Industry News

Oil major joins a feasibility study that could lead to gigawatts of Dutch offshore wind being built purely for the manufacture of green hydrogen.

Oil major Shell has started feasibility work on what would be the largest green hydrogen project in the world.

The plans would see 3 to 4 gigawatts of offshore wind capacity established in the North Sea by 2030 purely for the manufacture of green hydrogen. Electrolyzers will be based in Eemshaven, along the northern coast of the Netherlands, and potentially offshore as well. 

The project could be expanded to 10 gigawatts of offshore wind by 2040 dedicated to green hydrogen production.

Shell Netherlands, Dutch gas grid operator Gasunie and the port of Groningen are the founding partners of the NortH2 project, with the trio looking for others to join the consortium during the one-year feasibility study. They hope to develop a “European Hydrogen Valley” cluster.

Gasunie will develop the network infrastructure required for the storage and distribution of hydrogen.

“This project offers opportunities throughout the entire hydrogen chain,” said Marjan van Loon, president-director of Shell Netherlands, in a statement.

“In order to realize this project, we will need several new partners," van Loon said. "Together we will have to pioneer and innovate to bring together all the available knowledge and skills that are required. The energy transition calls for guts, boldness and action."

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AUSTRALIA’s second-largest gas producer, Santos (52.5%), and joint venture partner Inpex (47.5%) have made a final investment decision on the Van Gogh Phase Two project.

Santos said this morning its decision to go ahead with the second phase would involve extensive infill drilling to maximise field production, access additional reserves and lower unit production costs.

The Van Gogh field is one of three subsea oil field developments located in the Exmouth Basin, offshore Western Australia, which tie into the Ningaloo Vision FPSO.

Santos hit first oil from the Van Gogh infill project in January last year.

Under its phase two development plans Santos will drill three new horizontal production wells which will then be tied back to the Ningaloo Vision.

First oil from the second phase is targeted for late 2021.

Santos contracted the Valaris MS1 drilling rig for the project from early next year.

"It's little more than a year since the start-up of the Phase One, so I'm delighted to see FID being advanced on Phase Two in such a short timeframe," Santos CEO Kevin Gallagher said.

"Phase One proved to be a very successful project, with higher reserves delivered for lower cost, the value of which was enhanced by a strong premium to Brent realised for this crude."

Earlier this month the Santos noted it had been earning up to $30 above the Brent benchmark price for oil from the Van Gogh project. This was due to high demand from Asian refiners as the International Maritime Organisation implemented new laws enforcing a drop in sulfur content in shipping fuel.

Source: Energy News Bulletin

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QUEENSLAND’s Gladstone hasn’t been left entirely out in the cold after Labor’s May federal election loss, with the announcement today that a $4.2 million gas injection facility will be built to send hydrogen into the city’s gas network as part of the state’s $15 million Hydrogen Industry Development Fund. 

Labor had promised a total of $1.14 billion on hydrogen development with the Queensland town to become a hub based on its LNG experience with an initial investment of $3 million 

 "Due to existing LNG infrastructure and a proof of concept Hydrogen Plant, Gladstone has enormous potential as an export hub for hydrogen," it said.  

Today Queensland premier Annastacia Palaszczuk said the town will become the first entire city in Australia to use a blend of natural gas and hydrogen. Build will begin in November and the park will produce 20 kilos of hydrogen a day using certified green power from the local power grid and will be blended into the gas network at a level of 10%.   

Australia's chief scientist Dr Alan Finkel has suggested 10% is a fair rate for initial blending but after when practicable the networks should scale straight up to 100% rather than incrementally.  

The facility will include a 175 kilowatt Polymer Electrolyte Membrane electrolyser, water demineralisation system and process cooling equipment. As the facility modular it can be re scaled-up in the future to produce volumes beyond Gladstone's needs, for potential wider domestic and even export markets. 

"Using renewable hydrogen, Australian Gas Networks (AGN) will trial the blended hydrogen gas with a view to converting Gladstone's network to hydrogen in the future," the premier said.  

The Australian Gas Infrastructure Group's subsidiary Australian Gas Networks received $1.7 million via the fund to build the blending facility.   

"This project will be the first in Australia to blend renewable hydrogen into a gas network with residential, commercial and industrial customers," state development minister Cameron Dick said. 

"This project supports Gladstone's vision to be a key hub for Queensland's domestic and hydrogen export industry, just as it is for natural gas today," AGN CEO Ben Wilson said. 

Source: Energy News Bulletin

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FALCON Oil & Gas has reported successful drilling of the Kyalla 117 N2-1H ST2 well in the Northern Territory’s Beetaloo Sub-basin.

