<a href="http://youngpetro.org/2013/03/06/how-is-it-possible-to-produce-oil-from-sand/"><b>How is it possible to produce oil from sand?</b></a> <a href="http://youngpetro.org/2011/10/09/people-engineers-and-spe-members/"><b>People, Engineers and SPE Members</b></a> <a href="http://youngpetro.org/2012/12/19/if-i-were-a-prime-minister/"><b>If I Were a Prime Minister…</b></a> <a href="http://youngpetro.org/2012/12/26/polish-shales-delayed/"><b>Polish shales delayed?</b></a> <a href="http://youngpetro.org/2013/01/11/russia-continues-the-policy-of-states-companies-monopoly/"><b>Russia continues the policy of state companies’ monopoly</b></a>
 

Etrion and Total start solar power plant in Chile

27 September, 2013 News No comments
Etrion and Total start solar power plant in Chile

Yesterday, on 26th of September Total together with Etrion announced starting Salvador Project in Atacama region in Chile.

Both companies, together, are focusing on building a 70 megawatt-peak photovoltaic power plant. 70% interests of this project belong to Etrion, 20% to Total and 10% to Solventus. Total cost of the venture is  $200 million, financed in 30% by Etrion and Total. 70% of the costs will be paid by non-recourse debt from the Overseas Private Investment Corporation (the US Government’s development finance institution) with a 19,5 year tenor.

Furthermore, Salvador Project will be built by SunPower Corporation. This world leader in solar power was founded in 1985 in the USA. It has been in 66% possession by French Total since 2011.

Philippe Boisseau, Member of the Executive Commitee of Total said: “Solar power is a compelling proposition in Chile due to the amount of solar irradiation received every day in the region. Combined with Chile’s high electricity prices, large energy demand and low construction costs, solar can compete with traditional sources of electricity in Chile without government subsidies. As a world leader in the solar industry, we are proud to launch with our partners the largest solar merchant project in the world, and we are pleased to assist Chile in the diversification of its energy mix. We look forward to further developing our solar activities in the country.”

Salvador Project is the second one by Etrion in Chile. The first one rests on building a 8.8 MW solar power plant and providing energy to the iodine mine in Aguas Blancas. The Geneva -based company has also some interests in Italy and is owned in about 25% by Lundin family. The Swedes own also 31% of Lundin Petroleum company.

Total press release about the Salvador Project

Photos: southeasternsolarenergy.co, wikimedia

Why Canada ???

17 September, 2013 News 2 comments
Why Canada ???

A North American country, located in the Northern part of the continent, Canada attracts with its landscape and outstanding nature.  Views are great and beautiful, but potential of this country is even greater.  Recently three Polish companies connected with mining industry showed its interest in this region.

What convince them to aim in such faraway place?  

First signal came from KGHM which made a friendly acquisition of Quadra FNX. The value of the transaction amounted to CAD 2 900 000.00 (i.e. 3 343 720.00 $) Now renamed to KGHM International has become a leading producer of copper and silver. KGHM International Group has a diversified portfolio of assets in low risk countries and a portfolio of projects ensuring the development of the current production base, including 9 mines in: Poland, Canada, the USA, Chile, and 5 projects in the investment stage.

Next step was made by one of the richest people in Poland – Jan Kulczyk. His company Kulczyk Oil Ventures(KOV) bought Winstar Resources also connected with hydrocarbons industry. After acquisition it changed name into SERINUS ENERGY.  For KOV this transaction meant 50% production increase, triple increase of reserves and  13 concession in 5 countries.

Latest news comes from PKN ORLEN S.A., through its subsidiary ORLEN Upstream Sp. z o.o. it made an agreement with TriOil Resources Ltd.,  a Canadian company listed on the TSX Venture Exchange, which will initiate the acquisition of TriOil. PKN ORLEN has agreed with TriOil to acquire 100% of the shares of the company for CAD 2.85 per share, representing total cash consideration of approximately CAD 183 700 000 (i.e. 178 042 000 $) The offer has been accepted by the Board of Directors of TriOil, and will be considered by the shareholders of TriOil at the meeting of shareholders in November 2013.

