for oil well cementing worldwide and now it is ready to face the challenges of highly specialized arctic and horizontal cementing:

● Conforms to the American Petroleum Institute (API) specification – 10A Class-G- (HSR), Class-B- (HSR) and Class-A- (O) grades.● Tested and used by worldwide cementing companies● Easy to disperse resulting in considerable cost savings● First choice of major oilfield companies● Exported to GC Countries, Iraq, Yemen, Libya, Sudan, Tanzania, Turkmenistan, Ethiopia, Pakistan, India and Syria.

Oman Cement manufacturing facility operates on world class qualitymanagement system ISO 9001 and environmental management system ISO 14001. Quality control is online and laboratory automation systems consist of online x-ray spectrometers and robotic samplers, linked to process controllers and a raw mill proportioning system.

OCC has an enduring commitment to customer satisfaction, continual improvement and a stronger foundation for tomorrow.

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S11 ORME 5 2014 - HSE Feature_Layout 1 8/18/2014 12:37 PM Page 41


Health & Safety

THE DEMAND FOR power is rising, with global energyconsumption set to rise by 41 per cent by 2035 according to theBP Energy Outlook. As the energy-producing countries in theMiddle East continue to invest in new, unconventional methods

of fuel extraction, it becomes increasingly important for companies tohave a thorough and effective health and safety policy in place.

A health and safety policy is standard in any industry, but it hasparticular significance in the oil and gas sector. As both upstream anddownstream operations involve such large-scale projects and deal withhighly hazardous materials, the slightest incident can have devastatingrepercussions for the individuals working onsite, as well as thesurrounding environment.

An explosion at the Deepwater Horizon drilling rig in the Gulf of Mexicoin 2010 resulted in the death of 11 workers and reportedly sawapproximately 780,000 cu/m of oil leak into the sea causing far-reachingdamage to surrounding wildlife, in one of the largest oil spills in US history.

Furthermore the Deepwater Horizon spill had a significant financialimpact, costing the rig operators BP billions of dollars in cleanup andcompensation. Accidents in the oil and gas industry, however minorthey initially appear, can have a huge impact on a company’s business.As well as the price of fixing the incident, a bad reputation for healthand safety can result in rising insurance rates and the risk of losingprofitable business.

Andy Gibbins, Euro Petroleum Consultant’s (EPC) vice-president forMiddle East, told Oil Review, “An insurance company looks at theperformance of companies and uses pubic data as a means ofassessing how well they’re performing, and that [a bad health andsafety record] can result in insurance premiums being increased or insome cases the company has refused to cover an organisation.”

According to the report Process Safety Events – 2011 & 2012 Databy the International Association of Oil and Gas Producers (OPG), thefatal accident rate for its participating companies in 2012 increased by27 per cent on the previous year. Furthermore, 40 workforce fatalitieswere identified as being related to process safety events. A processsafety event is most commonly understood as an uncontrolled releaseof material, often toxic or flammable substances, from the operations ofa facility. As such, these events so often cause the biggestconsequences and greatest destruction, such as the explosion at BP’srig in the Gulf of Mexico.

Ultimately some of the worst accidents of the oil and gas sectorwere caused by a mistake of one individual working on the project. Thisis a topic explored in the report Increasing Operational Efficiency andWorkforce Productivity without Compromising Safety – an OffshoreNirvana? by Steve Elliott, process safety expert for enterprise softwareprovider Ventyx, an ABB company.

In his report Elliott said, “At the end of the day, it all boils down tohuman ‘error’. After all, if systems are designed by people and built bypeople, then a systemic oversight is nothing but a human oversight.”

Whether the problems lie in negligence during the design stages,insufficient training, or a lack of experience, is it ever possible to achievea 100 per cent safety record or will human error always be an obstacle?

Elliott underlines the high turnover of employees – a commontheme in the Middle East – as a catalyst of human error onsite. Heargues that with every member of staff that leaves they take with themthe knowledge on running the site, particularly the experience in theless common, less day-to-day tasks that might occur.

“The tacit, expert knowledge required to ensure safe and reliableoperations is being lost as an ageing workforce is being replaced by ahighly mobile younger generation,” Elliott explained.

Gibbins, on the other hand, highlights the multi-cultural nature ofworkforces in the Gulf as a key factor to tackle when training staff. Inorder to ensure optimal safety of operations and the workersthemselves, companies must recognise the problems that arise whenworking with a mixture of nationalities, cultures, and religions.

Gibbins said, “We have a very big focus on the local cultural issues,because these are very important in the Middle East. For example youmay have a site with a lot of employees who have an inherent belief infate so [might think] why should they wear a safety helmet or whyshould they wear safety shoes when it doesn’t matter?”

Furthermore, he explains that some companies fail at something assimple as language barriers and making sure a multi-national workforcehas fully understood the training programmes, which are primarilygiven in English.

“The good companies will try and recognise it and make sure theybring in some additional support using the local languages of theparticular people involved,” Gibbins added.

The BP Deepwater Horizon spill saw approximately 780,000 cu/m of oil leakinto the Gulf of Mexico waters (Photo: ideum)

Operational safety and overcoming

human errorAchieving optimal health and safety onsite is a constant struggle for oil and gas companiesoperating in the Middle East. What challenges do these businesses face and, ultimately, what is being done to overcome them?


Middle Eastern companies are not going to achieve optimaloperational safety through just monitoring their own staff. Businessesare increasingly aware of the importance of independently verifying thestaff they take on via smaller contractor companies.

“One of the biggest risks that exists, not so much in the bigcompanies but the smaller companies,” explained Gibbins. “You getexaggerated CVs, where people say they have a particular skill orqualification but in some situations that is not the case.”

Without naming the business, Gibbins refers to one operatingcompany that carried out a thorough survey on a service company andfound that 50 per cent of the CVs included false information. This posessignificant risks to the safety of any upstream or downstream facilityand begs the question of how a company may verify the skills andqualifications of these contracted workers.

Looking to the solutions, in his report Elliott highlights the need tobring in more machinery to assist the workforce, specifically datastorage machinery or “intelligent, automated systems designed tocapture data, learn from events, optimise production and preventsafety-related incidents”.

Although automated machinery of this kind may soundunrealistically futuristic, he claims that next-generation machinery of thiskind is in use in some European refineries.

“To combat the loss of knowledge retained by people, intelligentsystems are needed that are not just electronic filing cabinets, but captureknowledge in use and deliver the right information, to the right person, atthe right time, as part of day-to-day operations,” Elliott explained.

While it could enhance production and tackle problems broughton by a high staff turnover, there is still the issue of reducing theerrors made by the workforce. On the other hand, behaviouralsafety, as explained by EPC, is a specific form of health and safetypolicy, which aims to change an individual’s attitude while workingand trying to create a workforce with a unified approach to safety.Gibbins explained that it is about changing the antecedent, thereasoning that goes into every person’s action onsite.

“There are many ways that people can take short cuts and takerisks and the idea of behavioural safety is to get people toconstantly think about the way they work and the way they dothings and say to themselves ‘is it safe?’ and also look at thepeople around them,” Gibbins said.

There are any number of risks threatening the safety of oil and gasfacilities and operations, all of which come down to natural humanerror. Even installing more machinery would include humaninvolvement in the design, installation, and maintenance processes. Itis impossible to remove human error, but the key appears to bechannelling significant energy into up-to-date health and safety trainingand striving for complete transparency of the entire workforce. ■

Companies need to recognise the issues that arise when working with amulti-national workforce (Photo: DHL)


Health & Safety



Health & Safety

SSDS Risk Management generalmanager Carl Moon discussesthe importance of an effectiverisk management strategy whenworking in conflict areas.

RISK MANAGEMENT INinternational companies working inpost-conflict countries is essentialto the stability and redevelopment ofthat region. If policy and decisionmakers, however, are to secure themaximum benefits from privateinvestment they need to understandhow different companies viewopportunity and risk management involatile environments, and find waysto assess their requirements in post-conflict settings to ensure safety topersonnel and assets withoutendangering life, assets, andcompany reputation.

Security risks affect differentcompanies in various ways.Petroleum companies representexpensive fixed assets and the

protection of these assets is ofstrategic importance both to thecompanies themselves and often tothe host governments. Hence whyrisk management in a post-conflictenvironment, such as Iraq, differssignificantly to a stable environment,and will have an emphasis onprotection and contingency planning.

Companies with extensiveexperience in post-conflictenvironments combine differentapplications to form a riskmanagement system specific to aproject or operation, thus ensuring acordon of defensive security aroundthe project with security andemergency medical contingencyevacuation plans in place.

