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May 2017 DEW JOURNAL 1

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2 DEW JOURNAL May 2017

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Chairman Editorial Board andChief EditorArun Kumar Singhal

DirectorShrey Singhal

Editorial AdvisorsSatish Kumar Mathurformer General Manager (E&S), ONGC

Prof (Dr.) Nikolay P. ZapivalovChairman of Novosibirsk Centre ofRussian Academy of Natural Sciencesand Professor of NovosibirskUniversity, Russia

Dr. Himmat SinghHead of Department - PetroleumEngineering, Chandigarh Universityformer Distinguished Professor,Hydrocarbon Engineering, UPES,former Advisor (R&D), Bharat PetroleumCorp. Limited, former Sr. Dy. Director(Scientist “G”), Indian Institute of Petroleum

S K DasFormer Executive Director, ONGC

PublisherArun Kumar SinghalAdvertising ManagerMs. SarojCirculation ManagerPramil KhanduriDesign & GraphicsAbhinav AryaFinance ManagerPramod KumarRegional Coordinator - New DelhiMukesh GuptaRegional Coordinator - MumbaiJ. ChakarbortyRegional Coordinator -South East Asia & ChinaTony Chen W. K.

Annual Subscription Rs. 3000US $ 150 £ 90 (inclusive of Postage).Cover Price US$30 £25 Rs.300For details of how to subscribe toDrilling & Exploration World journal andrates for individuals countries email :[email protected] all payments in favour ofTECHNOLOGY PUBLICATIONS Fordetails of wireline transfer ofpayment, contact the Publisher.

Prepress processing & Printing at Saraswati PressDrilling & Exploration World (DEW) publishedsince 1989 by Technology Publications fromDehradun is an internationally circulatedEnergy and Oil & Gas journal. The journalholds the dist inct ion of being the onlyMONTHLY Energy and Oil & Gas journalpublished from India.

All r ights reserved in respect of al lar t ic les, i l lustrat ions, photography etc.published in Drilling & Exploration World(DEW). Reproductions or imitations areexpressly forbidden without the permissionof the publisher. The opinions expressedby contributors (editorial and advertising)are not necessarily those of the publisher/editor, who can not accept responsibilityfor any errors or omissions.

While every effort is made to ensure thatthe contents published in the journal arecorrect and up-to-date, the Publisher, Editorsand Advisors do not accept any responsibilityfor any error, omissions and factual lyincorrect statements published. This impliesfor both editorial and advertising contents.

Editorial and Advertising Office15/19, Kalidas RoadP.B. No. 271, Dehradun - 248 001(Uttarakhand) [email protected]@dewjournal.comTel./Fax : +91 - 135 - 2740559

CONTENTSISSN-0971-7242 R.N.I. No. 51048/89 © 2017 Technology Publications

Cover Focus

May 2017 - Volume 26 No.07

Expert View

Technology/Technical Papers

28 New fluid mapping-while-drilling serviceSpectraSphere service uniquely enables theunderstanding of reservoir properties while drilling forimproved reservoir characterization, well placementand reduction in overall well construction cost

Special Report

22 Oil will clearly remaina fuel of choice in the

coming decades

Mohammad Sanusi Barkindo,Secretary General, OPEC onthe current oil market conditions”

“

711

Qingdao McDermott Wuchuan delivers first ofkind structures for Yamal LNG project

Provenance, a pioneering global sedimentprovenance solution

New salinity system for increased flowassurance and to maximize production

30

59 First of its kind LNG test bed for marine unveiled

60 Spudding record breakinggeothermal well

63 Relief WellInjection Spool

67 A TOTEX approach in water and waste water infrastructure69 EPINET- ONGC’s E&P Transformer75 Mineral Exploration Industry82

The 19th Asia Oil & Gas Conferenceprovided an opportunity for the energyindustry leaders from across Asia andbeyond to discuss strategic energyissues and the importance of Asia asthe fastest growing region for globalenergy demand

Eyes on Asia32

“Saudi’s are exploring a variety ofpromising collaboration opportunities

across the fast-growing Asia”

4854 The new age oil for wind turbines

Keeping up with the time

Oil transfer a vital aspect


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dewjournal.com Petro-Events CalenderFrom the Editor

In recent years, much has been said about the importance of developing renewableenergy, especially those sources that come with an ‘environmentally friendly’stamp of approval. This need has become even more pressing in the wake of thelandmark Paris Agreement on climate change, reached by world leaders inDecember last year. However, while it is commendable to support ‘green’ sourcesof energy that have the potential to help preserve the planet for future generations,one has to be realistic. The fact is, in the overall energy mix, there is only so muchthat renewables, such as solar, wind power and biofuels, can do to supply theburgeoning levels of efficient, reliable and affordable energy the world requires.That is certainly the case now and one that will see only gradual change in theforeseeable future. All forecasts point to fossil fuels continuing to satisfy the lion’sshare of global energy demand in the years ahead.

Past experience has shown that the energy sector will need to continue toevolve if it is to keep pace with progress and meet future challenges. In fact, suchwill be the level of global demand, that all sources of energy — conventional,unconventional, as well as renewables — will likely be required to adequatelycover growing consumption levels.

The facts are quite profound: by 2040, OPEC predicts global economicgrowth doubling from today’s levels, as the number of people on the planetexpands by 1.7 billion. Significantly for the oil sector, which is transportationdriven, another 1.2bn people will be behind the wheel of an automobile.Commercial vehicles on the road will double, while air travel will soar. And, in thedeveloping countries, massive potential exists for providing access to modernenergy services to billions of people currently without adequate means of heating,cooking and lighting.

Translate all these facts into energy demand and unsurprisingly a 50 percent increase from today’s levels is predicted by 2040. Of course, these are justforecasts, which are always subject to change, but even if just half of what isexpected today becomes a reality, one constant will remain - fossil fuels willcontinue to be of paramount importance to the world’s economic wellbeing.Surely then, their development should be encouraged and nurtured- certainly notheld back.

The international oil market is quite unique among all the commodityexchanges operating in the world today. It is extremely complex and sensitive toall manner of influence, both internal and external, and will clearly requirecontinued vigilance and close monitoring on a daily basis.

As everyone in the industry agrees, fossil fuels will continue to play a leadingrole in global energy supply in the future. This fact makes what the OPEC andnon-OPEC producers are attempting to do in the market right now even moreimperative. Demand for oil and gas will grow considerably in the years ahead soit is vital to have the right conditions in place that support investment in new andexisting capacity, which OPEC calculates will amount to some $10 trillion up to2040 to satisfy burgeoning demand. That requires a market that is stable, predicableand sustainable. The cooperation the industry has been witnessing since the startof the year is the key to the oil market’s future success. It just needs what is beingdone right now to be even bigger and bolder. With everyone pulling in the samedirection and putting unity and cooperation before self-interest, the future willtake care of itself. And with stability restored, everyone stands to benefit.

The oil and gas sector needs to adapt and innovate if it is to survive in amuch-changed operating environment. Despite the challenges, there is optimismthat the industry was in good shape to meet the challenges created by low oil andgas prices, the need to compete with renewable energy, reduce carbon emissionsand cut costs in order to remain relevant is the key. To address these new realitiesthe oil and gas industry is driving new approaches to resource development, costmanagement and technology.

The consolidation of the oil and gas service sector to be more robust andcompetitive and thus responding to the new realities is also an important aspectthat cannot be overlooked.

It is therefore crucial that the conventional sources of petroleum, which haveserved the world well and have proven to be essential for the future welfare of theglobal economy and mankind in general will continue to play centre stage andnot be discriminated against, since there is no realistic alternative for meeting theworld’s energy needs. For the foreseeable future, renewables, however admirable,will only ever be supplementary, at best.

On managing new realities in the oil and gas industry while the mantra isadapt, innovate to thrive the need of the hour is to stay nimble, navigate challenges,and seize opportunities in the evolving energy landscape.

June 21-22, 2017, LISBON, PortugalAEGPL Congress 2017www.aegpl2017.com

June 28-29 AMSTERDEM, The NetherlandsIADC World Drilling Conference & Exhibitionwww.iadc.org/students

July 9-13, 2017, ISTANBUL, TurkeyThe 22nd World Petroleum Congress 2017www.22wpc.com

July 11-13, 2017, KL, MalaysiaThe 16th Oil, Gas and PetrochemicalEngineering Exhibitionwww.oilandgas-asia.com

July 12-14, 2017, JAKARTA, IndonesiaGasIndonesia Summit & Exhibition 2017www.gasindosummit.com

July 18-21, 2017, SINGAPOREWorld Engineers Summitwww.wes-ies.org

August 21-23, JOHANNESBURG, S.AfricaPublic Private Partnership-Financing,Projects and Contractswww.infocusinternational.com/ppp

August 24-25, 2017, NEW DELHI, IndiaPipeline Integrity Management SystemConference Cum Exhibitionwww.energyworld.biz

September 5-7, 2017, ABERDEN, UKSPE Offshore Europewww.offshore-europe.co.uk

Sept 19-21 2017, BANGKOK, ThailandAsia Power Weekwww.asiapowerweek.com

September 27-28, 2017, SINGAPORETank Storage Asiawww.tankstorageasia.com

October 3-5, 2017, MARRAKECHThe 30th World LPG Forum 2017www.worldlpgforum2017.com

October 9-11, 2017, BAHRAIN, UAEMiddle East Process EngineeringConference & Exhibitionwww.mepec.org

October 23-27, 2017, SINGAPORESingapore International Energy Weekwww.siew.sg

November 20-21, 2017, KL, MalaysiaAsia Petroleum Geoscience Conference& Exhibition (APGCE 2017)www.icep.com.my

December 12-14, 2018, BITEC, ThailandFuture Energy Asiawww.futureenergyasia.comAKS


dewjournal.comEvent Preview

The Institution of Engineers, Singapore (IES) hasannounced that the World Engineers Summit –Applied Energy Symposium & Forum: Low CarbonCities & Urban Energy Joint Conference (WES-CUE)2017 will take place from 18 to 21 July at the SuntecConvention & Exhibition Centre, Singapore. Theconference will be a focal point for addressingpressing global issues arising from energy- andcarbon- intensive urban development, with a specialfocus on harnessing engineering innovations tocreate a sustainable, low carbon future.

Rapid urbanisation is elevating energy demandto unprecedented levels. According to the World Bank,cities consume about two-thirds of the world’s energyand account for more than 70% of global greenhousegas emissions. WES-CUE 2017 will bring togethereminent experts, renowned researchers,practit ioners and policy makers to share latestresearch findings and engineering advancementscritical for moving cities towards highly energy-efficient and sustainable practices.

For the first time, the biennial WES series ispartnering with the internationally-reputed AppliedEnergy Symposium and Forum series, to deliverprofound and diverse technical content to multi-disciplinary engineers and scientists; energy, urbanplanning and environmental & water specialists;business leaders; academia and policy makers fromaround the world. The conference technical committeereceived a record 288 technical paper abstracts frommore than 35 countries in response to its call forsubmissions.

“WES-CUE 2017 is designed to bring delegatesto the forefront of scientific research and facilitateexchange of the latest progress in urban energysystems and policy options. This year’s summit willplay a major role in helping engineers, businessleaders, policy makers and other professionalsaccelerate the transformation of cities into low carbonurban systems and move the world towards a cleaner,more energy-efficient and resilient future,” said Prof

Singapore to convene luminary globalenergy leaders to support low carbon future

S.K. Chou, Co-Chair, WES-CUE 2017 Joint Conference.Prof J. Yan, Co-Chair of WES-CUE 2017, added,

“Singapore offers an excellent meeting point for thechosen theme of the joint conference. Applied EnergySymposium & Forum: Low Carbon Cities & UrbanEnergy (CUE) is a platform under the Applied Energynetwork that focuses on urban energy systemscovering topics such as energy supply, distributionand end use; smart eco-cities; urban transportationwith ef f ic ient energy use and low emissions;microgrid and smart homes; BIPV and renewableenergy applications; urban waste to energy; nexus ofenergy-water; and policy options.”

WES-CUE 2017 will address a range of criticalissues with focus on six key topics: Transport,Building, Industry, Environment, Power Generation &Energy Storage and Urban Planning.

Four sustainability thought leaders will kick off theconference as keynote speakers: Ms Jean Venables,Vice President of the World Federation of EngineeringOrganisations (WFEO) and Chair of Committee onEngineering & Environment (CEE); Prof. Lui PaoChuen, Advisor, Strategic Planning Division, MinistryOf National Development, Singapore; Dr Liu Thai Ker,Senior Director, RSP Architects Planners & Engineers,Singapore; and Dr Richard E. Rocheleau, Director,Hawaii Natural Energy Institute, University of Hawaii.

Pre-event workshop wi l l be on Float ingStructures by IStructE to keep delegates abreast ofthe latest developments, research and challengesand potential future applications in using seaspacefor industry, housing and recreational development

WiSER Forum will focus on empowering andpromoting women leadership in the engineeringindustry and professional fields

ASHRAE Distinguished Lectures Seminar willfocus on the integrated design, installation andoperation of Heating, Ventilation and Air-Conditioning(HVAC) system and Building Automation System (BAS)to achieve thermal comfort and indoor air quality inhigh performing buildings. dewjournal.com


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Investing in low emissions coalplants in Southeast Asia is one ofthe most efficient strategies forreducing greenhouse gasemissions in the region, accordingto a new report by the ASEAN Centrefor Energy (ACE) and the WorldCoal Association (WCA).

The report, ASEAN’s EnergyEquation - the role of low emissioncoal in driving a sustainable energyfuture, is a comprehensive cost-benefit analysis of climate andenergy policies, and sustainabledevelopment opportunit ies thatcleaner coal technologies provideto a region that is looking to coal tofuel its growing economy.

Cl imate f inance for lowemissions coal would reduceemissions equivalent to 1.3 billion

ASEAN can accelerate achievementof Paris Agreement goals

News

tonnes in the next 20 years, areduction equivalent to annualemissions from China, the UnitedStates and the EU - the top threeCO2 emitters- combined.

This act ion is expected toaccelerate the achievement ofglobal climate objectives withoutsacrificing economic and socialdevelopment needs in the region.

WCA Chief Execut ive,Benjamin Sporton said, “ I t isimportant to inject realism into thedebate on how to reduceemissions across Asia. There isno question that cleaner coal is thelowest cost opt ion among al lavailable low-carbon technologiesin ASEAN- a region that is rapidlyurbanising and industr ial is ing.Coal is forecast to be an essential

part of ASEAN’s economic growth.This reality means that it is onlylogical that the rapidlyindustr ia l is ing and urbanisingeconomies of Asia that arechoosing to use coal do so with thelowest emissions technologies.”

“According to the 4th ASEANEnergy Outlook, ASEAN’s energydemand is expected to grow by 2.7times in the next two decades, andcoal cont inues to be a majorcontributor in our energy mix (ACE,2016),” notes ACE Execut iveDirector, Dr. Sanjayan Velautham.“With about 100 mill ion peoplewithout electricity, the delivery ofaf fordable, rel iable andsustainable electricity is crucial toASEAN’s predicted economicgrowth. That’s why, we at ACEbelieve that viable modern coaltechnologies are essent ial inensuring that coal is used in asustainable way that will balanceboth the economic needs andclimate commitments.”

The ACE is anintergovernmental organisationwithin the ASEAN structure thatindependently represents the 10ASEAN Member States’ (AMS)interests in the energy sector.

The World Coal Association isthe only body acting internationallyon behalf of coal, with a mission todemonstrate and gain acceptancefor the fundamental role coal playsin achieving a sustainable, lowercarbon energy future.

The WCA provides a voice forcoal in internat ional energy,environment and developmentforums, and presents the case forcoal to key decision-makers.

• ASEAN requires 800 terawatt hours (TWh) of electricity generationbetween 2020 and 2035

• If ASEAN shifts its coal capacity to a modern fleet (mainly supercriticaltechnology) by 2035, the region would reduce cumulative emissionsby 1.3 billion tonnes- equivalent to the annual emissions from China,United States and the EU (top three CO2 contributors) combined.

• Shift means that new power stations in ASEAN could be CCS ready too.• Investment to ensure an efficient coal fleet in Southeast Asia is vital

for global climate ambitions.

Left to right: Mr. Benjamin, Chief Executive, WCA, Mr. Christopher G. Zamora, Manager ofASEAN Plan of ACE, Mr. Alihudin Sitompul, Indonesian Alternate Senior Officials on EnergyLeader, Director for Electricity Program Development, Directorate General of Electricity, MEMR

K E Y F I N D I N G S

Transition tolow

emissionscoal is oneof the most

efficientstrategies

for reducinggreenhousegas in the

region


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McDermott International, Inc. hasannounced that its joint ventureQMW recently delivered the lastbatch of 247 structures for the Yamalliquefied natural gas (LNG) project,an LNG plant being built northeastof the Yamal Peninsula in Russia.

With a total weight ofapproximately 2,400 tons, the 247bolt-connected st ick-bui l tstructures were completed aheadof schedule in less than fourmonths under i ts f inal workpackage. The scope of workincluded engineering,procurement, fabr icat ion andpacking. The structures are smallpipe racks, platforms, sleepers andsupports instal led betweenprocess modules to support hook-up pipes, cable trays, etc.

Construction of the structuresbegan in September 2016 at theQMW fabrication facility in Qingdao,China, and marked the first-timebolted-connected structures werebuilt instead of the usual weldedconnection structures. Thestructures were fabricated in QMW’smega-module assembly shop,which features four giant bays thatallows all fabrication and assemblyto be done inside which increasessafety, quality and productivity.

“We great ly appreciatedQMW’s excellent performance onthis project in terms of safety, qualityand on-time delivery,” said KenKasai, Site Manager of Yamgaz, ajoint-venture composed of TechnipFMC, JGC and Chiyoda, who aredesigning and constructing theLNG plant.

“QMW has now completed twomajor work packages for Yamgaz,

Qingdao McDermott Wuchuan delivers firstof kind structures for Yamal LNG project

First-time construction of bolt-connected stick builtstructures demonstrates precision capabilities

including the recently completedstick-built structures as well asfractionation process modulesfabricated and delivered in 2016,ahead of schedule without a singleLost Time Incident and through aninnovative sub-modules constructionmethodology,” said Leong EngChow, General Manager, QMW. “Wecontinues to gain recognition foroutstanding quality, health, safety andenvironmental performance on thisproject further demonstrating QMW’sinternational competitiveness,reputation and quality performancein the module fabrication market.”

Located at Sabetta, the YamalLNG plant is the f i rst LNGdevelopment venture in the Arcticwith a planned total capacity of 16.5million tons of LNG per year, and isone of the largest LNG projects inthe world.

QMW is a joint venture between

McDermott and state-owned CSICand offers integrated Engineering,Procurement and Commissioningsolut ions for the Float ingProduction Storage and Offloading(“FPSO”) market and fabricationcapabil it ies through a 111-acrefabricat ion yard located in theHuangdao Distr ict in Qingdao(Shandong Province), China.

McDermott is a leadingprovider of integrated engineering,procurement, construct ion andinstallation (EPCI) services forupstream f ield developmentsworldwide. The Company deliversf ixed and f loat ing product ionfacil it ies, pipelines and subseasystems from concept tocommissioning for complexOffshore and Subsea oil and gasprojects to help oi l companiessafely produce and transporthydrocarbons.

News


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Stress Engineering Services, Inc.,the global leader in consult ingengineering services, has beenawarded the Offshore TechnologyConference (OTC) Spotlight onNew Technology Award for i tsRealt ime Fat igue Monitor ingSystem (RFMS).

The Spot l ight on NewTechnology Awards—a program forOTC exhibitors—showcases thelatest and most advanced hardwareand software technologies that areleading the industry into the future.

Winning technologies areselected based on the followingfour criteria:• New and Innovative: less than

two years old; or iginal andgroundbreaking

• Proven: through ful l -scale

Realtime Fatigue Monitoring System

appl icat ion or successfulprototype testing

• Broad Interest: broad appeal forthe industry

• Signi f icant Impact: providessigni f icant benef i ts beyondexisting technologies

The RFMS was developed toprovide f ield measurements of

stress and fatigue on drilling risers,wel lheads and other subseasystems in near real-t ime. TheRFMS significantly improves riserintegrity management by usingmeasured data and advancedalgorithms at strategic locations toreconstruct stress and fat iguedamage along the entire riser. Itintegrates this approach into a fullyautomated, real-time environment.

“We are proud to receive thisaward in recognition of our RFMStool, which empowers dr i l l ingengineers to make informeddecisions in adverseenvironments, leading to increasedsafety and efficiency of drilling andproduction operations for the life ofthe system,” said Chuck Miller, VicePresident of Stress Engineering.

News

Wärtsilä has signed a Memorandum ofUnderstanding (MoU) with the Frenchmultinational energy company ENGIE,to develop solutions and services within the smallscale LNG business sector.

The cooperation covers four work streams: LNGfor ships, LNG distribution in islands and remoteareas, LNG to Power solutions, and small scale LNGand bio liquefaction. Both Wärtsilä and ENGIE arecommitted to working for a low-carbon economy, andshifting the focus towards LNG-solutions is seen asbeing an important step in this direction.

Through this partnership, the two companies willshare Wärtsilä's technical expertise and Engineering,Procurement and Construction (EPC) capabilities,along with ENGIE's technical expert ise, andexperience in natural gas distr ibut ion andcommercialization. Operation and maintenanceservices will also be offered.

"ENGIE has taken key positions in the small scaleLNG market. This agreement with Wärtsilä will helpdevelop innovative small scale LNG solutions withquicker implementat ion t ime and enhanced

Wärtsilä - ENGIE to develop small scale LNG marketscompetit iveness," says Jean-MarcLeroy, ENGIE's MD Gas Chain.

"We are excited to be working withENGIE and developing together more sustainableenergy solutions for our customers and society as awhole. This cooperation is an important step towardsWärtsilä's goal of growing our presence in the smallto medium scale LNG terminal business," saysAlexandre Eykerman, Vice President for LNGSolutions at Wärtsilä.

Wärtsilä is currently the EPC contractor for anonshore small scale LNG terminal in Finland, and hassuccessfully delivered several small scale powerbarges and a biogas liquefaction plant. ENGIE is oneof the pioneers in the development of small scale LNGmarkets and innovative solutions. This includes smallliquefaction plants, LNG truck loading, LNG bunkering,LNG fuelling stations, LNG for power applications, andsupplying LNG to remote customers.

This MoU is a strong incentive to co-developtechnical solutions that would enable both Wärtsiläand ENGIE to expand their smal l scale LNGbusinesses.


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dewjournal.com News

Using the combined expertise fromits acquisitions of Dresser-Rand andRolls-Royce Energy business, Siemens launchesthe latest evolution of its gas turbine portfolio – theSGT-A35 RB. The unit addresses the need for morecost-effective solutions for the offshore oil and gasindustry by increasing the power density of thetopside power generating equipment, thus reducingthe required space claim. The l ightweight,aeroderivative gas turbine can generate up to 38megawatts (MW) and is integrated into a compact,lightweight Dresser-Rand package, which is up to

Aeroderivative gas turbine for oil and gas industry30 percent smaller and lighter thanIndustrial RB211 predecessors.

This combination produces a compelling solutionfor the chal lenging requirements of of fshoreapplications, like floating production, storage andoffloading (FPSO) vessels. FPSO vessels havebecome increasingly popular as oi l and gasproduction moves towards deep-sea regions andharsher offshore environments to capture strandedreserves. With higher output and power density thancomparable products, the SGT-A35 RB turbine offersseveral cost-effective solutions for this and other

challenging offshore applications.The SGT-A35 RB gas turbine,

previously known as the Industrial RB211-GT30, is based on the proven pedigree ofthe Industrial RB211 and Industrial Trent60 gas turbines, built with Rolls-RoyceAero Engine technology. This trustedlegacy, evolved over 40 years oftechnological advancements, has morethan 800 instal lat ions worldwideexceeding 37 million operating hours. TheSGT-A35 RB var iant introduces alightweight free-power turbine derivedfrom Rolls-Royce aerospace and marineTrent, as well as Siemens Industrial Trent60. All rotating components are proven bymillions of hours accumulated in flight, aswell as industrial and marine service.

The SGT-A35 RB gas turbine isavailable in 34 and 38 MW variants to matcha range of application requirements. Bothratings are available for mechanical driveand 60 Hertz or 50 Hertz electr icalgeneration. In this configuration, the gasturbine can directly drive a 2-pole A/Cgenerator without the need for a gearbox.The thermal efficiency of the gas turbineexceeds 40 percent at ISO conditions. Theperformance is ideal for hot climates andat 30 °C, the gas turbine retains more than90 percent of its ISO power output.

The Dresser-Rand package usesfit-for-purpose packaging features andconfigurable options proven across oil

Offshore package: The SGT-A35 RB offshore package for floating production, storageand offloading (FPSO) applications.

New gas turbine for oil and gas industry: The rendering shows the lightweight architectureof the SGT-A35 RB gas turbine for offshore applications like floating production,storage and offloading (FPSO) applications.


dewjournal.comNews

Up to 30% smallerfootprint and lighter

solution foroffshore

applications

Highest powerdensity in this

class of turbines

and gas applications.I ts modular designfaci l i tates easymaintenance andreduces downtime tomaximize avai labi l i tyand reduce cl ients’operating expenditures.The package has alsobeen designed toquickly exchange thecomplete gas turbineand power turbine. Overthe years, the Dresser-Rand business hassuppl ied more than1,000 aeroderivat ivegas turbine packages tothe oil and gas industry.

“With the highestpower density in thisclass we help offshoreoperators with asignificant challenge,”said Judy Marks, headof New EquipmentSolut ions for theD r e s s e r - R a n dbusiness. “With gasturbines used as primemovers in of fshoreinstal lat ions, projectdevelopers cansimultaneously reducecapital investment andincrease product ioncapacity to achievedesired returns.”

Provenance, a pioneering globalsediment provenance solution

CGG GeoConsulting has announced the launch of Provenance, a ground-breakingintegrated global sediment provenance database, tool and knowledge base.Explorers can use the database to help make meaningful interpretations on clasticreservoir distribution and quality.

Provenance is an industry-first, global database bringing together public-domainand CGG multi-client sediment provenance data catalogues, to give explorers aquality-controlled dataset at the touch of a button. An integrated platform allowsteams to interpret the data in minutes, supported by insights from sedimentprovenance experts and leading authorities in the international scientific community.

Provenance helps geoscience teams optimize their use of sedimentprovenance data in their exploration workflows. It is designed to reduce leadtimes for in-house specialists edimentologists and put the data, tools, andunderstanding in the hands of every member of the geoscience team in order toimprove exploration outputs.

Mark Weber, Senior Vice President, CGG GeoConsulting, said: “CGG iscommitted to helping clients more fully understand the reservoir, and sedimentprovenance data has an important contribution to make in this effort. OurProvenance solution will help exploration teams to better understand the distributionand quality of clastic reservoirs and reduce exploration risk.”

Sediment provenance data comes in all scales, from whole rock compositions to individual grain analyses.CGG GeoConsulting brings these datasets and tools together under one integrated platform called Provenance(image courtesy of CGG GeoConsulting).

CGG GeoConsulting has launched Provenance, a pioneering globalsediment provenance solution, part of Robertson Data & Analytics.