In our view, TriOil is an optimal acquisition target. If the transaction is successfully completed, we will gain access to producing fields and will diversify our asset portfolio geographically. It also  offers an opportunity for the transfer of know-how from the mature and technologically advanced Canadian market,” Jacek Krawiec, PKN ORLEN’s CEO, said.

The past few years have been a period of intense growth for TriOil. In 2012, its hydrocarbon production increased by 65% year over year. In the first two quarters of 2013, its average daily production doubled over the corresponding period of 2012, reaching approximately 4,000 barrels of oil equivalent. Over the past few years TriOil has taken steps to expand the areas in which it has working interests, with TriOil’s principal operations now spanning some 3 500 square kilometers, including 1 100 square kilometers of hydrocarbon formations from which it produces both oil and natural gas.

This deal is the latest for a Polish company to buy Canadian assets, but obviously it is not the last one.

9,984,670 km sq (3,854,085 sq mi) of land and inland water bodies gives Canada the second place in the world by total area list. According to these  numbers we can imagine how many natural resources this land owns. Canada also dispose one of the biggest variety of minerals on earth (second place, after Russia). What attracts foreigners is not only about hydrocarbons and minerals, but also very rare elements.

What is more, comparing to other natural resources rich regions like Africa or Middle East, Canada  is very stable and safe place to invest. Low risk investments of course requires higher taxes and payments for government, but clear law and many years old steady economy is worth it for sure. Best example is current situation in Syria, investments there are frozen (or worse) because of civil war. Another advantage of buying an existing company is massive certainty that we will actually have a successful mine or well.

In conclusion it is important to mention the great potential of Canadian energy, mining, and exploration industry. In the mean time similar news are forecasted .

 

Sources:

http://www.wnp.pl

http://www.kghm.pl

http://www.orlen.pl

http://www.serinusenergy.com

Photos:

* Smart Home Page

http://www.wallsave.com

Challenges faced by Oil&Gas Industry and their possible solutions

16 September, 2013 News 12 comments
Challenges faced by Oil&Gas Industry and their possible solutions

A number of factors, such as changing geopolitical relationships, the emergence of new competitors, changes in supply and demand dynamics, social and environmental pressures are transforming and reshaping our industry. Among which there is one indisputable fact i.e. Global Demand for energy will continue to increase dramatically, driven in large part by population growth and the strong desire of developing countries to achieve economic prosperity.

Here I have tried to incorporate some of the challenges which are not only critical to our industry, but also to our world.

Health, Safety, Social Responsibility, Environment & Security
Human, environment safety and health protection remains the number one priority for the oil and gas industry. The technique for extracting gas from unconventional reservoirs — hydraulic fracturing— has raised environmental concerns about the water table. So these companies should pay greater attention to HSE issues within broader operations concerns i.e. across the entire span of their activity, from exploration and production, to pipeline management, down to refinery and marketing.

Management and Information
We need collaborative partnerships, alliances, or joint ventures involving oil companies, service companies, governments, and academia, all pooling their knowledge to achieve breakthroughs in the targeted areas in far less time and at lower cost than if everyone goes about it alone. Such collaboration should involve:

  • Integration across upstream, midstream, and downstream
  • Joint investments outside the host country
  • Different commercial terms and risk sharing
  • Greater shared control
  • More technology transfer and development of the local workforce

The People Shortage
One of the main challenges is having sufficient well-trained and capable technical people. However, we can solve this issue by attracting and encouraging more bright young people and “New Majority”—young women and ethnic and minority youth—into the science and engineering disciplines and then into our industry.

The Cost of Services
The other challenge is increased costs for services across the board, from exploration to production and refining of crude to its transportation, including seismic, drilling, deep water horizons and constructions. These are functions of higher commodity prices, which have driven industry activity to a point that exceeds the service industry’s capacity to respond. Capacity is being increased in some areas but larger, more complex, longer-lead-time projects are needed around the world.

