Oil spill preparedness and response

(Photocredit: News 12 Viewer, Julia Martin)

As Kenya embarks on its dream of joining the oil producing league of countries, one of the things I believe it should put into consideration is oil spill preparedness and response. I believe in as much as we await the economic benefits that come with oil production, we should equally be prepared to deal with oil spills or have measures to mitigate their impact.

Factors that are considered in the construction of a crude oil pipeline.

Photocredit:pipeline construction

There are many factors that are put to consideration when considering to put up a pipeline.

These include:

1.      Route (distance, pipeline length)

2.      Topography (hills, valleys, inclines, plains)

3.      Temperature ( warm or cold temperature regions,  seasonal variations in temperature and climate)

4.      Expansion

5.      Environmental impact (environment setting, urban or countryside, offshore or onshore, conservation reserves  or protected ecosystems)

Kenya in Proposal stage for new crude oil pipeline

Source: Oil news Kenya

Kenya’s active search for contractors to be charged with the responsibility of designing its newly proposed crude oil pipeline has begun. The pipeline is intended to run from Lokichar (Turkana) to the coastal town of Lamu.  The project has arisen after Kenya’s defeat to win over Uganda in the deal that was intended to construct a pipeline through Kenya. The deal was won by Tanzania instead of Kenya due to Uganda’s security concerns on the Northern route which was to pass through Kenya and terminate at Lamu.

Key Oil exporters fail to agree on Oil output freeze

Photograph: Sergei Karpukhin/Reuters

The much awaited meeting of Sunday 17^th April 2016 came and went by with poor results.

The negotiations buckled after Saudi Arabia surprised the group by reiterating its demand that Iran also agree to cap its oil production.

Oil prices had risen in the weeks prior to the meeting on speculation that Saudi Arabia might successfully lead an initiative between members of the Organization of the Petroleum Exporting Countries and Russia, which joined the talks.

Landlocked Uganda finally decides on Hoima-Tanga Route

The much anticipated outcome of the past weekend’s meeting with the three East African leaders is finally out.  The decision was made at the 13th Northern Corridor Integration Projects (NCIP) summit in Kampala, which was also attended by President Paul Kagame and Uhuru Kenyatta of Rwanda and Kenya, respectively. Landlocked Uganda has finally decided to partner with Tanzania to transport its oil from western Hoima district—home to some 1.7 billion barrels of oil, one of East Africa’s largest reserves to the Indian Ocean for trade. The 1,400 kilometre pipeline will run from Hoima (south of lake Victoria to Tanzania’s port of Tanga and is expected to be completed by mid-2020.

Crude oil prices rise to a $43 high on hopes for production freeze

Oil prices have jumped today based on the expectations that major oil producers will arrive at a productive agreement in the upcoming output freeze meeting on Sunday 17^th April 2016. Brent crude rose to a high of $43.58, the highest it has been this year, while WTI rose to $40.73.

In as much as production has begun falling within some regions in the US as a result of cutbacks on expenditure, the global oil market is still oversupplied. The U.S. Energy Information Administration said on Monday that production in the seven key shale-drilling regions would fall by 114,000 barrels a day in May compared with April.

Total remains firm on decision for Tanga Route amidst oil pipeline triangle between Kenya, Uganda and Tanzania

Total E&P Uganda has confirmed its commitment to construct the $4 billion crude oil pipeline through Tanga regardless of ongoing discussions between Kenya and Uganda to have it pass through the Kenyan route. The affirmation was made by Totals general manager Adewale Fayemi who said "As a company, our position remains that we are going through Tanga. I understand there are issues being discussed but our position remains the same,” This was said at the two-day East Africa Oil and Gas conference in Tanzania.

Mr. Fayemi added that all available options have been carefully considered and the firm is more interested in the Tanga route, which it considered cheaper for oil production.

Tullow strikes positive prospects in Kerio Valley.

Source: Business Daily Africa

British firm Tullow posted in an operation update on Wednesday that the initial tests show a sign of positive prospects at the Cheptuket-1 well in Block 12A, in Rift Valley.

"The objective of the well was to establish a working petroleum system and test a structural closure in the south-western part of the basin," Tullow stated.