Unlike a stable environment, riskmanagement in a post-conflictregion is implemented in amilitaristic manner. Riskmanagement providers are involvedfrom the initial planning stages ofany project by completing an in-

depth analysis of the requirementsthen combining the analysisrecommendations with acomprehensive range of solutions.

The last few years have seen newthreats from insurgent and criminalgroups targeting foreign companiesand personnel. The escalation ofconflict and post-conflict countriesexperiencing social unrest hasincreased the global threat tocompany assets and individuals

working in these regions, especiallyin the Middle East, Africa, and Asia.The heightened security threats haveprompted international petroleumcompanies to implement risk andcrisis management concepts thatare more diverse and specific topost-conflict environments.

As we devise and implement newmeasures to monitor, suppress, oreradicate potential threats to ourfacilities and personnel, we mustbear in mind that those insurgentgroups are mainly headed byeducated people with the samepassion to find and exploitweaknesses, and ultimately to createas much instability as possible.

Risk management is the backboneof every project operating in achallenging or conflict region. Tocompromise on risk managementcould lead to a potential disaster to aproject, facilities, or personnel,which in turn could seriously affect acompany’s reputation.

Risk management in a changing world

SSDS Risk Managementgeneral manager

Carl Moon


One success leads to another

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S12 ORME 5 2014 - Tech Focus 01_Layout 1 8/18/2014 3:00 PM Page 45

HYDRAULIC FRACTURING, OR ‘fracking’, has become one ofthe most valuable sectors of the energy industry and hascatalysed a new era of innovation by energy extraction, drillingservices and chemical engineering companies. This has

necessitated quick and thorough protection of these innovations. Thetechnical nature of the extraction and the chemicals used lendthemselves to patent and trade secret protection. As with any industry,there are unique sector-specific issues.

Shale gas is a natural energy source that cannot be extracted byconventional well bores due to the low permeability of the surroundingsedimentary rock. Fractures in this rock allow for gas extraction.Artificial fractures have been created since the 1940s, but moderntechnology has contributed to the technique of ‘fracking’. This involvesdrilling into the shale reserves, often horizontally, and inserting high-pressure liquids to create many miniature fractures. These allow shalegas to migrate to the well for extraction.

The USA has been at the forefront of the industry, increasing itsshale gas production by almost 1,600 per cent during the periodbetween 2004-2014 to 9.63 trillion cubic feet.1 The Energy InformationAdministration believes, however, that China holds the largest reservesand that also, outside the USA, continental Europe, South Africa, SouthAmerica and the United Kingdom also contain economically significantquantities of shale.

The first ‘modern’ fracking patent was applied for in 1948 byStanolind in the USA. In 2013, 706 patent applications were filedworldwide in respect of fracking technology, up from 236 in 2008.2 Thisincrease is not matched by related technologies such as wellcompletion or horizontal drilling and therefore fracking is fuelling its owninnovation rather than following a general trend.3

The established norm for patent protection has become protectionof innovations in fracturing fluid composition, pressure and use. Thefluid used is primarily water (~90 per cent) and sand (~9 per cent) withthe remainder comprising chemicals. A survey in the US in 2010 foundthat more than 750 different chemicals were used by US frackingcompanies in their proprietary fluids.4 Patents may also cover theinclusion of proppants (solid materials used to keep fractures open),gelling agents and acids (to help open fractures), surfactants (to reducesurface friction) and biocides (to kill bacteria contained in the water).

Fluids are not the only patentable inventions relating to fracking.Patents have been filed for methods for estimating the size of fractures,systems to provide power to isolated wells and methods for preparing

fracking fluids without electricity. Also, the holders of fracking patentsvary from energy supermajors to international service companies tosmaller material and proppant suppliers. Therefore, although thetechnology has matured and innovations are now occurring on anincremental basis, the scope for patent protection is wide.

Trade secrets are also key protections. An effective programme oftrade secret protection necessitates comprehensive non-disclosureagreements with employees and third parties as well as careful controlof access to physical records and equipment. There is, however, abalancing act if trade secrets rather than patents are to be the coreprotections for technical developments as there is an increasingclamour for the disclosure of technical details to regulators to combatpublic health concerns. In particular, this has manifested itself in adesire to see disclosure of chemicals used in fracking fluid. Forcompanies, this presents issues for trade secret protection and also therisk of patent infringement actions from competitors if they disclosetheir formulations publically. To combat this risk, many try to limitdisclosure to the chemicals themselves, but not the actual formulation.

Lastly, the technology has largely developed to date in the mannerrequired by the geology of the USA. As the technology spreads aroundthe world and national regulators and legislators begin to permitfracking, it is likely that there will be a new raft of fracking innovations todeal with specific obstacles such as fault lines, increased depth ofreserves, a lack of pipeline infrastructure and differing rock formations.This makes it imperative for those in the industry to protect and enforcetheir innovations and we are likely to see a sustained increase in patentapplications for incremental improvements to extraction processes,and/or the combination of existing patented technology with tradesecrets specific to differing geologies. ■

1http://www.statista.com/statistics/183740/shale-gas-production-in-the-united-states-since-1999/2http://share.thomsonreuters.com/assets/newsletters/Inside_Oil/IO_May_27_2014.pdf3page 290 http://repository.law.umich.edu/mwg-internal/2535425/progress?id=bW5cRmq+2W&dl 4page 291 ibid

More than 700 patent applicationsrelating to fracking technologywere filed worldwide in 2013

The rapid rise of shale gas as a force to bereckoned with in the global energy sector hasled to an increasing number of innovativeproduction technologies and techniques used toextract the resource, leading the firms providingthese solutions to find ways to best protecttheir intellectual property.

Intellectual property:

The catalyst for shale


Technology



SPEEDY COMMUNICATIONSBETWEEN offshore oil rigs and theirland bases are crucial in today’s oilindustry with the constant need to

monitor and manage an increasing amountand range of information, data and visualmaterial relating to output, crew rostering,equipment and emissions. Rapid and securecommunications are critical in the event ofan accident, such as an explosion or majorleakage, and are essential for the crews’personal and entertainment needs as well asfor their professional development. Currentcommunication technologies in common useare satellites, microwaves, subsea cablesand Wi-Fi. All these are proving insufficientby themselves to accommodate the everincreasing upsurge in data traffic fromoffshore oil rigs to their regional centres andheadquarters, leading some companies toupgrade their satellite communications whileothers are currently taking a look at wirelessand carbon fibre cables in order to improvebandwidth capacity. One example of amaritime communications upgrade is 3MNetworks’ 2013 deal to improve SaudiAramco’s communications with its offshoreSafaniya oil and gas field in the Gulf. Expertspredict that energy companies are willing tospend millions on improved bandwidthcapacity and speed of communications.

Maritime communications marketThe global market in oilfield communicationsis expected to grow from $2.37 bn in 2014 toan estimated $3.18 bn by 2019, according tothe Digital Oilfields World Summit 2013. TheMiddle East is expected to be the fastestgrowing market with a compound annualgrowth rate of just under 6 per cent owing tomajor investment programmes in the regionby, for example, Shell with its ‘Smart Fields’,BP with its ‘Fields of the Future’ and SaudiAramco’s DOF (Digital Oil Fields) initiatives.According to local media, the oil industry is

expected to spend over $1 bn on DOFbetween 2010 and 2015 not including largesums on hardware, software and affiliatedservices. Tony Edwards, CEO ofStepChangeGlobal, a DOF expert says, “Iffirms do invest, the payback is significant.”One of the Middle East’s largest such serviceproviders in the region is Harris CapRock,which meets the needs of nine out of the tenlargest offshore drilling contractors.

Range of communicationsIncreasingly, energy companies are having toemploy a range of integrated communicationssolutions in order to meet theircommunication needs. The adoption ofsatellite communications, while it broughtmajor improvements in bandwidth and

reliability to isolated locations, wheretraditional communications systems wereunavailable or uneconomic, has provedinsufficient for some users, triggering a searchfor alternatives. One promising option is asubsea fibre optic cabling network which linksall rigs in an offshore field together (by asubsea cable) which is then connected to ashore base by either cable or satellite. GlobalMarine Systems Ltd and Harris Caprock areleading the way in installing secure subseacommunication platforms with services ableto provide broadband data and video-calling. Itis reported that such systems dramaticallyimprove operating efficiencies by allowing a25 per cent reduction in crews. Cable issuperior and more cost effective than satellitefor, according to Keith Johnson, CEO of HarrisCaprock energy division, “Instead of paying$20,000 per month for five megabytes ofcapacity you can get 300,000 megabytes.” Heexpects fibre cable revenues “to grow at 15per cent a year”, since this technologyimproves security of data and reducesvulnerability to solar storms and jamming.