Fluctuating Crude Prices
Fluctuation in crude prices has become common due to politics involvement. For example the price went from a high of nearly $150/Barrel in mid-2008 to below $40/Barrel at the beginning of 2009. Slow approval of new capital projects, resultant talent squeeze due to early retirement and acquisition activity were the main reasons for this un-stabilized pricing. So we have to remain operationally effective while maintaining margins within environment.

Economic Uncertainty
Uncertainty in economics is an unknown prospect of gain or loss, whether quantifiable as risk or not and it has a direct impact on employment, income prospects and communication among industries. However, we can overcome it with setting a goal and creating a roadmap detailing how to get there.

Results
Capitalizing on the new interdependencies between senior management information, operational effectiveness, decision-making and the understanding of their impact on profitability can somehow resolve our problems.

The industry is under the influence of global forces such as geopolitical pressures. What supply chain management companies offer their clients facing pressures from geopolitical insecurity is the knowledge, contacts, and skills to adapt.  So Best in class supply chain performance will need to anticipate and react effectively to changes on the global landscape.

References

1. ShermanCpas

2. Google

3. Deloitte

4. IBM

Photos: Pennwell, graph by Mehwish Khanam

Newborn country faces inevitable problems

14 September, 2013 News 1 comment
Newborn country faces inevitable problems

South Sudanese independence dream became real in 2011. All the new countries must face a lot of matters and conflicting interests with their ‘parent’ countries. Especially, if they believe in other religions and differ in race. The situation is even more complicated, if huge money are on the table, money from the oil production and transportation.

The very beginning

Republic of Sudan became independent from British – Egyptian rule in 1956. Since that time the country has been torn by internal conflicts. Along with the Conflict in Darfur (western part of Sudan) which has caused over 200 000 deceases, Sudan has struggled with southern part of the country. The first war started in 1955 and ended in 1972. The second one caused about 2 000 000 casualties from 1983 to 2005, but it ended in a 6 years autonomy followed by an independence referendum in South Sudan. The new country was born on 9th July 2011. It was a natural and inevitable end of the 1956’s action. Two countries vary a lot. Whereas Sudan is in 97% Islamic, South Sudanese society is in 61% Christian and 33% believe in traditional religions. The country consists of many tribal groups and uses more languages than Sudan. Since the independence, South Sudan has been facing many problems, internal and also with its northern neighbor.

Black gold on the border = problem

The border between South Sudan and Sudan is still undefined, both countries use the border from 1956. It crosses exactly two the biggest oil – rich basins: Muglad and Melut. According to BP’s 2013 Statistical Review: South Sudan has 3.5 billion barrels of oil reserves, while Sudan inherited only 1.5 billion barrels of oil in the ground. Both countries also have natural gas reserves linked with oil, but they flare or re-inject it. In 2010, Sudan flared about 11.8 billion cubic feet of natural gas. What makes the situation between these two countries more complicated? South Sudan don’t have its own transportation and processing facilities and is fully dependent on Sudan. South Sudanese oil has just one direction of transportation – through two pipelines to Port Sudan, city at the Red Sea side. Furthermore, according to data from 2011, oil represented 78% of Sudan’s export earnings (now it declined to 32% !) and even 98% of total government revenues for South Sudan. Now it’s clear, why both countries haven’t taken even a one step back in their negotiations!

Unacceptable offer

After the 9th July 2011, Sudan proposed a transit fee of $32 – 36/barrel. They claimed that the price must make up their loss in the oil reserves. For South Sudan that was unacceptable. They offered less than $1 for each barrel of transported oil. The matter was unresolved. In January 2012 South Sudan accused its neighbor of stealing South Sudanese oil. The Northern government representative confirmed this accusations: “Since early December we’ve started taking part of our share after the southern government refused to agree on a deal for a transit fee“. Sudan stole 650 000 bbl of oil, worth $65 million, according to South Sudanese side. Both countries were negotiating in Addis Ababa, Ethiopia under the African Union flag. They couldn’t find a satisfying solution for the both sides, so South Sudan stopped its oil production.