The Irish company shares the well with operator Origin Energy (70%) and said late last week it had been drilled to total measured depth of 3,809 metres including a 1579m lateral section in the Lower Kyalla Formation.  

It said preparation work, which will include drilling water impact monitoring bores as required by the Territory's Code of Practice, will begin next month ahead of the next stage of operations.  

The JV will continue its in-depth shale evaluation of the technical data gathered from the conventional cores, sidewall cores and extensive wireline logging to build an understanding of the Kyalla Formation.  

"We are delighted to have successfully completed the Kyalla horizontal well section and we now look forward to the next phase of operations with the fracture stimulation of Kyalla 117 N2-1H ST2," CEO Phillip O'Quigley said. 

"We will continue to update the market as results become available."  

In early December Falcon said vertical drilling was completed to a depth of 1800m. 

Initial evaluation of the vertical section found three source rock reservoir sections identified within the Kyalla Shale Formation, with a thickness measuring almost 900m.

The three sections are known as the Lower, Middle and Upper Kyalla reservoirs. Gross thickness of each interval is between 75m-125m. 

 According Origin all three sections exhibited "elevated gas shows with relatively high C3, C4, and C5".

Source: Energy News Bulletin

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THE Australian Renewable Energy Agency has committed just under A$1 million to Yara Pilbara Fertlisers to support a feasibility study to produce renewable hydrogen and ammonia.

The study, conducted by Yara in collaboration with Engie, will look into creating hydrogen using electrolysis via solar PV at an industrial scale at Yara's existing ammonia facility in the Pilbara.  

The renewable hydrogen produced is expected to displace 30,000 tonners per year of hydrogen currently created from fossil fuels, according to ARENA.  

The blended hydrogen will then be converted to ammonia with a lower carbon footprint and sold for further processing into domestic and international markets.  

The study will also investigate using seawater for electrolysis. 

Yara hopes in the long term it will be able to produce all of its hydrogen and ammonia with renewables and hopes the study will be the first step on achieving commercial-scale production for export.  

"Yara's project will offer great insight into how Australia's current ammonia producers can transition away from the use of fossil fuels towards renewable alternatives for producing hydrogen while continuing to leverage the substantial export capabilities that those companies have already established," ARENA CEO Darren Miller said.  

"ARENA's support will assist in completing the feasibility study so that we can fully understand the opportunity for generating renewable hydrogen for use in our Pilbara facilities," Yara International executive vice president Production Tove Andersaid said.  

ARENA has committed roughly $50 million toward hydrogen initiatives so far, spread between research and development projects and feasibility and pilot projects. 

Source: Energy News Bulletin

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UPSTREAM Production Services has seen its maintenance service contract with Italy’s Eni for its Blacktip gas field and Yelcherr gas plant extended by two years. 

UPS has held the contract for three years for the platform in the Bonaparte Basin in the Timor Sea and gas plant near Darwin.  

The scope of services includes the administration and execution of maintenance activities and associated support in relation to the unmanned Blacktip wellhead platform and onshore Yelcherr gas plant for domestic use.  

"Upstream  has a well-established track record in the supply of safe and efficient operations and maintenance services in Australia," managing director Geoff Jones aid.  

"We are excited to have been given the opportunity to continue to support Eni Australia on this regionally significant project in the Northern Territory." 

Source: Energy News Bulletin

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TIMOR Resources has secured a US$30 million finance facility via a convertible note structure from Lakehouse Group to progress its onshore drilling plans for  Timor-Leste’s  first onshore well in 44 years. 

Timor Resources, whose parent company is engineering firm Nepean, plans a 10 well campaign to run for 426 days, with five wells this year in one permit it operates under a production sharing contract arrangement with the Dili government and five more in its other permit in early 2021.  

The first spuds on the first of May.  

Wells Karau, Kumbilli, Laisaipi, Lafaek and Raiketin will be drilled in Permit A.  

Eastern Drilling has the drill contract and will use a 1000 Loadcraft rig, made in the US.  

Weatherford is providing the wireline, and explosives, along with other subcontractors from Indonesia coming onshore Timor-Leste for the first time 

The company will free carry national oiler Timor Gap for its 50% share of the full exploration costs over four years valued at US$55 million, and if successful will be seeking field development finance after the drill campaign, possibly again looking to Lakehouse which has over US$1 billion in funds under management.  

The company has two onshore permits in the south close to Suai where the nation plans to eventually develop an LNG export terminal to commercialise gas from its Greater Sunrise fields. 

The unnamed drill rig is currently en-route from the US with an expected arrival date of March. Once onshore, rig training for the 45-strong Timorese workforce will begin. 

"Timor Resources is very optimistic of an oil discovery. Any drilling in the new democratic nation of Timor-Leste will be a country-first," it said today.  