A ground-breaking integrated global sediment Provenance anindustry-first database help make meaningful interpretations onclastic reservoir distribution and quality at the touch of a button


dewjournal.com News

Scientific and technologicaldevelopments are a key toany nat ion’s success.India is one of the top-ranking countries in thefield of basic research.Indian science hasprogressed to becomeone of the most powerfulinstruments of knowledge. Yet inthe wake of new demands ofeconomic growth, it is necessaryto embark on translating scienceand technology intodevelopmental needs in al lsectors such as infrastructure,agriculture, health, communicationand educat ion. The dispari tybetween haves and have-nots,urban and rural areas andexclusion or marginalization ofcertain groups can give rise tosocial unrest. It is crucial that moretechnological innovat ions aregeared towards eliminating thesedisparities and differences. In ourendeavour for global excellence,not even a single citizen should beleft. ‘Technology for sustainableand inclusive growth’ is the needof the hour. And it is where all -

DIT University goes beyond engineering!

innovators, technocrats,entrepreneurs and policymakers -have an important role to play. Theyhave to make sure that science andtechnology do not remain confinedto a select few sectors only.Progress and growth of the countrywi l l be sustainable only i fdevelopment for al l is theoverarching goal. For that, we haveto make sure that all strata of thesociety enjoy the benef i ts oftechnological innovat ion andscientific advancements equally.

India is a land of rich diversity,with outstanding talent hidden awayeven in the remotest areas andminutest villages. Such potentialshould be discovered and nurtured.It is essential that we continue tomove forward in this direction anduse technology to create stable

employment opportunities,encourage entrepreneur-ship, and build growthmodels that allow for theinclusion of women and thedisadvantaged.

Against thisbackground, Indiacelebrated the National

Technology Day on May 11, 2017.Technology Day commemoratesIndia’s success in using scienceand technology to address thechallenges facing the country. On 11May 1998, the Pokhran test wasconducted. The then Prime Ministerof India Mr.Atal Bihari Vajpayeedeclared India a full-fledged nuclearstate after operation ‘Shakti’ and itmade India the 6th country to jointhe Nuclear Club. Since 1998, Indiacelebrates May 11 every year as theNational Technology Day.

One of India’s premieruniversity imparting education inareas of Science, Engineering,Technology and Management, theDIT University celebrated for the firsttime the National Technology Day tospread importance of science andawareness about latest

L to R: Mr. Avinash Chandra, Mr. Arun Kr.Singhal and Prof.Y.K.Tyagi

Online science quiz competition cumcomputer/digital technology awareness/familiarization session for school students aspart of National Technology Day 2017 at DITU


dewjournal.comNews

Reliance commences commercialproduction of CBM in Sohagpur

Reliance Industries Limited (RIL) commenced commercial production fromits Coal Bed Methane (CBM) block SP(West)–CBM–2001/1 from 24th March2017 and is currently supplying CBM for commissioning the Shahdol PhulpurPipeline (SHPPL). The production from RIL’s Sohagpur CBM fields willgradually ramp-up in the next 15-18 months making RIL among the largestunconventional natural gas producers in India.

CBM is an environmental friendly natural gas extracted from coal-bed andhas become an important source of unconventional gas.

RIL was awarded the licence to explore two adjacent CBM blocks SP(West)and SP(East) with an area of 995 sq.km in the Round 1 of CBM block biddingby the Government of India in 2001. RIL has drilled more than 200 wellsconnected to two Gas Gathering Stations in the first phase of development. RILexpects to drill 600-800 wells further and develop associated infrastructureover the next phases of development.

Reliance Gas Pipelines Limited (RGPL) a wholly owned subsidiary of RIL,laid a 302 km Shahdol Phulpur Gas Pipeline that connects Sohagpur CBMfields from Shahdol to Hazira-Vijaipur-Jagdishpur (HBJ) pipeline Network ofGAIL at Phulpur. With this new pipeline network these CBM Gas fields are nowconnected with the Indian Gas Grid.

CGG has announced the completion of state-of-the-artreservoir-oriented seismic processing and imaging for its

Fort Trinidad 3D multi-client surveyin Houston County, East Texas. The dataisnow available for license.

Fort Trinidad is the 104-square-mile eastward continuation of CGG’sRock Ridge East and Bedias Creek Merge surveys. All three have beenacquiredand processedto a high specification, using a workflow specifically developedfor unconventional plays, to provide superior-quality seismic data forcharacterizat ion of Cretaceousreservoirs in the Eaglebine, Budaand Georgetown formations.

Luc Schlumberger, EVP, Multi-Client & New Ventures, CGG, said:“Fort Trinidad extends our EastTexas l ibrary of technologicallyadvanced multi-client 3D surveys.This library has been processedwith the latest imaging techniquesto i l luminate the stacked payformations of the Buda-GeorgetownLime play whi le giving greaterinsight into fracture density.”

State-of-the-art reservoir-orientedseismic processing and imaging

The map shows location of CGG's Fort Trinidad, RockRidge East and Bedias Creek Merge multi-client surveysin East Texas

technological developmentsamong students of middleand senior schools. Theprogramme provided acommon platform for thestudents, academicians,researchers and industryexperts to share theirknowledge abouttechnological developmentson every sphere of life. Theuniversity also showcased tothe students of the visitingschools the various researchcarried out by them.

Mr. Avinash Chandra,Executive Director, ONGCAcademy and Mr. ArunKr.Singhal, Chief Editor,DEW Journal addressedthe occasion as invi tedguests.

DIT Universi ty alsoorganised an onl inescience quiz competit ioncum computer/digi taltechnology awarenesssession on the occasion forthe visiting students of theinvited schools.

The event presidedover by Prof. (Dr) SSwaminathan, Pro ViceChancellor and Prof. (Dr)D.N.Saraf, Professor ofEminence, DIT University.The function was convenedby Dr. Y.K.Tyagi, Professor,Mechanical EngineeringDepartment. The Head ofDepartment of PetroleumEngineering Dr.Rajat Jainalong with seniorprofessors of di f ferentengineering disciplines ofthe Universi ty alsoparticipated in the day longfunction.


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The ABB remote service center willprovide 24x7 access to informationand support on drives installed atcustomer facilities for predictivemaintenance and condit ionmonitor ing for al l industr iesincluding power, cement, oil andgas, metals, food & beverage andmany other applications. The newcenter is the third of its kind in theABB global footprint and is now fullyactivated in India. It will supportcustomer installations in India andaround the world.

In India, 31% oftotal electrical energy isconsumed by industrialmotors. Drives controlthe speed of thesemotors and hence are akey component ofenabl ing energyefficiency and improvingproductivity. Benefits ofsuch a remote centerinclude fasteridentification of potentialproblems leading toincreased upt ime ofcustomer assets andult imately savings inoperational costs.

“This is areinforcement of ourcommitment to ournation and customers byestabl ishing a world-class center using ourexpert ise in digi tal lyenabled technology,”said Sanjeev Sharma,CEO & MD, ABB India.“We are also pleased tooffer the benefits of ourdigital portfolio to ourcustomers in India and

ABB India expands footprintpartner them in the next level of theirjourney to develop a range of futureservices that will allow customerassets to become digital ready.” Onthe new digitally enabled drives, headded, “we are committed toinnovating in country for country tomake our global technologyaccessible by developing features thatadapt to India's diversity for examplein the device interface, this in turnallows us to tap into thegeographically dispersed workforce.”

The new production l ine

manufactures digitally enabled lowvoltage drives (ACS560 and ACS580series). The drive information in thecloud can be accessed securelywith daily devices like smartphones.Drives are an environmentallyfr iendly option to use energyefficiently while running motorsbased on their current load insteadof running them on ful l speedcontinuously. These drives providemult iple energy optimizationfeatures, are easily commissionedvia smartphone, and include

features for uninterruptedoperations during powerfluctuations.

“ACS560 has beendeveloped in India forIndian customers,having user interface inHindi and energycalculator in IndianRupees. The new drivehas application macrosfor industries l ikeplastic, textile water andpharma, and uniqueicon based display forquick commissioningfulfilling the requests ofIndian customers”,” saidMorten Wierod,Managing Director ofABB’s global Drivesbusiness unit.

ABB recent lylaunched ABB Abi l i tyglobally with an industryleading portfolio of 180digi tal solut ions andservices. ABB AbilityTMCondition Monitoring forDrives is one of thesolutions. According tovarious reports, due to

ABB India expands footprint with a globalservice center for energy saving drives with

remote digital services and new production line

ABB India: New production line for digitally enabled low voltage drives withcloud and smart phone access and local language device interface

ABB Global Remote Service Center for digitally enabled drives with ABBAbilityTM Condition Monitoring solution


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ION Geophysical Corporation has announced thatScottish Enterprise (SE) will provide a grant of £522,984

over 15 months to support the Company’s £1.5 million software developmentprogram, which aims to revolutionize offshore operations management. TheSE support will create one job and protect twelve jobs in Scotland, and enablethe timely release of technology that will benefit the industry. Today, offshoreoperations are often managed manually and can be especially complexaround busy, congested oil and gas installations. These workflows andoperations can greatly benefit from proactive use of intelligent, automatedsoftware such as ION’s Marlin solution.

The announcement came ahead of the OTC next week in Texas, wherethe company will host a stand in the Scottish Pavilion to promote Marlin.

ION’s Marlin project is to be undertaken by a wholly owned subsidiary,Concept Systems Ltd. (CSL), an Edinburgh-based software provider developingreal-time navigation and data management solutions for the seismic industry.

CSL will develop an innovative marine management system thatcombines temporal project planning with 3D spatial situational awarenessacross diverse activities to support increased operational efficiency, saferoperations and reduced expenditure across oil and gas marine supportoperations. The Marlin project expands CSL’s market from the seismic sectorinto a broader range of exploration and production operations and potentiallyalso beyond the oil and gas sector.

Marlin technology currently exists in a form that can be delivered via aservice model. This new project will transform the Marlin solution into ascalable software product that will deliver value across a wide range of oiland gas activities, from use in a single project to an enterprise-wide solutionfor all assets in a company’s portfolio. Development of Marlin is aligned withE&P companies’ operational need for efficiency, safety and performance.

Christopher Usher, EVP & COO, ION’s E&P Operations Optimization group,said, “We have demonstrated the value that Marlin can deliver to E&P operationsvia our service model. This process has allowed us to deliver value to ourclients on a project basis, but has also helped us identify the need for andrequirements of an enterprise software solution to optimize operationalplanning and execution. The support and funding provided by ScottishEnterprise has been essential to help us develop our solution for this market.”

Lena Wilson, Chief Executive of Scottish Enterprise, said, “ION is afantastic example of a U.S. company recognising the benefits of Scotland’stop talent and effective business environment. We are very pleased to havebeen able to support the company to get to this stage and wish them everysuccess in achieving their future ambitions.”

ION is a leading provider of technology-driven solutions to the global oil& gas industry. ION’s offerings are designed to help companies reduce riskand optimize assets throughout the E&P lifecycle.

ION accelerates developmentof transformational software to

optimize offshore operations

News

ABB India inauguratedtwo new facilities

today thatsupports the nation'sdigital transformation,

energy savingtechnology and rise inindustrial productivity

In Bengaluru, ABBlaunched India’s first

digitalized remoteservice center for itsenergy saving drives

solutions and added anew production

line for digitalized lowvoltage drives

various energy eff iciencymeasures, India now has10GW less load on the gridduring peak hours in the lastfinancial year. The two keymeasures for dr iv ingefficiency have been perform,achieve, trade scheme (PAT)to encourage usage ofeff ic iency measures onshop-f loors and the nowglobally acknowledged Ujalascheme of LED lighting.

ABB is a pioneeringtechnology leader inelectr i f icat ion products,robot ics and motion,industrial automation andpower gr ids, servingcustomers in ut i l i t ies,industry and transport &infrastructure global ly.Continuing more than a 125-year history of innovation,ABB today is wri t ing thefuture of industr ia ldigitalization and driving theEnergy and Fourth IndustrialRevolutions.


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Experts ponder on technologies for future energy

A two-day Symposium on “Shapingthe Energy Future: Challenges &Opportunities (SEFCO-2017)” washeld at CSIR-Indian Institute ofPetroleum (CSIR-I IP) whichfocussed on Alternate Energy &Fuels, Catalysis for Energy &Environment, ProcessIntensification & Engineering andTechnologies for Future Energy.The symposium had two plenarylectures and nine invited lectures.The series of lectures was a perfectblending of research and successstories from various stake holders.The range of discussion was vaststarting from future energy materialto bio and conventional energy andalso process intensification forbetter results.

The Symposium wasinaugurated by Dr Pushpito K

Ghosh, Distinguished Professor,ICT, Mumbai. Prof. Ghosh spokeabout the relevance of the topic ofthe symposium and laid emphasison reduct ion of CO2 fromenvironment.

The Guest of Honour Prof BViswanathan, IIT, Madras said thatas a scientist we have to look for thefuture technology and base ourresearch as per needs of the country.

Dr. Anjan Ray, Director, IIPshared success stories of variousCSIR labs under energy cluster.

Dr. Soumendra Banerjee,Honeywell Technology Solutionsdescribed the details of Iso-Alkylprocess using ionic liquids.

Mr. Puneet Kishore talked of theinitiatives taken by ONGC EnergyCentre towards alternative energy.Mr. Sangeet Jain, Director, Lanza

Tech made a presentat ion oninnovative way of carbon recycling.Mr. G. D. Gupta from Indian RailwayOrganization for Alternative Fuelshared the var ious act iv i t iesinitiated by Indian Railway.

Mr. A.K. Jain, Senior Scientist,CSIR-IIP said that the country isdeficient in energy so we have todevelop new methodologies,technologies to increase it. He alsotalked about IIP’s research in wastemanagement and fuels from wasteplastic etc.

The symposium wasenvisioned on the globalphenomenon of the energy sectorpassing through a challengingphase amidst growingconsumption, str ingentenvironment regulations, need ofincreased production within thesame infrastructure and reductionin carbon emissions. SEFCO-2017provided a forum for exchange ofinformation, knowledge, experienceand networking opportunities in thefield of energy efficiency, energyconversion and technologies andalternate fuels for upgradingsources of energy for futuregenerations in this perspective.

The poster session had 30different ti les presented by theresearches in the relevant andcontemporary topics.

Academicians, Scientists,Engineers, GovernmentOrganizations, Researchers fromEnergy Sector and Pioneers suchas CSIR-NCL Pune, IIT Bombay, IITMadras, CURAJ Rajasthan, CSIR-NEIST Assam, IIT Delhi, IndianOilR&D Centre, Rajiv Gandhi Instituteof Petroleum Technology, ONGC,Honeywell and LanzaTech attendedthe Symposium.

Dr Pushpito K Ghosh (center) along with Prof B Viswanathan (second from right) and Mr. A.K.Jain (second from left)

Dr. Anjan Ray, Director, CSIR-Indian Institute of Petroleum (CSIR-IIP)


dewjournal.comNews

The President of India, Mr. Pranab Mukherjeeawarded prestigious National Award 2017 institutedby Technology Development Board (TDB) to CSIR IIPfor successful commercialization of indigenoustechnology for Wax Production at NumaligarhRefinery Limited (NRL), Assam, on the occasion ofnineteenth Nat ional Technology Day funct ionorganized by the Ministry of Science and Technologyat Vigyan Bhawan, New Delhi

The ‘Wax De-oiling Technology’ for NRL WaxPlant was developed by Indian Institute of Petroleum(IIP), Dehradun. IIP is one the CSIR labs involved inthe R&D in the area of petroleum refining andpetrochemicals. IIP has developed ‘Wax De-oilingTechnology’ to produce ‘Paraff in Wax’ and‘Microcrystalline Wax (MCW)’ from two waxy petroleumstreams namely MVGO & HVGO. Engineers IndiaLimited (EIL) provided engineering inputs in thistechnology development.

Numaligarh Refinery Limited (NRL), a subsidiaryof Bharat Petroleum situated in North-East part ofIndia has set-up a grass root ‘Wax De-oiling Plant’with the investment of Rs. 676crores. This is the 1st wax plantset-up by any petroleum refineryin the country based onindigenously developedtechnology with the largestinvestment. The ‘Wax De-oilingTechnology’ was offered to NRLthrough a joint bid by CSIR-IIPand EIL and the bid succeededagainst stiff competition withInternational Process Licensers

CSIR - IIP bagsTechnology Development

Board National AwardCSIR - IIP bags Technology Development BoardNational Award for Successful Commercializationof Indigenous Technology for Wax Production

at Numaligarh Refinery Limited, Assam

based on lower cost and process benefits.The salient feature of this technology which sets

it apart from other foreign competitors is low capitalcost and low energy intensive process becausefurnace has been eliminated from the solvent recoverysection through application of advanced engineeringtool such as ‘Pinch Analysis’. There are many societalbenefits of setting-up of this wax plant. The paraffinwax and microcrystalline wax are valuable productsand has wide range of applications in many industriessuch as tyres, rubber, candles, adhesives, corrugatedboard, cosmetics, casting etc. This will definitelyencourage small scale entrepreneurs to use waxesas raw material. Setting-up of ancillary medium andsmall sized plants will also create avenues forgenerating large scale indirect employment inneighboring areas to the local people in North-Eastregion of India thereby improving their quality of life.

Successful commercialization of CSIR IIP-EIL-NRL Wax De-oiling technology at NRL has openedup market for providing know-how for any other newunit that may come up in the country. The CSIR IIP-

EIL-NRL Wax Technology alsoopens up opportuni ty forexport of this indigenoustechnology, as a commercialreference of this technology isavailable now.

Production of paraffin waxusing indigenously developedSolvent De-oiling technology isa great success under the ‘Makein India’ program propelled byGovernment of India.

Dr. Manoj Srivastava, Principal Scientist, Indian Institute of Petroleum (IIP)(extreme right) recieving award from President of India.

After starting the wax production, NRLhas captured the wax market in Nepal,Bangaladesh, Thailand and Kenya.Also the refinery’s profitability hasincreased by Rs. 77.0 crores perannum which is equivalent to increasein gross refinery margins by US $ 0.53per barrel. The key benefit to the nationis it cut down the wax import by 50%which will save the foreign exchangeof the order of Rs. 300 crore/annum.


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Honeywell has announced the BWClip4, a new four-gas, portablemonitor that once turned on canoperate continuously for two yearswithout the need to change sensorsor charge batteries, helpingcustomers boost safety complianceand reduce maintenance costs.

Ideal for oi l and gas,wastewater, heavy manufacturing,conf ined space and otherapplications, BW Clip4significantlyreduces maintenance costsassociated with fleets of portablegas detectors by eliminating repairwork and the need to stockadditional sensors and spare units.Because it’s always on, the BWClip4 helps drive safety complianceby assuring that workers wearingthe device are protected.

“The BW Clip4operates on a fit

BW Clip4- “Fit and Forget” four-gas, portable monitor

Infrared sensing technologyfor portable monitor leads to

longer operating life,reduced maintenance andfleet-management costs

and forget cycle—simply turn it ononce and replace the detector twoyears later when the unit promptsyou to do so,” said Ken Schmidt,VP/General manager for HoneywellIndustrial Safety. “It offers a wholenew combination of benefits inmulti-gas detection that haven’tbeen possible until now: two yearsof battery runt ime without re-charging or changing batteries,small size and ease-of-use, thefunctionality of a multi-gas detector,and improved safety compliance.”

Using non-dispersive infrared(NDIR) technology, previouslyavailable only in fixed-gas detectorsfrom Honeywell Analytics, the BWClip4consumes 1,000-times lessbattery power than a catalytic bead(pellistor) sensor, the traditionaltechnology used to detectf lammable gases in a portabledevice. Other features include:• Simultaneous monitoring of H2S,

CO, O2 and combustibles (LEL);• Real-time display for instant gas

readings even in non-alarmconditions, along with current gasconcentration level and changes

in atmospheric conditions;• Simplifies fleet management by

generat ing record andcompliance reports automatically(using Honeywel l Intel l idoxinstrument managementsystem); and

• Internal test function alerts userswhen the product should bereplaced.

Honeywel l Safety andProduct iv i ty Solut ions (SPS)provides products, software andconnected solutions that improveproductivity, workplace safety andasset performance for ourcustomers across the globe. Wedeliver on this promise throughindustry-leading mobile devices,software, cloud technology andautomation solutions, the broadestrange of personal protect iveequipment and gas detect iontechnology, and custom-engineered sensors, switches andcontrols. We also manufacture andsell a broad portfolio of footwearfor work, play and outdoor activities,including XtraTuf and Muck Bootbrand footwear.


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Experts discuss Global Gas/LNG Markets,Pricing, Contracts and Legal issues

The 4th Workshop on Global Gas /LNG Markets, Pricing, Contracts &Legal Issues was organised byResonance Energy on April 27-28,2017 in New Delhi. DEW Journalwas media partner to the event. Theworkshop was organised inthe context of the recentdevelopments in the globalLNG markets wherein therehave been considerablechanges taking place in theglobal LNG markets - anincrease in short-term tradingof LNG, buyer contractualflexibility and FOB contractswhich have led to almost 30%of LNG being traded underspot and short-term contracts,with trading done byaggregators playing a far moresignificant role. The basic aimwas to bring together thestakeholders on one platformto create a knowledge forumfor deliberating the trends inthe global and Indian gas/LNGmarkets and strategicpreparedness needed tomeet the challenges of thechanging and dynamicenvironment.

The workshop formatenabled detailed presentationand discussion on a particulartopic so the participants get anin-depth understanding of thesubject. The workshopsessions were handled byeminent speakers sharingtheir knowledge andexperience with theparticipants. The key themesof the Workshop included:• Global Gas / LNG markets

and Trends: Shifting Patterns• Gas / LNG Pricing Methodologies• Gas / LNG Price Trends and

Setting a “New Normal” level• LNG contracts – understanding

the contract structures and

trends and legal review• Contractual and legal issues –

International Experience andIndian perspective

• Gas / LNG Sourcing – Indianstakeholders’ Forum - New

News

Inaugural Session: L to R: Dr. Basudev Mohanty, Member PNGRB; S. Ravishankar, Director, ResonanceEnergy; Dr. BS Negi, Former Member, PNGRB; Mr. Rajeev Chandok, Director Finance, Natural FertilisersLimited; Mr. Pankaj Wadhwa, Sr. Vice President Finance, Petronet LNG Ltd.

THE KEY AREAS DISCUSSED• Global Gas/Liquefied Natural Gas markets and Trends: Shifting Patterns• Gas/Liquefied Natural Gas (LNG) Pricing Methodologies• Gas/Liquefied Natural Gas Price Trends and Setting a “New Normal” level• Understanding the LNG contract structures, trends and legal review• Contractual and legal issues – International Experience and Indian

perspective• Gas / LNG Sourcing – Indian stakeholders’ Forum - New strategy of LNG

end users coming together and enhancing bargaining power.

Mr. Anil Joshi, Sr. VP, GSPC LNG addressing the audience.


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strategy of LNG end userscoming together and enhancingbargaining power.

The workshop received a goodresponse from the industry. Therewas a total participation of 40 seniorinvitees and delegates including 8speakers, representing 15companies. The gathering waswelcomed by Mr S.Ravishankar,Director, Resonance Energy. TheInaugural key notes were deliveredby Dr Mohanty, Member, PNGRB, MrRajiv Chandok, Director -Finance,NFL and Mr Pankaj Wadhwa, Sr VP,Petronet LNG Limited. The key notespeakers spoke on the regulatoryperspective, consumer perspectiveand supplier perspective, which setthe tone for the business sessionsof the workshop. Dr. B.S.Negi,Managing Director, ResonanceEnergy elaborated on the the variousbusiness, policy and legal issuesfacing the industry and how theprogramme has been structured tocover all the key aspects of LNGmarket Dynamics which will be ofimmense value to the participants.

The sessions were wel lstructured and practically orienteddelving deep into each of the topicsand elicited lot of interest andquest ions. Some of the keyhighl ights of the business

sessions are detailed below.The f i rst session had the

theme - Global Gas / LNG marketsand Trends: Shifting Patterns -Thesession was del ivered by MrS.Ravishankar, Director,Resonance Energy and Mr PankajWadhwa, Sr Vice President,Petronet LNG Ltd. The speakershighlighted the major trends in theGlobal Oil, Gas and LNG marketsand how the LNG industry has nowembarked on a period of furtherchange, with over 200 MMTPA ofnew LNG export capacity underconstruction or under approvalprocess, at a t ime when theexpected rapid LNG demandgrowth in Asia appears to beslowing. The absorption of this newsupply will affect, not only trade-f low patterns, but also pr ic ingdynamics, competition with othergas supply channels andpotentially other fuels. Key to thischange is US LNG, with buyersbecoming more selective aboutwhat they want and what terms theyare ready to accept. The currenttrends in Indian LNG market wasalso discussed during the session.

The session on “Gas / LNGPricing Methodologies”, waspresented by Mr S.Ravishankar,tracing the history of Gas / LNG

pricing worldwide, the indexationmethodologies in various marketsl ike US, Europe and Asia, Oi lIndexation and its history and alsohow the price and business cycleshave undergone various changesover the years. I t was alsohighl ighted that the currentdownward trend in oil and LNGprices has been continuing forabout 3 years since 2014 in thecontext of the emergence of shaleoil and gas from the US and themarket is caught in a continuedspell od downward trends.

The pricing session wasfollowed by a presentation on “Gas/LNG Price Trends and Setting a“New Normal” level” by Mr RajeevMathur, MD, Mahanagar Gas Ltd.The session coverage wascomprehensive taking thepart icipants through the latesttrends in the global LNG marketsand the “New Normal” that is seenin recent times in terms of pricing,contracts and portfolio. The speakeralso highlighted the fact that the newLNG suppliers are facing high costsand are reluctant to abandon abusiness model in which they haveconfidence but new supplies fromUS is changing the complexion. Oilindexation is under further attackwith US LNG selling at HH indexed

pricing formula and now thesellers and buyers are forcedto adopt different pricingpolicies and secure moreflexibility in the LNG contracts.The trends in price indexation,contract durations and buyerportfolios in recent years werealso discussed. New trendslike gas and hybrid indexation,contracts with f lexibleprovisions like price reopenerand destination flexibility havecome to stay.Mr. Rajeev Mathur, MD, Mahanagar Gas Ltd. addressing the audience


dewjournal.comNews

After detailed discussion onmarkets and prices during first day,the workshop focussed onContracts and Legal issues onsecond day. Mr Sumanto Basu,Legal Expert, covered the basics ofGas and LNG contracts withdetailed analysis of contractualprovisions, t radi t ional and UScontracts, portfolio contracts and

Mr Sumanto Basu, Legal Expert, covered the basics of Gas and LNGcontracts with detailed analysis of contractual provisions, traditional

and US contracts, portfolio contracts and the changing trends incontracts in terms of negotiation of flexibilities. The session also

covered legal issues associated with administering contracts and hownegotiation and defining the various key provisions upfront is so important

the changing trends in contracts interms of negotiation of flexibilities.The session also covered legalissues associated withadministering contracts and hownegot iat ion and def ining thevarious key provisions upfront is soimportant. Dr B.S. Negi presentedvarious case studies in the Gas /LNG contracts and also discussed

interesting aspects of India’s Qatarand Iran negotiations of the past.

This was fol lowed bydiscussion on “India’s SourcingOptions” which was deliberated byDr BS. Negi. The discussion alsorevolved around var ioustechnologies like LNG by Road andLNG as a transport fuel, which hasimmense future potential.

Schlumberger has announced that Petro leosMexicanos (Pemex) has signed an agreement tolicense data from the WesternGeco Campechewide-azimuth (WAZ) multiclient seismic survey inthe Salina del Istmo province of the southern Gulfof Mexico. The agreement a lso inc ludescollaboration with WesternGeco in the seismicprocessing phase of the project as well as for futuretechnology collaborations.