Fuel Prices for Major Towns in Kenya March 15th 2016 - April 14th 2016

Total VP meets with Tanzanian President Dr. John Maghufuli over crude oil pipeline

Mr. Javier Rielo, the vice president of Total assured Tanzania’s President Dr.John Maghufuli that the soon to be constructed pipeline from Uganda to Tanga will begin soon.

Mr. Rielo, who held talks with Dr. Maghufuli at the Dar es Salaam state house said on Monday 14^th March 2014 that Total had set aside funds for the 1410 kilometre pipeline which is expected to transport 200,000 barrels a day from Uganda’s Albertine basin to the port of Tanga. The project is estimated to cost $4 billion with a 3 year timeline, although Dr. Maghufuli requested that the timeline be reduced so that the region could benefit from the crude oil.

Construction of Uganda - Tanga Port Oil Pipeline to Commence in August 2016

The construction of the $4billion pipeline is slated to begin in August, pending ongoing discussions between Uganda and Tanzania and the investors. The pipeline is envisaged to transport crude oil from Kabale (Uganda) to Tanga Port (Tanzania).

Dr James Mataragio, the M.D of Tanzania Petroleum Development Corporation (TPDC) said in a recent statement that the 24-inch pipeline which will cover 1,403 kilometeres is expected to convey 200,000 barrels of crude oil per day. He added that "Tanzania has been chosen as a priority route due to a number of factors one of which is its experience in implementing gas and oil transportation projects through pipelines such as the 542-km Mtwara-Dar es Salaam gas channel."

Tanzania and Uganda agree to construct pipeline to Tanga

Source: Energy East Pipeline

Tanzanian leader President John Magufuli and Ugandan leader President Yoweri Museveni have agreed to construct a 1,120 km pipeline linking their countries and connecting the landlocked oil fields of Uganda to the Indian Ocean.  This was agreed after the recently concluded East Africa Community meeting held this week in Tanzania. The construction of the pipeline would create 15,000 jobs, and would cost around $4billion.

Eni's East African FLNG development plan in Mozambique approved

Floating LNG

Italian oil company Eni has won its approval from the Mozambique government to build its planned Coral floating liquefied natural gas (LNG) plant.

The company, is targeting to sell all the LNG from the plant to British oil company BP. It is expected to make a final investment decision (FID) this year but has now overcome one of the biggest hurdles.

Tanzania makes great onshore natural gas discovery

An additional onshore discovery of 2.17 trillion cubic feet (tcf) of possible natural gas deposits has been made in Tanzania. This raises the nations estimated recoverable natural gas reserves to more than 57 tcf.

The onshore reserves were found at a field licensed to the United Arab Emirates' Dodsal Group located at Ruvu basin in Coast region, near the country's commercial capital, Dar es Salaam, the local media reported.

Refinery to be used as storage facility for crude oil

Kenya Petroleum Refinery Plant in Mombasa

The fate of Kenya’s oil refinery has been determined.  Kenya Petroleum Refineries Limited plant, (the only refinery in the region) will be converted into a storage facility as the country gears up for commercial oil production. The decision is part of recommendations contained in a report by an inter-ministerial committee formed last July to review how best to utilise the idle refinery. The report will be released later this week to the Energy and Petroleum Cabinet Secretary Charles Keter.

Oil Slump Side-steps Kenya As It Anticipates To Turn On The Taps

Kenya’s oil is said to be commercially viable even at the dismal $30 per barrel. The country has so far discovered 1 billion barrels of oil, although its extraction might take years.

Tullow oil, one of the main exploration companies in Kenya which discovered 600 million barrels in the South Lokichar basin in 2012 says that oil can be produced in Kenya for around $25 per barrel, which would make it one of the cheapest places in the world for producers.

Iran is Eyeing Africa To Expand Oil, Refined Products Exports

Iranian officials announced on Tuesday 16^th February 2016 that the first exports of gas oil products (fuel oil distilled from petroleum) are headed to African countries.

Iran is ardent to raise its status as a major exporter of gasoline, kerosene, liquid petroleum gas (LPG), jet fuel and mazut in the Middle East.

Top oil producers 'agree on oil output freeze', Iran still an obstacle.