Speedy communications between offshore rigs and their land bases are crucial in today’s oil industry(Photo: Maersk)

Nicholas Newman highlightsthe need for effective offshorerig communications systemsand assesses the availableoptions.

Enhancing offshore rig

communications

If firms do invest, thepayback is significant”


Technology


Wireless communicationsIn addition to carbon fibre cables, someenergy companies are making use ofwireless communications for both above andbelow-the-surface activity and monitoring, tooperate equipment at close range. Indeed,offshore wireless rig-to-rig or rig to subseaequipment communications is taking off. AsMike Reyes, of Commercial WirelessSolutions, points out, “Some operators arerunning fibre to a platform and then they areusing wireless connections from a platformto the surrounding rigs. The field’s mainplatform acts as a communication gatewayserving the field. While below the surface,we are also seeing wireless acoustictechnology being used to operate variousproduction facilities. However, the bandwidthand distances involved are limited by theoptical properties of the seawater in thearea.” Intra-oilfield wireless communicationscan be expected to be adopted in deep-water oilfields as they come on stream inSaudi Aramco’s newly discovered Al-Haryddeep-water oilfield in the Red Sea.

Good communications are vitalToday’s energy firms’ communicationmanagers, network engineers and IT teamsneed to employ fast, secure and reliablecommunications systems to monitor drillingactivity, track production and provide ship-to-shore information to decision makers locatedonshore who, after data analysis can, forexample, order preventative Smartmaintenance. Moreover oil companies need tobe able to more easily identify, classify andmitigate potential risks as well as managelogistics and monitor deliveries and fuelconsumption. They need vessel-to-vessel orvessel-to-corporate voice and video circuitslinks. The need for effective and reliablecommunications was demonstrated duringBP’s Deepwater Horizon disaster in 2010,where communications between decisionmakers onshore, rescuers in ships and aircraft,and rig crew proved to be inadequate.

Equally important to monitoring andmanaging a rig’s hardware is a reduction inthe crew’s isolation. Human Resourcedepartments in major oil companies haverealised the importance of communicationsto crew retention and welfare by providingsuch services as telephony, IM, e-mail,video-calling, Internet and telemedicine. Inaddition, quality communications are vitalfor professional development by remote

training and e-learning provided by on-boarddistance learning services such as the UK’sOpen University.

This multiplicity of new requirements bythe oil industry is challenging maritimecommunication providers who areconstantly striving to meet the evergrowing communication needs of energycompanies worldwide.

Vulnerable to hackingThere has been a substantial increase in thenumber and types of new threats for bothoperators and users of marinecommunications in recent years. For instance,in October 2012, the New York Times reportedthat Saudi Aramco’s computercommunications network had been attackedby a virus from an Iranian source. Morecommonly and seriously, hackers haveinfiltrated computers connected to ports andlocated specific containers, making off withthe cargo and subsequently deleting allrecords. It has been estimated that cyber-attacks against oil and gas infrastructure costenergy companies nearly US$2bn last year.The British government estimates cyber-attacks are already costing the UK someUS$700 mn a year.

Security experts have also identifiedanother threat relating to vesselidentification and navigation softwaresystems, including Marine AutomaticIdentification Systems and GPS. Forexample, Somali pirates’ success in recenttimes has been attributed to the use ofnavigational online data tools used to viewpotential victims. Increasingly, ships’

captains are switching off their MarineAutomatic Identification Systems in order toavoid being tracked in waters operated bySomali pirates, suggests Windwood, amarine intelligence company.

In addition, concern is mounting overthe potential threat posed by criminalgangs or militant groups of signal jammingof satellite global positioning andnavigation devices used by ships and oilrigs. For example, it has been suggestedthat the crowded shipping lanes of theStraits of Hormuz would make an attractivepotential target. Unfortunately for theindustry, there is no quick fix. Counteringsuch threats to their vital communicationswill not only take time but will require achange of attitude by oil companiesworldwide. Currently, the number ofreported cases of threats to vitalcommunications is low. Many companiesfear that reporting such incidents againstthem would alarm their investors.However, it is a growing industry-wideproblem, which requires both transparencyand a concerted joint effort on the part ofoil companies and marine communicationcompanies to develop impregnable, fastand reliable communications.

As for the futureWhilst the industry requires ever greaterbandwidth, marine communicationscompanies are focused on incrementaltechnological developments, which willprovide more secure and faster datatransmissions from ship and rig to shore.Time is of the essence. ■

Equally important tomonitoring and managing arig’s hardware is a reductionin the crew’s isolation”

Satellite communications have brought major improvements in bandwidth and reliability to isolated locations


Technology


IN THE THREE decades from 2010 to 2040 world energyconsumption is set to rise by 56 per cent, according to the USEnergy Information Administration’s International Energy Outlook2013. It goes on to estimate that the Middle East, with its fast-

expanding population and ample domestic resources, will see anenergy demand increase of 76 per cent over the 30-year time period.

Furthermore, oil and gas companies working in the region areincreasingly investing in newer, unconventional forms of extractingfuel, which can see projects and operations venture further a-fieldinto more remote, unstable locations. Combine this with the risingdemand for power from regional markets then ensuring access tothe most reliable on-site power is of ever-growing importance. Powerloss, however temporary, can have significant effects on a projectand its output, and it is important to not only keep operations runningefficiently, but also for the power supply to be robust enough towithstand various environments.

Oil and gas companies have no end of power generator providersto choose from, particularly as several businesses continue re-establish their commitment to the region by opening new branches.

General Electric (GE) launched its new Distributed Powerbusiness in the Middle East and North Africa (MENA) region inMarch this year in response to the region’s increased demand for on-site power from oil and gas majors.

At the launch in Masdar City, Abu Dhabi, GE Distributed Powerpresident and CEO Lorraine Bolsinger said, “In line with the growthin the manufacturing sector and increasing demand for on-sitepower, delivering new power generation solutions is of criticalimportance to improve regional energy security.”

Meanwhile, power company Himoinsa recently welcomed JeanLuc Rolland to the position of senior project manager for the MiddleEast. This move shows, at least in part, that Himoinsa recognises theregion’s promising growth potential.

According to Himoinsa’s reports, demand for generator sets withan output of more than 375kVA represented 66 per cent of gensetsimported to the Middle East in 2012 – a figure that the companybelieves will rise given the constant development of special projectsin the region.

GE Distributed Power, by announcing its launch in Masdar City,was highlighting the sustainable and energy-efficient nature of itsgenerators. The company plans to invest US$1.4bn over four yearsglobally and boasts three key product lines, Aeroderivative GasTurbines, Jenbacher Gas Engines, and Waukesha. All three are‘ecomagination qualified’, meaning they increase customerproductivity and push cleaner energy solutions.

At around the same time as the launch, it was revealed that theGeneral Electricity Company of Libya (GECOL) had chosen GE for afast-track US$135mn project, supplying trailer-mounted, mobileaeroderivative gas turbines. The project details included four of GE’sTM2500+ units, which intend to provide more than 100MW tosupplement energy demand in the peak summer months and expandcapabilities at power plants in Zawiya and Tripoli.

In August this year, GE Distributed Power announced a number ofsimilar orders in Algeria, which are the latest part in a series of majorpower generation technology supply agreements made with Algeria’senergy industry. The deals include TM2500+ aeroderivative gasturbine-generators and the first Jenbacher gas engine. GE estimatesthat Algeria’s energy demand will grow by approximately 14 per centannually, reaching 24GW by 2017.

Energy efficiency is evidently also a concern for Himoinsa, asreflected in its announcement in February that its hybrid powergeneration systems can reduce diesel consumption by 30 per cent. Itprovides the design and start-up of hybrid power generation projectsprimarily for suppliers requiring a power range from 0.3 to 5MW,which is where hybrid systems are very appealing from a financialstandpoint, according to the company.

In this case, hybrid systems means generators that find the happymiddle ground between diesel and photovoltaic power generation,creating lower fuel consumption. Himoinsa stated that oil-exportingcountries also benefit from being able to export the surplusunconsumed diesel.

Himoinsa’s new business development manager Massimo Brottocommented, “These projects involve the incorporation into diesel

GE trailer-mounted TM2500+ aeroderivative gas turbine

All companies require optimal and reliablepower supply on the ground of oil and gasoperations, even more so as those projects inthe Middle East move increasingly into moreremote locations in the search of fuel.