This multiclient contract is the first of its kindfor Pemex in Mexico and provides access to new3D WAZ seismic data in theprovince. The data licensecovers deep and shallowwater areas in the basinclose to prolific geologicalt rends wi th wel l -established hydrocarbonsystems inc luding theCantarell and Ku-Maloob-Zaap reservoirs.

Jose Antonio Escalera,Vice President , Pemex,said: “Participating in thismulticlient survey offers acost-efficient opportunityfor Pemex to access new

Acquisition of high-quality broadband WAZseismic data reveals exploration potential The contract is the first

of its kind for Pemexin Mexico and

provides access tonew 3D WAZ seismicdata in the province

Acquisition of high-quality broadband WAZ seismic data over 71,000km2 of Campeche reveals exploration potential.

seismic data l ibraries forthis strategic area.”

Maurice Nessim,President, WesternGeco,Schlumberger, added: “We have invested significantlyin new seismic reimaging and 3D acquisition projectsin Mexico since CNH issued the first explorationpermits for geophysical companies in 2015. We lookforward to collaborating with Pemex in the seismicprocessing phase to deliver enhanced subsaltimaging in this geologically complex area.”

Schlumberger is theworld's leading provider oftechnology for reservoircharacterization, dril l ing,production, and processingto the oil and gas industry.Schlumberger supplies theindustry 's mostcomprehensive range ofproducts and services, fromexplorat ion throughproduction, and integratedpore-to-pipeline solutionsthat optimize hydrocarbonrecovery to deliver reservoirperformance.


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I will share OPEC’s views on the current oil marketconditions. In this regard, I feel that it is important

to initially take stock as to the current state of the oilmarket.

This includes a brief overview of the historicdecisions taken by OPEC and non-OPEC last year,what has happened to the market since the decisionswere agreed, where we are today in terms of therebalancing process, and perhaps the tr ickiestquestion of all: what is potentially ahead of us?

In the second half of last year, OPEC embarkedon the most extensive consultations among OPECMember Countries and between OPEC and non-OPEC producing nations, as well as with consumersand the broader international community about thestrategic urgency of restoring sustainable oil marketstability in a collective manner.

These extensive consultations, both formal andinformal, across various global capitals, were

The current oil market conditions

Mohammad Sanusi BarkindoSecretary General, OPEC

Oil will clearlyremain a fuel of

choice in thecoming decades

Expert View


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price fell by an extraordinary 80%. It isthe largest percentage fall in the sixepisodes of sharp price declines wehave observed over the past fourdecades.

It also led to thousands uponthousands of jobs being lost, manyprojects cancel led or deferred,investments frozen or discontinued,with a dramatic contract ion ininvestments in both 2015 and 2016,and many companies seeing greatfinancial and operational stresses.

It was clear to everyone we spoke to that the oilindustry could not continue along this path. Moreover,it was not only impacting short-term developments,but the medium- and long-term outlooks too, giventhe fact that the world will need more oil in thedecades ahead. The bleeding had to be stopped.

At this juncture, al low me to recal l theatmosphere at this Summit back on 21 April 2016. Inconversat ions with col leagues that were inattendance I heard expressions of bearish sentiment,a sense of foreboding about the industry’s near-termfuture, and little talk of industry expansion and

investment. The prevalent feeling wasgloomy and downbeat.

There was also no cleardirection, despite the efforts made atthe Doha-1 meeting in February 2016,between Qatar, Saudi Arabia,Venezuela and Russia, and the Doha-2 meeting in April 2016, with around20 OPEC and non-OPEC producerspresent, as to how the industry mightovercome the downturn that hadbegun in mid-2014, and in turn,rebalance supply and demand.Producers, both OPEC and non-OPEC,

Encouraging is the rise in energy investments in2017, which are expected to increase by 7%, withnumbers in the US of around $20 billion seen for

the first quarter of 2017. This is a significantimprovement over last year, when the recurrent

investment buzz words were ‘cut backs’ and ‘freezes’

unparalleled in the history of OPEC.There was a consensus that

stability on a sustainable basis hadeluded the industry since the summerof 2014, to the detriment of all industrystakeholders.

It is easy to appreciate why therewas a consensus. The effects of theprice crash that began in mid-2014were unprecedented.

Between June 2014 and January2016 the OPEC Reference Basket

Expert View


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had lost their compass and direction!Total OECD commercial oil stocks in April 2016

were around 350 mb above the five-year average, andexpectations were for them to continue to rise. Theyreached 380 mb in July 2016. WTI and Brent combinednet-long positions were at 620,000 contracts in mid-April, with a pessimistic market outlook among tradersfor the coming months. WTI and Brent combined net-long positions fell to below 400,000 contracts by mid-August. And the average ICE Brent price in the first fourmonths of 2016 was around $30/b, compared to anaverage so far in 2017 of $52/b.

I th ink i t is important to appreciate whatfundamentals might look l ike today without thedecisions taken last year being effectively put intoaction. The market would no doubt look very different- more unstable, more volatile, and with far lessoptimism, with continued negative impacts on allstakeholders.

The extensive consultations that began in August2016 were undertaken with commitment, greatdiligence and rare courage that facilitated flexibility,accommodation and compromise among the

respective part ies. Theseeventually led to the landmarkdecisions taken at the 170th(Extraordinary) Meeting of theOPEC Conference in Algiers,on September 28, 2016, the171st Ministerial Conferencein Vienna on November 30,2016, and the Declaration ofCooperation between OPECand non-OPEC producers inVienna on December 10,2016.

The decisions meant that for the first time in thehistory of the industry, 13 OPEC nations and 11 non-OPEC participating countries came together asstrategic stakeholders, to help rescue and stabilizethe global oil industry – one that has been vital to thedevelopment of modern civilization.

The voluntary production adjustments of the 24producing nations were focused on the urgent needto stimulate the acceleration of the drawdown of thestock overhang, bring the market rebalancing forwardand ensure that much needed confidence andinvestments return to the industry.

Following these landmark decisions, it wasevident that market optimism began to improve.

OPEC’s watershed decision in Algiers to agreeon a production ceiling of 32.5 to 33 mb/d, the firstproduction adjustment since the ‘Oran Decision’ of2008, saw an immediate return of positive sentiment,albeit with some cautious optimism. There was a risein net long-positions and a narrowing of the contango.

The timely decision in Algiers on 28 September2016, in the spirit of collectiveness and flexibility, withthree Member Countries accorded special

circumstances, also extendedthe hand of unity to non-OPECproducers to broaden theglobal platform of voluntaryproduction adjustments. Itwas vintage OPEC at work!

Market opt imismadvanced again fol lowingOPEC’s decision onNovember 30. This can beobserved by the fact that WTIand Brent combined net-longposit ions increased from

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close to 500,000 contractson November 29, 2016, to763,000 on January 3, 2017.

This sentiment furtherimproved in the early part of2017, particularly following thehigh level of conformity to thevoluntary productionadjustments seen in January.For this month, OPEC andnon-OPEC nations achieved aconformity level of 86%, whichcertainly seemed to surprisethe market to the upside. WTI and Brent combined net-long positions reach 921,000 contracts on February 21,an additional rise of 21% from January 3.

It was a period of lower volatility, and more stabilityin oil prices.

However, despite the expectation of improvedlevels of conformity in February, which proved to betrue, with overall conformity at 94%, we saw a turn inmarket sentiment in early March, with financial playerssignificantly reducing their net-long positions.

It is important to stress that this development wasnot totally unexpected. The first quarter of every yearhas a number of seasonal trends that can soften themarket.

The first quarter is a period when significant levelsor refinery throughput in the US is often shut-in. InJanuary and February this year, 1 mb/d of throughputwas shut down for maintenance. For these two months,this equates to approximately 60 million barrels.

On top of this, in previous months we have alsoseen rising production from a number of non-OPECnations, particularly in the US from tight oil, reflectingexpectations for much greater quantities to comefrom non-OPEC in 2017.

For example, in theJanuary 2017 OPEC MonthlyOil Market Report, non-OPECsupply was anticipated togrow by 120,000 b/d in 2017.In the April report, this numberhad r isen to 580,000 b/d,driven mainly by expectationsfor rising growth in the US, aswell as in Canada and Brazil.

In the US alone,expectations for 2017 were

While it is evident the market rebalancing is nowmoving forward, and some investments -

specifically short-cycle - are returning, it isessential we do not take our eye off our desired

goals. We need to see the global stock overhangmove closer to its five-year average. We need tosee the return of more long-cycle investments,the industry’s baseload. And we need to ensure

sustainable stability in the years and decades ahead

for a decline of 150,000 b/d back in the November2016 report, while in the April report it is now estimatedto grow by 540,000 b/d.

In addition, it is important to remember that thefourth quarter of 2016 was a period of significantlyrising supplies that were working their way throughthe market in the early part of 2017. Non-OPECincreased its production by around 1.8 mb/d fromSeptember to November 2016, and over the sameperiod, OPEC increased its production by about500,000 b/d. This huge increase of 2.3 mb/d needsto be set against a global demand increase of just200,000 b/d in the fourth quarter of 2016, comparedto the third quarter.

However, in recent weeks we have seen positivesentiment return, driven by expectations for furtherimprovement in OPEC and non-OPEC conformity,which ended up at 98% in March, and signs that themarket rebalancing is taking place.

Total OECD commercial oil stocks in March fellby 23 mb, the second consecutive monthly drop. Thetotal level is 275 mb above the latest five-year average,compared to 314 mb in February, and 356 mb in the

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same month in 2016.It should be noted that across the first quarter of

2017, stocks built by 26 mb, which is much less thanthe seasonal average of 36 mb, even though refinerymaintenance globally was much heavier. It is evidentthat the global inventory overhang of crude and oilproducts onshore is declining.

Outside of the US, we believe the global trend ofdestocking is broadly on track. Moreover, we are alsoseeing numbers from industry stating that crude infloating storage has fallen by over 40 mb since thebeginning of the year.

The US has evidently not been reflective of therest of the world, given rising production there in thefirst quarter of 2017, but even here the market hasnow witnessed three consecutive weekly crude stockdraws as refinery utilization has risen.

The improving sentiment was seen in a rise inWTI and Brent combined net-long positions, whichreached over 751,000 contracts on April 18, from670,000 on April 4.

Another encouraging sign is the rise in energyinvestments in 2017, which are expected to increase

by 7%, with numbers in theUS of around $20 billion seenfor the first quarter of 2017.This is a signi f icantimprovement over last year,when the recurrentinvestment buzz words were‘cut backs’ and ‘freezes’.

These are all signs of arenewed sense of positivemomentum and improvingstabi l i ty in the global oi lmarket.

We need to appreciate that the market rebalancingwas never going to occur in a linear fashion. Thereare too many factors at play.

Nonetheless, we are heading in the r ightdirection. Slowly, steadily, but surely we are seeinglight at the end of the tunnel.

Looking ahead, the general expectations fordemand growth for crude and oil products in thecoming months remain bul l ish, supported byanticipated firm economic performance across theworld, as highlighted in the latest IMF World EconomicOutlook, and the expected increase in demand forgasoline over the driving season, mainly in NorthAmerica and Asia.

Additionally, the return of refineries from seasonalmaintenance, together with the high conformityobserved in the OPEC and non-OPEC voluntaryproduction adjustments, should enhance marketstability and reduce volatility.

For OPEC, the focus remains on conformity,which is being analyzed and monitored through a JointMinisterial Monitoring Committee, the JMMC, and asupporting Joint Technical Committee, the JTC. These

are vital for the transparencyrequired to implement thesedecisions in a full and timelymanner, on the coreprinciples of equity andfairness.

We remain confident thatall 24 participating countriesremain steadfast inhonouring theircommitments to individuallyachieve the 100 per cent level.This is our firm goal.

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The importance of fasttracking the rebalancingprocess, and returningmarket stability, is also vitalto the medium- to long-termoi l , and the necessaryinvestments required for theworld’s growing oi l andenergy future.

In the tenth edition of ourWorld Oil Outlook, launchedlast November, oil demand isexpected to reach over 109million barrels of oil a day by 2040, an increase ofover 16 million barrels a day from 2015 levels. Thisdemand growth is driven by developing countries andan expanding transportation sector, with more thanone-third of the total increase expected in the roadtransportation sector, as well as significant growth inpetrochemicals.

Moreover, as both OPEC and the InternationalEnergy Agency agree, there are no expectations foran oil demand peak in the foreseeable future. Oil willclearly remain a fuel of choice in the coming decades.

This expansion in demand will obviously requiresigni f icant investments in new barrels and toaccommodate for decline rates from existing fields.Overall, we see oil-related investment requirementsof around $10 trillion over the period to 2040.

The industry needs t imely, adequate andsustainable investment to guarantee security ofsupply to the global community.

Finally, I would like to respond to one of thepertinent questions posed by the organisers of thisconference, and one that is perhaps apt to end on:What lessons have we learned from the 2014-2016price collapse?

Although the jury is still out, we do feel it isappropriate to provide some pointers.

The consequences of the decision of oi lproducers to abdicate their traditional responsibilities– related to stability and balance – to the vagaries ofthe market back in November 2014 have been evidentfor all to see. There is once again widespreadrecognition that on occasions the market needs tobe complemented, in the interests of al lstakeholders. And this is not only confined to oil.

The market saw the largest percentage price fallin the six episodes of sharp price declines we have

observed over the past four decades. The depth anddurat ion of the supply-side led downturn wasalarming, and so were the impacts for al lstakeholders.

OPEC producers are anticipated to foregorevenue losses of more than $1 trillion, the industryhas seen a sharp two-year contraction in upstreaminvestments of more than $450 bill ion, in manyconsuming countr ies i t has led to deflat ionarypressures, and as the IMF has highlighted, the globaleconomy overall has seen no net positive benefit.

The magnitude of these effects has seen growingcalls from both producers and consumers to bringforward the market rebalancing, return stability to themarket, and ensure the necessary industryinvestments take place, in a timely fashion.

The broad global platform of 24 producingnations from OPEC and non-OPEC initiated throughthe ‘Declaration of Cooperation’ is unparalleled inthe history of the oil industry. Given the nature of thedownturn, a collective and concerted effort wasrequired. No-one could have acted alone.

Looking ahead, as the ‘Declarat ion ofCooperation’ underlines, it is vital that we evolve aframework of permanent and sustained cooperationbetween all participating nations, given the industry’sgrowing complexity and its inter-connected nature.

And f inal ly, while i t is evident the marketrebalancing is now moving forward, and someinvestments – specifically short-cycle – are returning,it is essential we do not take our eye off our desiredgoals. We need to see the global stock overhang movecloser to its five-year average. We need to see thereturn of more long-cycle investments, the industry’sbaseload. And we need to ensure sustainable stabilityin the years and decades ahead. dewjournal.com

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Schlumberger haslaunched the new

SpectraSphere* f lu idmapp ing-wh i le -d r i l l i ngservice.

The service is theindustry’s first to deliverdownhole f lu idcomposit ion dur ingdri l l ing with real- t imepressure measurements-while-drilling. Applicablein a var iety ofenvironments, f romexploration wells to highlydeviated developmentwel ls, SpectraSpherelowers risks associatedwith f luid analysis andsampl ing operat ionswhi le enhancing wel l

By takingaccuratepressure

measurementsand analyzing

fluids whiledrilling, the

SpectraSphereservice enables

real-timedecisions thathelp improvegeosteering

outcomes, guidewells to the ideal

trajectory, andaccess more

reserves

New fluid mapping-while-drilling service

Drilling


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* Mark of Schlumberger

SpectraSphereservice uniquely

enables theunderstanding of

reservoirproperties while

drilling forimprovedreservoir

characterization,well placementand reduction in

overall wellconstruction cost

placement, maximizing reservoir contact andultimately boosting future production.

“Understanding the parameters of thereservoir in real time is critical for all ourcustomers dur ing al l stages of f ie lddevelopment,” said Richard Brown, president,Drilling & Measurements, Schlumberger. “TheSpectraSphere service enables customers toobtain laboratory-quality fluid analysis whiledrilling, which reduces the overall cost ofoperat ions and r isks associated withconventional fluid analysis.”

The SpectraSphere service is theindustry’s only service to enable real-timefluid mapping by providing cr i t ical f luidproperties, including fluid composition, fluidtyping, fluid fractions and gas/oil ratio whiledrilling. The reliable characterization of thesepropert ies is essent ial for est imat ingreserves, optimizing completions, designingsurface facilities and meeting productiongoals.

The service has been field tested in theGulf of Mexico, Middle East, Africa, the NorthSea and offshore Malaysia. While developinga field offshore Malaysia, a customer usedthe new service to acquire formation fluidsamples and pressure measurements in ahighly deviated wellbore that intersectedpressure-depleted zones with increased riskof differential sticking. The customer obtainedal l f lu id samples and pressuremeasurements in one run, with fluid samplesshowing less than 1% contamination. Thecustomer completed sampling in two hoursper station and eliminated the need to conductfurther formation testing in two additionalwells, saving three operating days.

Schlumberger is the world's leadingprovider of technology for reservoircharacterization, drill ing, production, andprocessing to the oi l and gas industry.Schlumberger supplies the industry's mostcomprehensive range of products andservices, from exploration through production,and integrated pore-to-pipeline solutions thatoptimize hydrocarbon recovery to deliverreservoir performance.

Drilling

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dewjournal.com

New salinity system for increased flowassurance and to maximize production

Production


dewjournal.com

Emerson AutomationSolut ions has

launched the Roxar SalinityMeasurement System for thesensitive, accurate and real-time measurement of saline waterin gas production well streams.

Through the new system,operators can instantly identifychanges in the flow stream and thesmallest amounts of saline water

at never previously achieved levelsof sensitivity. This enables theoperator to take immediateremedial action to prevent threatsto production, such as scaling,hydrate formation and corrosion.The onset of formation water andits salinity, if not controlled, canlead to well shutdowns and costproducers millions in unplannedshutdown time.

The system, which is a keyelement of the Roxar SubseaWetgas Meter and is based onmicrowave (MW) resonancetechnology, provides quantitativeand qualitative real-time salinitymeasurements in many types offield conditions but, particularly, inthe high gas volume fraction (GVF)/wet gas flows that characterize wetgas fields.

“With oil & gas wells beingproduced over a broader range ofprocess condit ions and watersalinity and conductivity a keyoperational parameter for reservoirmanagement and flow assurance,the t iming for our new sal initysystem couldn’t be better,” saidPatrick Babka, Vice President andGeneral Manager Roxar atEmerson Automation Solutions.“Our new system wi l l providecrucial decision-makinginformation for the operator inident i fy ing product ion threats;developing effect ive scale,corrosion and hydrate preventionstrategies and improving chemicalcontrol; and maximizing oil & gasproduct ion and the f ie ld’seconomics.”

The Roxar Sal ini ty

Measurement System has beendesigned as part of the RoxarSubsea Wetgas Meter, whichprovides individual flow rates ofgas, condensate/oil and water. Thesalinity system consists of a salinitysensor mounted flush with the wallof the meter. The MW resonancetechnology ensures an instantresponse to changes toconductivity of the flow stream - inseconds not minutes - and theability to measure water conductivitydown to ± 0.1 S/m and up to 99.99%GVF and sensitivity in the range of± 0,004 S/m. Small pockets offormation water leaking into theflow can therefore be detectedinstantaneously rather than inhours and days - something thatno other technology has achievedto date.

Emerson conducted extensivetesting of the new system internallyand at the Colorado ExperienceEngineering Station (CEESI) in theUnited States based on a leadingoperator’s specifications. In allcases, the system was found tohave the high levels of accuracyand sensitivity required.

Emerson is a globaltechnology and engineeringcompany providing innovat ivesolut ions for customers inindustr ia l , commercial , andresidential markets. The EmersonAutomation Solutions businesshelps process, hybrid, and discretemanufacturers maximizeproduct ion, protect personneland the environment whi leopt imizing their energy andoperating costs.

“Our new system willprovide crucial

decision-makinginformation for the

operator in identifyingproduction threats;

developing effectivescale, corrosion andhydrate prevention

strategies andimproving chemical

control; andmaximizing oil & gasproduction and thefield’s economics”

- Patrick BabkaVice President and

General Manager Roxar,Emerson Automation

Solutions

Through the new system, operators can instantlyidentify changes in the flow stream, take remedial

action and maximize oil & gas production

dewjournal.com

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A high level congregation of global industry captains, oil andgas players, government officials, thought leaders, operators,

service providers, advisory, research firms and academia formedpart of the 19th Asia Oil & Gas Conference (AOGC 2017) in KualaLumpur, Malaysia from May 7-9,2017 that addressed new realitiesconfronting the oil and gas industry driving a new approach. Theexperts provided insights on the state of the oil and gas industrythat has gone through structural changes leading to a paradigmshift which unfolds a new era and reality.

While AOGC 2017 explored fresh opportunities in the presentchallenging periods with the theme ‘New Realities-Driving a NewApproach’. The event saw industry players come up with innovativeideas with the passion to propel the industry in line with the changingtimes.

Against the down-turn witnessed by the industry over the pastover two years as a result of geopolitical events and economicvolatility, AOGC 2017 came at a critical juncture for the industry whereoil and gas players pondered on existing paradigms and movebeyond tried and tested conventions.

Organised by Petrol iam Nasional Berhad (PETRONAS)Malaysia’s fully integrated oil and gas multinational, AOGC a biennialevent is renowned as a meeting ground for gauging the nextindustry’s moves, as well as for forging meaningful businessconnections. The high level networking opportunities with regionalindustry captains and the strategic insights from global industryplayers through a rich conference programme are unparalleled inevery edition of the meet.

The 2017 edition of the AOGC was supported besides the hostPETRONAS by Sapura Energy Berhad, Saudi Aramco, Shell,

Eyeson Asia

By DEW Correspondent

“Saudicontinues to

explore a varietyof promisingcollaborationopportunities

across the fast-growing Asia”

Mr. Khalid A. Al-Falih, Saudi Arabian Ministerof Energy, Industry and Mineral Resources

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‘Asia poised to play apivotal role in influencingthe world’s energy future’Mitsubishi Corporat ion, Mubadala Petroleum, Murphy Oi l ,TechnipFMC and Weststar Aviation Services, among others. DEWJournal was once again nominated Media Supporter to AOGC 2017by the organizers.

Reiterating Saudi commitment to play a bigger role in satisfyingAsia’s expanding energy needs; the special guest at AOGC 2017,Mr. Khalid Al-Falih, Saudi Arabia’s Minister of Energy, Industry &Mineral Resources defined Asian economies as strategicallyimportant to the global oil and gas market due to robust growthscenario. For the last 30 years, he said, Asia has been the fastestgrowing region for global energy demand – and that is set tocontinue, underpinned by economics and demographics.

He stressed by 2050, half of the top 20 global economies will beAsia. He said Saudi Arabia attaches special significance to this regionand is poised to meet the region’s needs.

According to experts as governments and the regional energyplayers band together to focus their efforts on strengthening energysecurity and accessibility, Asia stands to gain the most in leadingreforms and creating opportunities to further sustain the industry.Asia is therefore looked upon to play a pivotal role in influencing theworld’s energy future moving forward.

While the immediate prospects for the industry is challengingthere remains a long-term upside of potential growth that wouldbenefit players with the right strategic prowess and foresightaccording to experts. Global energy demand is expected to doubleby 2050 contributed by a growing world population and increasingconsumption and affluence amongst the population of emergingeconomies.

The industry will also continue to bear heavy responsibility ofensuring the security of energy supplies and supporting economic

The 19th Asia Oil & Gas Conference (AOGC 2017)provided an opportunity for the energy industry leadersfrom across Asia and beyond to discuss strategicenergy issues and the importance of Asia as thefastest growing region for global energy demand

“To monetizestranded gas

assets, we havedeveloped theworld’s firstfloating LNGfacility - the

PFLNG SATU”

Mohd. Najib Bin Tun Haji Abdul Razak,the Prime Minister of Malaysia

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Mr. Khalid A. Al-Falih, Saudi Arabian Minister of Energy, Industry and Mineral Resources duringhis address at the 19th Asia Oil & Gas Conference 2017 emphasised the increasing importanceof Asia not only for the industry but the world at large. He also spoke of the special significanceSaudi Arabia attaches to this region; and a look at the present and future of oil and energy

“For the last 30 years, Asia hasbeen the fastest growing region forglobal energy demand-and that isset to continue, underpinned byeconomics and demographics”,stressed Mr. Khalid A. Al-Falih,Saudi Arabian Minister of Energy,Industry and Mineral Resourceswhile speaking at the AOGC 2017.By the middle of this century, Asia’spopulation will grow by another870 million people. In 2050, halfof the top 20 economies will beAsian, according to a recent reportby PWC. Furthermore, the twocountr ies set to move up thegreatest – Vietnam and thePhilippines – are both members

Saudi Arabia’s growing relations with Asia

of ASEAN, and both will enter thetop 20 global economies, he said.

Of course, as economic andpopulation growth sets in, and asliving standards rise in the ASEANregion and the rest of Asia, so willenergy demand. Almost all expectedoil demand growth over the nextquarter century is likely to originatein this part of the world, while almosttwo-thirds of gas demand will alsocome from the Asian region. Assuch, the importance of ASEAN andthe rest of Asia to the global oil andgas industry cannot beoveremphasized, he added.

Of course, the Kingdom ofSaudi Arabia, Mr. Al-Falih said,

enjoys deep, historicalbonds with Asia and thePacif ic that spammult ip le spheres such asdiplomatic, security, economic andenergy relations, which are rootedin very longstanding cultural andspiritual ties.

In the years and decades tocome, those relationships wil lcontinue to grow, diversity andstrengthen as a result of our sharedvalues, common interests, andmutually beneficial opportunities. Infact, the recent visits to the regionby His Majesty King Salman are atestament to the Kingdom’s desireto take these strategic ties to aneven higher plane.

Saudi Arabia has made a long-term commitment to Asia, and we arethe number one supplier of energyto all the region’s major economies– a responsibility we take mostseriously. Through our energyproducts, advanced technology, andcontinuing investments across thevalue chain, we are determined toplay an even bigger role in satisfyingAsia’s expanding energy demands,he said.

As our part ic ipat ion in thePETRONAS’ Ref inery &Petrochemical IntegratedDevelopment (RAPID) project herein Malaysia demonstrates, we inSaudi Arabia believe the best wayto realize that goal is to cultivateclose partnerships with keystakeholders and leadinginstitutions across the region that

L to R: Amin H. Nasser, President and CEO Saudi Aramco; Mr. Khalid A. Falih, Saudi Arabia’sMinister; YB Datuk Seri Abdul Rahman Dahlan, Minister in the Prime Minister's Department; andDatuk Wan Zulkiflee Wan Ariffin, President & Group CEO PETRONAS upon signing the SharePurchase Agreement allowing Saudi Aramco’s equity participation in PETRONAS’ RAPID project.

In addition to its equity stake in RAPID, Aramco is also apartner with Sinopec and ExxonMobil in the Fujian refineryand petrochemicals manufacturing complex in China, a

majority shareholder in S-Oil in Korea, and is collaboratingwith Idemitsu Kosan and Shell in Japan. Saudi Aramco is

also working with Pertamina to upgrade the Cilicap Refineryin Indonesia, with the project set to enter the FEED stage inthe second half of the year. Saudi Aramco continues to explore

a variety of other promising collaboration opportunitiesacross Asia, with India as a prime target

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growth. The industry is also expected to provide responsiblestewardship of resources and work with stakeholders tocollectively craft the right energy solutions for a changingworld. At the same time, industry players must also play amore prominent role in mitigating the impact of climatechange, according to experts.