Long awaited turn

After 15 months of shutdown, South Sudan restarted oil production in April 2013. It was a result of the agreement from March 2013 in which both countries accepted $26/bbl for the transport from Heglig to Port Sudan and $24.1/bbl for Petrodar pipeline transport stakes. South Sudan was also obliged to pay $3.028 billion to compensate the Sudanese loss. They agreed to pull back their troops from the border to create a demilitarized zone. It looked that everything was going to be fine, but in May and June Sudanese President Omar al – Bashir threatened South Sudan to stop the oil flow through his pipelines, because of the support of South to the rebellions in Sudan. The situation needed some time to talk and a few visits of the President of South Sudan – Salva Kiir. Fortunately, both presidents buried the hatchet.

Recent news and the future

South Sudan has restarted production from more oil fields recently. Two another fields are scheduled to start in November and December, producing additional 30 000 bbl/day. Daily production by the end of 2013 will be 250 000 bbl/day. In August President Kiir signed also a petroleum bill which makes the South Sudan more attractive to invest. Since the restart of the production in April 2013, South Sudan has earned $1 billion from oil sales. Facing such problems with its neighbor, South Sudan signed memorandum of understanding with Kenya, Ethiopia and Djibouti, for building two new pipelines to Kenyan Port of Lamu and Port of Djibouti through Ethiopia.

Both countries have some serious internal troubles. Sudan faces military conflicts, while its neighbor from south must focus on a civilization improvement – now 135.3/1000 infants die, some areas has just one doctor for 500 000 citizens. In 2011 more than 80% couldn’t read and write. Money from oil production and trade are indispensable for the development of both countries. After months of impasse, they finally speak the same language, seeing biggest issues ahead, but I advise you to keep your eye on this region – I’m sure that from time to time there will be some tensions between the newborn South Sudan and its northern neighbor Sudan.

Sources:

1. EIA report about South Sudan and Sudan

2. bbc.co.uk/news

3. aljazeera.com

4. arabnews.com

Photos: eia.gov, usaid.gov

 

What is the best solution for European energy problems?

14 September, 2013 News No comments
What is the best solution for European energy problems?

This is a significant question, being asked in many countries, offices, companies and even houses through the whole old continent. Civilization and economic growth involves increase of power demand and raises energy cost. If we do not find new solutions to stop the trend, European industry can be ravaged by these adverse conditions. We have to look for new sources of energy and change our approach to be more progressive. One of the biggest chances for European economy is shale gas.

As we know, there are both supporters and opponents of gas and oil extraction from shales. Opponents argue that it is too risky and hydraulic fracturing will have very negative impact on natural environment – they advise us to look for other solutions – nuclear power or renewable sources of energy.

The theme is also one of the most important ones taken by European Parliament. Over a month ago European Union’s Environment Committee endorsed a proposal to impose a mandatory Environmental Impact Assessment for all shale gas drilling activities in the EU. This is in line with the Parliament’s resolution on the environmental impacts of shale gas, voted in November 2012. The Committee is supposed to go on with adapting EU regulatory framework to new conditions and maybe even aggravation of law regulations.

Great Britain and Poland are the most engaged members of the Union fighting for liberalization of the regulations and focusing their efforts on preventing next potential bans and restrictions concerning shales gas exploration and extraction. For these countries this is a way to ensure energy security.

Opponents (mainly France and Bulgaria) line up against exploration works. They suggest to abandon fossil fuel usage and turn into renewable sources like power of wind, water, sun and biomass.