Meeting on-site

demand for power

Power loss, however temporary, can havesignificant effects on a project and its output”


Technology


Ansell Healthcare – Middle East1 Lake Plaza 22-02, PO Box 125299, JLT, Dubai. United Arab Emirates.Tel: +971 4 452 3232 E-mail: [email protected] Web: www.ansell.eu


generation plants of photovoltaic equipment capable of providingaround 30 per cent of nominal output, which can vary according tothe project, geographical location and the cost of fuel.”

Other design priorities for Himoinsa include the durability of itsproducts, as well as soundproofing. In April it released its HHWseries; seven soundproofed, open generator models, with poweroutput ranging between 20-100kVA at 50Hz and 30-120kVA at 60Hz.One of the series’ key selling points is its capability of bearingextreme weather conditions, with the generators complying withIP23 protection grade requirements and a special resin coatingallowing it withstand any operating conditions.

The company also showcased its Power Cube at this year’sMiddle East Electricity exhibition in Dubai. A 500kW generator set ina three-metre container, the Power Cube is acknowledged for itscompact design and is equipped with a remote cooling system,designed on top of the engine compartments.

Attention to sound proofing is feature of the recent release byglobal power provider Doosan. It launches its new G80-IIIA andG100-IIIA generators, (80kVA prime power and 100kVA prime powerrespectively), in August 2014, and the sound attenuation LwA ratingof both reportedly meet or exceed the relevant European regulations.

Advertised as providing robustness, reliability, and high performance,

the fuel tank frame system on the new models offers a containmentbase integrated as standard in the frame to ensure 110 per cent fluidcontainment capacity. The generators can also provide a minimum of 12hours of autonomous operation, at 75 per cent of the load.

The specification for choosing on-site power supplies in the oiland gas industry seems to be a growing list and many factors mustbe weighed up in the selection process, from energy efficiency,durability, or sound proofing. However, as the considerationsincrease so too do the technological advancements and capabilitiesof the generators, meaning more machines are available on themarket to fit companies’ specific needs. n

Doosan G100-IIIA generator

Its hybrid power generation systemscan reduce diesel consumption by 30 per cent”


Technology



OPTASENSE works on the principlethat ‘if you can measure it you canmanage it’ and has developed aneffective Distributed Acoustic

Sensing (DAS) system able to provide real-time data via the conversion of optical fibreinto a distributed acoustic (or seismic) sensor.

Acoustic signals striking the fibre causeminute strains, which are measured usinglaser interrogation, turning the fibre into adistributed acoustic, or seismic, sensor. AnInterrogator Unit (IU) fires a laser beam intothe fibre, measuring backscatter returns fromimperfections inherent in the crystallinestructure of the optical fibre. The strainscause subtle modulations of the backscatterthat are then measured by the IU thussensing the seismic signal.

Already a proven technology onshore,OptaSense is currently developing the world’sfirst fully marinised and qualified DAS systemin a joint programme with Shell. Functionableat water depths of approximately 3,050m, thesystem will allow accurate acoustic dataacquisition offshore for the first time andprovide data for a range of deepwaterapplications, including pipeline surveillance, in-well monitoring, and permanent reservoirmonitoring. The multi-application device willinclude functional and technical parametersconfigurable in software, enabling the systemmeasurement settings to be changed toaddress different application requirements.

The marinisation process will require there-engineering of the interrogator unit toreduce its size to fit into a robust pressurecanister. The modified opto-electronics will betested to ensure they meet the stringenttemperature, vibration, shock and electricalcertifications required of subsea equipment,particularly during transportation anddeployment. In the subsea in-well monitoringapplication, the interrogator unit will bepositioned near the wellhead and data will berelayed to shore or appropriate installation viaa fibre-optic link in a control line.

Predicted to be demonstration-ready bythe end of 2014, the wide-ranging potential of

the DAS technology subsea is being explored.Applying the system for reservoir monitoringwould involve the DAS fibre providing animage of the subsurface at a significantlylower cost compared to current practices. Themarinised DAS is also being considered as amonitor of flow lines and pipelines in order toidentify leaks and hazardous activity, such asanchor drags, which can lead to catastrophicmechanical failure.

Successful application onshore OptaSense has already achieved onshoresuccess with its DAS technology, which hasbeen applied to a range of applications, suchas seismic monitoring. With services availablein hydraulic fracture profiling, production flowmonitoring, and vertical seismic profiling,OptaSense is transforming the industry’sability to understand in real-time what ishappening along the well bore and beyond.

Distributed temperature sensing (DTS)using fibre-optic cable has been around forseveral years, but the development of DAS isa relatively recent phenomenon and has thepotential to radically improve understandingof a range of issues including reservoirs,fields, geology and asset integrity. It is five

years since DAS was first used down holeand it has delivered significant benefits incompletion, production, and evaluationprojects, including hydraulic fracture profiling.

Despite the rapid development ofhydraulic fracturing techniques over the pastdecade, the hostile environment inside thewell during injection means that sensorscannot survive. As a result, during this high-cost, yield-dependent stimulation process,many wells are not monitored. How can thefull production lateral be measured withouthaving sensors inside the well? Via its fibre-optic technology, DAS can provide aneffective solution. Clamped to the productioncasing, a fibre-optic cable can provide real-time DAS and DTS without well interventionfrom completion to abandonment.

The uses of DTS, however, are limited.Despite being used for over a decade,borehole temperature is only part of the storywhen it comes to monitoring a hydraulicfracturing operation. With the DAS system itis possible to listen to the well at eachperforation location and hear how the fluidand proppants rush through the orifices andhow the rock fractures just outside the wellinto the formation. By combining DAS datawith real-time pump data, it is possible toestimate how much fluid is being pumpedinto each perforation cluster. The companyanticipates that this process will have asignificant impact on reservoir modelling, welldesign, field operations, and ultimatelyreservoir performance and hydrocarbonrecovery in the years ahead.

With the full-well continuous monitoringthat DAS enables, all activities during thehydraulic fracturing operation can bemonitored for effectiveness, including:6 Wireline tool tracking6 Bridge plug setting 6 Perforating6 Ball drop, ball seating, sleeve sliding and

isolation from previous stage

Furthermore, DAS can detect casing leaksthat can deter operations and report their

OptaSense chief technology officer David Hill

As the search for oil and gas faces new environments and higher operating costs, OptaSense chieftechnology officer Dr. David Hill looks at how the need to fully understand the challenges andsurroundings of an asset is more crucial than ever.

Subsea - the next step for acoustic

sensing technology?


Technology


depth accurately. Recently fluidmigration between isolated zones hasbeen measured, providing theoperator with data that can be usedto halt operations if a previouslyfractured zone is at risk of being overstimulated.

The system is also used tovisualise flow dynamics providing analternative to conventional productionlogging tool (PLT) readings. Via aninstalled fibre, measurements can betaken on a continuous basis withoutthe need for costly well interventionand deferred production.

An industry first Earlier this year OptaSense announced it hadcontracted with Petroleum DevelopmentOman (PDO) to provide the industry’s firstmulti-well 4D DAS vertical seismic profiling(VSP) system to monitor and map theperformance of up to 12 steam-injected oilwells in a brownfield development at SouthOman Salt Basin.

Seismic signals have been recorded fromfibre-optic cables attached to each well’sproduction tubing, permanently installed and

linked to a surface data-gathering centre. Theprocessed data will be integrated into PDO’sreservoir models and assist in determiningfluid substitution through production andcontribute to the positioning of infill wells.

Weighed against the use of geophones inthis type of application, the DAS technologyprovides a number of benefits including low-cost on-demand acquisition throughpermanent cable installation; deployment inwells inaccessible to geophones; synergies

with existing systems andretrofitting capabilities; coverageover the entire length of a well; andsimultaneous data acquisition ofmultiple contiguous wells.

ConclusionThe development of DAS throughthe deployment of fibre-optic cablerepresents the latest technologicaldevelopment in the monitoringarena, enabling operators to ‘turnthe light on’ down hole and allowthem to see what is happeningacross the wellbore in real-time.

Producing a marinised versionof the DAS technology will enable

OptaSense to extend the use of its provenonshore technology into the growing subseasector, providing operators with decision-ready data to optimise well performance frominitial well construction and throughoutproduction.

With its multiple uses and producingsignificant through-life value, the long-termcosts effectiveness of the DAS system will bea game-changer for operators both onshoreand offshore in the oil and gas industry. ■

Time versus depth waterfall showing DAS recording of in-flow at the production zone of a horizontal well


Technology




ORGANISED BY EXPOTIM International Fair Organizationand Pyramids International Group, Basra InternationalOil & Gas has now entered its fifth consecutive year.The show is the largest oil and gas event of its kind in

Iraq, having grown to become a staple of the country’s oil and

gas calendar, attracting a range of regional and internationalcompanies, and providing a platform for local companies toassess the products and technologies available to them.