In light of the above it was pondered on how effortsmay be tuned to achieve the full potential of resources thatwill involve not only technical solutions, but also incorporatethoughtful management of social and environmentalmandates.

While the pace at which the oil and gas industryembraces innovative practices is a key to long-termsustainability of the industry, the cut in oil production byOPEC to rebalance the market has also made natural gasand LNG more competitive. Beyond oil and gas, the shareof renewable energy in the energy mix is also witnessed.

Looking at the current scenario although oil and gasappears continue to remain relevant in the near future, inview of recent COP 21 pledges by nations to reduce globalemissions, natural gas and renewables do seem to providethe right solution. The experts felt, the last over two yearshave been characterised by changes that prompted theindustry to make hard calls, shed old habits, and explore

new ways to increase efficiency and stay resilient.Talking to DEW Journal, Datuk Wan Zulkiflee Wan Ariffin, President

& Group CEO, PETRONAS emphasised, “in Asia, the future demand isgetting complex to predict, it is a very exciting market with enormousgrowth potential. The way forward is defined by greater collaborationamongst industry players. We’ve learned that by consolidating ourstrengths, we are in a better position to succeed”.

Earlier inaugurating AOGC 2017, Malaysia’s Prime Minister Dato’Sri Mohd Najib bin Tun Abdul Razak said: “The oil and gas industrycontinues to be at the leading edge of adopting new technologies toraise efficiency and productivity. With the rise of the Internet of Things,and the increasing use of data analytics and automation, the industrywill be able to deliver more energy resources at better prices.

“With fresh perspectives and insights AOGC will bring to all theparticipants, and that they will lead to new approaches to pushinginnovation to its utmost limit, to producing abundant, cheaper and cleanersources of energy,” the Malaysian Prime Minister said.

In conjunction with AOGC 2017, the Malaysian Prime Minister alsolaunched the PETRONAS’ FLNG (PFLNG) Satu, the world’s first floatingliquefied natural gas (LNG) facility. Designed for water depths between70 and 200 metres, the PFLNG Satu has a processing capacity of 1.2mtpa, and can accommodate 145 crew members on board.

The PFLNG Satu is PETRONAS proven technology, adapting aconventionally land-based installation to a floating LNG facility, a game-changer in today's LNG business landscape. It is a testament

know their markets and whosestrengths and capabi l i t iescomplement our own. AndPetronas certainly fits this bill!

In addition to its equity stakein RAPID, Aramco is also a partnerwith Sinopec and ExxonMobil in theFujian refinery and petrochemicalsmanufacturing complex in China,a majority shareholder in S-Oil inKorea, and is collaborating withIdemitsu Kosan and Shel l inJapan. Aramco is also workingwith Pertamina to upgrade theCilicap Refinery in Indonesia, withthe project set to enter the FEEDstage in the second half of the year,he said.

And of course, Saudi Aramcocontinues to explore a variety ofother promising col laborat ionopportuni t ies across the fast-growing ASEAN region andelsewhere in Asia, with Indiabeing a prime target.

Mr. Khalid A. Al-Falih

“As economic and population growthsets in, and as living standards rise inthe ASEAN region and the rest of Asia,

so will energy demand. Almost allexpected oil demand growth over the

next quarter century is likely tooriginate in this part of the world, whilealmost two-thirds of gas demand willalso come from the Asian region. Assuch, the importance of ASEAN and

the rest of Asia to the global oil and gasindustry cannot be overemphasized”

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Vision 2030That ’s in keeping with SaudiArabia’s own development plansfor the future. As you might beaware, last year the Kingdomannounced i ts Vision 2030 toprovide a blueprint for the socialand economic development ofSaudi Arabia, he said.

The Vision cal ls fordiversi f icat ion of the nat ionaleconomy to be led by the privatesector, the privatization of majorGovernment-owned enterprises,bui lding Saudi Arabia into aninternat ional investmentpowerhouse, and turning thecountry into a hub for logistics,services, and advancedmanufactur ing, with part icularemphasis on the knowledgeindustries of the future. We will alsoturn the Kingdom’s youngpopulat ion into a world-classworkforce, and promote greaterpart ic ipat ion of women in thenational economy, Mr. Al-Falih said.

Vision 2030 also recognizesthe role that internat ionalcooperat ion and cross-borderinvestments must play to realizethose aspirations. As a result,there is a wide range of attractivebusiness opportunities on offer inthe Kingdom for strategic investorsaround the world.

Many of these opportunities willbe of interest to companies andorganizations throughout theASEAN region and right acrossAsia and the Pacif ic, just l ike

Khazanah, the sovereign wealthfund of Malayisa, which I am proudto note is actively investing in theKingdom.Long-term MarketWhat I said about Asia in a moreglobal perspective on the oil andenergy markets, beginning with alook at longer term trends.

The world’s economy is likelyto more than double in size by 2050,with economic powers as Imentioned continually shifting todeveloping nations. By then, in fact,six of the seven largest economiesin the world in PPP terms will beemerging markets. Likewise, theworld’s population will continue togrow, requiring ever more energy.

As we all know, Mr. Al-Falihsaid, the global energy environmentis in the early stages of a majortransformation, with renewablesand electric vehicles starting tomake progress. But alternatives arestarting from a small base, and theirfuture growth is also likely to beslower than many casual observersimagine. Besides the technical andeconomic hurdles faced byalternatives, affordability is likely tobe an issue in many developingeconomies, considering thatalternatives still require subsidiesdue to their high cost compared toconventional energy sources thatare proven, reliable, and supportedby a massive system of existinginfrastructure.

So, in my view, the globalenergy transition, while certain, will

be long and complex. In fact, I amconcerned that the slowdown of oiland gas investments, driven in partby short-term oversupply and by theunreal ist ic expectat ion ofalternatives’ rapid deployment,could lead to energy shortages andsupply securi ty concerns. Itherefore do not anticipate that oildemand will peak anytime soon.

I believe we should continueto work to develop a diversifiedenergy port fol io whichencompasses both conventionaland new energy sources, givingalternatives the time and spacethey need in order to effectively,ef f ic ient ly and economical lyshoulder a larger burden of worldenergy demand over time, he said.Present oil market & future directionLet me now turn to the short termstatus of the global oil market.

Despite lingering headwinds,the oil market continues to improvefrom the conditions we saw earlylast year, when crude oil inventorieswere at an all-time high and set tocontinue rising. The markets,however, have recently beenimpacted by a combination of lowseasonal demand and refinerymaintenance in the US, somegrowth in non-OPEC supply, and theactions of financial players in themarket. All of this has slowed theimpact of recent production cuts.

I bel ieve the worst is nowbehind us with multiple leadingindicators showing that supply-demand balances are in deficit andthe market is moving towardsrebalancing. We should expecthealthier markets going forward.

For us in the Kingdom, there isprimarily one metric that we focuson and target as we move forward,and that is global inventories. We

“The global energy transition, while certain, will be long andcomplex. The slowdown of oil and gas investments, driven

in part by short-term oversupply and by the unrealisticexpectation of alternatives’ rapid deployment, could lead toenergy shortages and supply security concerns. I do not

anticipate that oil demand will peak anytime soon”

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are pleased that OECDinventories – for whichreliable and timely dataare avai lable – havebeen gradually decliningsince the middle of lastyear, with an estimatedoi l stock draw of 60million barrels since theypeaked last July. Floatingstorage, for which less data arepubl ished, has also decl inedsignificantly.

Unfortunately, however, the USmarket – where analysts are mostfocused upon – is whereinventories have been fluctuating!But we expect US inventories toresume a downward trend drivenby increasing refinery inputs, whichare underpinned by seasonalityand a healthy US productsdemand that shows signs ofcontinuing to grow in 2017.

Turning to oil demand in othermajor markets, we look for China’soil demand growth to match lastyear’s, on the back of a robusttransport sector, while India’sant ic ipated annual economicgrowth of more than seven percentwi l l cont inue to dr ive healthygrowth. In sum, we expect globaloil demand to grow at a rate closeto that of last year.

On the supply side, short cycleand smaller projects – such asshale oil developments –and incrementalinvestments are pickingup as a result of the pricerecovery, which is good!However, longer-cycle,more complex andhigher cost upstreamprojects, especial lymega investmentsinvolving expensive

Today is a time of great changes and global uncertainities, and the oiland gas industry – which is crucial to the global economy – has notbeen exempt from having to face a series of new realitites.

There has been the shale revolution, principally in North Americabut elsewhere as well.

There has been increased competition due to advancements inrenewable energy resources. In many countries there is strong publicpressure to shift to these, and to support the growth of wind and solarpower, the Malaysian Prime Minister said in his inaugural address.

The International Energy Agency predicts that global energy demandwill double by 2050, not least because of a rising global population,and legacy industry players will need to work harder and realign theirstrategic priorities in order to remain relevant and sustainable in thelong run.

Collaborationis the answer!

To address the new realities, the oil and gas industry is driving newapproaches to resource development, cost management andtechnology. Abundance of gas discoveries have helped spur the growthof LNG, industry in the Middle East, the Asia Pacific and Australia. Theemergence of more producers, increased supplies and competitivegas prices has transformed LNG into an attractive energy resource foremerging economies, and one that also has the benefit of being farless carbon intensive. I strongly believe that industry players cancollaborate to support the wider adoption of LNG by offering innovativecommercial solutions and technical assistance to nations with afledgling interest in this sector emphasized Mohd. Najib Bin Tun HajiAbdul Razak, Prime Minister, Malaysia while inaugurating the 19th AOGC

Prime Minister of Malaysiaon new energy realities

Mohd. Najib Bin Tun Haji Abdul Razak

The Prime Minister of Malaysia (second from left) along with other dignitaries unveiling PFLNG SATU model atthe 19th AOGC. PFLNG SATU is world’s first floating LNG facility designed to monetize stranded gas assets.

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marginal barrels, remain on hold.In fact, global E&P investmentsworth about one tril l ion dollarshave been deferred or cancelledsince the downturn.

It is also worth noting thatsome of the supplies currentlycoming on-stream and

contributing to inventories stemfrom investments made roughly adecade ago, but this backlog ofproduction projects will soon bedepleted.

And then we have to deal withthe natural decline of the largebase of legacy production, which

“The US market – where analysts are most focusedupon- is where inventories have been fluctuating! But we

expect US inventories to resume a downward trenddriven by increasing refinery inputs, which are

underpinned by seasonality and a healthy US productsdemand that shows signs of continuing to grow in 2017”

we see clearly in the North Sea,Mexico, China, and other majorproducing basins. In fact,conservative estimates predict thatwe will need to offset 20 millionbarrels per day in combineddemand growth and natural declineover the next five years. That is whyI fear, as earlier mentioned, that weare heading into a future of supply-demand imbalances.

Finally, turning to our posturewith other producing countries, I ampleased that our OPEC and non-OPEC partners who agreed on

to PETRONAS' innovativesolut ions to monet isestranded gas molecules tomeet the demands of globalenergy.

AOGC 2017 providedan opportuni ty for theenergy industry leadersfrom across Asia andbeyond to discuss strategic energy issues and theimportance of Asia as the fastest growing region forglobal energy demand. Asia-Pacific LNG and the roleof natural gas also focused during the deliberations.

The CEO Strategic Dialogue – a panel comprisingsome of the energy industry’s most influential chiefexecutives from Malaysia, US, India and UAEemphasised on the need for cooperation and flexibilityto survive and thrive in today’s market conditions.

Datuk Wan Zulkiflee Wan Ariffin, President & GroupCEO, PETRONAS said the new realities facing ourindustry have settled in, with the 100-dollar oil priceseeming like a distant memory. The last two years

have been characterized bychanges that prompted usto make hard calls, shed oldhabits, and explore newways to increase efficiencyand stay resilient.

Similar to many otherorganizations, PETRONAShad also implemented far-

reaching measures in our quest to be a sustainable,merit-based high-performing organization.

Amidst wildly fluctuating forecasts, we havelearned not to let fear of circumstances paralyze us,and have instead invested time and effort in areaswithin our control. We have high-graded our businessport fol ios in pursuing and securing marketopportunities.

A final investment decision on whether the refinerywill be built, which would include a 3m tonnes peryear ethylene unit, is due to be made by early 2019.The project could involve Saudi Arabian investment.

Mr.B.Ashok, Chairman, Indian Oil CorporationLimited presented India’sgrowth story in oil andgas. He stressed Indiaand its dynamic oil andgas sector is now thesubject of global interest.

He shared Indian OilCorporation along with itsIndian PSU companiesBharat Petroleum,Hindustan Petroleum

L to R: Datuk Wan Zulkiflee Wan Ariffin, Mr. Ryan Lance, Mr.B.Ashok, Tan Sri Dato’ Sri Shahril Shamsuddin,Dr. Bakheet Al Katheeri, and Dr.Fereidun Fesharaki at the session on CEO Strategic Dialogue

Datuk Wan Zulkiflee Wan Ariffin Mr.B.Ashok

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Of course, there are the geopoliticalissues many of which could shape markets,trade flows and relations between countriesin ways that we cannot as yet know.

To address these new realities, the oil &gas industry is driving new approaches toresource development, cost management and technology.

The abundance of gas discoveries have helped spur the growth ofthe LNG, industry in the Middle East, the Asia Pacific and Australia.

The emergence of more producers, increased supplies andcompetitive gas prices has transformed LNG into an attractive energyresource for emerging economies, and one that also has the benefitof being far less carbon intensive.

I believe that industry players can collaborate to support the wideradoption of LNG by offering innovative commercial solutions andtechnical assistance to nations with a fledgling interest in this sector.

The oil and gas industry continues to be at the leading edge ofadopting new technologies to raise efficiency and productivity. Withthe rise of the Internet of Things, the increasing use of big data analytics,and automation, the industry will be able to deliver more energyresources at better prices.

Indeed, I have witnessed firsthand how the adoption of digitaltechnology by PETRONAS has helped our national oil corporationenhance the efficiency of its global operations, reduce operationalcost, and harness data to improve performance, all from its digitally-enabled Integrated Operations centre, the Prime Minister disclosed.

Further, a strong oil and gas sector can only function well with thesupport of a robust services sector, and the consolidation of the oiland gas services sector is crucial. In Malaysia, we have alreadywitnessed a number of service sector players responding to the newrealities by reorganizing their structure and strategies to be morerobust and competitive, and I hope others will follow suit.

Under the Government’s Economic Transformation Programme,(ETP), the energy sector is set to register annual growth of 5% up to2020, transforming Malaysia into a regional oil trading & storage hub,and ensuring long-term energy supply security to the domestic market.

The recent USD7 bil l ion investment by Saudi ARAMCO inPETRONAS Refinery and Petrochemical Integrated Development, orRAPID, project in Pengerang, Johor, exemplifies Malaysia’s ongoingattractiveness as an energy investment destination of choice.

This clearly positions the oil and gas industry as one of the biggestdrivers of the ETP. This investment also makes Saudi ARAMCO thesingle largest investor in the country so far.

In terms of Malaysia’s oil and gas sector, there have been plenty ofachievements and successes. For instance: To monetize Malaysia’svaluable stranded gas assets, we have developed the world’s firstfloating LNG facility. The PFLNG SATU is a game changer for theindustry, bringing together the liquefaction, production, storage and

supply cuts are so far exhibitinghigh levels of adherence to thecommitments that were made lastDecember. I would also l ike toemphasize what I have said in thepast, that the producer coalition isdetermined to do whatever it takesto achieve our target of bringingstock levels back to the five-yearaverage. Based on theconsultat ions I have had withparticipating members, I am ratherconfident the agreement will beextended into the second half of theyear and possibly beyond.

Corporation and Engineers Indiaare preparing to bring online whatcould be world’s largest everrefinery project to be built in one goon India’s west coast. The 60million tonnes a year refinery and amega petrochemical complex to beset up in two phases on west coastwill meet the rising fuel needs ofthe country. This is a bid to takeadvantage of both low oil and gasprice and spiraling demand forrefined products from the fast-growing Indian market, he said.

The mega refinery complexhas also generated the world’slargest oi l producer SaudiAramco’s interest to pick up stakein it which is expected to be built ata cost of over Rs 1.8 trillion.

Mr.Ashok also stated, on linesto India’s Prime Minister’scommitment at COP-21 that Indiawill substantially reduce carbonemissions and greenhouse gasemissions in the coming yearsmigration to BS-IV fuels showsIndia’s resolve to cut downemissions. Indian OMCs haveworked in unison to set up refininginfrastructure and logistics in recordtime for the launch of BS-IV gradefuels across the country from April

“I strongly believethat industry playerscan collaborate tosupport the wideradoption of LNG”

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this year. The next step he added is to usher directly toBS-VI fuels by 1st April, 2020 to be at par with globalstandards, he said. In three years flat all the refineriesin India will switch to BS-VI fuel which will be anotherrecord for India he pointed out. He informed OMCs arepresently incurring huge expenditure on phase-wiseupgradation of fuel quality in the country.

India is also vigorously pursuing various otherforms of energy such as LNG for industries andtransport sector, compressed natural gas (CNG) andAutoLPG for automobiles, and piped natural gas(PNG) for households, besides ethanol and bio-massto expand the existing energy basket, he added.

India he said is actively promoting city gasdistribution networks and connecting major citieswith “green highways,” which will have vehiclesrunning on CNG and LNG with adequate re-fuellingstat ions. Lakhs of households are gett ing thebenefits of piped natural gas (PNG) supplies. All thishe said is part of India’s focus on clean energy.

Mr. Ryan Lance, Chief Executive, ConocoPhillips,US said another key component of the industry’srealignment, technological advance, was alreadymaking a big difference to companies’ plans andcosts. He cited progress in multilateral wells in theUS shale sector – where more than one wellbore isdrilled from and connected to a single main bore - agood example of how the upstream industry could drivedown costs. “Just think what that revolution has instore in terms ofefficiency, cost benefits inultimate recovery comingfrom the shale. We arest i l l very ear ly in thestages of understandingwhat these technologiescan do, but it’s drivingdown the breakdowncosts,” he said. “I feel thetechnology is taking us to

the place that will bring on apretty abundant amount ofsupply in a less-than $50 (abarrel) world. I wouldn’t besurprised if many of our playswork at $30-$40 a barrel.”

Tan Sri Dato’ Sri ShahrilShamsuddin, Chief Executive,Sapura Energy, Malaysia

emphasized the role of rapid and realistic cost-cuttingand restructuring measures to turn companies intomore agile competitors that can survive in the worldof low cost oil. Sapura has gone through a period ofconsolidation, during which it slashed staff numbersand renegotiated contracts with contractors.

“We still have to go through at least another 15months of real ly working very hard to make areasonable return,” he said.

Meanwhile, on the E&P side, Sapura has beenmaking significant progress, and is working on its firstgasfield development, the B15 gas project off Sarawak.

Dr. Bakheet Al Katheeri, the recent-appointed ChiefExecutive, Mubadala Petroleum, UAE said that a lowoil price could give his company the opportunity to growfurther. Mubadala is already a strategic investor inseveral Southeast Asian countries, including Malaysia,and has a cooperation agreement with China NationalPetroleum Corporation.

However, the days are gone when Gulfcompanies expect to rely on the financial reserves oftheir parent conglomerates. Mubadala Petroleum hasundergone a streamlining process along with muchof the rest of the industry.

A sector that has a duty to supply oil efficiently tothe world needs to keep in shape over the long-termplan. It has to be consistent. You practice day in, dayout, every day,” Mr. Al Katheeri said. “Staying fit andhealthy needs strong focus and dedication.”

L to R: Mr. Shaikh Nawaf al-Sabah, Mr. Arnaud Breuillac, Ms. Emeliana Rice-Oxley, Mohammed Anuar Taiband Mr. Bob Davenport at the session on Upstream - Green Shoots for Growth

Tan Sri Dato’ Sri Shahril ShamsuddinDr. Bakheet Al KatheeriMr. Ryan Lance

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offloading processes of LNG to offshore gasfields.

We are proud that PETRONAS hasdeveloped this technology, which wil lmaintain the company’s technical edge as akey global LNG supplier.

Another ETP driver in the energy sectoris Cost Reduction Alliance 2.0, or CORAL2.0. This is a long-term industry-wideprogramme driven by PETRONAS to ensurethe sustainability of the country’s oil and gas industry by preparing forfuture challenges through asset and cost optimization, efficiencyupgrades and intensifying innovation across operations, the MalaysianPrime Minister said.

The current state of the industry demands that we pay more attentionto the higher value end, and CORAL 2.0 will help Malaysia’s oil and gasindustry, especially the upstream sector, to remain competitive.

As part of our pursuit of growth that is inclusive and sustainable,the Government places an uncompromising emphasis on managingour environment for future generations. We are committed to adheringto global standards in protection and conservation, such as our pledgeto reduce greenhouse gas emissions by 45 percent by 2030.

The talks at the recent COP-22 in Morocco underlined the urgencywith which we must act to reduce our carbon footprint. Malaysia is fullycommitted to the objective of combating climate change, and I believethat oil and gas players are key stakeholders in helping us realizethese goals.

Firstly, I believe oil and gas companies can help push thetechnological envelope to reduce the amount of greenhouse gasesemitted during their industry’s processes.

I understand that there have been some strides inthe development of CO2 management technologies,including by PETRONAS, and I hope more can be doneto achieve a quantum leap in improving and developingthese technologies.

Secondly, I believe oil and gas companies can helppromote the use of natural gas, together with renewableenergy, as the cleaner fuel option to sustain economicgrowth. This is the right time to encourage the adoptionof natural gas in new markets as prices have becomeattractive, aided by the right investment in infrastructure,the Prime Minister added.

I am hopeful that companies and governments canform “smart” partnerships to unlock the full potential ofnatural gas as a viable option – which will make bothcommercial sense and environment sense, and it isimportant that we see these two motives as supportingone another, not being in opposition.

As companies doubled downon cutting costs over the past twoyears, a leaner and more efficientupstream industry has started toemerge. That was one of the keymessages from the Upstreamsession of AOGC 2017 which sawleading industry figures chart newroutes for upstream success in apanel appropriately entitled theGreen Shoots of Growth.

Mr. Shaikh Nawaf al-Sabah,Chief Executive, Kuwait ForeignPetroleum Expansion Companykicked off proceedings byunderscoring the sheer scale of thedisinvestment seen under the low-price climate. “About $1 trillion hasbeen removed as capex fromcompanies’ development plans,”he said, noting this has had aninevitable impact on explorationsuccess. “Last year we found one-quarter of the barrels we had foundin the previous 15 years. That’s ahuge drop.”

Similarly, on the developmentside, some 4.7 bn barrels of oildevelopment projects weresanctioned last year – the lowestin 40 years, and a 30% drop from

Mohammed Anuar Taib Mr. Shaikh Nawaf al-Sabah

Mr. Bob Davenport Ms. Emeliana Rice-Oxley

“Malaysia is fullycommitted to the

objective ofcombating climate

change such as ourpledge to reducegreenhouse gasemissions by 45percent by 2030”

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“The first thing to say is thatsince we can’t controlparameters, we need to begood at what we can control-operating costs. At Total, wehave been pace setters inthe industry, by cutting in halfour global opex from justbelow $10/b in 2015.”

Mohammed Anuar Taib,Chief Executive – Upstream,PETRONAS also flagged upthe Malaysian giant’srelentless focus on drivingdown costs. At PETRONAS,production costs were closeto $10/b in 2014, he said.Last year, this was down to

$7.30/b, and it hopes to get to $5/b next year.We are looking more at integrated value, to see

what we as an integrated company can do to findadditional margin within the interfaces betweenbusinesses,” he said. “And we can see there is plentyto learn from the supply chain and procurement to

Md Arif Mahmood Mr. Abdulaziz Al Judaimi

Dr. Jeff Brown M Firouz Asnan

2015. The net effect ondecline rates in oil and gaswells has been substantial.According to Mr. ShaikhNawaf, these have doubledto 5% on an annual basis.

Mr. Arnaud Breuillac,President – E&P, Totalspoke of a new reality inwhich disruption is shakingup the market. Volatility maybe bad, he said, but it wasinherent to commodit iesbusinesses.

“The industry is a victimof i ts own success,” Mr.Arnaud Breuillac said. “Thesuccess in developingunconventional resources led to the oil price fall.”

In this context, less money is going intoexploration. “In Asia in 2016 there was a 62% declinein licensed areas, a dramatic fall which will have along-term impact,” said Mr. Breuillac.

The challenge is how to adapt to the new reality.

A new report on ‘Natural Gas:Flipping the Switch – Dawn of anew era’ by Investvine (a newsportal) was launched during the19th AOGC 2017. The launch,hosted by Malaysian GasAssociation (MGA) was officiatedby Datuk Al lauddin Hj Anuar,Deputy Director General(Sectoral), Economic PlanningUnit of Malaysia.

The report takes a look at thecurrent state of the natural gasindustry in Southeast Asia region,as well as worldwide, and details

Natural Gas: Flipping the Switchthe benef i ts of natural gas ascompared to other sources, namelycoal and oil. It aims at makingpeople familiar with the featuresand benefits of natural gas ascompared to other energy sources,namely coal and oil, decipheringcommon myths and examining andhighl ighting the advantages ofnatural gas in terms of energyefficiency, environmental impactand costs.

The report analyzes market-related and government-drivenfactors that influence the extent towhich natural gas is used as anenergy source for electr ic i tygenerat ion and commercial orprivate consumption, taking intoaccount environmental objectivesand goals of countries to becomemore energy-efficient, particularly in

comparison to coal use.The report discusses the future

outlook as to where the industry willl ikely be moving over t ime,examines technology trends inexploration, emission reductionand environmental protection, aswell as ways of supporting existingconsumer applications of naturalgas for example, as a fuel forvehicles, district cooling, heating orindustrial processes. The reportalso seeks to give inspiration to findnew and innovat ive suchappl icat ions and del iverssuggest ions for a sustainableenergy policy for the 21st century.

Adopting natural gas as the to-go fuel for the transportation sector,the largest source of CO2emissions in Malaysia, would givebirth to a great deal of positive side

Mr. Hazil Sham Kassim

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reduce costs.”The current climate

has opened up space fornew entrants to themarket. Mr. BobDavenport , ManagingDirector, EnQuest Plc,Malaysia, a UK-l istedupstream operator,highl ighted how hiscompany is creating newvalue from late life assets.

The session onrefining and oil tradingwas address by Md ArifMahmood EVP & CEODownstream PETRONAS.He spoke on opportunitiesin a brave new world.

Mr. Abdulaziz AlJudaimi, Senior VicePresident, Downstream,Saudi Aramco, Saudi Arabia spoke on driving successthrough downstream integration.

L to R: Mr. Shigeru Muraki, Mr. Djohardi Angga Kusumah, Ms. Ieda Gomes and Mr. Hazil Sham Kassim at thesession on Gas - Accelerating Transition, Fulfiling Potential

L to R: Mr. Eelco Hoekstra, Md Arif Mahmood, Mr. Abdulaziz Al Judaimi, Dr. Jeff Brown and M FirouzAsnan at the session on Refining & Oil Trading - Opportunities in a Brave New World

trading opportunities.Dr. Jeff Brown, President,

FGE touched upondownstream oi l out look:winners and losers.

