Well cement tech enhanced; Crude dents majors’ profits; Arctic ship dodges NGO hold-up
A selection of news from the last fortnight.
Baker Hughes rolls out “revolutionary” cement technology
Oilfield service giant Baker Hughes has announced the roll out of its Integrity eXplorer cement evaluation service, which it says will improve engineers’ ability to measure and manage well integrity.
For the past 30 years, acoustic techniques have been used to evaluate the integrity of cement bonds. Baker Hughes’ new product relies on electromagnetic-acoustic technology to directly assess the state of any kind of cement bond in any wellbore environment.
The service has been developed in response to the increased demands placed on well integrity in the increasingly challenging environments faced by oil and gas companies.
Operators in the upstream sector rely on the accuracy of cement-bond logs to make decisions that can affect long-term well integrity and the environment.
Compared with traditional acoustic based techniques, Integrity eXplorer provides operators with more accurate and comprehensive data about the properties of cement, thereby enabling them to protect their assets, reduce non-productive time, and minimize remediation.
Majors post lower profits, slash spending citing bearish crude outlook
Major US and European oil and gas operators posted lower quarterly profits and slashed spending plans as the stubbornly low oil price further dented performance.
At around $50/barrel, crude oil prices are around half what they were a year ago but despite this some firms fared better than analysts’ predictions. Refining and chemicals businesses propped up results.
“Total reported adjusted net income of $3.1 billion, a decrease of only 2 percent compared to the same period last year, thanks to productivity gains in all the business segments," the French group said in a statement.
Royal Dutch Shell’s quarterly 2015 earnings on a current cost of supplies (CCS) basis were $3.4 billion, compared with $5.1 billion for the same quarter a year ago.
Profit adjusted for one-time items and inventory changes was $3.2 billion, beating the $2.5 billion average of 12 analysts’ predictions compiled by Bloomberg.
The profit of US majors fell sharply. Exxon's profit fell by more than half to $4.2 billion and the largest drop was seen in its exploration and production business, where earnings slumped by nearly $6 billion.
Chevron's profit plunged 90% to $571 million, exacerbated by a $2.22 billion loss in its exploration and production division.
ConocoPhillips said it had made a loss of $179 million compared with a profit of $2.1 billion a year earlier.
Ryan Lance, ConocoPhillips chairman and chief executive, told investors the aim was to cut $1 billion from its cost base over three years, partly by reducing spending on deep water exploration.
The goal was to reach “cash flow neutrality” by 2017 even if the price of Brent crude stays at the $60 a barrel mark, he said in a conference call.
In the longer term, ConocoPhillips has more than 44 billion barrels of identified resource, over half of which has a “very attractive cost of supply”, according to Lance.
“That's almost 30 years of resource at current production rates. So we have the opportunities to invest capital in captured economic programs with little resource risk,” he said.
Several of the major operators predicted low oil prices would remain stubbornly low for some time.
Royal Dutch Shell Ben van Beurden said low oil prices “could last for several years,” as the company announced plans for a further 6,500 job cuts.
Shell hurdles Greenpeace action against Arctic icebreaker
An attempt by environmental group Greenpeace to prevent the icebreaker MSV Fennica from leaving Portland Habour and joining Royal Dutch Shell’s drilling campaign in the Arctic was defeated on July 30.
Activists had tried to blockade the ship by surrounding it with dozens of kayaks, and by dangling 13 protesters from the St Johns Bridge.
However, the oil giant was able to extricate the Fennica with the support of the US Coast Guard, the Portland fire department and the federal legal system.
A district judge in Alaska ruled that the NGO was in civil contempt, and ordered it to pay a fine of $2,500 for every hour that the bridge blockage continued. In May the same judge had granted a request from Shell that protesters be ordered to stay away from the company’s vessels.
The Fennica is part of Shell’s fleet that will drill off the northwest coast of Alaska. It will protect drilling vessels from ice and also carries equipment to control any spills from successful wellbores.
Greenpeace had hoped to detain the ship in Portland for long enough to prevent Shell from carrying out its exploration before winter weather shut down operations. In the end, the ship was delayed for a day and a half.