Industry News

THE last down turn in onshore drilling work at the start of last year saw rig contractors park their fleets until the market bounced back, but now that it inevitably has explorers are cautious that a lack of experienced hands could be having a negative impact.

Received wisdom suggests rig demand is outstripping supply but it could be the people who operate them that are missing.  

Speaking during a half-year results conference call Tuesday Senex Energy CEO Ian Davies said that the view that rig availability is tight was not an issue facing the sector. 

"I think it is something that is a little opaque in the market. We're out for tender as we speak for rig lines and well services. We understand exactly which rigs are available and it's a fallacy that there are no rigs available.  

"There are plenty of rigs, it is just lining up the actual rigs with the work program and timing. And we've got that well in hand.  

He said experienced rig crews were few and far between, something that came down to the low oil price in recent years which saw experienced hands leave the industry for good.  

"I think [that it is] important to get the good rig hands and the good operators back into the industry because the last time there was a down turn in the industry we lost a lot of people - and they were lost permanently - so you think rig hands in particular the crews that operate the rigs we had a permanent drain across the industry the last downturn.  

"We're seeing some of them come back, and I think one of the things to note when people talk about a lack of rigs, its generally a lack of rig crews that has actually been the issue more than anything else," Davies said.  

He also welcomed recent wage growth, something he touched on in the recently released quarterly results also.  

 "We are seeing wage inflation across the industry [which] I actually see as a positive because the industry was zero to negative wage growth over the past few years," Davies said.  

"In terms of cost inflation, the fact that we're out to tender will bear the results of any cost inflation out. But what we're not seeing material cost inflation across the board," Davies said.  

While rig availability is not an issue facing Senex, Davies did make the observation Longer term contracts like the one Senex currently has out for tender has the potential to encourage people to return to industry, something the company says is already having an effect.  

A Senex spokesperson told Energy News today that while drilling companies lost people over the past few years, they retained enough experienced professionals and are continually developing their workforce.  

Perth will again host the region’s biggest annual outlook event for the oil and gas sector in March at the 38th Australasian Oil and Gas (AOG) Exhibition & Conference.

The three-day Exhibition and Conference will cover a range of topics centred around the theme ‘An Energy Shift’, highlighting changing trends in the industry such as the rising confidence of the oil and gas market; effective transitioning of projects from construction to operations and maintenance; new uses for liquefied natural gas (LNG); and new energy.

The conference program includes updates and insights from Woodside Energy, Chevron Australia, NERA, Deloitte and Scottish Development International and the Department of Jobs, Tourism, Science and Innovation.

“The industry has had a tough few years; however, a recovery in global oil prices, Australia’s world dominance of LNG exports and a resurgence in investment in the sector have set the scene for a vibrant program across all three forums,” said AOG Event Director Bill Hare.

The vast AOG exhibition space will showcase more than 250 companies and provides a unique opportunity for policymakers, operators and service providers to meet, network and debate the future roles for natural gas and oil. Mr Hare said for the first time in 2019, AOG would emphasise a targeted focus on drilling and completions featuring both technical presentations and a dedicated exhibition zone.

“This exciting space has been added due to interest from past visitors and will feature the latest products, technology and services in drilling and well completion from Halliburton and the Society of Petroleum Engineers to name a few,” continued Mr Hare.

The AOG Exhibition & Conference – which is supported by Federal and WA State Government, the City of Perth and the local oil and gas industry – is considered one of the leading events on the global oil and gas calendar.

“Last year the conference and exhibition attracted more than 8,000 oil and gas leaders, policymakers, experts, innovators and educators from 45 countries – including official delegations from Norway, Scotland, Belgium, Malaysia, Poland and the UK. We are expecting to again host many delegations from leading global oil and gas producing regions in 2019, and this provides a unique opportunity to liaise with these influential decision-makers.

AOG 2019 will run between 13 -15 March at the Perth Convention and Exhibition Centre and is free of charge. For more details, visit the AOG website or register for a free AOG visitor pass, here. 