Last days we could hear a significant voice of Antonio Tajani, European industry commissioner. He said that “We face a systematic industrial massacre”. He convinced that we have to stop pretending and struggling for climate goals, which are not realistic and also are not enforced worldwide. European energy is much more expensive than US energy and this is the reason why investors rarely choose the old continent. And, what is very important for all shale gas supporters he said “Personally, I am in favour of shale gas in Europe because we have to do more for industry”. Is it a forerunner of positive changes in the European Parliament? We will see.

A few next years will be decisive – European society will have to choose a direction of the continent’s development. We can say one thing for sure – shale gas, renewable sources, nuclear energy or any other way – Europeans have to unit their efforts to solve energy problems. If not, we all will face further raise of living costs – energy, food etc.

Dear YoungPetro readers, what do you think about this problem? What will be the best solution for European economy – further shale gas exploration, looking for renewable sources or maybe another way of power generation? We are waiting for your opinions!

“Brussels fears European ‘industrial massacre’ sparked by energy costs” | The Telegraph

Photos: http://www.telegraph.co.uk

The Middle East: Employment Future and Challenges

10 September, 2013 Career 4 comments
The Middle East: Employment Future and Challenges

Oil and gas are the world’s most important energy sources. They produce power for our factories and our homes, run our cars, ships, aircraft and railways, and provide us with plastics and other synthetic materials that, in the modern world, we often take for granted.

With demand for oil and gas increasing, and greater care being taken of our natural resources, the oil industry faces a challenging and exciting future – one that is going to test its ingenuity and expertise to the full. The oil industry offers a variety of job opportunities. Many are office based, but some still demand working in difficult conditions.

The oil and gas industry creates widespread impact throughout all sectors of an economy. The economic impact includes direct employment, labor income, and “value add” benefits based on the investments in the sector. These benefits are called multipliers. Indirect impact takes into account the economic activity created through the supply chain serving the oil and gas industry while induced impact is based on household spending. The last element creates additional employment and related economic activity.

In the recent past, Middle Eastern national oil companies (NOCs) have had to compete with other regions of the world for the best available human resources from their partners, the International Oil Companies (IOCs). Until about five years ago, this competition was relatively unsuccessful, as IOCs deployed their best exploration and production talent instead to more technically challenging areas of the world such as the deepwater Gulf of Mexico, Brazil, West Africa, the Caspian and emerging areas of Asia- Pacific. The effect of using this talent elsewhere was that Middle Eastern NOCs were not exposed to the best in class experience in science, engineering and technology that the IOCs had to offer. In the past five years however, things have started to change, as the Middle East re-emerges as a priority investment area for those IOCs attracted by the size, availability and stability of the resources available in the region.

According to Derek Massie, former SVP HR at deepwater drilling company, Seadrill: “Labour supply and demand is not balanced on a global scale. In the Middle East, 86% of workers are imported”.

What can be done to ease the talent shortage in the Middle Eastern energy and utilities sector?

There are a series of measures which, when taken together, can provide solutions for the short-, medium- and longterm. Before an increase in the existing skill base is even contemplated, quick wins can be realized simply by better managing the existing pool of talent within an NOC or NEWC organization or within the industry as a whole. Apart from the benefits which a well thought out and executed organizational redesign can bring, the positive contribution of a professional HR function, fully integrated with the business operating units which it serves, is crucial for developing coherent and proactive talent strategies to enable them to compete in a global resourcing market. A separately identified HR function is relatively unknown to the Middle East, where HR activities are sometimes regarded as part of an overall administrative function, tasked with reactive fire-fighting rather than constructive, preventative action. A professional HR function, empowered by senior management and staffed by well-trained individuals, can address a whole range of issues such as recruitment, training, career progression, remuneration, and retention of an organization’s most valuable assets.

