Guntis Moritis
OGJ Production Editor
HOUSTON, June 18 -- Eni SPA awarded a $60-million contract to FMC Technologies Inc. for manufacturing and delivering subsea equipment to its Kitan oil field development in the Joint Petroleum Development Area Block 06-105 of the Timor Sea between Australia and East Timor (Timor-Leste).
Kitan lies in 1,000 ft of water, about 100 miles off East Timor and 300 miles off Australia.
Eni drilled the Kitan-1 discovery well in 2008 to 3,658 m and tested it at 6,100 bo/d. An appraisal well, Kitan-2, completed in March 2008, confirmed the discovery.
Eni expects production to start from Kitan in 2011 and reach a peak of 35,000 b/d. It estimates that the field contains 30-40 million bbl of recoverable oil.
The production will flow to a floating production, storage, and offloading vessel.
FMC will supply three subsea production trees and all associated control systems and umbilicals. FMC’s Asia Pacific unit will manage this engineering, procurement, and construction project, and FMC’s operations in Singapore and Malaysia will engineer and manufacture the equipment, with deliveries to begin in 2010.
Contact Guntis Moritis at guntism@ogjonline.com.
Related news in 2008:
DARWIN, July 17 (Reuters) - Italian energy firm Eni (ENI.MI) said on Thursday its Kitan oil field in the Timor Sea was expected to hold about 30-40 million barrels of oil reserves. The exploration well Kitan-1, located in the permit JPDA 06-105, some 500 kilometres off the Australian coast, had crude flowing at a rate of about 6,100 barrels per day during a test conducted in March, Eros Agostinelli, managing director of Eni Australia, told an industry conference. Agostinelli said a further Kitan-2 appraisal will confirm the commercial viability of the field, which has "theoretical deliverability" of 20,000 barrels of oil a day. The company is reviewing development options for the field, which includes having it as a standalone project, or developing it jointly with Eni's neighbouring discoveries. Eni will submit a development plan for the Kitan field by May 2009. Eni, which has a 40 percent stake, serves as the operator of the Kitan project. A subsidiary of Japan's Inpex Holdings Inc (1605.T) has a 35 percent stake in the permit, while Canada's Talisman Energy (TLM.TO) has the remaining 25 percent stake. (Reporting by Fayen Wong; Editing by Ben Tan) http://www.reuters.com/article/rbssOilGasExplorationProduction/idUSSYD1211820080717Eni says Kitan field seen to hold 30-40 mln bbl oil
The Timor Sea Designated Authority approved the development area for the Kitan oil field following Eni's declaration of commercial discovery. The Kitan discovery is located in the permit 06-105 of the Joint Petroleum Development Area, an area jointly administered by Timor-Leste and Australia and situated approximately 170 km off the Timor-Leste coast and 500 km off the Australian coast. Kitan has recently been discovered by the successful exploration activity performed by Eni through the well Kitan-1. Following the discovery, Eni also drilled the well Kitan-2 which was completed on March 30, 2008 and confirmed the presence of a potentially commercial oil accumulation. Eni will now progress the preparation of a Development Plan to the TSDA that will be delivered within 12 months of this approval. Eni is the operator, holding 40% in the permit JPDA 06-105, with Inpex holding 35% and Talisman Resources Pty Limited holding 25% as joint venture partners. This discovery reinforces Eni's presence and growth potential in the region. Eni has been operating in Australia since 2000 and in Timor-Leste since 2006. An area of the Timor Sea lying between Australia and Timor-Leste is subject to overlapping territorial claims by Australia and Timor-Leste. This area contains substantial resources of petroleum. In this situation, Australia and Timor-Leste have agreed that a joint development regime, pending final delimitation of the seabed, is the best approach to permit development of petroleum resources to the benefit of both countries. Following passage of legislation through both Houses of Australia's Parliament, the Timor Sea Treaty came into force on 2 April 2003. The Treaty establishes a Joint Petroleum Development Area, the necessary administrative arrangements and provides for petroleum produced from the Area to be shared 90% to East Timor and 10% to Australia. Australia and Timor-Leste have developed the detailed regulatory and fiscal regime to apply to future petroleum activities in the Area. Day-to-day approvals for petroleum activities in the Joint Petroleum Development Area are administered by the Timor Sea Designated Authority (TSDA) located in Dili. These matters are overseen by the Timor Sea Joint Commission, comprising two Commissioners appointed by Australia and three from Timor-Leste. The Joint Commission also has responsibility for broad strategic issues, including the award of titles. The Joint Commission reports to a Ministerial Council, representing both countries. Commencing in 2008 the TSDA will most likely be incorporated into the administration of the Timor-Leste Government. The Timor Sea Joint Commission will continue to oversee its