The session on Gascovered topics like developingIndonesia gas market byDjohardi Angga Kusumah GasPower Senior Vice PresidentPT Pertamina (Persero);Opportunities and challengefor LNG by Shigeru Muraki,Executive Advisor Tokyo Gasand Emerging gas marketspricing trends and issues byIeda Gomes Senior AdviserFGV Energia, OIES.

The session on LNGfocused on LNG: Changing thegame by Mr. Ahmad Adly AliasVice President, LNG MarketingAnd Trading, PETRONAS;LNG: changing the game byMr.Steve Hill Executive Vice

New report, ‘Natural gas: Flipping the switch,’ underscoresnatural gas’ undisputable role as the cleanest fossil fuel

effects for the environment, as wellas the greater general socio-economic good of the country, thereport reveals.

In the power generation sector,the report highlights that the rise ofcoal consumption for feedstock intopower generation across Malaysia isinconsistent with the goals outlinedby Putrajaya to cut CO2 emissions by45 percent compared to 2005 levelsby 2030.

“This report is insightful inhighlighting the benefits that naturalgas brings; both environmentally andeconomically,” Mr. Hazil Sham Kassim,President, Malaysia Gas Association(MGA) said while speaking on theoccasion. “Natural gas will continueto be an important energy source formany years to come. Firstly, natural

gas is abundant. Secondly, thecredentials of natural gas as a clean,efficient and cost effective fuel areindisputable. Thirdly, natural gas willcontinue to play a critical role in theeconomic growth of the country,” headded.

The year 2016 has seen ahistor ic mi lestone with theconclusion of the Paris Agreementon climate change to arrest carbonemissions in combating globalwarming. Countries and cities aretaking steps towards achievingclimate neutrality and a low-carbonenergy future, according to Mr.Kassim .

MGA, he said believes that thisis a start for new conversations totake place on adding further valueto this precious natural resource.

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Mr. Eelco Hoekstra Chairman of the ExecutiveBoard and CEO Royal Vopak spoke on refining & oil


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Mr. Keisuke Sadamori

President, Shell Energy; New paradigms in LNGmarket Thailand by Mr.Wuttikorn Stithit, Executive VicePresident Natural Gas Supply & Trading PTT PublicCompany Limited.

The Petrochemical session covered areas suchas unlocking potential through integration and newmarket by Datuk Sazali Hamzah PETRONAS VicePresident & MD/CEO, PETRONAS Chemicals GroupBhd; The global petrochemical industry byMohammad Alazzaz Director, SadaraValue Park Department SadaraChemical Company and the newchallenges in Petrochemicals: TheContractor Viewpoint by Mr. Fabrizio DiAmato Chairman, Maire TecnimontChairman.

The session on energy andtechnology focused views of Mr. Richard

Dobbs Senior Partner McKinsey & Co. Mr.Dobbstalked about Energy, Technology and otherdisruptions.

Life under COP 21 & Challenges under IMO wastouched upon by Mr. Keisuke Sadamori Director ofEnergy Markets & Security IEA.

Mr. Sadamori in his presentation talked aboutmedium term oil market outlook in the Oil MarketReport 2017. He said due to low investments in 2015

and 16, supply capacity growth will beslower than demand growth, inpart icular in early 2020s, possiblyleading to t ight markets. Marginalcontribution expected from EV despiteits rapid growth.

The presentation also focussed ondif f icul ty for low sulphur fuel oi l ,scrubbers, LNG ships to fill the gap

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Industries focused his talk on how digital technologiesare transforming the oil and gas industry.

Digital Businesses are disrupting virtually everyindustry and profession and broadly, this is driven bythree key shifts (mentioned as under) Mr.Luq said.1. Data: the world is being disrupted by the sheer

amount of data that is available and the potentialto harness it beyond traditional analytics.

2. Cloud: the emergence of cloud is transforming ITand business processes into digital servicesprovided both inside and outside of the company.

3. Engagement: mobile and social are transformingindividual engagement, creating expectations ofsecurity, trust and value in return for personalinformation.These three forces are combining to generate

coming from the ban onhigh sulphur fuel oil by thenew IMO regulat ion.Shipping industry wouldneed to bid high prices todraw more diesels awayfrom other uses.

Mr. Sadamoritouched upon the longterm outlook for coal, oil,gas and low-carbonsources in the centralscenario of IEA WorldEnergy Out look, f rom2015 to 2040.

On the sectoralbreakdowns for long termoil demand outlook, Mr.Sadamori pointednegative growth in powergeneration, building andpassenger cars, butthere will be a continuedsolid growth in maritime,freight, aviat ion andpetrochemical sectors.EVs contribution to besubstantial, but smallerthan eff ic iencyimprovements, he said.

He added, naturalgas to face uncertaintycoming from competitionwith coal and renewables in power generation.

There is therefore, a cont inued need forinvestments for oil and gas sector to compensate fordeclines in existing fields. Declines from the existingfields are much faster than the decline in demand in450 ppm scenario, he said.

Transforming Mobility@Daimler was discussedby Mr. Wilko Andreas StarkVice President, DaimlerStrategy & ProductStrategy and PlanningMercedes-Benz Cars,Daimler AG.

Mr. Luq Niazi, IBMGlobal Managing DirectorChemicals & Petroleum

L to R: Mr. Ahmad Adly Alias, Mr.Steve Hill, Mr.Wuttikorn Stithit and Mr. Adnan Zainal Abidn at the sessionon LNG: Changing the game

L to R: Datuk Sazali Hamzah, Mohammad Alazzaz, Mr. Fabrizio Di Amato and Mr. Akbar Md. Thayoob at thesession on Petrochemical - Unlocking Potential through Integration and New Market

L to R: Mr. Richard Dobbs, Mr. Keisuke Sadamori, Mr. Wilko Andreas Stark, Mr. Luq Niazi and Mr. AdifZulkifli at the session on Energy & Technology: The Future is here

Mr. Luq Niazi

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significant transformation in the oil and gas industrythat will be adopted at pace over the next five years.Analysts predict Digi tal Transformation, DataPlatforms, Advanced Analytics and Cognitive / AIsolutions will have the biggest impact on businessperformance, he said.

Forward-thinking oi l and gas leaders have

already identif ied the potential of these digitalenablers and are bui lding new capabi l i t ies toaddress the current skill gaps they have in theirorganizations. They understand and are working oninitiatives to unlock additional business value througha new level of partnership and interaction betweenhumans and technology, Mr.Luq added.

PETRONAS' proven capability inoperating a fully integrated liquefiednatural gas (LNG) operation isamong its greatest strengths. Sincethe first LNG cargo was delivered toJapan in 1983, it has concludedlong-term contracts with customersin Japan, South Korea and Taiwan,supplying a significant share oftheir domestic needs. Over the yearsthere have been a lot of changes inthe market and PETRONAS is onethat has been very adaptable andprogressive to changed marketconditions emphasisedPETRONAS Vice President of LNGMarketing and Trading, En. AhmadAdly Alias while talking to DEW onthe sidelines of the 19th AOGC.

“The world is changing and soare we” stressed Mr.Alias.

“Our goal is to providesolutions that are tailor-made forspeci f ic needs of the buyers.

‘The world is changing and so are we’PETRONAS Vice President of LNG Marketing and Trading,

En. Ahmad Adly Alias on the company’s portfolio ofdistinctive liquefied natural gas (LNG) solutions

Mr. Ahmad Adly Alias

Whether i t ’s pr ic ing, contractflexibility, quality or location, we aregeared up to meet the buyer’srequirements” added Mr.Alias.

Unlike earlier when it was justsupplying gas on a long termcontract basis PETRONAS tend tobe now more of a solution providersimply keeping in view thechanging LNG supply and demandlandscape he disclosed.

The port fol io of dist inct ivesolutions broadly lie in options forcombination of LNG sources fromequity and trading volumes;multiple pricing options includingvarious indices, hybrid pricing andtiered pricing; varying duration ofcontract durations and flexibility inshipping and delivery.

With our distinctive solutions,we are not averse to long termtraditional contracts as was thepractice till now, we do not mindvertical integration of moving in thedownstream value chain to addvalue i f that is the means tomonetise our gas said Mr. Alias.

It may be noted that the nextfive years appear bring a reshapingof the global gas trade. New LNGsupplies are coming online just asdemand growth in some majormarkets weakens, resul t ing inmajor shifts in global gas trade

As one of the world’s largestsupplier of LNG, PETRONAS

remains at the forefront ofglobal LNG supply, poised to

meet growing energydemand in both the Pacific

and Atlantic Basins

patterns. A weak outlook for Japanand Korea – the world’s top twoLNG buyers - means that newsupplies will need to find othermarkets.

In a scenario where thetraditional LNG demand anchorssuch as Japan, Korea and Taiwanare seemingly going slow or evencutting back on reviving/signingvolumes current levels of LNG arekeeping spot trade stimulated,especially to emerging buyers.

"We are looking at al l theemerging markets as a home forthose volumes," Mr. Alias said.

Mr.Alias also cal led forequitable relationship betweenLNG producers and consumers toensure the continuity andsustainability of the LNG business.

PETRONAS has continuouslystrengthened i ts relat ionshipswith customers to of fer LNGsolut ions beyond just supply,providing energy solutions andpartnerships to meet globalenergy demand. PETRONASstrong presence in the integratedLNG value chain and diversifiedLNG market portfolio coupled withit promoting the consumption ofLNG beyond the existing marketportfolio and LNG as marine fuelis a step ahead.

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Analytic, Cognitive,Internet of Things (IoT)and Block chain solutionsthat understand reasonand learn across keyprocesses and valuechains are proving theessential building blocksto new levels ofcapabil i t ies. IBM areworking with many Oil andGas clients, helping themto outthink their currentbusiness models throughdigital technologies tosignif icantly improvebusiness results. Fromthe multiple initiatives weare progressing withcl ients, we see thegreatest potential for valuein five main areas:1. Upstream Subsurface2. Equipment Reliability3. Operational Improvements4. Market Insights and

Demand Planning5. Business Support

ServicesReal iz ing the

potent ial of digi taltechnologies alsorequires the formation ofnew industrypartnerships and thedevelopment of newecosystems, embracingnew approaches tocol laborat ion andinvestment – ultimatelywe see the future and nextlevel of enterpr iseperformance beingachieved through hybriddigi tal capabi l i t iesbrought together f romboth inside and outside ofthe company, Mr.Luqinformed.

PETRONAS through its subsidiary PETRONAS LNG Ltd. (PLL) and its shippingaffiliate, MISC Berhad (MISC) inked a non-binding Memorandum of Understanding(MoU) on 9 May 2017 with Gas4Sea partners, comprising ENGIE S.A. (ENGIE),Mitsubishi Corporation (MC) and Nippon Yusen Kabushiki Kaisha (NYK) to explorepotential collaboration in promoting LNG as the preferred marine fuel.

Gas4Sea is a partnership created to jointly promote LNG as the cleanermaritime fuel, by providing LNG bunkering services in the global market.

Under the terms of the MoU, the parties will explore ways to collaborateand identify potential business opportunities in relation to LNG bunkering.

Signing on behalf of PLL and MISC were PLL Chief Marketing Officer &Chief Executive Officer, Mr. Ezhar Yazid Jaafar and MISC Vice President of LNGBusiness Unit, Faizul Ismail while Gas4Sea partners were represented by MCGeneral Manager of LNG Bunkering Business Office, Mr. Yuji Toshima, ENGIESenior Vice President of Business Development Asia, Mr. Denis Bonhomme,and NYK Manager of Fuel Project Team, Mr. Takahiro Nito.

Commenting on the MoU, Mr. Ezhar said that the collaboration is expectedto enhance PETRONAS’ strong presence in the integrated LNG value chainand diversified LNG market portfolio.

“PETRONAS is looking at ways to further promote the consumption of LNGbeyond the existing markets portfolios, and advocating LNG as marine fuel is anew frontier for the LNG sector,” said Mr. Ezhar.

Gas4Sea partners are major players in the energy and global shippingindustries. With their world’s first purpose built LNG bunkering vessel based inthe port of Zeebrugge , they are equipped with a key piece of the LNG bunkeringvalue chain to extend the reach of LNG to fuel the marine transportation sector.

“In addition, this collaboration will also support the usage of LNG as a fuelof choice for maritime activities, which is in line with PETRONAS’ effort in helpingthe industry reduce its carbon footprint,” continued Mr. Ezhar.

With over 40 years of experience in the oil and gas industry, PETRONAS isrecognised as a reliable fully integrated oil and gas multinational with a proventrack record in operations spanning the entire hydrocarbon value chain.

PETRONAS Group has diversified its LNG supply portfolio in recent yearswith the addition of Australia Gladstone LNG and PETRONAS First FloatingLNG Facility in offshore Sarawak.

Petronas inks MOU with Gas4Seato promote LNG as marine fuel

The partnership ties after the signing of MoU between PETRONAS LNG Ltd and Gas4Sea dewjournal.com

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To maximize value for Malaysia’s natural gas resources,PETRONAS Chemicals Group Berhad (PCG) the leading

integrated chemicals producer in Malaysia and one of the largestin South East Asia has achieved phenomenal growth inperformance on the operations, commercial and financial frontsduring 2016 despite significant decline in Brent crude oil andpetchem product prices. It is worth noting that the company hasnot only battered through the ongoing tough market conditionsbut ensured that its business practices are in line with globallyrecognized standards for environmental, social and governancepractices.

PCG operates a number of world class production sites, whichare fully vertically integrated from feedstock to downstream endproducts. With a total combined production capacity of 10.8 millionmetr ic tons per annum (mtpa), i t is involved pr imari ly inmanufacturing, marketing and selling a diversified range ofchemical products, including olefin, polymers, fertilizers, methanoland other basic chemicals and derivative products.

Keeping up with the time

Chairman of PCG, Md Arif Mahmood (centre) flanked by Managing Director/CEO ofPCG, Datuk Sazali Hamzah and Chief Financial Officer of PCG, Rashidah Alias at thepress conference.

Petroliam Nasional Berhad (PETRONAS) Malaysia’s fully integrated oil and gas multinationalmanages natural resources in a way that contributes holistically to the wellbeing of societywherever it operates. With business activities that include the exploration, development andproduction of crude oil and natural gas in Malaysia and overseas; the liquefaction, sale andtransportation of LNG; the processing and transmission of natural gas, and the sale of naturalgas products; the refining and marketing of petroleum products; the manufacturing and sellingof petrochemical products; the trading of crude oil, petroleum, gas and LNG products andpetrochemical products; and shipping and logistics relating to LNG, crude oil and petroleumproducts, the company is keeping up with the time in the present tough market conditions bytaking strategic moves on all its business fronts to make sure its leadership. A report by DEW:

“PETRONAS ChemicalsGroup Berhad (PCG)

progress is a result of itsfive key projects namelySabah Ammonia Urea

Project, Integrated AromaIngredients Complex,2-Ethylhexanoic Acid

Project, Highly ReactivePolyisobutene Project andthe Pengerang Integrated

Complex Project”

- Datuk Sazali HumzahManaging Director/

Chief Executive Officer,PETRONAS Chemicals Group Berhad

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PETRONAS haslaunched its state-of-the art TerengganuGas Terminal(TGAST) in Kertih on18 April 2017, the firstof such fac i l i ty touti l ize PETRONAS-owned carbondiox ide (CO2)removal technologyexpected to give aboost to thedevelopment ofMalaysia’s offshoregas fields with highCO2 content.

The facility waslaunched by PETRONAS President & Group CEODatuk Wan Zulkiflee Wan Ariffin, during his visit toPETRONAS’ operations in the East Coast region.

Datuk Wan Zulkiflee said the TGAST project wasnot only a testimony of PETRONAS’ continuouscommitment towards adding value to the oil andgas resources found offshore Peninsula Malaysiabut also reflected the company’s larger cleanerenergy commitment in support of Malaysia ’senvironmental agenda to reduce its carbon footprintby 2030.

He added that TGAST, with the capacity to

State-of-the-art Terengganu Gas Terminal

L to R: TGAST Project Director, Encik Rashid Sainal, PETRONAS President & Group Chief Executive Officer,Datuk Wan Zulkiflee Wan Ariffin, PETRONAS Vice President of Group Project Delivery, Encik Zakaria Kasahand PETRONAS Vice President of Malaysia Assets, Development & Production, Encik Jukris Abd Wahablaunching the Terengganu Gas Terminal (TGAST) in Kertih, Kuala Terengganu

PETRONAS President & Group Chief Executive Officer, Datuk Wan Zulkiflee Wan Ariffinwas briefed by the TGAST project team at the launching event.

process up to 700 mmscfd of gas from the Malaysia-Thailand Joint Development Area (MTJDA) and fromthe North Malay Basin offshore Terengganu, wouldhelp ensure the security and sustainability of supplyto PETRONAS’ customers in Peninsular Malaysia aswell as to PETRONAS’ own facilities in the region,particularly its integrated petrochemical complexesin the East Coast.

Datuk Wan Zulkiflee said the launch of TGASTwas also a proud moment and achievement forPETRONAS, as it not only utilized the PN-1 MembraneSystem for CO2 removal developed by PETRONAS

and a partner, but also because theproject involved more than 80 per centparticipation of local contractors.

The project was successful lycompleted four months ahead ofschedule. At the launch, TGAST alsocelebrated 10 million safe man hourswithout lost-time incident (LTI), and1,300 incident-free days from theproject start date in 2013.

Apart from the gas terminal, theproject also includes compressorunits, storage tanks and relatedinfrastructure and the installation oftemperature control machinery andsafety systems.

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The company’s progress is a result of its five keyprojects namely Sabah Ammonia Urea Project,Integrated Aroma Ingredients Complex, 2-Ethylhexanoic Acid Project, Highly React ivePolyisobutene Project and the Pengerang IntegratedComplex Project according to Datuk Sazali Humzah,Managing Director/Chief Executive Officer of PCG.

The Sabah Ammonia Urea Projectrepresents PCG’s continuous effort tomeet market demands for urea,especially in the South East Asia region.The project will add 1.2 million metrictons per annum (mtpa) of ureaproduction to PCG’s existing 1.4 millionmtpa capacity, positioning PCG as thesecond largest urea producer in SouthEast Asia.

Currently, both ammonia and ureaplants are running at 100% full capacity.As of April 2017, a total of 148,813 tonnesof ammonia and 187,300 tonnes of ureahad been produced. Majority of SAMURProducts are exported to Thailand (51%),Australia (25%) and to other ASEANcountries.

The Integrated Aroma IngredientsComplex in Gebeng, Pahang is a jointventure project undertaken together withBASF through our associate company,BASF PETRONAS Chemicals Sdn Bhd.Citral, citronellol and L-menthol, arearoma ingredients, to meet the highdemand from the rapidly growingfragrance and flavour industries. Thisproject, that is f i rst to use BASF’stechnology outside Europe, marksPCG’s foray into the highly attractiveniche and specialty play, which are lessaffected by cycl ical i ty compared tocommodity chemicals. Aroma

ingredients are sold to the flavour and fragranceindustry, mainly in home and personal care productsand in the food industry as well as pharmaceuticalapplications.

The commissioning and start-up process of theIntegrated Aroma Ingredients Complex is progressingwell to meet the range of 2017 start-up schedule.

Chairman of PCG, Md Arif Mahmood (centre) flanked by Managing Director/CEO ofPCG, Datuk Sazali Hamzah and Chief Financial Officer of PCG, Ms. Rashidah Alias atthe press conference.

PCG achieved its highest plant utilisationrate ever recorded since listing. The

Group’s plant utilisation rate of 96% farsurpasses world class standards and is theresult of its continuous efforts in reaching

sustainable outstanding plant performance.Correspondingly, its production volume

grew by 11% to 9.2 million metric tonnesfrom 8.3 million metric tonnes, the highest

level ever recorded since listing. Thisachievement is attributed to PCG’s reliable

plant operation of its top-notch facilities

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The 2-EHAcid plant in GebengPahang, undertaken together withBASF through our associatecompany, BASF PETRONASChemicals Sdn Bhd is the first ofits kind in South East Asia and willbenefit from the integration with itscurrent faci l i t ies in Gebeng.Product application include as achemical compound in theproduction of synthetic lubricants, as well as oiladdit ives and functional f luids l ike automotivecoolants, and other uses in various industries.

On specification 2-EHAcid was successfullyproduced and delivered to overseas customers in late2016

PCG has sanctioned the development andconstruction of a new world-scale HR-PIB plant at itsassociate company, BASF PETRONAS ChemicalsSdn Bhd, to add further value to its existing businessat PETRONAS Chemicals MTBESdn Bhd in Gebeng, Pahang.Product funct ions include asintermediate product for themanufactur ing of high-performance fuel and lubricantadditives.

HR-PIB is expected to becommissioned in the fourth quarterof 2017 as planned.

The Petrochemical Projects inPengerang Integrated Complex(PIC), which are scheduled to beoperat ional ised in 2019, aresignificant growth projects for PCGto broaden its product portfolio andfurther diversify into derivatives,specialty chemicals and solutions,while expanding PCG’s existingproduction capacity.

As at end March 2017, thePengerang Integrated Complex(PIC) development is around 62%overal l project progress. Thisproject is progressing well wherebyto date the overall petchem projectfor polymer and glycol is more than30% and sl ight ly ahead ofschedule. On 18 April 2017, PCG

PETRONAS is set to expand its liquefied natural gas (LNG) businessin China, extending its reach to the country’s southern region whilelooking to expand the volume of supply to its existing buyers.

PETRONAS Vice President of LNG Marketing & Trading, Mr. AhmadAdly Alias said that a liaison office is in Beijing to facilitate LNG businessgrowth in the country.

“PETRONAS has strong relationship with China in the LNG tradeand the prospect for further growth is strong. As an integrated LNGsolution provider, the company is in the best position to deliver a reliableand innovative long term LNG solutions to meet China’s clean energydemand,” he said.

Mr. Ahmad Adly was speaking at a recent business reception inGuangzhou, hosted by PETRONAS’ subsidiary, PETRONAS LNG Ltd.(PLL).

PLL’s new Chief Executive Officer, Mr. Ezhar Yazid Jaafar was alsointroduced to about 70 potential partners at the event.

PETRONAS’ first LNG trade to China was in 2006 with a 25-yearterm supply to Shanghai LNG Company Ltd and expands its marketpresence in China with the addition of term LNG customers inSouthern China.

Backed by over 30 years of LNG experience, PETRONAS isrecognised as a reliable and flexible LNG supplier, operating from itsmain supply base in Bintulu, Sarawak.

PETRONAS Group has also diversified its LNG supply portfolio inrecent years with the addition of Australia Gladstone LNG and theupcoming Floating LNG projects in offshore Sabah and Sarawak.

Expansion of LNG portfolio in China

approved the Final Investment Decision for anisononanol plant at Pengerang Integrated Complex.This is yet another strategy of PCG to grow further inspecialty chemicals.

Speaking to DEW, Datuk Sazal i Hamzah,Managing Director/Chief Executive Officer, PCG saidthat in 2016, PCG achieved its highest plant utilisationrate ever recorded since listing. The Group’s plantutilisation rate of 96% far surpasses world classstandards and is the result of its continuous efforts

Speaking of what lies ahead for PCG, DatukSazali Hamzah shared that the slight recovery of

petrochemicals prices in quarter 1 of 2017 isdriven by the improvement of the overall energy

industry. With global oil & gas sector growthexpected to improve slightly, PCG foresees thatdemand for petrochemicals will remain moderate

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in reaching sustainable outstanding plantperformance.

Correspondingly, its production volume grew by11% to 9.2 million metric tonnes from 8.3 millionmetric tonnes, the highest level ever recorded sincelisting. This achievement is attributed to PCG’sreliable plant operation of its top-notch facilities.

Mr. Sazali further elaborated that the Group’scommercial excellence efforts have also enabledPCG to gain additional value for its products with thehighest sales volume ever recorded at 7.3 millionmetric tonnes, despite it being a buyers’ market in2016.

“Against the bearish environment, PCG continuesto drive commercial excel lence through betterunderstanding of our customers’ needs, sustainingand augmenting our market position, as well asenhancing our marketing and sales capability,” hesaid.

Speaking of what lies ahead for PCG, DatukSazali Hamzah shared that the slight recovery ofpetrochemicals prices in quarter 1 of 2017 is drivenby the improvement of the overall energy industry. Withglobal oil & gas sector growth expected to improvesl ight ly, PCG foresees that demand forpetrochemicals will remain moderate.

Mr. Sazali said “PCG will continue to work onsustaining our world class operational excellence,while keeping health, safety and environment as ourutmost priority. We will continue to optimise cost andimprove customer experience. And as Southeast Asiaremains our key market, we will continue to furtherexpand our presence in this region”

He also mentioned that PCG will focus on thedelivery of all its growth projects to ensure minimumdisruption affecting timeline and cost. Key activitiessuch as developing PIC products route-to-market iscurrently ongoing.

“The completion of PIC, as well as the currentplants that we have, will provide a lot more opportunitiesto grow in the area of chemicals, derivatives andspecialty. Moving forward, PCG is set to stay at theforefront of the industry with the ability, resilience anddetermination to overcome challenges. We continueto assess further opportunities beyond 2020 indownstream derivatives and specialty chemicals atPengerang, Kertih, Gebeng and East Malaysia. Thisis part of our long term business positioning andsustainability” he added.

PETRONAS Lubricants International (PLI) recentlylaunched the newly expanded lubricant-blendingplant in the Weifang Economic Development Zonein Shandong, China, to meet the market’s growingdemand for premium lubricant products and high-quality services.

The comprehensive expansion project, whichwas carried out in phases, saw the upgrade of theplant’s production capacity, production lines andstorage facilities, bolstering the company's ability toserve the booming Chinese market.

PETRONAS President and Group CEO, DatukWan Zulkiflee Wan Ariffin who officiated the new plantsaid, “The second phase expansion at our Shandongplant adds much-needed production capacity that willhelp us meet the soaring demand for our products.

“Naturally, this will also infuse our marketing andsales operations with a major boost of new energyto pull away from the pack. This strategic expansionof our footprint in China reflects the great importancewe attach to our local customers here as well as ourconfidence in PETRONAS’ prospects for future growthin the Chinese market."

The plant’s off iciat ing ceremony was alsoattended by PETRONAS Executive Vice President andCEO of Downstream Business, Md Arif Mahmood;PETRONAS Lubricants International (PLI) Group

“The second phase expansion at ourShandong plant adds much-neededproduction capacity that will help us

meet the soaring demand for ourproducts. Naturally, this will also infuseour marketing and sales operations witha major boost of new energy to pull awayfrom the pack. This strategic expansion

of our footprint in China reflects the greatimportance we attach to our local

customers here as well as ourconfidence in PETRONAS’ prospects for

future growth in the Chinese market"

- Datuk Wan Zulkiflee Wan AriffinPresident and Group CEO, PETRONAS

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Newly expanded lubricant to meet growing demand


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CEO, Giuseppe D’Arrigo and PLI Head of Regional Business (GreaterChina), Mark Gau.

In order to optimize services and offer customers a complete rangeof premium solutions, PETRONAS has invested RMB600 million (RM384 million) to expand the plant's footprint to 21,000 square metres tonow include an automated, hi-tech lubricant blending line as well asadditional storage tanks.

The plant’s annual output is expected to increase from 45,000 to150,000 tonnes, covering a wide range of automotive lubricants, anti-freeze liquids, industrial lubricants and greases. The expansion alsosaw an upgrade of the plant's warehouse facil it ies to enhancecapabilities for storage, transportation, local distribution and overseasexport.