VALMEC reported revenue of $47.7 million for the half-year ending December with EBITDA of $3.2 million and says it has a strong order book heading into the second half of the financial year and then into 2020.

It expects total financial 2019 earnings to be higher than the previous year.  

Valmec qualified its results however, saying, "whilst strong is reflective of the delayed start to construction activity across Valmec's energy clients.  

"A significant increase in construction activity is expected in the second half if he year, underpinned by over $40 million of new contracts secured since December 2018, including the recent award of the Jemena Atlas gas pipeline project," it said.  

The Atlas project will be worth $22.1 million, renewal of long term services contracts with Origin Energy's Australia Pacific LNG export consortium is worth $15 million, and APTS testing and inspection services on the Tanami gas pipeline for MPC Kinetic was worth $4.7 million.  

Australia Gas Infrastructure Group announced the pipeline went into operation yesterday.  

Revenue from the energy construction segment was $23.1 million, while services was up over 43% from the previous corresponding period at $24.4 million.  

It has an order book of over $80 million with the company suggesting a "robust tender pipeline across new and existing clients". 

Managing director Steve Dropulich said that "with operating conditions within energy and infrastructure markets continuing to strengthen Valmec has been able to grow its longer term order book and tender pipeline". 

To celebrate the United Nation’s 4th International Day of Women and Girls in Science Brighter hosted a roundtable discussion with experts to discuss what can be done to further encourage young girls and women into STEM careers.

Strong role models, mentors and consistent exposure to science from an early age are just some of the ways we can encourage young girls into STEM jobs, according to women who are trailblazers in their own respective careers.

To recognise the United Nation’s International Day of Women and Girls and Science, the Brighter program hosted a roundtable discussion with women who are at different points in their STEM careers – some studying, some leaders and emerging leaders, some already retired.

Moderated by Director – Communications for the Brighter program, Sarah Browne, the discussion was centred on the initiatives already in place to promote STEM among women and young girls, and what else can be done to further encourage them to pick a STEM career.

Verity Blackman, board member for the UN Women National Committee Australia spoke to the group about the importance of role models and working with children, right around the world, to provide them with opportunities to try new things.

“You can’t be what you can’t see – this is why role models are critical for  young people.”

Sue Barrell, vice president of Science Technology Australia, and former Chief Scientist for the Bureau of Meteorology said:

“We need to get everyone – boys and girls – on a level playing field when it comes to STEM and build their confidence.”

Sarah Browne said: “It was a fantastic opportunity to get these women, from different backgrounds and experiences, to share their story.”

“What was apparent is that everyone around the table agreed on the same thing – young children, and young girls in particular, need a consistent and strong support network to introduce them to the big, interesting world of science, technology, engineering and mathematics,” she said.

“This should start from an early age so young girls go on to finish high school, they are confident to pick an engineering degree at university or go on to study their STEM-based PhD without fear of being overlooked or dismissed because of gender.”

The DLNG team has taken innovation to a new level, trialling 3D visualisation technology ‘Virtual DLNG’ which will revolutionise Perth-Darwin collaboration.

Read more here.

State of the art photographic scanning was recently completed at DLNG creating a google-maps-style simulated walkthrough of the plant. This software will allow designers and engineers to virtually ‘visit’ DLNG at any time, enabling unprecedented facility access.

The idea was born when Reza Dashti, Project Engineer, created a 3D tour for his rental property to help conduct inspections. When sharing this with his colleagues, they commented “we need this for DLNG!” and the idea was born. Innovation can stem from something as simple as a chat between workmates.

Collaboration in action – Perth and Darwin staff using Virtual DLNG

A collaboration room at the Integrated Operations Support Centre in Perth has been set up with a 360 degree camera, allowing multi-site meetings to run as though everyone is in the same room. Virtual DLNG enables immediate access for engineers and designers across locations to view plant equipment in a matter of minutes, improving efficiency in the inspection and decision making process. Furthermore, this creates cost saving benefits, decreases HSE risk to personnel, while optimising site visit requirements.