Top oil exporters, Russia and Saudi Arabia agreed on Tuesday to freeze output levels to tackle the growing oversupply of crude oil so as to stabilise the oil price.  The deal however is dependent on other producers joining.

The announcement was made following a meeting of oil ministers from Saudi Arabia, Russia, Venezuela and Qatar in Doha, with meetings with Middle East oil powerhouses Iran and Iraq said to be imminent. The outcome of today’s meeting with Iran and Iraq is being awaited with bated breath as more talks are to take place in Tehran today, however fears of Iran ramping up production are high.

Petroleum Pump prices in Major towns in Kenya from 15th February2016 - 14th March 2016

Fuel pump prices have reduced further to reflect the current crude oil market prices. This is also after the world bank raised concerns over the pump prices in Kenya which they deemed did not reflect the current market climate. Major economies have reduced their gasoline and diesel prices to reflect the plummeting crude oil prices. This raises the question how will Kenya deal with the situation when it becomes and oil producer. Most oil producing countries enjoy heavily subsidised oil prices at the pump. 

Crude oil grades from different parts of the world

There are several crude oil grades around the world. They are usually classified according to the geographical region from where they are extracted.  Below is a partial list of the world’s crude oil.

1	Abu Bukhoosh	51	Djeno	101	Liverpool Bay	151	Sirri
2	Al Shaheen	52	Doba Blend	102	MacCulloch	152	Sirtica
3	Alaska North Slope	53	Draugen	103	Mandji	153	Sleipner Condensate
4	Alba	54	Dubai	104	Maureen	154	Snorre
5	Algerian Condensate	55	Dukhan	105	Marib	155	Souedieh

Classification of oil

Petroleum classification is dependent on the intrinsic properties.  There are various categories which are related to the density (referred to as API° gravity), sulphur content, extraction process and geographical location.

The most common classification is

1.      Heavy oil

2.      Light oil

3.      Sour

4.      Sweet

Fulbright Scholarships 2016 now open

The Fulbright Foreign Student Program is sponsored by the USA Government, aimed at graduate students, young professionals, and artists from abroad to research and study in the United States for one year or longer at U.S. universities or other appropriate institutions.  The scholarship is targeted at international students from155 countries. The scholarship is administered and processed by binational Fulbright Commissions/Foundations or U.S. Embassies.

Petroleum geochemistry

Source: Weatherford

This is a branch of geology that is important in the exploration phase of oil. Nearly all explorations employ geochemical surveys. Geochemists study the surface geochemistry which is usually closely similar in the subsurface properties.

Geochemical surveys also include studying the source rocks to determine, where they form, the type of organic matter, thermal maturity as well as the geochemical processes involved in the transformation of the organic matter i.e biodegradation and thermal cracking.

How is oil located?

Geologists are key to helping find oil. They are tasked with looking and finding the right conditions for an oil trap. An oil trap constitutes of 5 components.

1.      Source rock

2.      Cap rock

3.      Reservoir rock

Africa Oil - Maersk Oil farmout deal completed

Africa Oil has completed its farm out deal to Maersk oil and gas where it is reported to have received a total of $427 million which is accounted for as follows.

•  $344million as reimbursement of past costs incurred by Africa Oil prior to the agreed March 31, 2015 effective date of the farmout.

• US$83 million representing Maersk’s share of costs incurred between the effective date and December 31, 2015

•   a carry reimbursement of US$15MM of exploration expenditures. 

Gas production to start in mid February 2016 at Kiliwani North, Tanzania

Aminex shareholders have been informed that the Tanzanian Petroleum Development Corporation has advised Kiliwani North-1 well could start production in mid-February 2016. The well is currently undergoing final well integrity testing prior to first production. The development comes after the Gas Sales Agreement (GSA) signing that happened in January, where the gas price was agreed at $3.00 per mmBTU, which approximates to $3.07 per mcf, for which the gas price is not linked to any commodity price and hence is not affected by the current commodity market. The payment will be made in USD for all produced gas including commissioning and testing gas.

Tanzania could supply the UK with gas for the next 20 years

The 55 trillion (tcf) gas resources so far discovered in Tanzania can meet the current demand of gas for the whole of the UK between now and around 2040, The Guardian has reliably learnt. The gas resource is 22 times the gas British users consume annually. The annual British consumption lies at 2.5 tcf meaning that Tanzania has capacity to supply the UK with gas for over 20 years.