Improving the capabilities of the Shandong Plant not only allowsfor increased production capacity to satiate consumer demands, it isalso testament to PETRONAS’ commitment to the rapidly developingChinese market. Aside from lubricants production, PETRONAS is alsoactively growing its LNG business while looking to expand the LNGvolume supply to its existing buyers in the country.

PETRONAS President and Group CEO, Datuk Wan Zulkiflee Wan Ariffin (centre) officiated theopening of PLI’s newly expanded lubricant-blending plant in Shandong, China.

Special Report

blending plant in Chinafor premium lubricants

The plant tohave an

automated, hi-tech lubricantblending lineas well asadditional

storage tanks

The plant’s annual output is expected to increase from 45,000to 150,000 tonnes, covering a wide range of automotivelubricants, anti-freeze liquids, industrial lubricants and

greases. The expansion also saw an upgrade of the plant'swarehouse facilities to enhance capabilities for storage,

transportation, local distribution and overseas export


dewjournal.com

As India increasingly turns to clean energy to power its growing economy, windenergy offer the foundation of Renewable Energy Program in India. The wind energy

sector is India’s largest and most successful renewable energy. Currently, India has aninstalled capacity of more than 27 GW of wind energy making it the 4th largest in theworld. In 2015, the Ministry of New and Renewable Energy (MNRE) announced a 60 GWtarget for wind power by 2022, and to raise the share of non-fossil fuel power capacity inthe power mix to 40 percent by 2030.

India is also ranked the fourth largest wind energy producer in the world with apotential to grow over a time. Presently India has an installed capacity of 27,509.0 MW ofwind energy making 4.3% of total wind energy produced across the globe.

Wind energy brings low part running cost, which makes it an ideal source of energyin the long run. But when it comes to wind energy generation, wind turbine lubricantsneed to last long and offer excellent oxidation and shear stability, all the while protecting

The new age oil for wind turbines

Mr. Glen Sharkowicz andMr. Shankar Karnik displaying the highperformance Mobil Lubricants in New Delhi54 DEW JOURNAL May 2017

dewjournal.com

India’s Ministry of New and RenewableEnergy has announced a 60 GW targetfor wind power by 2022, and to raise theshare of non-fossil fuel power capacityin the power mix to 40 percent by 2030


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Over 40,000 wind turbine gearboxes across the world run on Mobil lubricantsthat maximize equipment productivity under high-stress operating conditionsby minimizing unscheduled downtime and maintenance. Known for extendinggear and bearing life, the new age synthetic Mobil SHC Gear 320 WT backedby the seven years limited warranty recently demonstrated its world-classquality at Windergy 2017. The new age oil can supplement wind turbineefficiency as India targets 60 GW by 2022 with massive wind turbinesexpansion plans across the country on anvil to meet the National Action Planon Climate Change target of 15% energy generation from renewable by 2020.The Chief Editor DEW Arun Kr.Singhal interacts with Mr. Glen Sharkowicz,Industrial Marketing Manager Asia-Pacific, ExxonMobil Asia-Pacific PrivateLimited and Mr. Shankar Karnik, General Manager-Industrial, ExxonMobilLubricants to understand the power behind the Mobil SHC Gear 320 WT oil


dewjournal.com

Advanced Mobil SHC lubricants and greaseshelp unleash wind turbine power. Mobil SHC™Gear 320 wind turbine oil is backed by 7 yearslimited warranty promising extended oil life


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interface.What distinguishes the Mobil SHC™

Gear 320 WT oi l f rom the otherproducts is that i t remains stableduring water contaminat ion andprovides minimal unscheduleddowntime and maintenance whichleads to longer gear, bearing and oill i fe. This signif icant achievement

demonstrates how Mobil products are enabling theworldwide wind industry to become efficient evenunder the most extreme climatic conditions as wellas cost competitive.

This synthetic wind turbine gearbox oil gives anexcellent protection against conventional wear modessuch as scuffin while providing a high level ofresistance against micro pitting fatigue. Mobil SHCGear 320 WT wind turbine lubrication maximizesequipment productivity by minimizing unscheduleddowntime and maintenance, extends gear andbearing life under high-stress operating conditions.Moreover, the wax-free nature of synthetic fluids andthe low coefficient of traction provide excellent lowtemperature pump ability and very low starting andrunning torque. Backed by the 7 years limited warranty

ExxonMobil’s wide portfolio of grease, gear oil andhydraulic oils is designed specifically to meet thechallenges of equipment in extreme conditions oftemperature, load and water contamination.• Mobil SHC™ Gear 320 WT and Mobilgear SHC™

XMP 320 are gear oi ls designed to provideprotection from wear and corrosion, anti-foaming.The oil remains stable during water contaminationand provides minimal unscheduled downtime andmaintenance, which leads to longer gear, bearingand oil life

• Mobil SHC™ Grease 460 WT, Mobil SHC™ Grease102 WT and Mobil i th SHC™ 100 are greasedesigned for main, pitch, yaw and generatorbearings. These grease help in flexible componentplacement, long re-greasing interval helps controlservice cost. Help in smooth performance duringexceptional high- and low-temperature conditions

• Mobil SHC™ 524 and Mobil DTE 10 Excel™ Seriesare specially designed hydraulic oils ideal for high-pressure and tight-clearance systems. It provideslong oil, filter and component life, carry's anti-wearprotection and resists deposit formation

• Mobil SHC™ 600 Series is an oil designed forancillary gear boxes. It promotes operationalreliability and energy efficiency, longer oil life andhas high and low temperature capability

• Mobi l tac™ 375 NC is an open gear di luentdesigned to protect gear teeth and machineelements

• ExxonMobil offers Mobil ServSM

o Mobil ServSM Lubricant Analysis – a mobile-enabled used oil analysis service, in India. It alsooffers application-specific analysis options –including hydraul ic, gearbox, engine,compressor, powertrain and circulating analysis,among others – for a wide range of industries,enabling companies to choose the option thatbest fits their specific needs.

o Mobil ServSM Engineering Services – includingWind Turbine Gearbox Flush and Fill, as well asstartup and cleanliness guidance – which helpsupport wind farm operators in achievingoutstanding equipment protection and longservice intervals, resul t ing in safety,environmental and operating cost benefits

“Our specially designed synthetic oilsand greases provide excellent

protection against wear, rust andcorrosion adding to improved

performance, longevity of equipment”- Mr. Glen Sharkowicz

key turbine components such as gears from micro-pitting and main bearings from failure etc.

With this background and the need for a qualitylubricant to help the industry in harnessing windenergy to the fullest and make higher productivity andsustainability goals Mobil Industrial Lubricants’ hasdemonstrated the Mobil SHC™ Gear 320 WT oil, afully-synthetic industrial gear lubricant at Windergy2017 an event jointly organised by the Indian WindTurbine Manufacturers Association and Global WindEnergy Council in Delhi, India from 25-27 April 2017.Supporting the growth of the wind industry MobilIndustrial Lubricants used in over 40,000 wind turbinegearboxes across the world. The products designedto meet the challenges of the wind industry, reducemaintenance and cut a human to an equipment

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promise, it offers extended oil life.Mobi l ’s f ie ld demonstrat ion withequipment builders has also helpedto confirm the results from laboratorytests demonstrating the exceptionalperformance of Mobil SHC Gear 320WT advanced wind turbine gearlubricant, and gaining the approval ofleading gearbox builders globally.

ExxonMobil further showcased Mobil SHC™Grease 102 WT and Mobil SHC™ Grease 460 WT.Mobil SHC™ Grease 102 WT is a new syntheticgrease which protects wind turbine bearings fromextreme temperature conditions as high as 120degrees Celsius to as low as -50 degrees Celsius.Mobi l SHC™ Grease 460 WT is a superiorperformance lubricant especially suited to exceed thedemanding requirements of wind turbine applicationsat extreme temperatures. It is widely used by allleading builders in India and across the globe fortheir main bearings. Mobil SHC™ Grease 460 WThas become the first fill product of choice for manywind turbine builders and component suppliers.Compared to conventional greases the benefits ofthis synthetic grease include longer grease life,enhanced false brinelling protection and bearing life,wide temperature range of application, and thepotential for improved mechanical efficiency. For boththe greases, the unique features of synthetic basefluids are combined with high quality lithium complexthickener. The lithium complex thickener contributesexcellent adhesion, structural stability and resistanceto water.

"Wind industry is a growing market with a largenumber of new entrants tapping this segment. Tosuccessfully run operations today requires not onlyefficiency and productivity but also make sure safetyby reducing risks in human to machine interface aswell as control and cut environmental impact. Mobil’ssynthetic lubricants help in Advancing Productivity,which means Mobil lubrication solutions help mitigatepotential employee risks arising from direct contactwith equipment, helps in reducing carbon footprint,meet the operat ional goals and enhancecompetitiveness by increasing efficiency, reliability,and productivity. Our specially designed synthetic oilsand greases provide excellent protection againstwear, rust and corrosion adding to improvedperformance, longevity of equipment as well as wind

The term "ExxonMobil" is used for convenience only, and may includeExxonMobil Corporation or any of its affiliates. ©ExxonMobil, Mobil andMobil1 are trademarks of ExxonMobil Corporation or one of its subsidiaries.ExxonMobil Lubricants Private Limited is a wholly-owned affiliate ofExxon Mobil Corporation.

turbine productivity”, said Mr. Glen Sharkowicz,Industr ia l Market ing Manager Asia-Pacif ic atExxonMobil Asia-Pacific Pte. Limited

ExxonMobil offers a wide portfolio of products forthe rapidly growing wind industry; it has also been atthe forefront of developments in the wind energysector for over 30 years through experienced fieldengineers and industry-leading used oil analysisservice. They work closely with equipment buildersto gain insights into their requirements. Theformulators then use these insights to bui ldoutstanding lubricants that are well supported bybuilder approvals.

“India is the fourth largest wind energy producerin the world. The government has taken variousinitiatives to grow the sector and we are able to supportit through our extensive product portfolio. Our gear oilsand greases make sure adequate and optimizedperformance of wind turbines while preserving the lifeof the gear box and other critical components, extendoil drain intervals and reduce overall maintenancecosts. We are helping the wind industry in India reachhigher levels of efficiency and productivity,” said Mr.Shankar Karnik, General Manager Industrial,ExxonMobil Lubricants Pvt. Limited.

Mobil lubricants help the wind industry increaseefficiency, productivity which leads to longevity ofassets and longer oil life reduces the frequency ofoil change. ExxonMobil scientists and applicationspecialists work with key OEMs to make sure thatthe product of fer ing prov ides except ionalperformance with the rapidly evolving gear designsand operat ion. Count ing on the technologyleadership and application expertise behind MobilLubricants reinforce productivity of wind turbines andhelp OEMs.

“Our gear oils and greases aredesigned to ensure adequate and

optimized performance of windturbines extend oil drain intervals andreduce overall maintenance costs”

- Mr. Shankar Karnik

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Power Management CompanyEaton delivers higher levels ofsurge protection with the launch ofa modular device range designedfor easy instal lat ion,commissioning and replacement.Eaton’s new MTL SD Modular rangeprovides comprehensive protectionfrom transient surge events up to20 kA, the highest level of protectioncurrently available for a modularpluggable device which is coupledwith the highest packing density onthe market. With over 50 per cent ofpremature electronic equipmentfailures being attributed to surgeand maintenance failures, Eaton’sMTL SD Modular range offerscomplete cost-ef fect ive surgeprotection to valuable instrumentsand distributed control systems.

“The del icate circui ts anddevices in today’s equipment andsystems make their susceptibilityto transient surge events muchgreater,” said Roger Highton, MTLProcess Connectivity Product LineManager, Eaton. “Underestimatingthe importance of reliable surgeprotection devices can be extremelycostly if the worst should happen.The MTL SD Modular range isunique in offering 20 kA protectionwith a module width of just 7mm,allowing maximum protection ofvaluable assets in minimal space.”

The design of the MTL SDmodular device reducesmaintenance cost and downtime,as modules can be quickly andeasily replaced. The pluggablepart is held in place with a simpleretention tag and can be removedfrom its base without de-energisingthe protected device, saving the

Eaton unveils highest performing modular surgeprotection device for complete process reliability

user valuable time and complexity.This is achieved using aninnovative ‘make before break’design to ensure uninterruptedloop operation during replacement.Additionally, the slim-line footprintof the surge module increases thepacking density, resulting in savingboth space and cost, whichpotentially reduces the number ofcabinets needed.

A diagnostic LED option isavailable to provide a clear, visualindication of a failed module so thatengineers can immediately seewhich module to replace. A portablesurge test device is also available,allowing users to simply check thehealth of each module dur ingroutine maintenance.

This new modular rangeinherits the proven reliability of theMTL SD range, increasing systemavailabi l i ty in a wide range ofindustries including oil and gas,chemical, power and water/

wastewater. With versions availablefor all process signal types, they areideal for panel builders, systemintegrators and engineers lookingto protect electrical and electronicassets. The range is fully ATEX/IECEx certified for use in intrinsicallysafe applications, is SIL suitableand is designed to meet globalstandards.

Eaton’s Crouse-Hinds divisionoffers a range of cable fittings,enclosures, plugs and receptacles,industrial lighting fixtures, signalsand alarms, and electroniccomponents designed for the mostdemanding environments. TheCrouse-Hinds business servescustomers in the industrial andmanufacturing, mining, oil and gas,solar, infrastructure and othermarkets.

MTL products, part of Eaton’sCrouse-Hinds series portfol io,provide leading electronicinstrumentation and protectioncapabilities for the process controlindustries. Key applications includeintrinsic safety, fieldbus, industrialnetworking, surge protection, HMIand visualisation, gas analysis andalarm management.

Eaton’s electrical business isa global leader with expertise inpower distr ibution and circuitprotection; backup power protection;control and automation; lighting andsecurity; structural solutions andwiring devices; solutions for harshand hazardous environments; andproject design services. Eaton ispositioned through its globalsolutions to answer today’s mostcritical electrical power managementchallenges.

News

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Caterpillar Marine has announcedthe unveiling of the first LNG testbed for gas-fuelled engines at itsfacility in Kiel. The LNG preparationunit comprises of an LNG tank anda gas preparation unit, both in 40 ftcontainer size. Both developed andprovided by Marine Service GmbH,Hamburg.

The future holds great promisefor LNG solutions, and Caterpillaris perfecting the technology at itsnew Kiel test bed. Caterpillar isalready a leader in LNG power withits respected and widely adoptedMaKTM branded dual fuel engines,which are capable of running onMDO or NG (natural gas). Butthere’s still a lot to learn about LNGand the engineering required tomaximize its potential. With its Kiellocation, Caterpillar will improve itsunderstanding of the technologyand enhance the service it providesto clients adopting LNG.

“LNG offers obvious benefits tomarine power and it’s considereda true future fuel,” saidGeorg Gi l ler t ,engineering supervisorfor Caterpillar Marine. “Itburns cleaner than otherfuels, emit t ing lowamounts of ni t rogenoxide (NOx), sul furoxides (SOx), particulatematter and carbondioxide. When handledproperly, LNG offers aclear path to regulationcompl iance with al lcurrent and futurestandards,” statedGil lert . LNG alsoprovides greater energydensity than natural gasin its gaseous form, and

First of its kind LNG test bed for marine unveiledit ’s possible to store up to 600times more LNG than standardnatural gas.

LNG’s clean burning nature hasdrawn numerous vessel owners,and particularly those with an eyefor future compliance. Severalmarine industries, including cruiselines and chemical / oi l tankeroperations, have begun fitting theirfleets with MaK power, and gas-fuelled engine prevalence will onlyincrease over time.

“Caterpillar’s LNG test bed inKiel is a mi lestone in LNGdevelopment,” said Gillert. “WhileLNG is a promising fuel, it doesoffer unique challenges. LNG hasto be kept at extremely lowtemperatures to prevent it fromvaporiz ing, and this requiresaddit ional gas handl ingcomponents not found in otherpower systems. New engine andgas handl ing archi tecture isneeded to take full advantage ofLNG’s emissions benef i ts.

Customized monitoring and controlprocesses will also be needed tooptimize fuel/air composition andsafe engine operation.”

With that in mind, Caterpillar’sKiel test bed wil l focus on thefollowing:• Famil iar iz ing Caterpi l lar

personnel with LNG capabilities.• Demonstrating LNG benefits to

Caterpillar’s clients. Knowledgeis power, and it’s no different withLNG power.

• Test ing and improving LNGcomponents.

• Developing LNG plants for actualoperations.

• Facilitate customer training to notonly become familiar with LNG,but also teach customersimportant safety informationregarding LNG handl ing andoperational procedures.

• LNG is exciting and challenging,and with the Kiel locat ion,Caterpillar is ready for everythingit has to offer.

News

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The flagship DAV MX™ CircSub from ChurchillDr i l l ing Tools, an oi l f ie ld service company

specializing in drilling innovation, was selected forthe world’s deepest and hottest geothermal borehole

Spudding record breaking geothermal well

Churchill Drilling Tools, an oilfield service companyspecialising in drilling innovation has had its flagshipDAV MX™ CircSub selected for the world’s deepest andhottest geothermal borehole in the Iceland Deep DrillingProject (IDDP) on the Reykjanes Peninsula. The IDDPwell is earmarked to become an integral part ofIceland’s geothermal energy production – providingclean, renewable energy by using supercritical steamheated by the earth’s magma. Drilling took 176 daysand involved the deepening of an existing geothermalborehole to a depth of 5km. The IDDP team encounteredtemperatures of 427°C at a depth of 4659m –simultaneously creating the deepest and hottest evergeothermal borehole and encountering supercriticalconditions at a shallower depth than anticipated

in the Iceland Deep Drilling Project (IDDP) on theReykjanes Peninsula.

The IDDP well is earmarked to become anintegral part of Iceland’s geothermal energy

Drilling site at Reykjanes, Iceland

Innovative drillingsolutions for theoil & gas industry

Technology


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production – providing clean,renewable energy by usingsupercritical steam heated bythe earth’s magma.

Drilling took 176 days andinvolved the deepening of anexisting geothermal boreholeto a depth of 5km. The IDDPteam encounteredtemperatures of 427°C at adepth of 4659m –simultaneously creating the

deepest and hottest evergeothermal borehole andencounter ing supercr i t icalconditions at a shallower depththan anticipated.

Samples were taken to surfaceto ascertain fluid chemistry and thedrill presented an unprecedentedlook into the depths of the earth’scrust.

The DAV MX™ CircSub wasselected on the recommendationof a major operator and partner inthe IDDP product due to its robusttemperature resistance andexperience in HPHT conventional

Illustration of the geothermal process

The DAV MX™ CircSub has robust temperatureresistance and experience in HPHT conventionalwells. The tool offered a contingency for the IcelandDeep Drilling Project team against pack-off relatedcirculation loss in which the BHA componentswould be literally cooked if circulation was lost

Technology


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wells. The tool offered a contingency for the IDDPteam against pack-off related circulation loss in whichthe bottom hole assembly (BHA) components wouldbe literally cooked if circulation was lost.

Mike Churchill, CEO and commercial directorsaid: “Churchill was delighted to secure two worldfirsts’ on this well. The IDDP well is both the deepestand hottest geothermal well on record and it is a

reflection on the DAV MX™ that it was selected to berun in this string. The tool has a significant casehistory in HPHT wells and can withstand a good dealof punishment – both of which suited the client in thisunconventional case.

“Geothermal wells are a new area for Churchilland it is a market we are looking to expand as ourcompetition in the segment simply cannot match the

resi l ience of theCircSub.”

Churchi l l Dr i l l ingTools is a special istengineering companythat provides leadingand innovative drillingsolutions for the oil andgas industry. Fromfounder Andy Churchill’soriginal designs in 1998the company hasbecome renowned forthe supply of a widerange of simple, reliableand effect ive rentalproducts.

Churchill’s presencein the drilling industry isglobal, with off iceslocated in Houston,Aberdeen and Dubai. Itsflagship product, the DAVMX™ CircSub, is arecognized performanceleader and has beensuccessfully run in morethan 900 wells. Thecenter pieces of theChurchil l range areinnovative applications ofdrop-in dart technology,such as Smart Darts™,which help control thenext generation of downhole tools that are takingthe industry forward incritical areas such as wellcontrol, drift ing, mudcirculation and stuck-piperecovery. dewjournal.com

Technology


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Trendsetter Engineering and Add Energy have combined expertiseto provide market leading engineering and hardware support

services to the industry’s most challenging problems in a nimble andresponsive environment. The companies have recently been awardeda contract to supply engineering expertise and access to Trendsetter’spatented Relief Well Injection Spool (RWIS) in support of an operators’drilling campaign on a newly sanctioned field development.

The RWIS has been designed and built to greatly increase thepumping capacity of a single relief well by enabling the ability to pumpin excess of 200 bbl per minute of kill mud through a single relief well,utilizing multiple vessels as opposed to the conventional method ofmultiple relief wells. The RWIS is installed on the relief well wellheadbeneath the blowout preventer (BOP) to provide additional flowconnections into the wellbore. Using high-pressure flex lines, the inletsenable pumping units from separate floating vessels, in addition to therelief well rig, to deliver a high-rate dynamic kill.

Additional benefits generated by this hardware include an increasein redundancy and flexibility of operations by moving the additionalrequired pumps and mud storage to the remote vessels, allowing for

Relief Well Injection Spool

RWIS positioned for use on the relief well wellhead beneath the blowout preventer (BOP)

The RWIS has beendesigned and built togreatly increase the

pumping capacity of asingle relief well by

enabling the ability topump in excess of 200 bbl

per minute of kill mudthrough a single reliefwell, utilizing multiple

vessels as opposed to theconventional method ofmultiple relief wells. TheRWIS is installed on the

relief well wellheadbeneath the blowoutpreventer (BOP) to

provide additional flowconnections into thewellbore. Using high-

pressure flex lines, theinlets enable pumpingunits from separatefloating vessels, in

addition to the relief wellrig, to deliver a high-rate

dynamic kill

Technology


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the potential for an off-bottom killwhich could provide a faster reliefwell intercept, thus reducing spillvolumes to the environment.

A kill operation with two ormore relief wells is recognized asbeing a challenging operation. Inthe event of multiple relief wellsbeing required to dynamically kill awell, all relief wells will have tosuccessfully locate and intersectthe blowing wellbore. The blowingwel l must be ki l led through a

simultaneous coordinated ki l loperation. Assuming a blowoutwhere a relief well intervention isthe only option and that the killrequirements are expected to bevery demanding, the use of theRWIS provides a viable costeffective solution.

Brett Morry, Global TechnicalDirector of Trendsetter Engineeringcommented; “We are delighted tohave been contracted to supportour client in their quest for best in

Add Energy and Trendsetter present the first photo of the RWIS

class and safe operations. Webelieve that Add Energy’s expertknowledge and experience in wellcontrol engineering, in partnershipwith our patented RWIS equipmentwill provide well control assurancefor this operator if an incident wasto occur.”

Morten Haug Emilsen, SeniorVice President at Add Energy alsocommented; "We are eager toimplement our combined expertisewith this client to ensure safe andeconomic drilling operations. Ourrecent enhancements in wel lcontrol technology will now allowfordrilling of prolific reservoirs thatmaintain single rel ief wel lcontingency. The RWIS technologyhas a huge cost saving potentialthat enables larger completionsand optimized casing design. Weare pleased with this contract winand to be given the opportunity toprovide substantial and uniquebenefits to our cl ient in safetyassurance."

Trendsetter Engineering, inbusiness since 1996, is a premierprovider of special ized subseasolut ions for oi l and gascompanies across the globe. Theengineering company specializesin solving unconventional problemswith convent ional f ie ld proventechnology, especially in a crisisenvironment.

Since 1991, Add Energy’s WellControl and Blowout Support teamhave delivered blowout contingencyplanning and well controlengineering services to the oil andgas industry. These services havebeen provided globally for bothonshore and offshore well controlprojects ranging from smallincidents to large scale blowoutslike the Montara incident in Australia,and Macondo in GOM.

Assuming a blowout where a relief wellintervention is the only option and that the kill

requirements are expected to be verydemanding, the use of the RWIS provides a

viable cost effective solution

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Technology


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DNV GL launches LVRT testing services in IndiaDuring Windergy 2017 on April 26, 2017 in New Delhi,DNV GL, the world’s largest resource of independentenergy experts and certification body has officiallylaunched their full suite of LVRT Testing services forthe Indian wind market to support grid stability andimprove security of supply.

The goverment of India has ambitious plans toachieve 175 GW of renewable capacity by 2022, 60 GWbeing in wind energy, to compliment it’s growth plans.

Whilst wind energy becomes more of an integralpart of the Indian power system, operators oftransmission networks have added more stringentrequirements for grid connected wind turbines. The

main challenges are the Low Voltage Ride Through(LVRT) capability, the reactive power demand duringthese voltage dips, and the power recovery after thevoltage dip. The LVRT test provides transmissionnetwork operators and wind turbine manufacturerswith reliable voltage dip capability results.

As India aims high to broaden their renewableenergy capacity and takes more stringent measuresto improve the quality, DNV GL launches its LVRTtesting services, fol lowing up with the CentralElectr ic i ty Regulatory Commission’s (CERC)mandate to make these tests grid compliant for alloperating wind turbines.

DNV GL with decades ofinternational accredited measurementexperience will now offer a full suite ofLVRT Testing services in India, withrespect to container design and build,schedul ing, forecast ing, demandestimation, contingency plans andprotection system. This is not limitedto other testing services DNV GL canprovide l ike Power PerformanceManagement, Power Qual i ty andAcoustic measurements.

Mathias Steck, Execut ive VicePresident Asia Pacific, DNV GL –Energy comments, "I am very pleasedto see that India is finally making thesetests mandatory. With the welcomeand ambit ious renewable energytargets the current Indian governmenthas set this is an absolute must toensure grid stability.”

After successfully commissioning20,000 LVRT tests on 50 different windturbines being operated worldwide,and leveraging over 20 years ofoperating experience in India, DNV GLaims to now support the growingdemand for accredited testing services.

DNV GL, whose origins go back to1864, operates globally in more than100 countr ies with i ts 16,000professionals dedicated to helpingtheir customers make the world safer,smarter and greener.

News


dewjournal.comEngineering

Engineering f i rms andowner-operators in water and

wastewater utilities are constantlylooking for better ways to reducethe total cost of infrastructureprojects. To meet this end, manyare taking a TOTEX (totalexpenditure) approach to managingand operat ing their water andwastewater infrastructure assets.As the demand for newinfrastructure grows,owner-operators arelooking to improve howthey manage and mitigatethe risk associated withlarge capital projects. Todo this, water andwastewater utilities need toconverge the r ighttechnology, the r ightpol ic ies and a new,creat ive method ofinteract ion in order toextend and enhance the lifeof an asset with assetmanagement at the fore ofthis strategic process.Connect ing IT, OT(operational technology),and ET (engineeringtechnology) is now offeringa potential way of reachingthis goal.

A key driver enforcinga TOTEX approach inwater and wastewaterut i l i t ies is the lack of

A TOTEX approach in waterand waste water infrastructure

Aidan MercerIndustry Marketing DirectorUtilities and Government, Bentley Systems

for the OPEX cycle. This isimportant as owner-operatorsrequi re in format ion f rom al l

phases of the pro jectlifecycle to be useful in theasset management ormaintenance managementsystems when the assetreaches handover. In orderto improve data quality andaccuracy, an emergence ofdisruptive technologies ishelping to deliver the rightinformation to the rightteams, at the right time overthe entire project lifecycle.