The software has embedded ‘tagging’ functionality allowing for equipment, scopes of work, engineering documents and even videos to be interactively tagged into the ‘virtual tour.’ Examples include hyperlinks to controlled documents (e.g. SAP), an embedded time-lapse video showing how to safely change out a turbine or filter, or even access to view a past scaffold build.

Virtual DLNG visualisation

Although the 3D visualisation was initially produced for the team working on DLNG backfill, there is limitless potential for innovative process improvements within other functions of the Business Unit. From providing a Perth-based accountant an understanding of the facility they support, to enhancing site inductions for shutdown crews, Virtual DLNG is the future of ABU-West. The Backfill team are also continually looking for more ways to create value with the tool, including using it to create a true One Team project with the Engineering, Procurement and Construction contractors.

Members from the Timor-Leste process team travelled to Perth to help tag the scopes of work within the visualisation. Their assistance will help finalise Virtual DLNG as a tool for internal and external stakeholders to fully understand the scopes and associated physical constraints.

THE move comes as the Morrison government decides to scuttle its ‘big stick’ energy plan until after an election but it’s good news for explorers as the minister for resources underlines how much energy exports to a growing Asia add to the economy. 

It outlines how the government aims to support develop new resources and markets, support jobs, attract investment into the wider Australian resources sector and "share the benefits of success with more regional communities". 

Rural and regional communities have increasingly become flashpoints over concerns about the impact of large resources projects, particularly new unconventional oil and gas fields, and coal mines, on the water table. 

"There is a bright future for the resources sector given the economic growth occurring in our region," Canavan said. 

"By 2030, Asia will produce more than half the world's economic output, consume 40% of its energy and be home to a middle class of almost 3.5 billion people.  

"Given this growth, and if Australia can maintain its global share of commodity production, at least 24,000 new direct mining jobs could be created, along with the broader prosperity those jobs will bring." 

The Australian parliament has three days left to pass legislation before it will be dissolved ahead of the budget and a general election, likely in mid-May, when the Coalition, which has burnt through two prime ministers, faces an electoral drubbing if polls are accurate. 

In the remaining sitting days the delivery of the national resources statement, a promised goal of the government's Resources 2030 Taskforce, is unlikely to receive much attention from MPs, with the government keen to focus on boarder security, encryption laws and superannuation 

Other legislative items such as a resources and energy policy issues and banking reforms are being sidelined on the parliamentary agenda. 

Despite that, Canavan has promised to start work immediately by progressing some elements of the statement in collaboration with the states and territories through apparatuses such as the Council of Australian Governments Energy Council. 

He also has plans for his favourite prospective region, the Northern Territory's Beetaloo Basin, saying the plan would support "the development of new resource basins through cooperation with state and territory jurisdictions, like our Memorandum of Understanding with the Northern Territory on the development of the Beetaloo Basin. 

"This includes an agreement to establish a new critical minerals work program to boost exploration, develop a data strategy to de-risk investment decisions, and build community confidence in the sector," he said. 

Speaking this morning, Canavan said the government would look to promote a national resources brand for Australia, continue its investment in pre-competitive data such as seismic and aero-magnetic surveys.

Source: Energy News Bulletin

Read more here.

Building a productive onshore gas industry that protects our unique environment and delivers local jobs

Strengthening environmental management of the Territory’s petroleum industry
Strengthening regulation and increasing transparency was the focus of legislative changes made by the Northern Territory Government in the final months of 2018, building foundations for robust decision-making.

A suite of legislative amendments were made to bolster environmental management, including clearly separating the agency responsible for regulating the environmental impacts and the risks associated with onshore gas and the agency responsible for promoting the industry.

During the first quarter of 2019, the transfer of the authority for the Petroleum (Environment) Regulations and the Environmental Offencesprovisions of the Petroleum Act from the Minister for Primary Industry and Resources to the Minister for Environment and Natural Resources will take effect.