The fourth edition of Basra Oil & Gas Exhibition andConference took place between 5-8 December 2013 at BasraInternational Fair Ground and featured more than 270participants, as well as attracting 10,000 visitors from more than35 countries, in turn making it the largest oil and gas sectorevent to take place in Iraq in 2013.

Since the first edition of the show in 2010, both the exhibitionand supporting conference have contributed towards Basra’sgrowing reputation as ‘Iraq’s Oil Capital’.

The largest portion of participants at the 2013 edition of theshow came from Iraq, the UAE, Turkey, Germany and Jordan,while a host of participants from the UK and the USA were alsoin attendance.

The event received the official support of Iraq’s Ministry of Oiland attracted a number of leading companies from across theglobal oil and gas industry, including Bertling, Cameron, ChinaPetroleum Technology, CNPC, Emerson Process Management,ENI, FMC Technologies, Honeywell, Interpipe, Jotun, Mitsubishi,Petrojet, Rumalia, Sakr Power Generation, Scania, Shell,Siemens, Tenaris and Volvo.

Ministry of Oil companies, including South Oil Company,South Gas Company, Iraq Drilling Company and State Companyfor Oil Projects, also played a key role at the event by networkingwith representatives from private company in attendance anddiscussing the future of the country’s oil and gas sector.

Expotim revealed that more than 90 per cent of last year’sexhibitors were satisfied with the visitor profile of the event,while more than 80 per cent of exhibitors stated that theyconsidered the exhibition to be truly efficient. Meanwhile, animpressive 95 per cent of participants at the fourth version of theevent said they would be willing to participate in the fifth editionof the event in December 2014, which will look to provide aninteractive business platform for senior-level decision-makingbuyers to network with more than 270 local and internationalprofessionals offering the latest technologies, solutions andproducts.

Basra International Oil & Gas will take place from 4-7 December2014 at Basra International Fair Ground. For further information,please contact [email protected]

Basra International Oil & Gas looks set to highlight Basra’s prominence within Iraq’s oil and gassector as the southern Iraqi city gears up to host the fifth edition of the annual event.

Basra event to highlight

Iraq’s potential


Exhibition

Basra Oil and Gas

Date: 4th-7th December 2014Venue: Basra International Fair Ground


S15 ORME 5 2014 - Training & Development_Layout 1 8/18/2014 12:51 PM Page 59

MOST ARABIC SPEAKERS find thatlocal training facilities meet theirskills and certification needs,whether under the wing of an

NOC or through independent institutions suchas GTSC (Abu Dhabi and other locations),ADC’s Dhahran Training Center and the DohaPetroleum School. But sometimes it isnecessary to seek certification overseas.

The USA is usually the first choice giventhe international recognition of itsqualifications. A key resource is theAmerican Petroleum Institute in Washington,DC (www.api.org). Specifically orientated toUS industry needs, the API has a wideinvolvement in all aspects of training forcareers in the energy industries.

In June the API, effectively the USA’snational oil and gas trade association,launched a new recruitment website –www.oilgasworkforce.com. This providesvital information to anyone interested incareers in the oil and gas industry, as well asin certification and training.

A recent report from internationalbusiness consultants IHS predicts anadditional 1.3 mn new career opportunities inthe US energy workforce alone by 2030. USpersonnel are also key members ofoperations and development teams invirtually all corners of the world.

The Institute’s new online resourcebuilds on its existing recruitment initiativesto develop and source from completelynew categories of human resources,including labour unions and general tertiarytraining colleges, as distinct from the manyUS campuses offering targeted courses.

Other major training institutionsheadquartered in the USA include thePetroleum Institute for Continuing Education,the Petroleum Safety & Technology Center,ATEC Training & Certification Services andthe Well Control School. Quick links to allthese and more can be found on the API’sskills development website.

Across the Atlantic another major

source of internationally recognisedtraining is Germany’s TÜV SÜD, a leadingtechnical services company located inMunich, which maintains a specialregional site for the benefit of residentsof the Middle East at www.tuv-sud.ae(tel:+971 4 4473 113).

A third recent initiative is provided byOPITO (Offshore Petroleum IndustryTraining Organisation), the UK oil and gasindustry’s global training standards body,which in July 2014 agreed to provide nearlyUS$1.3mn of funding over five years to theinternational development division of theOpen University (OU), an experienceddistance learning institution which includesenergy in its course programme. Thisbuilds on an earlier successful but more

limited funding scheme aimed at meetingthe international needs of the energysector. OU’s Danni Nti commented, “WithOPITO’s support we can uncover newsolutions, support local partners anddeliver effective programmes which reallymeet local needs.”

Funded by the industry itself, OPITOleads the drive for common global trainingstandards to improve safety in all oil andgas operations. The organisation’sinternational division works withgovernments, regulators and the industry inmore than 40 individual countries to delivertraining standards which help developnecessary skills and competencies.

Iraq is one of the countries whereOPITO is currently helping to build a localworkforce capable of supporting thedevelopment of the oil and gas industries.It is co-operating with IOCs there to designa framework for delivering qualified localworkers, thereby helping to transform thecountry’s troubled economy.OPITO can becontacted locally in Dubai’s Knowledge Village(tel: +971 4 445 8402, email:[email protected]). n

US personnel are key members of operations and development teams throughout the world. (Photo: BP)

Training and certification areoften provided on the job, butonline or ‘ distance’qualifications play a role too.

Meeting the region’s

training needs

Iraq is one of thecountries where OPITO iscurrently helping to build alocal workforce”







“STAY TRUE TO your core” writes Dr Frank R Lloyd, Associate Dean ofExecutive Education at the USA’s Cox School of Business, which acts asacademic partner to a variety of energy companies throughout NorthAmerica. In the 18 February edition of PennEnergy he cites severalsuccessful examples drawn from oil and gas operations, in a review of howto prepare middle managers for leadership in the industry.

Dr Lloyd introduces the concept of an enterprise’s own special marketadvantage (an ‘economic moat’) that makes it stand out from its competitorsand lines up its activities with its essential mission. “All organisations have,in common, one potential strategic advantage that can propel them past thecompetition: human capital,” he says.

Dr Lloyd maintains that this combination of ‘alignment’ and ‘empowerment’requires a new set of skills for one of the industry’s key resources - its middlemanagers, who in the past relied on basic grounding in finance andinterpersonal skills to fit the business’s middle management mould. “Now …mid-managers need to know about strategic thinking and decision making sothat they can communicate the plan to their employees and help themprioritise their daily activities. They also need to understand basic tools ofoperational excellence such as work flow, process improvement, problemsolving and safety...Abandon the truism that 70 per cent of leadershipdevelopment takes place through on-the-job experience, 20 per cent inlearning from others … and 10 per cent in the classroom,” he says.

Cox clients are exposed to a much wider range of tools including self-assessments, simulations, coaching, and real business projects to ‘leverage’their learning opportunities. As a result trained middle managers are able to

generate the best outcomes by establishing trust with co-workers andmanagement. Dr Lloyd’s suggested approach is 50 per cent learning fromwork experience, 30 per cent from the classroom, and the rest from lifeexperience. This ‘new paradigm’ offers opportunities to align and empoweremployees at all levels to help them achieve their best.

Middle managers typically come from a company's pool of petroleumengineers, geologists and other technical specialists (Photo: BP)

Staying true to your core values - a new approach to developing middle managers


TDI RECENTLY WON a contract workingwith WesternGeco in Kuwait toprovide a UXO (unexploded ordnance)search capacity capable of locating

UXO and any other explosive hazardousmaterial which may hinder or compromisethe safety of WesternGeco’s seismic surveyoperations as they traverse the area.

During the Iraqi occupation of Kuwaitfrom August 1990 through until February1991, Saddam Hussein’s forces laid over twomillion land mines in staggered minefieldsalong the country’s southern and westernborders in an effort to deter any incursion byCoalition forces. These minefields wereoriginally cleared in 1993, however themethodologies used were perhaps not asrobust as they are today, and live mines stillremain in the ground, although theconcentration of these is not known.Certainly, during TDI’s time working insupport of WesternGeco in 2006-2007 anumber of mines were located in what wereknown to be previously cleared areas.

There will be two separate capacities.One will conduct Battle Area Clearanceworking ahead of the seismic survey teams,ensuring that all UXO and other explosivehazardous materials are located and clearlymarked for subsequent removal ordestruction in situ by the Kuwaiti MOD EOD(Explosive Ordnance) Team.The second willinvolve clearance of the seismic corridorthrough the mine fields identified byWesternGeco.