Tullow Launches FPSO set to start operations on African Coast mid 2016

Despite the challenging economic environment for the oil and gas sector, Tullow has braved the storm and have this week launched a giant deep water vessel converted from a Very Large Crude Carrier (VLCC) in Singapore.  The Floating Production, Storage and Offloading (FPSO) vessel named after the late Ghanaian president Prof John Evans Atta Mills will be sent to the coast of Africa to pump oil from depths of 1,000-2,000 meters.

Oil and gas firms in Tanzania form a consortium for supplier database

Two major oil and gas firms in Tanzania, BG Tanzania and Statoil Tanzania formed a consortium with AS and Achilles- a global supplier information firm- to set a common supplier prequalification system.  The system will be used as the preferred mechanism to identify and select local suppliers and service providers for opportunities emerging in oil and gas in the country.Using the new initiative, local suppliers wishing to provide services to the oil and gas industry will be offered a new route to market their expertise to the world’s biggest operators.

OFID 2016/2017 Scholarships now open

OFID scholarship is open to candidates who have obtained or are on the verge of completing their undergraduate degree and who wish to study for a Master’s degree at any accredited University around the world.

The number of scholarships available: 4

Nature of study: Masters

Scholarship value: Award will receive a scholarship of up to US$50,000. The funds will be spread over a maximum of one year, toward the completion of a Master’s degree, or its equivalent, at an accredited educational institution, starting in the autumn of the academic year 2016/2017. The scholarship covers, tuiton fees, medical insurance, monthly allowance. allowance to cover living expenses, books and accommodation and travel costs.

Why Fracking?....(Blog Series Part 2)

Fracking is the main reason as to why America is having an energy revolution. Engineers and Scientists have worked hand in hand to produce safe hydraulic fracturing practices which have minimum impact on the environment. The US is now able to tap a vast amount of oil and natural gas reserves which were once considered difficult to reach (shale locked reserves and tight rock formations), hence were deemed not economically viable. The process has also been used in stimulating production from older depleting wells. Some sources claim that >95% of natural gas wells to be drilled in the future will be done through hydraulic fracturing. In the UK, this is being considered amidst opposition from environmental pressure groups.

FRACKING THE REASON FOR AMERICAS OIL BOOM.........( Blog Series part 1)

What is Fracking?

Fracking is  the short form derived from the term hydraulic fracturing. The term fracking refers to how the rock is fractured apart by the high pressure mixture.  This is a type of drilling that has been used commercially for 65 years. Thanks to major technological advances hydraulic fracturing and horizontal drilling , is responsible for swelling U.S. oil and natural gas production.  Since the US began intensively using  it since 2010, the oil produced has increased from 5mb/d to 9mb/d. The process is being considered in the UK and is mostly at its exploration stages having faced much opposition from environmental pressure groups.

Aga Khan Foundation International Scholarship Programme 2016/17 now open

The Aga Khan Foundation International Scholarship Programme is now open. Forms may be obtained from Agakhan Foundation or Agakhan Education Board offices. A limited number of scholarships are available for postgraduate studies to outstanding students (below 30 years of age) from select developing countries who have no other means of financing their studies. The objective of the programme to develop effective scholars and leaders and to prepare them for employment, primarily within the AKDN.

New Zealand Development Scholarships for 2016/2017 now open

New Zealand Government is offering scholarships for post-graduate students starting full-time postgraduate degree programmes in 2016.   The New Zealand Development Scholarships (NZDS) are targeted at candidates from select developing countries with the aim of providing an opportunity to gain knowledge and skills in specific subject areas which will assist in the development of their home country. Eligible candidates are nationals of African Commonwealth countries, Africa – non-Commonwealth countries, Asia, Latin America, Caribbean Commonwealth countries and Caribbean non-Commonwealth countries.

Gas production could boost Mozambique to one of the largest African economies

Mozambique is set to be Africa’s next biggest gas producer, joining big-wigs such as Angola and Nigeria in gas production by 2028 once its offshore natural gas , (the biggest ever discovered on the continent), reaches full production capacity as planned, the International Monetary Fund (IMF) said in  recent report.