The Water Amendment Bill 2019 was introduced to Parliament during the February sittings. This Bill addresses some of the key recommendations of the Final Report of the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory, delivering four of the 135 recommendations.

Introduction of the Water Amendment Bill 2019
The series of amendments proposed in this Bill, introduced on Wednesday, fulfils the Government’s commitment to strong environmental protections while supporting economic growth. The Bill also ensures that recommendations in the Final Report regarding relevant prohibitions are clearly legislated.

These prohibitions apply to the taking of surface water for petroleum activities, groundwater extraction close to landholders bores and the disposal of hydraulic fracturing waste to waterways and aquifers.

The Bill will not impede the recycling of water in hydraulic fracturing operations. This would improve water use efficiency and be managed through the risk assessment process associated with any Environment Management Plan approval.

Consultation on key aspects of implementation
Stakeholder consultation is underway and will continue in the first half of 2019 on key aspects of the implementation of the Final Report’s recommendations. Elements where consultation is underway or imminent include;

Publishing of draft hydraulic fracturing EMPs for public comment
The Petroleum (Environment) Regulations were amended and commenced 19 December 2018 to provide for the publishing of draft hydraulic fracturing Environment Management Plans involving well drilling or hydraulic fracturing for public comment and consideration of public comments by the Minister before granting approval.

Code of Practice
Codes of Practice have been drafted to clearly define the standards and requirements for gas company operations, as recommended in the Final Report. The Codes of Practice have been drafted to address a number of the recommendations;

• Surface Activities Code of Practice
• Well Operations Code of Practice
• Wastewater Management Code of Practice
• Methane emissions Code of Practice

The Codes of Practice have been developed by technical working groups. Draft Codes of Practice are undergoing independent third party peer review and will be released for public comment in early 2019.  The Codes of Practice will be finalised soon after and will be made enforceable via legislation.

Water Extraction Licences for consideration and public comment
Water Extraction Licences by petroleum companies are now subject to the advertising, notification and assessment provisions of the Water Act. These provisions include the public advertising of a notice of intention that triggers a 30‑day period during which submissions can be made.

More information about the water extraction licensing process can be found at https://nt.gov.au/environment/water or by emailing the Water Resources Division of the Department of Environment and Natural Resources at water.licensing@nt.gov.au

The NT Government’s Water Licensing Portal provides information about all pending and current water extraction licences.

More information
To read the Implementation Plan or access additional information, please visit hydraulicfracturing.nt.gov.au
To read the Inquiry report and recommendations, please visit frackinginquiry.nt.gov.au
Or you can contact the Hydraulic Fracturing Inquiry Implementation Taskforce at hydraulic.fracturing@nt.gov.au
To read the latest from the NTG Newsroom, please visit NTG Newsroom

The 2019 Australasian Oil & Gas Exhibition & Conference is shaping up to be a must-see event for professionals in the energy sector, with local industry heavyweight, Woodside Energy, front and centre as this year’s official Platinum Sponsor.

Now in its 38th year, AOG will be held in Perth from 13-15 March, bringing together major players from across the globe and cementing the event’s status as the most important in the Australasian region.

As this year’s major supporter, Woodside will offer its valuable insights at a range of forums with a particular focus on effective transitioning of projects from construction to operation and maintenance, new uses for LNG and opportunities in renewable energy.

Headquartered in Perth, Woodside Energy is the largest Australian oil and gas operator, with an expansive global portfolio and a reputation for world-class exploration, development, production and supply capabilities.

Company representatives will be joined by some 8,000 oil and gas industry leaders, policy-makers, experts, innovators and educators from 45 countries. Official delegations from Norway, Scotland, Belgium, Malaysia, Poland and the UK will also be among the attendees.

