From the July 2010 issue of The Land Rig Newsletter:


The Granite Wash play is not developing in a single rock formation like the Barnett or Woodford shale, but in multiple sands within a Pennsylvanian-age sediment package up to 4,000 ft thick. This sediment eroded off the granitic Ouachita Mountains into the Anadarko Basin, hence the play’s name. The play extends across six counties in north Texas: Gray, Hemphill, Lipscomb, Ochiltree, Roberts, and Wheeler; and six in Oklahoma: Beckham, Custer, Dewey, Ellis, Roger Mills, and Washita. Sand packages that are being developed include the Cleveland, Oswego, Red Fork (upper and lower), and Atoka (A and B). Unlike some shale plays that apply a standard well plan across many wells, a standard well plan in this play can only be used in a relatively small area when drilling for any specific sand package. This means that economies of scales for drilling are limited. Rigs will drill vertically to sands at TVDs varying from 8,000 ft to 13,000 ft before going horizontal into a productive zone. Laterals of about 5,000 ft are not uncommon. Operators are still learning which sands produce the best, and the best way to develop the most ...

Steel tubular manufacturer TMK IPSCO announced the appointment of Paul Fullerton to the newly created position of Vice President, TMK Premium. Fullerton, based in Houston, will be responsible for developing, coordinating and integrating a global technical sales force along with a world wide network of TMK production locations, third party threaders and licensees to support the rapid expansion of TMK IPSCO ULTRA™ premium connections, TMK Premium connections and related services to support on and off-shore drilling customers globally.

Noble Drilling VP of Marketing Roger Hunt said during Noble’s second quarter earnings conference call with analysts that the company believes that Pemex “will be going out to bid shortly and it sounds like it could be for 21 rigs for a February startup”.  He added that in Pemex’s last jackup tender that “Pemex completed its tender for rigs with 10-year age restrictions, but few companies submitted bids despite the sizable number that bought the bid packages.  We view this as encouraging for our position as Pemex’s largest driller”.  The statement is clearly in reference to Noble’s earlier 2010 statement that it believed all of its 12 jackups, all older than 10 years, would keep working for Pemex.  Since that time, only one, the Noble Leonard Jones, has been released and that rig was scheduled to receive an extension through August 2010, but Pemex opted not to exercise it the day before it was due to begin.

 

Diamond Offshore reports that semi Ocean Confidence has departed the U.S. Gulf, headed for Republic of Congo for a three-well program with Murphy E&P.  The rig, which is under contract with Murphy through March 2012, is tentatively scheduled to mobilize back to ...

Contango Oil & Gas reported its Ship Shoal 263 well (Nautilus) and its Eugene Island 10 well (Eloise South) discoveries are now both on production and are producing at a combined rate of 15 mmcf/d and 1,000 bopd net to Contango. This brings the company’s total offshore production to 87 mmcf/d and 2,500 bopd.

 

ExxonMobil Corporation’s board of directors will appoint S. M. (Steve) Greenlee as President of ExxonMobil Exploration Company and elect him aVice President of the corporation effective September 1, 2010. Greenlee is currently President, ExxonMobil Upstream Research Company  S. N. (Sara) Ortwein will become President  of ExxonMobil Upstream Research, effective September 1, 2010.

 

BP has updated the operational status of the Macondo well blowout.  On July 23, relief well activities at the MC 252 well site were temporarily suspended because of potentially adverse weather associated with Tropical Storm Bonnie. Following the passing of the weather system, the DDIII drilling rig returned to the relief well site on July 24 and is taking steps necessary to reconnect with the well and resume drilling operations. These steps are expected to take a number of days. However, work on the second relief well has been suspended so as ...

Schlumberger and Smith International announced that the European Commission has cleared the proposed merger without any conditions. The proposed merger remains subject to clearance by the U.S. Dept. of Justice, approval by Smith stockholders, and other conditions. Schlumberger and Smith expect that the merger will close in the third quarter of this year.

 

The International Association of Drilling Contractors (IADC) issued a statement saying the association applauds the leadership of three U.S. Senators: David Vitter (Louisiana), John Cornyn (Texas), and Roger Wicker (Mississippi), who are opposing the federal moratorium on offshore permitting and drilling activities announced on July 12 by Secretary of the Interior Ken Salazar. The three Gulf Coast senators sponsored legislation (S. 3588) to lift the offshore drilling and permitting moratorium for companies that have complied with the new safety and inspection requirements issued by the Department of the Interior.

Mobile rig utilization in the Gulf of Mexico fell below 50% this week as two jackups joined the idle rig rolls and one semi left the region.  Total fleet utilization stands at 49.6% with 60 of 121 mobile rigs under contract or committed for work.  Marketed utilization, which excludes those cold stacked and other non-marketed rigs dipped to 72.3% with 60 of 83 units under contract.

 

Jackup fleet utilization dropped as the ENSCO 90 and Seahawk 2600 were both released from contracts. Total utilization is now 37.8% with 31 of 82 rigs under contract or committed for work.  As such, marketed utilization fell to 620% with 31 of 50 units contracted.

 

Floating rig fleet utilization is now 87.8% with 29 of 33 units under contract, while marketed utilization is still at 90.6% with 29 of 32 units under contract.  The change was due to Diamond Offshore’s Ocean Confidence departing the region for West Africa.

 

Total platform rig is unchanged this week.  Overall utilization is 33.3% with 17 of 51 units under contract.  Marketed utilization remains at 48.6% with 17 of 35 rigs contracted.  Inland barge fleet utilization fell as one rig was released.  Total fleet utilization is ...