The advent of digitalengineering models usedduring the capital phase ofprojects have allowed forgreater leverage of assetperformance modell ing,which has provided waysto reduce costs, improvecollaboration, and enableasset opt imisat ion foroperations. These digitalengineering modelstypically have not had aprominent role in

Fig.1 Digital engineering models bring together critical information ina virtual 3D environment.

Fig.2 Asset performance monitoring brings together IT and OT withbig data analytics.

complete and accurateengineering information capturedduring CAPEX that serves as feed


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of reducing cost andoptimising their networkscan be realised – in realtime. Hydraulic modellinggenerally has been usedfor long-term planning,while data from the SCADAsystems are used heavilyin dai ly operat ionaldecisions. Linking thesetwo technologies hasensured barr iers areremoved, col laborat ionhas improved, and data isshared for mutual lybeneficial reasons.

A TOTEX approach isgiving rise to a newbreed of digital nativesWater and wastewateri n f r a s t r u c t u r eprofessionals are wel l -placed to deliver againstCAPEX, OPEX, and TOTEX,by keeping continuity andenhancing collaboration

through better work processes andan ultimate convergence of IT, OT,and ET. By leveraging digi ta lengineering models, waterinfrastructure professionals will actas beacons of l ight for otherindustries to follow. Its success willbe driven by the mutually beneficialnature of TOTEX, with engineersand architects delivering value andcreating a new generation of digitalnatives to act as flag-bearers forinfrastructure improvement andasset longevity to the delight ofowner-operators.

Engineering

Fig.3 Asset performance modeling integrates 3D models with IT andOT systems used to model asset performance.

Fig.4 Users can utilize 3D meshes as an immersive environment forvisual operations.

operations as of yet. Thereis a huge amount ofinformation related toassets that can beleveraged at di f ferentphases of a project, suchas asset specif ications,precise geo-coordination,configuration management,cost information, detailedcomponent information,and recommendedmaintenance and repairinformation.

The ultimate convergenceof IT, OT, and ETEngineering data is not theonly potential for reducingTOTEX. As OT leveragesthe Industrial Internet ofThings (IIoT) with operatingsystems and sensors toproduce huge quantities ofdata, the need to make thisdata usable and secure isfast becoming main streamin its outreach and adoption. So far,OT data has initiated a convergencewith IT systems, which has yet toyield significant gains. At Bentley, wesee the crit ical importance ofleveraging the engineering data inorder to yield significant gains.

Asset management systemsthat allow a convergence of IT, OT,and ET data will help to bridge thegap between data formats to makeinfrastructure assets morepowerful, efficient, and reliable byexploiting the Big Data potential.Enhanced by the power of the cloud,digital engineering models areevolving toward an upgrade to theIIoT: digital engineering tools thatgo beyond observing andmonitoring the asset’s performanceto modelling its desired behaviourto produce better outcomes.

Water and wastewater utilitieshave been a step ahead of otherindustries in exploiting the potentialfor ET and OT data to be betterut i l ised. I IoT and supervisorycontrol and data acquisi t ion(SCADA) software have had aharmonic convergence of their ownin enriching the oversight value ofdata analyt ics for t reatment,distr ibut ion, and col lect ionfacilities. Engineering departmentsand the operational control roomshave more reason to interact thanever before, as the common goal

Aidan Mercer joined Bentley in 2010 and is currently Industry MarketingDirector for water and wastewater, electric and gas, communications,and government. He has held various roles in geospatial and utilitiesmarketing with Bentley and previously held various marketing roles insimilar high-tech organizations.

about the author

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of data and making i tsassessment difficult. Also, evenafter digital data storage startedthe same data wasn’t available atall. Each person had a separateset of data in separate easi lyaccessible format. All these issueshave been resolved using EPINETwhich has created cloud storagefrom where all the information isaccessib le to the companyemployees.

EPINET- ONGC’s E&P TransformerIndia’s largest integrated energy major Oil and Natural Gas Corporation started a datamanagement initiative, EPINET (Exploration and Production Information Network). ThisE&P transformer of ONGC has been discussed and reviewed in this paper. The paperdiscusses how EPINET has helped dealing with people, process and technologicalaspects of the project implementation.

The main aim of the initiative has been to make information and data networkingstronger in the ENP sector, this was achieved by setting software, empowering thesetup sites with manpower and implementing and executing policies for the steady andunhindered flow of information.

Presently the EPINET deals with data aggregation, organizing disparate informationand providing easy and free excess to information. In short EPINET helps in shifting andupgradation from personalized local databases to integrated worldwide databases.

Along with a general introduction the paper even stresses on the challenges,advantages and limitations of this multibillion dollar profitability project of ONGC whichaims to improve the speed, and accuracy of business decisions through efficient teamwork and availability of reliable multidisciplinary data like well completion, logging andproduction.

Vrinda Joshi

ONGC has been India’s largestoil and natural gas producing

company. It remains committed toa vis ion of evolving into anintegrated energy major ofinternational repute.

In the industry one of thebiggest problems that still remainunresolved is the col lection ofvar ious data, i t comput ing,distribution, processing and quickdecision making, but due to theefforts of ONGC this is no longer achallenge. ONGC has formulaedand undertaken a project calledEPINET that has the key to thisissue. EPINET is a setup of webenabled industry standard datamanagement system forgeophysical and other ENP relateddata, for use by geophysicist aswell as all other geoscientists andengineers across the company.The biggest advantage of EPINET

is that all users sitting thousandsof miles away can access dataeasi ly from the workplace andspeedy and accurate decisionsfrom the experience and tutilegeof various experts can be taken.There were many reasons behindthe emergence of EPINET l ikepreviously storage of data was verydifficult and the confidential datawas stored in unsecureenvironment. All this led to the loss

Shivank SabharwalDepartment of Petroleum Engineering, UPES

Reservoir

Paper reviewed by: Dr S.K. Nanda, Adjunct Professor, UPES (formerly Executive Director,ONGC), Somnath Banerjee, Industry Fellow, UPES (formerly with Halliburton) and Dr.Pushpa Sharma, Professor, UPES (formerly General Manager, ONGC)

BEST PAPER AWARDED AT UPES SPE FEST 2017


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WHY EPINET?• E&P data is the asset of

any oi l company andneeds preservation tillits entire life, for the oiland gas industry, its 50years.

• Data searching andmanagement is a timeconsuming process.

• Data degrades with time.Hence i t needspreservat ion both interms of qual i ty andquantity.

• Risk factor has to bereduced which requiresinterpretat ion and re-interpretation with new tools onthe old data set available.

HISTORYEpinet Phase 1The project was div ided intophases for i ts implementat ionsetup and execution. The projectstarted in May 1999 and completedin June 2000. The main purpose ofthis phase was to setup theequipments required for the cloudstorage of data. Computer systemsand data management softwareswere acquired and setup via LANat ONGC’s KDM Inst i tute ofPetroleum Exploration (KDMIPE)Dehradun and backup of this datawas installed at Baroda, Mumbaiand Ahmedabad. Theemploys were trained forthe EPINET system and 25percent of data wastransferred to the softwaresto check whether thesystems are workingproperly or not. This 25%data included data of wellcompletion, geo laboratory,seismic navigation anddata regarding f ield

reservoir and production.

Epinet Phase 2The phase 2 plan was made via acontract between ONGC and GeoQuest Systems B.V on 29 March2004 and a deal was put inplacethat the decided targets would beachieved by March 2005. In thisphase, the ONGC personnel weretrained through special tailor mademodules. To ensure seamless flowof current data in the minimumpossible t ime from the datagenerating centre to the concernedEPINET si te, work f lows weredesigned and implemented.Currently EPINET is managingcurrent as well as legacy E&P datato provide more and more intrinsic

• Standardizat ion of newmethodology, nomenclatures,qual i ty assurance and datamanagement for all databasesystem.

EPINET IT INFRASTRUCTURE• Hardware: Sun Microsystems• Operating System (OS): Sun

Solaris 8• DBMS: RDBMS Oracle 9i• Softwares:

FINDERLOGDBSEISDBDRILLDBASSETDBGEOFRAME GEOLOGYGEOFRAME PETROPHYSICSDECISION POINT DATA ACCESS

Reservoir

Fig.1 Phase-1 and Phase-2 Scope; EPINET Sites and Networking

value to the Geoscientists,as wel l as topmanagement by makingthe desired data availablein the quickest possiblemanner. Refer figure 1.

TECHNICAL OBJECTIVES• Development of a

corporate level storage forcompany’s Explorationand Production data.

• Implementat ion of aproject level databaseplatform at all assests,basins, corporatecenters etc.

Fig.2 Systematic flow of work in a pyramidal structure

Refer figure 4.

METHODOLOGYData should be capturedactivity wise at the sourcepoint in spreadsheets(Microsoft Excel); geology,dr i l l ing, logging andchemistry.• Existing network means

and practices are to beused for communication


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of data to base office.• Data owners have to

validate and authenticatedata at base office.

• Data should then beuploaded into EPINET.

• Mutiple data entr iesshould be avoided.

• Existing data should notbe affected.

EPINET project teamsare the custodians of allthe E&P data of ONGC.Refer figure 3.

EPINET DATA TYPES• Geology• Seismic• Well Log• Reservoir• Laboratory• Lease• Drilling• Production• Physical Assets• Geoscientific Reports• Seismic sections• Log films• Cores• Fluid samples

Well dataThe well data includes headerinformation, core detai ls,

due to EPINET and thedevelopment of uniformnaming conventions andstandardization the data isstored on Oracle Rdbms infinder.

Log dataONGC is the largestoperator in India and sincethe companies inception ithas col lected var iouslogging data for overthousands of wells in Indiaand abroad. Though an oiland gas company’s poweris determined by theamount of logging datapossesses but managingsuch a huge data wasbecoming a tiresome jobfor ONGC. EIPNEThowever has changed thisscenario. Raw logs as wellas spliced edited and readyto use merged logs are

managed by ONGC by utilizing LogDB and finder master databasetechnologies of Schlumbergerprivate limited.

Seismic dataMost of the seismic data wasmanaged during phase 1 and post

Reservoir

strat igraphy, wel l complet ion,production testing, reservoir rocketc. Before the evolution of EPINET,the data was stored on differentdata bases and platforms alsomapping of common entities withdi f ferent data sets of var ioustopographies was difficult but now

Fig.3 EPINET work flow

Fig.4 EPINET Scenerio

Fig.5 SEG-Y Trace viewer Fig.6 Well activities setion in drillDB

RESULTS AT A GLANCE


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phase 2 activities of the project.However entire 2D/3D seismicstack and migrated data wascovered in phase 2 and managedby utilizing SeisDB software fromthe solution provider. Refer figure5 and 9.

Data loadingData policy was adopted by ONGCaccording to which data will beuploaded from recent to past. Datamay be uploaded on the basis ofpriority in some cases. Currentdata however is loaded on thehighest priority.

Drilling DataAround 10,000 wells have beencompleted by ONGC. Daily reportsand other reports are madeavailabe everyday at different sites,media and formats. These aredeveloped in Drillmis system inIDT, whereas current data iscaptured through another project byusing a module of ICE. A source ofdrilling data is provided to drillingengineers. Refer figure 6.

Production DataFinder at EPINET managesONGC’s product ion data.Production volumes, work overhistories, Well stimulation jobs,Pipe lines, Water injection, Artificiallift, Gas utilization, Value addedproducts, Fluid characteristics, etcare common production data types.Systematic storage is the need ofa Product ion Engineer and i tsorganization.

Product ion extension datamodel (PDM) manages productiondata. Refer figure 7 and 11.

CURRENT STATUS• All sites of ONGC have been

given access to this state of the

Reservoir

Fig.7 Well wise production

Fig.8 GIS view

Fig.9 2D and 3D seismic data


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art technology.• Implementation of the system

flow functionalities.• Electronic as well as the hard

copies of al l the ENP dataavailable since inception hasbeen loaded into the system.

• Establishment of the current datasystem.

FOCUS AREAS• Wide range of customization has

been carried out as per multi-

Reservoir

discipl inary work f lowrequirement for various dataclasses. This needs to beregularized to avail the benefitsof implementat ion of higherversions/upgrades etc. f romvendors.

• The standards entities attributesfor EOR, Coal Bed Methane(CBM) and Gravity Magneticscope need to be defined in thedata model in line of ONGC.

• Lead should be taken by

Energistics for Implementation ofdata mining tools to get earlyreturn on investment.

FUTURE TRENDS-THE ROADAHEADThe task of migrating explorationand product ion in format ionnetwork EPINET finder base tonew prosource environment isdifficult but a need for the future.Migration odf prosource seismicand logs is already done. Thetransfer of well database is beingdone to prosouce. I t is a lsoplanned that in the upcomingyears finder database should haveal l modules under prosourceenterpr ise in tegrat ion. Futureplans also include stor ing theinterpreted data in prosourceenvironment.

CONCLUDING REMARKS• In the present order of E&P world,

storage and retr ieval ofinformation have become criticalfor business workf low, andaccess to the right information atthe r ight t ime is a key tocompeti t ive edge. With theacquisit ion of everincreasingvolumes of G&G data, the resulthas been an explosion in the sizeof data that underl ies theinformation, the industry needsfor rapid, accurate decisionmaking.

• The source of data & informationretrieved from the system acts asa tool to the MIS for decisionmaking by creat ing a realframework that ensures accurateand right data analysis, leadingto t imely and r ight decisionmaking based on facts.

• A considerable volume ofgeophysical data along withother E&P data have been

Fig.11 Contour Map showing surface top

Fig.10 Data analysed through production data analysis tool


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migrated and implemented withstate of art technology at al lAssets, Basins and Forwardbases including the Corporatecentre at KDMIPE Dehradun, andother R&D institutes such asIRS, IDT and IOGPT. The finalbuild and deploy activities arebeing carried out by the EPINETteams across the country.

• However, technology can onlyassist in data management andquality control and cannot solvethe problems on i ts own.Technologies are no substituteto good housekeeping.Resources are available to aconsiderable extent and theteams are devoted at all workcentres to perform basic tasksincluding verifying compliance ofstandards, cleaning up data,archival of correct data andinterpretations.

• EPINET teams have realized thatstrict compliance of standards,definitions, codes, proceduresetc. is essential to maximize thebenefits of technology underlyingthe EPINET system.

• With geologists, geophysicists,petro-physicists and reservoir,drilling & production engineers,al l looking at the same datamodels at the same t ime,immeasurable value to thecompany will be visible in thenear future to obtain newexploration leads.

• As growth in worldwide demandfor oi l and gas cont inuesunabated, part icular ly indeveloping countr ies, theupstream E&P industry haslaunched major ini t iat ives toopt imize the search for andproduct ion of convent ionalhydrocarbons—a cradle-to-gravemindset that begins with field

discovery and extendsthroughout i ts l i fet ime unt i labandonment.

• In today’s highly price sensitivemarket situations, the focus hasbeen two-fold: reduce the costsassociated with f inding,accessing and producing newreserves; and maximize recoveryfrom existing reserves.

The implementat ion andintegration of EPINET resourcemanagement System, shows thatONGC is focusing, to a muchgreater extent, on a mult i -dimensional, processbasedapproach that recognizes theadvantages of merging a variety oftechnologies and discipl ines,converging to value-addedsolutions that overcome problems.Data and information aretremendously valuable assetswhich, when used correctly, canprovide the differentiation neededin a very competitive world. Thosecompanies that embrace changeand technology in today’sinformation-centric world will be thewinners of tomorrow by “Gettingright the first time, every time”.

ACKNOWLEDGEMENTSA special thanks to Mr. SumitNauriyal, Sr. Programming officerEPINET and Mr. G.K. Rajan Dy.S.G,KDMIPE, Oi l and Natural GasCorporat ion (ONGC) forencouragement and constantinspiration through out the trainingperiod in ONGC which helped inthe idea and completion of thispaper. The authors express duethanks to Keshava Deva MalviyaInstitute of Petroleum Exploration(KDMIPE) Campus, Dehradun forprov id ing constantencouragement and support toyoung minds and also the UPES

SPE Student Chapter for providingus an opportunity to exhibit thispaper.

REFERENCES1. P.K.Mittal; C.L.Badoni and S.

Bhattacharya, KDMIPE, ONGC,Dehradun, India “6thInternational Conference &Exposit ion on PetroleumGeophysics “Kolkata 2006”.

2. Naresh Kumar, SanjayChakravorty, S. K. Mehta, TariqHussain, A. V. Rao, A. V.Satyanarayana & A. K. Tyagi.“Current E&P DataManagement and Reporting inONGC - A Step towards RightTime Data Availability & FutureConsolidation.

3. P.K. Mit tal , ONGC, and D.Chatter jee, Schlumberger;“EPINET in ONGC India:Transforming E&P Informationinto Energy Intelligence, 2006”.

4. P.K. Mittal, KDM Institute ofPetroleum Exploration, Oil &Natural Gas Corporation Ltd.,Dehradun, India. “Setting up ofExplorat ion & Product ionInformation Network in Oil andNatural Gas Corporation.

5. S.F.H Rizvi; EPINET, KDMIPECampus, Dehradun, “TrainingProgramme for EPINET EndUsers under ProgrammeCode: SP-05, 12th to 16th Dec2011”.

LINKS REFERRED• h t t p s : / / w w w. s p g i n d i a . o r g /

10_biennial_form/P064.pdf• http://www.energistics.org• www.oilit.com• www.ppdm.org• h t t p : / / w w w. e n e r g i s t i c s . o r g /

witsml-standard• http: / /www.slb.com/serv ices/

software.aspx. dewjournal.com


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GEOPHYSICAL METHODSExplorat ion geophysicists usemeasurements of physicalquantities made at or above theground surface or, more rarely, inboreholes to draw conclusionsabout concealed geology. For ageophysical technique to be usefulin mineral exploration, there mustbe contrasts in the physicalproperties of the rocks concernedthat are related, directly or indirectly,to the presence of economicallysignificant minerals. Geophysicalanomalies, defined as differencesfrom a constant or slowly varyingbackground, may then be recorded.Geophysical methods can beclassed as either passive or active.Passive methods includemeasurements of magnetic andgravity fields, naturally occurringalpha and gamma radiation, andnatural electrical fields (static SPand magnetotellurics). All otherelectr ical and electromagnet ictechniques, seismic methods, andsome downhole methods that useartificial radioactive sources areact ive. Dif ferent geophysicalmethods are given below:1. Airborne Surveys: The mainvirtue of airborne work is the speedwith which large areas can becovered. Surveys may be flowneither at a constant altitude or at aconstant height above the ground.Aircraft are often filled with multiplesensors. Airborne surveys requiregood navigational control, both at

the time of survey and later, whenthe flight paths have to be plotted.Traditionally, the pilot was guidedby a navigator equipped with mapsor photo-mosaics showing theplanned line locations. Trackingcameras were used to recordimages, either continuously or asoverlapping frames, or 35mm film.Fiducial numbers and markersprinted on the film provided theessent ial corss-referencesbetween geophysical data,generally recorded on magnetictape, and flight paths. GPS (globalposit ioning satel l i tes) systemsprovide accuracy in monitoringaircraft position. Velocities can beestimated with great accuracy,making airborne gravimetry. Surveylines must not only be flown in theright places but at the right heights.Ground clearance is usual lymeasured by radar altimeter. In adetailed survey the radar altimeterdata can be combined with GPSestimates of elevation to producea high resolution digital terrainmodel (DTM). In the future someairborne surveys, and especiallyaeromagnetic surveys, may beflown by pilotless drones.2. Magnetic Surveys: Since

magnetite is a very minorconstituent of sediments,amagnetic map generally recordsthe distribution of magnetic materialin the underlying crystal l inebasement. The standardinstrument is now the high sensitivitycesium vapour magnetometer. Thecesium magnetometer providesreadings every tenth of a second.Sensors on aircraft are usuallyhoused in specially constructednonmagnetic booms placed as farfrom the main aircraft sources ofmagnetic field as possible. Theearth’s magnetic f ield isapproximately that of a dipolelocated at the earth’s centre andinclined at about 10 degrees to thespin axis. The practical unit ofmagnetic field is the nenotesla (nT)or gamma. At the magnetic polesthe field is about 60,000 nT andvertical, whereas at the equator it isabout 30,000 nT and horizontal. SeeFig.29. Diurnal effects areespecially important in airbornesurveys, which use measuringprecisions of the order of 0.1 nT andcontour intervals of 5 nT or less.Magnetised bodies produce verydifferent anomalies at differentmagnetic latitudes, the regional

Minerals & Metals

Mineral Exploration Industry - IV

S.L. Sahformer Chief Engineer, ONGC

...continued from April 2017 Issue


dewjournal.com Minerals & Metals

changes in dip being farmore important from aninterpretation point of viewthan the regional changesin absolute magnitude. SeeFig. 30. Magnetic mapsobtained near the poles aretherefore more easilyinterpreted than thoseobtained elsewhere, thereduction-to-pole (RTP)processing has been developed toconvert low and middle latitudemaps to their high lat i tudeequivalents. Magnetic anomaliesare caused by magnetite, pyrrhotite,and maghemite. Ordinaryhematite rarely producesanomalies large enough tobe detectable inconventional aeromagneticsurveys. Magnet ic f ie ldvariat ions oversedimentary basins areoften only a few nanoteslain amplitude, but changesof hundreds and eventhousand of nanotesla arecommon in areas ofexposed basement, e.g.,more than 150,000 nT.Magnetic maps contain awealth of informationabout rock types andstructural trends that canbe interpreted qualitatively.Werner deconvolution andEuler deconvolut iongenerally focus on depthdeterminat ion. Directdetermination of gradientsis becoming commonplace,especially in exploration forkimberl i tes. In airborneinstal lat ions horizontalgradients can bemeasured using nose andtai l sensors or wingtipsensors.

3. Gravity Method : The gravity fieldat the surface of the earth isinfluenced, to a very minor extent,by density var iat ions in theunderlying rocks, e.g., 2.0 Mgm–3

for soft sediments andcoal, 3.0 Mgm–3 for maficand ul tramafic rocks.Orebodies are oftendenser than theirsurroundings. Gravi tymeters must be extremelysensitive. They measureonly gravity differences andore subject to drift, so thatsurveys involve repeated

references to base stations. Gravitytends to increase towards thepoles. Gravity also varies withelevation. A Bouguer gravity map isusually a good guide to the effect

of subsurface geology onthe gravity field, althoughadditional corrections areneeded in ragged terrain.The Bell Geospace FullTensor Gradiometer (FTG)gives comparable results,equivalent roughly toground stations recordedon a 150m grid, with 0.2mgal noise.4. Radiometrics: Naturalradioactive decay producesalpha part icles, betaparticles, and gamma rays.Gamma rays are moreuseful in exploration.Gamma ray energies canbe measured byspectrometers, al lowingdifferent sources ofradiation to be identified.Terrestrial radiation maycome from the decay of 4°K, which makes up about0.01 percent of naturallyoccurring potassium, orfrom thorium, or uranium.Gamma-ray photons withenergies above 2.7 MeVcan only be extraterrestrial(usually solar) origin, but a2.615 MeV signal is

Fig.29 The Earth’s magnetic field solid lines are contours of constantdip, dashed lines are contours of constants total filed strength in nT.

Fig.30 Variations in shape of magnetic anomalies with latitude andorientation. (a-c): The variation with magnetic inclination produced bythe body X. (d): The anomaly at the equation with vertical intrusionsin low latitudes. (e-f): The variations in the anomaly produced in mid-latitudes by an inductively magnetized sheet with varying dip.


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produced by a thorium. The mostprominent uranium signal is at 1.76MeV and the single peak associatedwith potassium decay is at 1.46MeV. Three main radioelements inany source can be estimated byanalyzing spectra by count rateswithin windows centred on thesethree energy levels. Gamma-raysurveys do have geologicalapplications in locating alternationzones in acid and intermediateintrusions and in search for, andevaluation of, phosphate and placerdeposits. Another application is inairborne soils mapping, since soilsderived from different rocks havedifferent radiometric signatures.False-colour maps, produced byassigning each of the three primarycolours to one of the three mainradioactive source elements, cansupplement magnetic maps asgeological mapping tools and mayreveal features such as old riverchannels that have explorationsignif icance. The addit ion of agamma-ray sensor to anaeromagnetic system isbecoming routine.5. Resistivity: Rockresistivities very widely butare normally within therange from 0.1 to 1000ohm-metres. two currentand two voltage electrodesare used in arrays whichare usual ly l inear. Forconvenience, current issupplied through the outerelectrodes. Power may beprovided by motorgenerators orrechargeable batteries. Toreduce polarization effectsat the electrodes, and alsoto compensate for anynatural currents andvoltages, direct ions of

current f low are reservedperiodically, usually at intervals ofthe order of a second. Voltageelectrodes that do not polarize canbe made by immersing copper rodsin saturated copper sulfate solutioncontained in porous pots. Contactwith the ground is made by solutionthat leaks through the bases of thepots. For studying lateral variationin resistivity, the Wenner, pole-pole,and gradient arrays are the mostconvenient. See Fig.31. Wennertraversing, the leading electrode ismoved one electrode interval alongthe line for each new station andeach following electrode is movedin the place vacated by i tsneighbour. Resistivity surveys arealso used to investigate interfaces,such as water tables or bedrocksurfaces, that are approximatelyhorizontal . More sophist icatedcomputer programs now allow theresults obtained from mult ip leWenner traverses at di f ferentelectrode separations along singlel ines to be inverted to cross-

sections approximately the actualsurface distribution of resistivity.6. Spontaneous Polarization (SP):Natural currents and naturalpotentials exist and have explorationsignificance. Sulfides orebodiesmay produce negative anomalies ofseveral hundred millivolts. The oreacts as a passive conductor,focusing currents produced by theoxidation-reduction reactions thattake place across the water table.For a voltage to be produced, theconductor must straddle the watertable and the method requiring onlya high-impedance voltmeter, somecables, and pair of non-polarizingelectrodes.7. Induced Polarization (IP): Flowof electric current in a rock masscan parts of it to become electricallypolarized. The effect is almostnegligible in sandstone, quitemarked in clays, and can be verystrong at the surfaces of grains ofelectronic conductors such asgraphite and metallic sulfides. Ifcurrent flow ceases, the polarization

Fig.31 Arrays for resistivity and IP surveys: (a) Wenner array, (b) pole-pole array, (c) Schlumberger array,(d) gradiet array, (e) dipole-dipole array.