TDI will deploy a mine clearance capacityto clear corridors through suspectedminefields along predefined seismic lines aswell as a robust management,administration and logistics support capacityto ensure a high level of co-ordination withall stakeholders.

Somalia project closesTDI has also recently completed twocontracts in Somalia. The first, for stabilisingnewly recovered areas and consolidatingnational capacities to manage the explosivethreat in south central Somalia, involved thedeployment of two explosive ordnancedisposal teams and three mine risk educationteams in Hiran Province. The second, foremergency mine action and rehabilitationthrough demining in south central Somalia,

involved deploying four manual clearanceteams, four explosive ordnance disposalteams and four mine risk education teams.33,137 people received mine risk education,and 2,553 pieces of ordnance were dealt withby TDI teams.

Work in Mali a successTDI are currently engaged on a project withUnited Nations Mine Action Service (UNMAS)supporting their mine action efforts in Gao andTimbuktu. The TDI Mali Operations Manageralong with UNMAS and FAMA conducted aninspection of approximately 100 SA3 missiles,which are are currently being dismantled anddestroyed by TDI teams.

All EOD and missile attached staff are

undergoing on-the-job training with theemphasis on demolitions and SA3 missilesdismantlement and destruction.

Continuing work in South SudanFor the 2014-2015 demining period, TDI willdeploy four Multi Task Teams to conductsurvey and clearance tasks, along withcommunity liaison and risk education as perUNOPS/UNMAS requirements.

South Sudan has been involved in thelongest running conflict in Africa, and theremaining mines and Explosive Remnantsof War (ERW) continue to kill, maim,obstruct humanitarian aid and impededevelopment, while recent instability meansthat many towns and roads previouslycleared may now again be contaminatedwith mines and other ERW.

“As a result of the conducting of MultiTaskTeam operations from 2011 through to2014, as well as several seasons of Multi TaskTeams and Mine Action Support Teamsduring 2010 and 2011, we feel we are wellequipped to begin this job with relative ease,”says Ian Anderson, operations manager. n

Contributing to safety

and security

TDI, which provides commercial clearance and remote logisticssolutions, outlines some recent successes in the region.

TDI will deploy amine clearance capacity toclear corridors throughsuspected minefields”

TDI works in inaccessibleand often hostile locations


Innovations

S16 ORME 5 2014 - Innovs_Layout 1 8/18/2014 3:11 PM Page 63

YOKOGAWA ELECTRIC CORPORATION hasenhanced its YS1000 series single-loopcontrollers with a new TFT (thin-filmtransistor) LCD featuring improved displaycharacteristics and a design that facilitateseasy maintenance.

Single-loop controllers are used in a widevariety of industrial facilities such as powerplants, oil refineries, petrochemical plants,chemical plants, and iron and steel plants.These controllers receive temperature, flowrate, pressure, and other types of measurementreadings from sensors and send correspondinginstructions to control elements such as valvesin order to maintain these values within adesired range. Each control loop has its own

controller. Formerly, this

product used asuper twistednematic (STN)LCD screen. Thishas been changedto a TFT LCDscreen that has a1.5 times widerviewing angle.The displaycontrast andbrightness arealso notablyimproved, making

the screen mucheasier to read. In addition, the TFT LCD has alonger lifespan and does not need to bereplaced as frequently.

With the enhanced YS1000 controllers, theTFT LCD can be replaced while the controlleris online, with no need to switch off thecontroller before replacing the display.

In a separate development, Yokogawa hasreleased the CENTUM® VP R5.04, anenhanced version of the company’s flagshipintegrated production control system, to offerimproved alarm and batch functions.

WANNER INTERNATIONAL HAS introduced twonew Hydra-Cell® Dosing Performance Pumpranges with mechanical flow rate adjustment.

Because sealless Hydra-Cell pumps are truepositive displacement pumps, flow rate isdirectly proportionate to input shaft speed andvirtually independent of system dischargepressures. Very precise, infinite adjustment ofshaft speed is achieved through a simple manualadjust hand wheel.

The variable speed gearboxes operate on theelasto-hydrodynamic principle, producing outputtorque by means of a traction fluid. This removesthe possibility of mechanical slippage betweeninput and output, potentially experienced withfriction type variators.

The Hydra-Cell G03/G13 dosing rangeaccommodates repeatable, steady flowrequirements up to 310 litres per hour at pressuresup to 100 bar and flows up to 490 litres per hour atpressures up to 70 bar.

The Hydra-Cell G10 dosing rangeaccommodates repeatable flow requirements upto 732 litres per hour at pressures up to 103 bar

andflows upto 1470 litresper hour atpressures below 50bar.

These mechanicallyadjustable dosing pumps areideal for use in ATEX Zone 1 and 21 when coupledto compatible, explosion proof motors which canalso be provided.

Both ranges come with a variety of camprofiles to meet specific flow rate adjustmentrequirements and a variety of pump headmaterials is also available.

EMERSON PROCESS MANAGEMENT, a leading supplier ofprocess automation services and technologies, has expandedthe application scope for its Rosemount® 2120 range ofvibrating fork point liquid level switches. The Rosemount2120 level switch is now certified for SIL 2 functionalsafety with SIL 3 capability, enabling the device to meetthe most demanding safety application requirements. The2120 range is now approved for marine applications by theAmerican Bureau of Shipping (ABS), and Emerson has alsoadded an expanded choice of process connections forgreater installation flexibility.

For safety critical applications, SIL 2 certification is now availablefor the 2120 with NAMUR and 8/16mA electronic outputs. There arefive plug-in electronic outputs available providing a choice of switchingfunctions. The SIL 2 certification extends the time between prooftests and allows users to avoid extra shutdowns for safety testing.

The 2120 also offers an expanded choice of process connections. In addition to the new 2"NPT process connection, the switch is now available with Mobrey A and G flanges enablingcompatibility with mechanical float switch process connections.

Yokogawa enhances controllers

BELZONA, A WORLD leader in the designand manufacture of polymer repaircomposites and industrial protectivecoatings, has formulated a new peelablecoating concept, Belzona 3411(Encapsulating Membrane), specificallydesigned for the protection of flanges,fastenings and associated pipework. Made available in 2014, Belzona’sinnovative encapsulating membrane systemhas been specifically developed to meetthe growing demand for new and more

effective corrosion protective systems,providing excellent corrosion protection, asimple installation, suitability for all flangesizes and shapes, and easy access forinspection purposes. Belzona’s R&D chemist, Ruckseeta Patel,said, “With the use of clever polymerchemistry, we have created a flangeprotection system strong and flexibleenough to be peeled back without tearing.This solution features the flexibility ofelastomers but is based on a completely

new technology excluding the use ofisocyanates and toxic metal catalysts. Thesystem bonds to manually preparedsurfaces and does not involve hot work,making it safe and easy to use.”This encapsulating system can be used notjust to provide a complete corrosionprotection for flanges, fastenings andassociated pipes, but also as a preventivesystem which helps improving andfacilitating further monitoring andinspection of flange faces.

Emerson expands application scope for switch

Belzona introduces peelable coating concept

New dosing performance pumps launched

The Rosemount2020 switch

Innovations

The YS1000 single-loopcontrollers

The Hydra-Cell G13 pump




Innovations

WOOD GROUP INTETECH (WG Intetech), a world leader in wellintegrity management, has developed a new software platform foranalysing global well component reliability data. Called iQRA, thetool provides operators with valuable insight to make better, moreinformed decisions about the selection of well and oilfieldcomponents – enhancing asset performance and safety.

Responding to the industry demands to have ready access to abroad set of validated component reliability data, WG Intetech hasdesigned a solution to harness this information in a single, securelocation.

Based on the ISO-14224 standard, iQRA supports critical decision-making by giving users the ability to benchmark their reliability figuresagainst a global dataset and extract safety critical element (SCE)failure statistics and mean-time-to failure (MTTF) data. iQRA is afeature-rich platform that comes with quality-assured, trustworthydata. The cloud-based tool allows users to construct their ownqueries and generate information instantly, from anywhere.

“Wood Group Intetech has been delivering online well integritydata solutions for more than a decade and we have a strong andproven track record in providing top quality information to supportstrategic decision making. As a trusted partner for the oil & gasindustry we were in the perfect situation to develop a solution forbenchmarking and analysing global well performance data,” says DrLiane Smith, managing director and founder of Wood Group Intetech.