BG Tanzania Post graduate Scholarships 2016 now open

The BG Tanzania International Postgraduate Scholarship Scheme in Geoscience and Engineering is now open. The scholarship is aimed at equipping Tanzanians with the relevant skills for the energy and related sectors.  The scholarship is fully funded by BG to the following Universities; Aberdeen University, Robert Gordon University, Herriot-Watt University and Cranfield University for a range of 23 courses offered within the four Universities.

Plummeting crude prices? Here is the reason why.

Source: International Energy Agency

The global crude oil prices have been plummeting for the last 1.5 years. Brent crude prices were at $110 a barrel just as recent as June 2014, a far -cry from today’s price of $30 a barrel, which was last seen in 2003.  Simply, the supply of oil exceeds the demand. The World is producing far more than is needed.

Africa Oil farms out its stake to Maersk oil

Canadian owned oil firm, Africa oil has sold half of its stake in 3 blocks to  Danish owned Maersk Oil.  Africa Oil is Tullow's  joint venture partner in Turkana’s exploration fields and co-owns the blocks on an equal basis.

The fields comprise of Blocks 10BB, 13T and 10BA in Kenya and the rift basin, south Omo blocks in Ethiopia. The farm-out is as a bid to raise some $350 million for use in further exploration and developmental costs.  The first oil discovery by the two companies was in Block 10BB in March 2012 where significant crude oil deposits have since been found in the surrounding 3 blocks .

Lowest oil price in 12 years?

The oil price has fallen to a 12 year low to $32.62. Brent crude, which is the most expensive of the crudes has sank by 4.2% and is now trading at $ 34.88 a barrel. This is the lowest it has been since July 2004.

US crude is also affected and is trading at $33.42, 3.9% below its lowest level in 2008.

The tumbling oil prices are as a result of oversupply of oil. The prices are now 70% lower than 18 months ago, which has heavily affected companies and government reliant on oil revenues.

THE US EYES KENYA'S ENERGY DEAL WORTH $18BILLION

The United States is expecting to invest in the blossoming oil and gas sector in Kenya including an export pipeline which is expected to transport crude oil from the Lokichar basin to the Lamu port.

The United States through its ambassador Bob Godec met  the newly appointed energy and petroleum cabinet secretary Charles Keter  on 5^th January 2016 whereat the pipeline was the basis of the discussions.

Petroleum Engineering

Petroleum Engineer.

A petroleum engineer is one who has studied petroleum engineering. This is an engineering field concerned with all activities in hydrocarbon production. Hydrocarbons in this case include crude oil or natural gas. Petroleum engineering aims at maximising recovery of hydrocarbons economicaly from subsurface reservoirs. However, the recovery of hydrocarbons involves the following steps.

• Exploration
• Development
• Production

The processes involved in hydrocarbon recovery are interdisciplinary as they include;

•  The geologists and geophysicists, (who perform the static description of the reservoir rock by analysis of subsurface structures using geological and geophysical methods),

• The reservoir engineer, whose aim is to optimise production of oil and gas through, proper well placement, models the productivity of the reservoir and predicts the reservoir potential with the aid of computer simulation software,

• Petroleum engineers who estimate the recoverable volume by utilising their understanding of the physical properties and behaviour of oil, water and gas within the reservoir.

• Production engineers - who manage the interface between the reservoir and the well through such tasks as perforations, sand control, artificial lift, downhole flow control and downhole monitoring equipment.

• Drilling engineers: who manage the technical aspects of drilling both production and injection wells. They work in multidisciplinary teams alongside other engineers, scientists, drilling teams and contractors.

• Facilities Engineers who ensure proper selection and design of surface equipments used in separation of the produced fluids (oil, gas and water).

The petroleum engineer is involved in nearly all the stages of exploration, development and production. They are charged with the task of economical hydrocarbon recovery with minimal environmental impact. The petroleum Engineer requires to also have a relatively good knowledge of other related disciplines such as petroleum geology, geophysics, well logging, drilling, field development economics, reservoir simulation and engineering, well engineering, artificial lift systems, completions and facilities engineering. However, the combined efforts of geologists and petroleum engineers helps in determining the way a reservoir is to be developed and depleted.