Minerals & Metals


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cells discharge, causing a brief flowof current in the reverse direction. Asquare-wave voltage applied to theground will cause current to flow, butthe current waveform will not beperfectly square and will be differentin different parts of the subsurface.Its shape in any given area can bemonitored by observing the voltagedeveloped between twoappropriately placed non-polarisingelectrodes. The asymmetry of theobserved voltage curve impliesfrequency-dependent phasedifferences between it and theprimary signal. These differencesto be measured and plotted asfunctions of frequency. This isphase IP. Time, frequency, andphrase techniques can be used. IPsurveys are also resistivity surveys.IP is important in base metalexploration because it depends onthe surface area of the conductivemineral grains. I t is especial lysensit ive to disseminatedmineralization. Since both massiveand disseminated deposits can bedetected, IP is very widely used.8. Continuous-wave Electro-magnetics: Electr ic currentsproduce magnetic fields. Voltagesare induces in conductors that areexposed to changing magneticfields, and currents. These inducedcurrents produce secondarymagnetic fields. Electromagneticsurveys, which measure thesef ields, use ei ther cont inuous,usually sinusoidal, waves (CWEM)or transient (TEM). Electromagneticmethod can be used from aircraft.This is used in exploration formassive sulfide orebodies, usingtransmitter and receiver loops withtheir planes horizontal and axesvert ical . In CWEM surveys,alternating currents are passedthrough transmitter loops or wires

at frequencies that usual ly l iebetween 200 and 4000 Hz. Therewill be phase differences betweenthe primary and secondary fields,and anomal ies are normal lyexpressed in terms of amplitudesof the secondary field componentsthat are in-phase and in phase-quadrature with the primary field.Almost all airborne systems usemulti-coil system.9. Transient Electromagnetics(TEM): A magnetic field can besuddenly collapsed by cutting off thecurrent producing it , and themagnetic effects of the currentsinduced in ground conductors bythis abrupt change can be observedat t imes when no primary fieldexists. In the case of a fixed-wingaircraft, the transmitter coil mayextend from the tailplane to the nosevia the wingtips. The receiver coilmay be mounted in a towed bird.Induced currents attenuate quiterapidly in poorly conductive countryrock but can persist for considerableperiods in massive sulf ideorebodies and often in graphiteshales. Signals associated withthese currents are observed nowwith the 256 channels. TEM surveysare equivalent to multi-frequencyCWEM surveys. TEM multi-frequencycharacter al lows calculation ofconductivity-depth plots that can beused in studies of porphyrysystems, in detection of stratiformorebodies and kimberlites, and inthe development of water resources.10. Remote Source Methods (VLFand Magnetotellurics): Efforts aremade to use virtually all the existingforms of backgroundelectromagnet ic radiat ion forgeophysical purposes, e.g., militarytransmissions in the 15-25 kHzrange and natural radiation in the10Hz to 20kHz range produced by

thunderstorms cal led audio-frequency magnetotelluric or AMT.Differences between the phases ofvarious magnetic and electricalcomponents of the waves can bemeasured and used diagnostically.When using VLF radiation, themagnet ic components aregenerally the most important if theconductors dip steeply, while theelectr ical components provideinformation on the conductivites offlat-lying near-surface layers. VLFmethod is especial ly useful inlocating steeply dipping fracturezones.11. Seismic Methods: Mostorebodies are in igneous andmetamorphic rocks lack coherentlayering. So seismic method isused in search for offshore placers.Subbottom prof i l ing using asparker or boomer source and onlya single hydrophone detector canallow bedrock depressions, andareas of possible heavy mineralaccumulation, to be identified, e.g.,subsea resources of bulk mineralsare sands and gravels. Where oresoccur in sedimentary rocks thathave been only gently folded orfaulted, seismic surveys can beuseful . In the assessment ofdeposits of industrial mineral, therefraction surveys can be useful.12. Ground Radar: Groundpenetrating radar (GPR) results aredisplayed as images very similar tothose used for seismic reflectionwork, but penetration is limited to afew tens of metres at the best, andmay stop at the water table, whichis usually a very strong reflector. Insome cases the mapping of thewater table helps to indicate that thecosts of extracting bulk minerals willincrease dramatical ly at thissurface. GPR can also be usedonshore to locate r iver


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paleochannels beneath overburdenand to define favourable locationswithin them for placer deposits.Sedimentary layering can often beimaged within such channels, andalso in sand dunes, which mayinclude beds rich in heavy minerals.13. Borehole Geophysics: Innormal logs, one current and onevoltage electrode, a few tens ofcentimetres apart, are lowereddownhole, with the other two atinf in i ty on the surface. Thel imitat ions of direct currentresistivity in base metal explorationapply downhole and more usefulresults may be obtained with IP orelectromagnetic. Transient (TEM)techniques are now considered themore effective to detect massivesulfides. When conductive ore hasbeen intersected, the mise-a-la-masse method can be used. Onecurrent electrode is posit ioneddown the hole and the otheris placed on the surfacewell beyond the area ofinterest. If the ground wereelectr ical ly homogenousand i ts surface f lat ,equipotentials mapped atthe surface using one fixedand one mobi le vol tageelectrode would contour ascircles centred above thedownhole electrode. I f ,however, the downholeelectrode is placed at anore intersection, there aredepartures from this patternindicat ing the str ikedirect ion and extent ofcontinuous mineralization.Equipotentials are actuallydiverted away from goodconductors that are not inelectrical contact with theelectrode. This method is apowerful tool for

invest igat ing the cont inui ty ofmineral isat ion betweenintersect ions in a number ofboreholes.14. Integration of Geological andGeophysical Data: Making gooduse of data from a variety of verydi f ferent sources requiretheoretical knowledge, practicalunderstanding, and a degree of flairand imaginat ion. The mosteffect ive way to recognizingcorrelations is to overlay one set ofdata on another. Computer-basedgeographical information system(GIS) offer greater f lexibi l i ty.Presenting different types of datatogether on a s ingle map isgenerally useful if they are shownas separate entities that can stillclearly distinguished. Those mostuseful exploration programs arebetween geology, air photographs,and magnetic maps. Structural

dislocations such as faults andshears are likely to be indicatedmagnetically and the intersectionsof magnetic lineaments have beenfruitful exploration targets in manyareas. Gravity and radiometric data,along with infrared or radar imageryand soils geochemistry, may alsohelp in obtaining the best possibleunderstanding of the geology.Geophysics provides independentinformation on the third dimension(depth), and may be especiallyuseful in preparing regional cross-section.

EXPLORATION GEOCHEMISTRYA geochemical program can bedivided into the five phases: (1)planning, (2) sampling, (3) chemicalanalysis, (4) interpretation, and (5)follow-up. The geologist will startwith a knowledge of the elementsassociated with a particular deposit

Minerals & Metals

Table-9. Elemental associations and associated elements (pathfinders) useful in exploration.(After Moon et.al., 2006).


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type, an idea of the economic sizeof the deposit to be sought, themineralogical form of theelements, and the probable size ofthe elemental anomalies around it.See Table-9. The geochemicalresponse at the surface dependson the type of terrain and especiallyon the type of material covering thedeposit . Elements behavedif ferent ly in the near-surfaceenvironment from that in which thedeposit formed. The process ofmovement away from the primarysource is termed secondarydispersion. Al l e lements arepresent n every rock and soi lsample; the concentrat ion wi l l

depend on the mode of formationof the rock and the process formingthe soi l . See Table-10. Thematerial to be sampled will largelybe determined by the overburdencondition, e.g., density and exactnature of the sample. The bestorientation survey is that in which avariety of sampling methods istested over a prospect or depositof similar geology to the target andin similar topographical conditionsto determine the method whichyields the best results. After theorientat ion survey has beenconducted the logistics of the majorsurvey need to be planned. Ananalysis is precise. At the elevation

stage the analyses must beprecise and accurate. Precision ismeasured by analyzing samples indupl icate whereas accuracyrequires the analysis of sample ofknown composition, a referencematerial. When laboratory resultsbecome available the data shouldbe plot ted batch by batch toexamine the within and between-batch effects. Samples should becol lected in non-metal l iccontainers to avoid contamination.Kraft paper bags are best suitedfor sampl ing soi ls and streamsediments. Thick gauge plastic orcloth are preferred for rocksamples. All samples should be

clear ly labeled by penscontaining non-metallic ink.Most analysis is aimed atthe determination of theelemental concentrationsin a sample and usually oftrace metals. Most generalanalysis in developedcountries is carried out byinductively coupled plasmaemission spectrometry(ICP-ES), of ten incombinat ion withinductively coupled plasmamass spectrometry (ICP-MS), or X-ray fluorescence(XRF). In less sophisticatedenvironments, high qualityanalysis can be provided byatomic absorpt ionspectrophotometry (AAS).Widely used method inindustry is neutronactivation analysis (NAA).The choice of analyticalmethod wi l l a im atoptimizing contrast of themain target element.Once the analytical data

have been received from thelaboratory and checked for

Table-10. Background concentration of trace elements and utility in geochemical exploration.(After Moon et.al., 2006).

Minerals & Metals


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precision and accuracy, alarge number of sampleswill involve the use ofstatistical analysis on acomputer. The object ofgeochemical exploration isto define significantanomalies. Anomalies aredefined by statisticallygrouping data andcomparing these withgeology and samplinginformation. Normally thisgrouping will be undertakenby computer and a widevariety of statisticalpackages are available. Thebest means of statisticallygrouping data is graphicalexamination usinghistograms and box plots(Garrett, 1989). Geologistsare used to think in terms ofmaps and the most usefulend product to comparegeochemical data withgeology and geophysics isto summarize the data inmaps form using a griddingor GIS package such asGeosoft Oasis Montaj, ArcView, or MapInfo. If the datareflect the chemistry of anarea, such as a catchment,it is best if the whole area is shadedwith an appropriate colour or tone,rather than contouring. See Fig.32. Amore usual method of presentationif the samples were collected on agrid to present the data as a contourplot using the intervals from ahistogram. See Fig.33. Thecombined analysis and elementmapping is used to define areas ofinterest which need to beinvestigated in detail, using detailedgeology, topography samplinginformation, and a return to the site.The active sediment in the bed of a

than 177 m. The mostcommon sample collectionmethod is to take a grabsample of active streamsediment at the chosenlocation. A number ofsubsamples should betaken over 20 to 30m alongthe stream and at depths of10 to 15cm. Panning inwater usually separatesdiscrete minerals with adensity of greater than 3.Besides precious metals,panning will detectgossanous fragmentsenriched in metals,secondary ore mineralssuch as anglesite, andinsoluble minerals such ascassiterite, zircon,chinnabar, baryte, and mostgemstones, includingdiamond. The mobility ofeach heavy mineral willdepend on its stability inwater. The numerous smalllakes provide an idealreconnaissance samplingmedium as they areaccessible from the air. Asample is taken bydropping a heavy samplerinto the lake sediment and

retrieving it. In areas of residualoverburden, overburden sampling isgenerally employed in areas of exoticoverburden. If the chemistry of thenear-surface reflects that at depththen sampling soil is safe. If not, thensamples of deep overburden mustbe taken. The type of soil reflects thesurface processes but in general themost effective samples are from azone at around 30cm depth. Theusual method of soil collection intemperate terrains is to use a soilhand auger.

Minerals & Metals

Fig.32 Stream sediment survey of part of the Gairlock area, WesterRoss, NW Scotland, which was designed to follow up knownmineralization (A), detected further anomalies along strike (B) anddisseminated mineralization at C. (After Moon et.al., 2006).

Fig.33 Contour plot of Daisy Creek data showing the highestanomalous populations for copper (>128 ppm), lead (>69 ppm), andsilver (70.55 ppm). (After Sinclair, 1991).

Continued in June 2017 Issue...

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river forms as a result of the passageof elements in solution and inparticulate form past of the samplingpoint. Interpretation of streamsediment data is carried out bycomparing the elementalconcentrations of catchments. Intemperate terrains maximumanomaly/background contrast fortrace metals is obtained in the finefraction of the sediments as thiscontains the majority of the organicmaterial, clays, and iron andmanganese oxides. Usually the sizecut-off is taken at 80 mesh or less


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Connecting REELINE hoseswith hydraulic wrenches

REELINE floatinghoses connected

and ready forfinal installation

in Brazil

Engineering


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The market conditions for the oiland gas industry remain

challenging, with many observersarguing that the main theme for 2017will be continued uncertainty. As such,oil companies are having to find waysto adapt, re-evaluate their currentpractices, and ensure that theiroperations are as robust as possible to deal with these unpredictable market conditions.

Recent research reveals some of the methods that are already being adopted toadapt. A report from Trelleborg’s Offshore operation has found that many companies arestriving to learn lessons the last few years and future-proof their businesses. Despite thefact that over half of engineers expect installation and commissioning costs to be a majorchallenge when making ‘shelved’ projects more viable in the extended low oil priceenvironment, 61% of facilities are willing to spend more on a project upfront to ensurelongevity and reduce the need for future upgrades. In another recent survey, over 80% ofrespondents said that ‘quality’ was the most important factor in their decision to purchasean oil hose. Interestingly, the next most important factors were ‘ease of installation’ and‘relationship with manufacturer’. This shows a growing awareness of the value in investingin lifecycle maximisation, despite the prevailing climate of uncertainty.

An important part of this transformation is bringing suppliers to the table and tappinginto their expertise to see what could be being done differently, and whether the productsa company is using are really suited to their operations. As suppliers of oil hoses, weare involved in some of the most technically challenging processes the industry faces –oil transfer. These processes need to be maintained for years in even the harshest ofenvironments. By working with our customers to ensure that the environment in whichproducts function is properly analysed in order to select the right product for the job andto maximise its lifespan, a supplier of oil hoses can make a tremendous difference toensuring cost-effective, safe, and uninterrupted oil transfer.

Analysis and discoveryThe first stage of this collaborative approach is to understand the environment in whichthe product within the oil supply chain will function. This begins with our R&D team, whoare involved in the earliest stage of any project to work with our customers in determiningthe most appropriate technical solutions for the targeted application and design life.Traditionally, R&D departments may not have been expected to play such an active role.However, it is becoming increasingly vital for them to consult on each project so they cancreate a truly customised solution that modern-day standards and expectations demand.

In our case, we are able to leverage 40 years of expertise in the industry at ourfacility in Clermont-Ferrand, France, where hundreds of hoses per year are manufactured.This site is also where full scale tests are performed, new materials are developed, and

Oil transfer a vital aspect

Engineering

Vincent Lagarrigue,Director, Trelleborg GroupHead, Oil & Marine Business


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determine how often will it be feasible to change andmaintain an oil hose, and what the optimum balancebetween capex versus Opex is in each case.

Selecting the right tool for the jobHaving fully analysed the conditions for a project, weare then able to help customers select the right hosefor the job. Trelleborg is the only manufacturer to offerboth nippleless and nipple hoses, giving customersthe choice of the broadest possible range of optionsin the market. Choices provided also include singlecarcass, double carcass with leak detection system,and dual carcass hoses. All hoses are designed,manufactured, and tested in accordance with theGMPHOM 2009 guideline, and API spec 17K standardusing fatigue computation can be applied in specificapplications.

In most cases, the most suitable solution for non-harsh, low cost of extraction environments will be asingle or double carcass nipple hose such asTrelleborg’s SEALINE offering. The so-called ‘nipple’is a metal cylinder with a standard flange at the end ofthe hose that connects securely to a corresponding

innovative components are manufactured.To accurately assess the impact of environmental

and situational conditions, Trelleborg’s R&D teamsuse prototypes. These undergo rigorous mechanicaland chemical testing, and hydrodynamic analysis todetermine material behaviour laws, establishingageing models for realistic service conditions, as wellas a detailed analysis of performance under fatigue ineven the most extreme environments. This allows forthe creation of high fidelity finite element models (FEM)for each specific hose construction, enabling therendering of exact hose behaviour under complex loadcombinations, and compute strains and stresses inany rubber layer or internal reinforcement. Vital factorsto consider include the fluid properties of the crude oil,refined products, or condensate to be transferred,including temperature, pressure and viscosity. Thenecessary standards and their specific requirementsmust also be considered, such as GMPHOM 2009 orAPI Spec 17K. Crucially, this work is undertakenwhether the project is a new project or a replacementfor an existing solution, a complete system, or to beinstalled as part of an existing system.

Considerat ion of the environmental andoperational conditions is also paramount. Equipmentcan be exposed to the most extreme environments,often facing intense weather conditions; selecting theright hose can ensure the highest safety standardswhile not compromising on crucial optimised servicelife. OCIMF estimates that a floating hose string canbe subjected to 30,000 wave cycles per day – andeven more in areas with chal lenging weatherconditions - so it is essential that the environment ismodelled accurately.

The number of off loadings must also be takeninto account, as this will affect the strain that is placedon the hose. Integrating hoses with other installationtechnology (such as marine breakaway couplings,quick emergency release devices or reel ingapparatus) is also essential in ensuring safety. Hosesneed to be specifically engineered so they are easyto instal l wi th minimal requirements for themanagement of the integration with other systems.These might be CALM Buoy systems, conventionalbuoy moorings, or reeling systems. Each differentoption will place its own demands on the hose andpresent different potential challenges.

The expected service l ife and maintenanceprograms are also important factors. It is crucial to

Engineering

Submarine REELINE

Installation of a submarine lineFloating hoses REELINE


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attachment on another hose, or piece of equipment.This design consists of binding steel wires that arefixed on a nipple, using a standard metallic flange andpipe to connect with the hose body structure. Highoperational resistance is achieved through a perfectlink and adhesion between hose and flange.

The major advantage of such a configuration isthat it is highly ubiquitous, and can be combined witha range of other attachments. Many sites around theworld use this technology, which is certif ied toGMPHOM 2009 guidelines. Nipple hoses are alsooften the most affordable solutions, but this doesn’tmean they aren’t sturdy - they can withstand all butthe most extreme environments with ease. Nipplehoses can be used in both floating and submarineoffloading configurations.

For extremely harsh weather condit ions orextended service life, more specialised solutions maybe required. In this case, a nippleless technology maybe more suited to the task, such as Trelleborg’sTRELLINE or KLELINE offerings. The nipplelesstechnology means that there is no stiff metal connectorthat would reduce flexibility - instead, the flange is

embedded in the rubber itself. This design can beoptimised for reeling with products such as REELINE,allowing extra space on deck when transporting orhandling. The extra flexibility also reduces wear,meaning that service operations of up to 25 years canbe achieved. These hoses can be used in bothsubmarine and floating situations, in environmentsthat would be too challenging for a nipple hose.

Ensuring maximum lifecyclePerhaps the most significant need for collaboration,and an area that is vital to maintaining the highestsafety standards, comes after purchase andinstallation; maintaining and servicing the equipment.This final aspect of any project is far too important forsuppliers to adopt a ‘fire and forget’ approach; theymust be actively involved throughout the product’slifecycle.

It is essential that suppliers support projectsthroughout their execution to ensure that the highestsafety standards are upheld, as well as guaranteeingthe benefits of proper lifecycle management. Thisapproach includes on-site inspection and testing for

Installation - Vertical connection of floating hoses in Angola

Engineering


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requalification, hose maintenance and inspectionprograms, and on-site repairs to ensure that hosesare not only performing correctly but are meeting therequired standards in safety and quality. This can evenextend to undertaking specific investigation programs.These may include inspections, tests on site or inthe factory such as OCIMF and burst tests, or ageinganalysis of the components such as adhesion tests,elastomer property analysis.

Suppliers can also choose to engage in trainingand education programs, disseminating bestpractices on storage, transportation, and maintenanceof hoses. It’s also important to ensure that a supplierhas global reach – that their products are universallyavailable, and that they can be serviced with speedand responsiveness anywhere in the world.

These lifecycle support measures ensure thatproducts function at the optimum level for the longestpossible safe operational lifespan – reducing theamount of time and money spent on maintenancewhich can contribute to a significant proportion ofoperating expenditure.

A changing mindsetThe good news is that we are seeing a realizationspread through the industry that this approach isthe right way to go, as the examples cited aboveshow. Reth ink ing o i l t ransfer, s tar t ing by re-evaluating the relationship between purchasers andsuppliers, is a vital first step. From the evaluationand design stage, right through to ensuring that eachproduct reaches i ts maximum l i fespan, theknowledge and understanding that suppliers canbring to a business can be a vital asset. Are youmaking the most of it? dewjournal.com

Bentley Systems, Inc., a leading global provider ofcomprehensive software solutions for advancinginfrastructure, demonstrated at SPAR 3D new ContextCapture offerings for reality modeling that increasejoint opportunities in surveying and engineering.Context Capture capabilities now include cloudprocessing services, amobi le app, and photoplanning for Bentley’s applications. Context Shareextends Bentley’s Project Wise connected dataenvironment to securelymanage, share, and streamreality meshes, and their input sources, acrossproject teams and applications. Navigator Webis anew web application that delivers high-performancestreaming of very large reality meshes through thebrowser to desktop or mobile devices.

For infrastructure project delivery, reality modelingcaptures the actual context of infrastructure projectsthrough photos and/or scans, creating engineering-ready reality meshes for design modeling, analyticalmodeling, and construction modeling. During assetperformance, as-operated reality meshes can serveto immersively geo-coordinate the alignment of thesedigital engineering models with right-time inputs fromconnected IoT technologies. Accordingly, realitymodeling extends the scope for engineers to add valueto include “conceptioneering” and “constructioneering”for capital projects, and “inspectioneering” and“productioneering” for operating assets. These use-case benefits of “continuous surveying”in turn providenew value opportunities for surveyors throughout theinfrastructure lifecycle.

Bureau Veritas, a world leader in testing,inspection, and certification of infrastructure assets.Thomas Daubigny, Bureau Veritas Chief Digital Officer,said,”Reality modeling is becoming pivotal in manyindustries as i t fundamental ly changes themanagement of assets, reinventing the handling ofinspections, maintenance, and training, while openingdoors to brand new services. Bureau Veritas is playinga key role in leveraging digital engineering models,implementing acquisition, and classifying objectsbased on its expertise on the asset, and ultimatelyoperating the model as a data gatekeeper. The newBentley Context Capture cloud processing service will

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Vincent Lagarrigue is Director at Trelleborg Group,heading Oil & Marine Business line which is theleading supplier of innovative and field proven large-bore bonded hoses for Crude Oil, Chemicals andLPG marine transfer solutions.

His work has been previously focused on thedevelopment of new technologies (e.g. cryogenicflexible hosefor LNG offshore transfer systems) aswell as on the design of bonded flexible hoses for OilOffloading Lines (i.e. Trelline OOL).

His background comprises a M.Sc. in MechanicalEngineering and a MBA from France.

about the author

Advancing reality modeling


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provide us the flexibility and power to accelerate thedeployment of such innovations to our clients.”

CEO Greg Bentley said, “Last year at SPAR Idescribed what I believed to be the significant potentialof reali ty modeling for improved infrastructureengineering, in particular, from continuous surveyingenabled by simple digital photography and UAVs, butthat was then based only on our own experience. Andthere could have been resistance from surveyprofessionals concerned that this more accessibletechnology might jeopardize their return oninvestments in laser scanning specialization, for eg. Itis gratifying to report now that in the intervening year,reality modeling has ‘gone mainstream’ globally,supporting projects and assets of every domain andscale in‘going digital.’ Additionally, laser scanning isnow fully incorporated-where available, and as neededto supplement photography-among hybrid inputs forengineering-ready reality meshes.

“Our Context Capture and Project Wise ContextShare announcements at SPAR complete the reach,in my view, for reality modeling’s fidelity, accessibility,scalability, and shareability. In the coming year, ourpriority at Bentley Systems is to help engineers andsurveyor stake full advantage of this breakthroughopportunity to broaden the scope and value of theirwork in ‘going digital’ themselves!”

Bent ley’s real i ty model ing advancementscomprehensively del iver to surveying andengineering teams:Fidelity: Hybrid processing in Context Capture enablesthe creation of engineering-ready reality meshes thatincorporatethe best of both worlds – the versatility andconvenience of high-resolution photography,supplemented, whereneeded, by addit ionalaccuracy from laserscanning.The new photoplanning capabil i t ies inBentley’s applicationsempower engineering orsurvey professionals to easilyprescribe the optimal camerapositions and flight pathsfor

UAVs to achieve the required levels of accuracy, inparticular,for critical inspection points.Accessibility: The new Context Capture mobile appbrings reality capture to every member of a projectdelivery or asset management team. Combined withthe new Context Capture cloud processing service,this delivers 3D reality meshes back to the mobiledevice, and to of f ice-based professionals,immediately af ter a set of photos have beentaken.The new NavigatorWeb application makesimmersive reality modeling accessible through anybrowser, with progressive levels of detail.Scalability: Context Capture uniquely enables realitymodeling to scale from city models to site models tocomponentnameplates. Users can now takeadvantage of cloud services’ inherent paral lelcomputing to speed processing of reality meshes.Scalable mesh technology enables multi-resolutioninputs through the new (.3sm) format.Shareability: Project Wise, the collaboration systemof choice for the majority of the ENR Top Design Firms,delivers comprehensive work sharing supported by aconnected data environment, unifying design andconstruction teams to enable comprehensive projectdelivery. Project Wise CONNECT Edition is provisionedby Microsoft’s Azure cloud service and supports hybridenvironments. The new Project Wise Context Shareservice adds breakthrough performance in securelystreaming reality meshes and their inputs, making itpossible to instantly and persistently share full-scale,engineering-ready datasets across adistributed team, whether in the field or in theoffice.Offered through a visa subscription, withcharges only for actual use, Project Wise Context

Share completes the reach ofBentley’s comprehensivereali ty modeling solution,empowering engineering andsurveying professionals toextend the value oftheir services acrossall applications andthroughout the infrastructurelifecycle.

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to extend the scope of engineering and surveying value

Bentley technician capturing a reality mesh using theContextCapture mobile application. Images courtesy: Bentley

Bentley’s reality modeling advancements comprehensively deliver to surveyingand engineering teams: Fidelity, Accessibility, Scalability and Shareability


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Marine scient ists arediscovering that the

Leopard electr ic underwaterrobot ic vehicle from SaabSeaeye- world’s leadingunderwater e-robotics companyis particularly suited for complexand varied research projects.

These projects range fromcod-water coral studies toenvironmental monitor ing,biodiversi ty research andtsunami warning systems.

Tokyo University says that technological advancesunderwater robotics systems, as found the Leopard,are making a wider range of tasks more possible.

Studies in Japan are using the Leopard toexamine the biodiversity surrounding hydrothermalvent activity order to protect the inter-connectingecosystems around mineral extraction sites.

They are so using the Leopard to help enhancethe tsunami early warning seismographic monitoringsystem on the sea floor with theinstallation of 45 kilometres ofnew sensors and transponders.

At Israel ’s Universi ty ofHaifa, Chief Engineer, BenHerzberg, says they chose their3000m-rated Leopard afterevaluating range systems fromdifferent manufacturers. “Weopted for the Leopard, not justbecause of i ts technologicalexcellence and because SaabSeaeye is the largestmanufacturer of electric roboticsystems the word, but alsobecause the universities andscientific users we contactedgave Saab Seaeye the best andmost positive feedback.”

Scientists around the wordwelcome a resource that scompact enough to ft onto asmall research vessel yet has

Scientists discover electric Leopardthe power of a work vehicle.

Even when loaded theresearch equipment, the 3000mrated Leopard can maintainunmatched f ight stabil i ty instrong currents for preciserecording and sampling tasks.

Making the possible is theLeopard’s advanced iCONdistributed control architectureand its 11 powerful thrusters,setting it as the most powerfulsystem of its size in the world.

The Leopard’s precise mult i -direct ionalmaneuverability has allowed scientists to accuratelyfilm along straight lines in turbulent high current seaswhilst keeping steady to within 10cm of navigationalaccuracy.

Apart f rom supreme di rect ional contro l ,scientists particularly like iCON’s building-blockconcept that allows more interchangeable toolingand survey sensors to be installed than ever before

possible in a vehicle of theLeopard’s size.

In addit ion to cameras,sensors and manipulators,samples can be gathered andstored in a recovery skidmounted beneath the Leopardwhere a sample box withseveral discrete compartmentsfor samples can be opened andclosed hydraulically and a two-line laser on the pan and tilt unitused for s ize cal ibrat ion ofobjects on the seafloor.

When scientists operatingin remote locations are facedwith the r isk of mult ip leequipment damage, they havea better chance of remaining ontask as iCON will independentlymanage each intelligent deviceon the vehicle to keep the vehicleworking.

The 3000m rated Leopard is the most powerful electricunderwater e-robotic system in the world, making it

Images and data from the Leopard can be examinedby scientists aboard the research vessel.

The Leopard inside its tether management system,ready for studies offshore Japan.

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