Wood Group Intetech establishesglobal well performance database

Wood Group Intetech's new product enablesoperators to make more informed decisions aboutthe selection of well and oilfield components

THE BRITISH SAFETY Council has signed a partnershipagreement with Abu Dhabi’s Environment, Health and SafetyCenter (OSHAD) to share best practice in the management ofoccupational health and safety and to help the Emirate to raiseawareness among employers and workers of the social andbusiness benefits of well-managed health and safety.

OSHAD was established by the government of the Emirateof Abu Dhabi in February 2010, to implement occupationalhealth and safety (OHS) policies, plans and programmes throughthe provision of integrated OHS regulatory frameworks toensure safe and healthy workplaces. OSHAD helps to secureexcellent standards of health and safety management by thecountry’s businesses and government agencies.

The British Safety Council will share its and its members’knowledge and expertise of the systems and arrangements thatlead to excellent health and safety performance. It will also helpOSHAD to raise awareness of the benefits of management ofhealth and safety risks among Abu Dhabi’s employers.

British Safety Council partners with OSHAD


AUSTRALIA’S LEADING SUPPLIER ofstainless steel emergency safety showers,Enware Australia, has made its largestexport delivery to date, to the $US10.8billion Ma’aden aluminium complex inSaudi Arabia.

Enware has delivered more than 700 ofits Australian designed and manufacturedemergency safety showers along withassociated safety equipment to Koreanbased Design, Construct and Engineeringcompany Hyundai for use at diverselocations throughout the project.

The tough, reliable and technicallyadvanced safety shower and eyewashfeatures solar battery charging for use evenin the world’s remotest and harshestconditions and features loading/unloadingaccess for forklift tines or cranes. It is alreadyin use by leading resources, engineering andproject management companies inQueensland and Western Australia.

Enware supplies safety showers

The Enwaresafety shower

GE OIL & GAS has received an order for theoffshore oil and gas industry’s first 20,000-psi (20-ksi) rated deepwater blowout preventer (BOP)stack and riser systems from Maersk Drilling. Theequipment, due to enter service in the first half of2018, is being supplied for Maersk and BP as partof their joint Project 20K™ Rigs design programme,which involves developing conceptual engineeringdesigns for a new generation of advanced drillingrigs that will be critical to unlocking the nextfrontier of deepwater oil and gas resources. Theprogramme will result in deepwater drilling vesselsdesigned to operate efficiently in high-pressure andhigh-temperature reservoirs up to 20,000 psi and350 degrees Fahrenheit.

GE Oil & Gas will design, test and manufacturethe new 20-ksi BOPs and risers at the company’srecently expanded Houston Technology Center inTexas. The system will include a number of newreal-time monitoring and condition-basedmaintenance technologies aimed at improvinguptime by reducing unplanned maintenance.

GE to supply new

BOP systems

The 20-ksi BOP prototype

THE WORLD’S FIRST training course in workclass ROV operations delivered by anindependent training provider has beenlaunched by The Underwater Centre in FortWilliam to meet the huge demand for ROVoperators forecast by the industry.

The new five-week residential course - AnIntroduction to Work Class ROV - will come underthe umbrella of the new ROV Industry TrainingAcademy, which is being established and will beled by a steering group made up of key industrypersonnel who will ensure the training closelyreflects the needs of the industry. This willinclude basic training introducing technicalpersonnel to the industry and, in due course,more advanced training designed to accelerateROV personnel through their careers. It will bedelivered in a contextual training environment,ensuring it is as realistic as possible to the

conditions that are found offshore.Significant industry support has been

provided and Technip has also led thedevelopment of the course syllabus, which wasdeveloped in conjunction with the InternationalMarine Contractor’s Association (IMCA) and theROV industry.

The Underwater Centre is a purpose-builtsubsea training and trials facility and is basedon the shore of a seawater loch, well shelteredby the surrounding mountains. The Centre’sunique location allows it to provide year-roundtraining and testing in an open-waterenvironment. With access to depths of morethan 100 metres, it is the ideal location toperform realistic and industry-specificsaturation and air diver and ROV pilot techniciantraining, as well as providing a convenientlocation for subsea equipment trials.

Work class ROV training course launched


Innovations

AVEVA HAS LAUNCHED the AVEVAInformation Standards Manager (AVEVAISM), a software product that enables bothEPC contractors and asset owner operatorsto achieve greater control over criticalengineering information across their projectsand enterprises. It does this by rationalisingexisting class libraries and imposingconsistent and compliant standards thatimprove information quality and reduce bothproject and operational risk.

AVEVA ISM is fully compatible withsoftware systems from other vendors.With today’s massively increasingquantities and variety of asset life cycle

information, this powerful enterprise-levelapplication offers increased value to bothproject and operations managementprocesses without the need to replaceexisting authoring products. The quickdeployment and open design of AVEVAISM delivers rapid ROI to EPCs andowner operators.

“AVEVA ISM is able to establish andgovern all asset information standards,across any number of projects,” explainedDerek Middlemas, COO and head ofenterprise solutions, AVEVA. “This launchstrengthens AVEVA’s Digital Information Hubcapabilities, and has been built around the

principle of creating and maintaining anaccurate digital asset.”

Using AVEVA ISM, owner operators areable to communicate their informationstandards requirements fully and accuratelyto their contractors, who are thus able toexecute projects more quickly and to thenecessary contractual standards.Contractors who work with multiple clients,each with their unique informationstandards requirements, can more easilymanage concurrent projects to differentstandards. This enables valuable efficiencybenefits, saves cost and time, and reducesopportunities for costly errors and rework.

AVEVA launches new application for governing asset information



HALLIBURTON HAS RELEASED its CYPHER 2.0Seismic-to-Stimulation Service, a proprietaryand collaborative workflow that links geoscienceand reservoir, drilling, and completionengineering to allow operators to better predictand produce unconventional reserves.

The CYPHER 2.0 service builds on thecompany’s CYPHER service introduced inSeptember 2013 which has resulted in increasedproduction rates for users, and providesenhanced capabilities through innovativesoftware applications allowing operators tooptimise the development of their unconventionalreservoirs and reduce their cost per barrels of oilequivalent (BOE).

Powered by Landmark's DecisionSpace®next-generation earth modelling solution, theworkflow is capable of updating dynamically anditeratively with the seismic and well datarequired to model the structure, rock and fluidproperties. Halliburton's petroleum systemsmodelling technology defines the distribution ofhydrocarbons in the unconventional reservoir toaid well placement, while the company'sintegrated formation evaluation module identifiesthe sweet spots for optimising the spacing ofperforation clusters.

Key scientific and technological advances inthe CYPHER 2.0 service include modelling the

interaction of the reservoir's natural fracturenetworks with the fractures induced by thehydraulic fracturing process. This results in amore accurate fracture network model withwhich to simulate the production performance of

the completion design. Critical operationalfactors can then be adjusted in real timebetween stages during the fracture treatment tofurther optimise well performance.

Another feature is the ability to evaluate,predict and alter perforation cluster efficiency.Leveraging these models to rapidly evaluate theproduction performance of different wellplacement and completion design options,Halliburton is able to quickly and iterativelyoptimise the development plans for operators'shale assets.

The CYPHER service is deployed to all majorshale developments in North America and manykey international markets through multi-disciplined technical teams, with more than 300technical professionals trained on majorelements of the workflow.

“Since we released he CYPHER service inSeptember 2013, we have seen tremendouscustomer interest and uptake,” said JimBrown, Halliburton’s President of the WesternHemisphere. “Projects on shale assets inseveral North American basisn havedelivered a 35 per cent production increaseon average. The CYPHER 2.0 service is astep-change improvement in our ability todeliver better wells for our customers at alower cost per BOE.”

SULZER, ALONG WITH FMC Technologies,has fully qualified a 3.2MW, 5,000psi,6,000rpm pump/motor system for use insubsea applications.

Traditionally, subsea wells would be tieddirectly back to topside or land basedprocessing facilities, but by placing moreprocessing equipment subsea, closer tothe wells, significant cost and productionadvantages can be made.

If a multiphase well stream is boostedusing a multiphase pump, the reservoirback pressure is lowered and the final yieldfrom the field increased. This boosted wellstream can be tied into a distant onshoreprocessing facility previously un-reachablewithout the subsea boosting.

With the use of a subsea separationsystem, instead of bringing produced waterto the surface for treatment, hot producedwater can easily be separated from theproduct and immediately re-injected atsource. This significantly reduces the OPEXof running an aging field.

By using subsea water injection pumps,raw seawater injection can be donewithout the need for long risers andtopside water treatment facilities, reducingthe CAPEX of any project.

