September’s top stories: INEOS to shares shale gas profits, Encana buys Athlon Energy

INEOS to share £2.5bn of shale gas profits with communities in UK

INEOS intends to give 6% of its revenues from shale gas to communities who live above its operations sites in the UK.

The company estimates that it will share £2.5bn of its profits over the life of its shale gas business in the country.

The company believes this step will generate community support for Shale gas production.

The sharing of profits from Shale gas is practiced in the US.

Encana to acquire Athlon Energy in $7.1bn deal

Canadian natural gas producer Encana agreed to acquire the US-based independent exploration and production firm Athlon Energy in a $7.1bn definitive merger deal.

Encana will pay nearly $5.93 in cash and assume about $1.15bn of Athlon’s debt.

Texas-headquartered Athlon acquires, develops and explores unconventional oil and liquids-rich natural gas reserves in the Permian Basin.

Athlon currently produces around 30,000 barrels of oil equivalent per day (boe/d) in the Permian basin in Texas, of which 80% is oil and liquids.

Parkmead discovers new gas field in Netherlands

Oil and gas explorer Parkmead discovered a new gas field in the Netherlands.

The company, together with its partner Vermilion Energy, identified a 157ft gas column at the Diever-2 well in northern Netherlands.
Vermilion used the Explorer TB2100S rig to drill the well, which is targeting the Diever West exploration prospect.

The company will set production casing in the well before testing and it is anticipated that Diever West will be tied into existing production facilities in the area.

Pavilion Gas to buy LNG from BP

Pavilion Gas, a subsidiary of Pavilion Energy, agreed to buy 400,000tpa of liquefied natural gas (LNG) from BP for 20 years, starting in 2019.

BP will supply the LNG from its equity stakes in Freeport LNG in Houston, US, and its global portfolio.

BP has a liquefaction tolling agreement for more than 4.4 million tonnes per annum LNG capacity at the Freeport LNG project.

A final investment decision on the Freeport LNG project is expected to made by the end of 2014.

Drilling to start at South Malak-2 exploration well in Egypt

Drilling began at the South Malak-2 exploration well in Egypt.

The operator of the West Esh el Mellaha production sharing contract (WEEM-2 PSC), onshore Gulf of Suez, has advised Aminex on the move.

The South Malak-2, which is targeting the prolific Nubia and Matulla sandstones, is the first of two planned wells in the programme.

It will be followed by the Wadi Kofra-1 well by the end of 2014.

Veresen to acquire GIP’s 50% stake in Ruby pipeline for $1.42bn

Veresen agreed to acquire 50% convertible preferred interest in the Ruby pipeline system from Global Infrastructure Partners (GIP) for $1.425bn.

Kinder Morgan’s affiliate El Paso Pipeline Partners owns the remaining 50% stake of Ruby and will continue to operate the 680-mile, 42in pipeline.

The pipeline starts at the Opal hub in Wyoming and extends to the Malin hub in Oregon.

It has a current capacity to carry approximately 1.5 billion cubic feet per day , with potential to be expanded to 2 billion cubic feet per day via the addition of compression.

Ramba Energy to sell 25% stake in Indonesian Lemang PSC

Ramba Energy agreed to sell its 25% interest in the Lemang oil and gas block in Indonesia to Risco Energy Investments (REI) for $157.5m.

Both companies have signed a binding letter of offer, which will allow REI to acquire a 25% direct working interest in the Lemang production sharing contract (PSC) from Ramba’s Indonesian subsidiary, PT Hexindo Gemilang Jaya.

The companies have also agreed to enter into a three-month exclusivity period, during which REI will complete a due diligence on the Lemang PSC.

REI and Ramba will also agree the scope, schedule and resourcing of the field development plan for an early partner alignment.

Siemens to acquire Dresser-Rand for $7.6bn

German engineering company Siemens agreed to acquire US-based oil equipment manufacturer Dresser-Rand for around $7.6bn.

Dresser-Rand delivers rotating equipment solutions to the oil, gas, petrochemical and process industries.

It has manufacturing facilities in the US, the UK, France, Spain, Germany, Norway, India and Brazil.

Siemens plans to operate Dresser-Rand as the company’s oil and gas business by retaining its brand name and executive leadership team.