"All historical drilling was completed before any seismic was undertaken. There are two historical wells that had oil discoveries in the permit but were not developed for geopolitical reasons."

Source: Energy News Bulletin

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SANTOS is lobbying all levels of government for its carbon capture and storage pilot program in the Cooper Basin that would eventually see 1.7 million tonnes of CO2 injected underground each year, from an initial 300,000t during phase one. 

It also released its third climate change report which says the oiler has "a long term aspiration of achieving net-zero emissions by 2050" and which offered more detail and colour on its CCS plans.  

Santos managing director Kevin Gallagher said carbon capture is "crucial technology for achieving the world's climate goals… it's a large scale permanent abatement solution".  

There are currently 40 million tonnes per annum of CCS projects in operation globally.  

Australia could be a world leader in CCS and hydrogen production - for which CCS is a necessity if it is to be made from methane or coal - provided policy settings are favourable.  

Santos is planning a front-end engineering and design entry mid-year for an end-of-year final investment decision for phase one of its planned CCS project.  

During a conference call after its full-year earnings were released Gallagher, now a CCS convert, said as the cost of carbon goes up the costs of its carbon sequestration program will go down.  

"We're working hard with all levels of government to encourage the accreditation of sequestration projects for carbon credits in Australia," he said. 

Santos' climate change report, which leans heavily on International Energy Agency data, said its emissions are in line with all three scenarios from the agency's latest climate report, suggests a glowing future for Aussie CCS, provided support is offered.  

Its report states "government policy in the form of tradeable credits, financing vehicles and investment incentives will be needed".  

With this support in place the Cooper and Eromanga basins have potential to store over 20MMtpa of CO2 for 50 years and could also capture emission from power generation, steel, cement and chemicals, Santos said.  

Overall "Australia has an estimated storage capacity of enable injection at a rate of 300MMtpa for at least 100 years," it said. 

The Cooper Basin is ideal given the depleted reservoirs and Santos' long history of working there. It has already drilled two wells to test the project.  

Source: Energy News Bulletin

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SHELL confirmed to Energy News this afternoon its floating LNG vessel the Prelude is out of action but would not give a date for when production would restart. 

"Work continues to restore full operations on Prelude. Our focus remains on a facility that is safe, robust and reliable and we are working to restart production with that in mind," an email said.  

The offshore regulator previously said to this publication that "Shell has advised that the facility will remain shut-down for at least three weeks from last Wednesday, 12 February".  

The National Offshore Petroleum Safety and Environmental Management Authority issued Shell a safety notice January 22 but did not shut the vessel down. Shell took the decision in early February and told Energy News then it was unrelated to the notice.  

Mechanincal issues and power shutdowns apparently drove the production halt.  

Energy News understands half the crew remain stood down with only 180 currently on the vessel.

Source: Energy News Bulletin

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From Minister Kirby's office

The Territory’s exploration sector is experiencing strong growth in exploration activity for commodities such as gold, zinc, copper and lithium.

The upcoming Annual Geoscience Exploration Seminar (AGES) conference provides existing and potential explorers and friends of the industry an opportunity to come together and discuss the latest discoveries and future opportunities for the sector.

AGES is the Territory’s premier mineral and petroleum exploration event held annually, that regularly attracts over 200 delegates.

The 2020 conference is a Territory Government flagship event, highlighting the latest geological results from the Northern Territory Geological Survey’s (NTGS) programs under the Resourcing the Territory Labor Governments initiative.

Celebrating its 21st anniversary in 2020, key program highlights include:

• The first release of data from the new 840 km Barkly seismic survey acquired in collaboration with Geoscience Australia;
• new data on the age, structure and correlations of the South Nicholson Basin;
• The interpretation of the NTGS Tanami airborne magnetic survey; and
• insights into the undercover copper-gold and base metal mineral potential of the ‘East Tennant’ region in the Barkly Tableland and the Rover field SW of Tennant Creek.

To register to attend, or to view the complete conference program for the 2020 Annual Geoscience Exploration Seminar, visit the AGES website.

Quotes from Minister for Primary Industry and Resources, Paul Kirby:

“The Territory Labor Government knows that jobs in regional communities are critical to Territorians, and a healthy exploration sector can play a key role in supporting regional economies in centres such as Tennant Creek and Alice Springs.

“The growth in exploration activity in the Territory proves that the resources sector has an exciting future, a future which the Territory Labor Government supports through the sustainable development of the resources sector and delivering jobs for locals.

“This year attendees can expect to hear about the Territory Labor Government’s NT Geological Survey’s programs under the Resourcing the Territory initiative which is a crucial part of exploration and production success in the minerals sector in the NT.”

Media Contact: Tom Ryan (0436 951 084)