activities. Consistent with the terms of the Timor Sea Treaty, an International Unitisation Agreement (IUA) for the Greater Sunrise petroleum field which straddles the boundary of the Joint Petroleum Development Area was signed by both countries on 6 March 2003. The International Unitisation Agreement provides a financial framework and international legal basis for the joint development of the Greater Sunrise field. On 12 January 2006, the Certain Maritime Arrangements in the Timor Sea (CMATS) treaty was signed by Timor-Leste and Australia. By signing this treaty Timor-Leste has demonstrated its intention to agree to a moratorium on boundary issues for 50 years. Following ratification in both countries' parliaments, the IUA and CMATS entered into force on 23February2007. There are several projects either under way or being considered in the Joint Petroleum Development Area. These include the: The Timor Sea Designated Authority released four Contract Areas in the Joint Petroleum Development Area in early 2006. Eight bids were received for the four Contract Areas that were on offer, with the successful bidders signing Production Sharing Contracts. This brings the number of active production sharing contracts in the Joint Petroleum Development Area to eight. Information on petroleum exploration and production in the Area is available from the Timor Sea Designated Authority. Dili Office: No. 5 Avenida de Portugal Further information on the Joint Petroleum Development Area, including links to the legislation can be obtained from the Department of Industry, Tourism and Resources' website at: www.industry.gov.au An area of the Timor Sea between Australia and Timor Leste (referred to as the Joint Petroleum Development Area or JPDA) is subject to overlapping territorial claims by Australia and Timor Leste. Petroleum exploration and development by Australia and Timor Leste in the JPDA will continue under the agreed terms and conditions of the Timor Sea Treaty and the Treaty on Certain Maritime Arrangements in the Timor Sea. The Timor Sea Treaty The Greater Sunrise field straddles the border of the JPDA and an area of sole Australian jurisdiction. In the Timor Sea Treaty, the resources of the Greater Sunrise field are attributed 20.1 per cent to the JPDA and 79.9 per cent to Australia. The Greater Sunrise International Unitisation Agreement (IUA), signed by Australia and Timor Leste on 6 March 2003, unifies the field under the two jurisdictions for production and apportionment purposes. In March 2004, the Australian Parliament ratified the IUA by enacting the Greater Sunrise Unitisation Agreement Implementation Act 2004 On 12 January 2006, Australia and Timor Leste signed the Treaty on Certain Maritime Arrangements in the Timor Sea The CMATS Treaty and IUA each passed into force on 23 February 2007 and together provide for investor certainty, a precondition for development of the resource. Day-to-day approvals for petroleum activities in the JPDA are administered by the Timor Sea Designated Authority (TSDA). These matters are overseen by the Timor Sea Joint Commission, which also has responsibility for broad strategic issues including the award of titles. The Joint Commission reports to a Ministerial Council. The TSDA is located in Dili. From 1 July 2008, the TSDA will transition to the Timor-Leste system of administration as provided for in the Timor Sea Treaty. Currently, there is only one petroleum production project in the JPDA, the Bayu-Undan gas/condensate project. First commercial development of the Bayu-Undan field (located wholly within the JPDA) commenced in early 2004. The gas production phase involves piping the gas to Darwin, where it is processed into liquefied natural gas (LNG). The first export cargo of LNG was shipped in February 2006. The Department participates in the management of the JPDA through its role in the Timor Sea Joint Commission. The Head of the Resources Division is the Australian Commissioner on the Timor Sea Joint Commission and the General Manager of the Department's Offshore Resources Branch is the alternate Commissioner.Background information:
Timor Sea Joint Petroleum Development Area
Farol
PO Box 113
Dili, Timor-Leste
Telephone: +670 3324 098
Web Page: http://www.timorseada.org
Email: dilioffice@timorseada.orgTIMOR SEA TREATY
came into force on 2 April 2003 and sets out the framework for joint administration by Australia and Timor Leste of petroleum exploration and development in the JPDA. It includes the fiscal and administrative arrangements, the sharing of the benefits from development of the resources and importantly provides certainty to investors. The provisions of the Timor Sea Treaty do not prejudice a final determination of the boundary. The Petroleum (Timor Sea Treaty) Act 2003 and the Petroleum (Timor Sea Treaty) (Consequential Amendments) Act 2005 are the relevant pieces of Australian legislation. and amending thePetroleum (Submerged Lands) Act 1967 andCustoms Tariff Act 1995.TREATY ON CERTAIN MARITIME ARRANGEMENTS IN THE TIMOR SEA
(CMATS Treaty). The CMATS Treaty includes:PETROLEUM PRODUCTION
THE DEPARTMENT'S ROLE
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