Sponsorship of continuing education, also a key element in staff development and retention, is gradually becoming a core strategy adopted by the NOCs. Last year Saudi Aramco paid for the education of 1,922 graduate and undergraduate Saudi students, including 1,138 in North America, 439 in Europe, and 217 in Saudi Arabia itself. Saudi Aramco also supports a College Preparatory Program that gives Saudi secondary-school graduates the skills they need to succeed in international universities. The company runs the equivalent of community colleges that give thousands of Saudi young people the technical skills they need for employment, and it has other extensive collaborations with Saudi and international higher education institutions. In 2009, Saudi Aramco set up a “university relations” division to manage such partnerships. As far as closing the mid-career skills gap in energy and utilities is concerned, other quick wins can include identifying and fast tracking young employees according to their technical and business development skills, as well as incentivizing the delayed retirement of long-serving employees. In the long term, however, only a sustained program of attracting school students at an early age into science, engineering and technology education and careers, sponsored by the NOCs and IOCs working together, will solve the problem which they helped to create 15 years ago.

References:

1. Deloitte, Midle East Energy and Resources.

2. Energy Zone, Careers in Oil and Gas Industry.

3. Schlumberger, The Gulf Challenges.

EUROPOWER Energy Conference 2013

EUROPOWER Energy Conference 2013

XVIII edycja Konferencji Energetycznej EUROPOWER

20-21 listopada 2013r., Hotel Sheraton, Warszawa

 

Konferencja EUROPOWER to wydarzenie, które od kilkunastu lat skupia w jednym miejscu prezesów, członków zarządów, dyrektorów koncernów oraz grup energetyczno-paliwowych, elektrowni, elektrociepłowni, przedsiębiorstw sieciowych oraz firm świadczących usługi dla podmiotów branży energetycznej.

 

Spotkanie to jest miejscem wymiany wiedzy i doświadczeń ekspertów sektora energetyczno-paliwowego oraz administracji centralnej. Konferencja EUROPOWER jest efektywną platformą dialogu dotyczącego rozwoju rynków na różnych płaszczyznach. Uczestnicy tego wydarzenia mają okazję do rozmowy o najistotniejszych zmianach zachodzących na rynku, analizy nowych trendów oraz wspólnego poszukiwania modeli biznesowych, pozwalających na realizację przyjętych wcześniej strategii.

 

Zakres tematyczny Konferencji współtworzony jest przez Radę Programową, w skład której wchodzą prezesi, dyrektorzy oraz eksperci reprezentujący kluczowe firmy i instytucje sektora paliwowo-energetycznego. Podczas tegorocznej, 18. już edycji Konferencji, Rada Programowa wprowadza nową formułę jej przebiegu. Nowatorstwo to polega na przedstawieniu holistycznego spojrzenia na energetykę i zaprezentowanie jej w kontekście determinujących ją argumentów, jakimi są społeczeństwo i gospodarka.

 

Zagadnieniami, którym poświęcona będzie tegoroczna Konferencja, będą :

  • Efektywny model makroekonomiczny dla polskiej gospodarki energetycznej,
  • Nowoczesny klient na rynku energii i jego oczekiwania pod adresem energetyki,
  • Konkurencja na rynku gazu – możliwości i ograniczenia, prawdopodobne scenariusze rozwoju,
  • Polityka energetyczna – jak realizować jej cele przy posiadanych zasobach i narzędziach?
  • Przejście od gospodarki opartej na tradycyjnych źródłach energii do zielonej energii – główne wyzwania i kierunki rozwoju.

 

Patronat honorowy nad tym wydarzeniem objęli m.in.:

  • Pan Marek Woszczyk – Prezes Urzędu Regulacji Energetyki,
  • Pan Janusz Piechociński – Wicepremier, Minister Gospodarki,
  • Pan Włodzimierz Karpiński – Minister, Ministerstwo Skarbu Państwa.
  • Pan Andrzej Czerwiński – Poseł na Sejm RP, Przewodniczący Parlamentarnego Zespołu ds. Energetyki,
  • Pan Adam Struzik – Marszałek Województwa Mazowieckiego.

 

Szczegółowy Program Konferencji oraz inne informacje, na temat tego wydarzenia znajdą Państwo na stronie internetowej: www.konferencjaeuropower.pl.