Woodside was a key participant in the inaugural Collaboration, Subsea and Knowledge Forums at AOG 2017 and an important contributor in 2018. Woodside Chief Operations Officer Meg O’Neill said the company was looking forward to being part of the discussions once again in March.

“As we progress our Burrup Hub growth plans in Western Australia, we want to work with others across the resources sector, within government and the community. AOG is a great opportunity to hear from and speak to those people – from SMEs and start-ups, to innovators and academia and other industry partners,” said Ms O’Neill, who will be delivering a keynote address on the opening morning of the event’s Collaboration Forum alongside Hon. Bill Johnston MLA, Minister for Mines and Petroleum; Energy; Industrial Relations.

Event Director, Bill Hare, said having a company of Woodside’s calibre as a consistent voice highlighted the value that the Australian and global oil and gas sector placed on the annual exhibition and conference.

“The backing we’ve received from Woodside Energy and the wider industry and government has been huge and is a testament to the standing and importance of AOG,” he said.

The AOG event will be staged at the Perth Convention and Exhibition Centre. For more information, visit the AOG website or register for a free AOG visitor pass, here.

From Minister Eva Lawler's Office.

The Territory Government is better protecting our precious water resources by today introducing the Water Amendment Bill 2019.

This Bill addresses some of the key recommendations of the Final Report of the Scientific Inquiry into Hydraulic Fracturing in the Northern Territory, delivering four of the 135 recommendations.

The amendments fulfil Territory Government’s commitment to introduce strong environmental protections THAT support jobs.

A series of proposed amendments within the Bill will ensure that the Final Report recommendations for relevant prohibitions are clearly legislated.

The prohibitions apply to the taking of surface water for petroleum activities, groundwater extraction close to landholder’s bores and the disposal of hydraulic fracturing waste to waterways and aquifers.

The Bill will not impede the reuse of wastewater for future hydraulic fracturing operations. This would improve water use efficiency and be managed through the risk assessment process associated with any Environment Management Plan approval. It also won’t prohibit existing wastewater management practices undertaken by conventional petroleum producers.

The introduction of the Bill demonstrates the Territory Labor Government is serious about protecting our precious water resources that so many jobs rely on.

This is unlike the previous CLP Government whose water policy damaged our unique environment, destroyed trust in Government processes and cost the Territory jobs.

Quotes from Minister for Environment and Natural Resources, Eva Lawler:

"Water is a precious resource and we need to manage it responsibly to ensure its sustainability. Protecting the environment creates jobs — good environmental policy, is smart economic policy.

"The sustainable use of the Territory’s water resources is crucial for the health of our rivers, aquifers and water‑dependent ecosystems and the values that we attribute to them as a community.

"It also crucial to protect the thousands of jobs in the tourism, fishing, cattle and agriculture industries that rely on the health of our water systems."

Media Contact: Carl Pfeiffer 0417 910 720

12 February 2019

Chief Minister Michael Gunner has today confirmed Mr Shaun Drabsch as the new Chief Executive Officer for the Department of Trade, Business and Innovation (DTBI), following a national recruitment process.

Mr Drabsch has extensive experience in both Government and private enterprise, including developing and implementing economic policy, infrastructure and major investment projects.

With previous experience in senior Government roles in Queensland and Canberra, he has worked on a number of Territory projects and initiative and in broad sectors including resources and energy, transport, agribusiness, education, and telecommunications.

He also brings deep experience with parliament, cabinet and budget processes, land tenure, procurement and stakeholder management and corporate governance.

Quotes from Chief Minister Michael Gunner

“Our number one priority is to create jobs for Territorians and the Department of Business, Trade and Innovation is a key driver of job creation.

“As CEO of DTBI, Mr Drabsch will apply his considerable skills to help grow the Territory’s economy, with oversight of the Territory’s Major Projects.

“With his experience in trade and investment attraction, innovation and economic development, I welcome this appointment and look forward to working with Shaun to develop the Territory to its fullest potential. 

Media Contact: Cameron Angus 0404 021 192