Sulzer’s new pump/motor system hasbeen designed to meet all of these

applications. At the heart of the machineis a high speed permanent magnetsynchronous motor, faster than any othercurrently available. This is coupled with afast acting mechanical barrier fluidsystem to reduce system complexity andumbilical size. All pump options have fieldproven Sulzer hydraulics. The multiphasepump design has pressure balancing

technology to allow pressure risepotential in excess of 100 bar. These allcombine to give solutions to the subseaprocessing market.

The development programme receivedindustry recognition in 2013 by winning theSpotlight on Technology award at theOffshore Technology Conference inHouston, USA.

Sulzer develops new subsea pump

Halliburton introduces new service to lower operators’ cost per BOE

The Sulzer / FMC Technologies new subsea pump system

Innovations

The CYPHER service is deployed in major shale developments



S17 ORME 5 2014 - DMS - Rig Count_Layout 1 8/18/2014 12:56 PM Page 69

Middle East & North Africa The Baker Hughes Rig Count tracks industry-wide rigs engaged in drilling and related operations, which include drilling, logging, cementing,coring, well testing, waiting on weather, running casing and blowout preventer (BOP) testing.

Source: Baker Hughes

RIG COUNT

THIS MONTH VARIANCE LAST MONTH LAST YEAR

Country Land OffShore Total From Last Month Land OffShore Total Land OffShore Total

Middle EastABU DHABI 21 9 30 0 23 7 30 19 8 27

DUBAI 0 2 2 1 0 1 1 0 0 0

IRAQ 94 0 94 5 89 0 89 80 0 80

JORDAN 0 0 0 0 0 0 0 0 0 0

KUWAIT 34 0 34 0 34 0 34 30 0 30

OMAN 59 0 59 1 58 0 58 45 1 46

PAKISTAN 20 0 20 -3 23 0 23 21 0 21

QATAR 2 5 7 1 2 4 6 2 7 9

SAUDI ARABIA 89 19 108 10 78 20 98 64 19 83

SUDAN 0 0 0 0 0 0 0 0 0 0

SYRIA 0 0 0 0 0 0 0 0 0 0

YEMEN 4 0 4 0 4 0 4 4 0 4

TOTAL 232 35 358 15 311 32 343 265 35 300

North AfricaALGERIA 47 0 47 -2 49 0 49 46 0 46

EGYPT 45 11 56 -9 45 10 65 47 11 58

LIBYA 11 1 11 3 8 0 8 15 0 15

TUNISIA 0 0 0 0 0 0 0 3 1 4

TOTAL 103 12 114 -8 102 10 122 111 12 123


Project DatabankCompiled by Data Media Systems

Project Facility Budget ($ US) Country Status

Block D Exploration Exploration 200000000 Qatar Engineering &

Procurement

Dolphin Energy Limited (DEL)

Export Gas Compression Facilities Upgrade Gas Production 280000000 Qatar Construction

EPS Qatar - Expandable Polystrene (EPS) Plant Polystyrene 100000000 Qatar Feasibility Study

Maersk Oil Qatar - Al Shaheen Offshore Field Development Plan Oil & Gas Field 500000000 Qatar FEED

Oryx GTL - Gas To Liquids Plant - Phase 2 Gas to Liquids (GTL) 1500000000 Qatar Feasibility Study

Qatar Petroleum (QP) -

Air Compressor Replacement at Mesaieed Refinery Gas Processing 50000000 Qatar Engineering &

Procurement

Qatar Petroleum (QP) -

Bi-directional Pipeline Between KM and KS Gas Pipeline 80000000 Qatar Engineering &

Procurement

Qatar Petroleum (QP) - Vapor Recovery System Gas Processing 50000000 Qatar FEED

Qatar Petroleum (QP) - Wellhead Scada &

Cathodic Protection (Dukhan Field) Oil Production 200000000 Qatar Engineering &

Procurement

Qatar Petroleum (QP) / Qatar Petrochemical Company (QAPCO) -

Al Sejeel Petrochemical Complex - Aromatics Plant Aromatics 1000000000 Qatar FEED

Qatar Petroleum (QP) / Shell -

Al Karaana Petrochemical Complex - (Overview) Petrochemical Plant 6000000000 Qatar EPC ITB


Al Karaana Petrochemical Complex - Package 1 Petrochemical Plant 3000000000 Qatar EPC ITB


Al Karaana Petrochemical Complex - Package 2 Petrochemical Plant 3000000000 Qatar EPC ITB

RasGas - Qatar Barzan Gas Field Development Project (Overview) Gas Field Development 8600000000 Qatar Engineering &

Procurement

RasGas -

Qatar Barzan Gas Field Development Project - Offshore - Phase 1 Gas Field Development 800100000 Qatar Construction

RasGas -

Qatar Barzan Gas Field Development Project - Offshore - Phase 2 Gas Field Development 700000000 Qatar Feasibility Study

RasGas -

Qatar Barzan Gas Field Development Project - Offshore - Phase 3 Gas Field Development 300000000 Qatar Feasibility Study

RasGas -

Qatar Barzan Gas Field Development Project - Onshore - Phase 1 Gas Field Development 1700000000 Qatar Construction

RasGas -

Qatar Barzan Gas Field Development Project - Onshore - Phase 2 Gas Field Development 2000000000 Qatar Feasibility Study

OIL, GAS AND PETROCHEMICAL PROJECTS


Project Summary

Project Backgrounds

Dolphin Energy Limited has started the renovation project to increase the overall reliability and availability of the plant andenhance the transmission capacity of the plant by allowing full utilization of the export pipeline.

Project Status

Aug 2014 The construction works is continuing as per schedule with completion expected in the first quarter of 2015.

Apr 2013 The construction works is on track.

Nov 2012 The construction works is likely to commence in the second quarter of 2013.

Sep 2012 Larsen & Toubro was awarded the EPC contract.

3Q-2012 Engineering & Procurement

2Q-2013 Construction

1Q-2015 Completed

Project ScopeThe scope of the scheme involves: - Gas compression facility - Depressuring & steady state simulation of flare network - Hydraulic and line sizing Upgrade of utility facilities - Associated works

The scope of the scheme will also add three new compressors, each rated at 52 megawatts (MW), increasing export gas transmission capacity to 3.2bn scf/d.

Project Finance

Dolphin Energy Limited is the client.

Project Schedules

Project Name Dolphin Energy Limited (DEL) - Export Gas Compression Facilities Upgrade

Name of Client Dolphin Energy Limited

Budget ($ US) 280,000,000

Award Date Q3-2012

Facility Type Gas Production

Status Construction

Start Date Q2-2012

End Date Q1-2015

Location North Field, Qatar

Project FocusCompiled by Data Media Systems



S18 ORME 5 2014 - Arabic_Layout 1 8/18/2014 1:33 PM Page 74




ABCO Middle East FZE ......................52ALAA Industrial Equipment Factory ..55AlMansoori Specialized ..................79

EngineeringAnsell Healthcare-Middle East..........51Baumer Electric AG ..........................37BGH Edelstahlwerke GmbH ..............43Bredero Shaw Middle East Ltd. ........13Bulk S.r.L. ........................................27Cansco Well Control ........................61CGG Services (SA) UAE ....................19DMG World Media Dubai Ltd............69

(ADIPEC 2014)Emerson Process Management ..........7Exterran............................................15Haagen ............................................44Hi-Force Ltd. ....................................25HOT Engineering GmbH ....................58

Hydratight Ltd ....................................8IFP Training Middle East ..................62International Register of ..................53

Certificated Auditors (IRCA)J. De Jonge Flowsystems B.V. ..........56JESCO (Jubail Energy Services Co) ....29Jotun Paints UAE Ltd (LLC) ..................5Kaeser Kompressoren FZE ................17Magnatech International BV ..............1Marelli Motori SPA ..........................59Metscco Heavy Steel........................31

Industries Co. Ltd.Nexans ............................................21OKI Europe Ltd ................................38Oman Cement Company ..................41R Stahl Middle East FZE....................65Ruth's Chris Steak House ................67

(Fine Dining Ltd)

Saga PCE Pte Ltd. ............................23Schlumberger Oilfield ........................2

Mktg CommsSchlumberger Technical ....................9

Services IncShree Steel Overseas FZCO ..............14Society of Petroleum Engineers........40SSDS ................................................53Starlink Oilfield Supplies & ..............11

Services DMCCSulzer Pumps Middle East ................27Suraj Limited ....................................33T.D. Williamson, Inc. ........................35Technogenia ....................................30The Development Initiative Ltd ........63Tratos Cavi S.p.A. ............................77Van Beest B.V...................................11Westmark BV ..................................39

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