October 2023

First oil

Upstream situation in Eastern Mediterranean deteriorates
Kurt Abraham / World Oil

The Israeli-Hamas conflict in the Middle East has cast a pall over the outlook for upstream activity in the Eastern Mediterranean region. Certainly, the proximity of the fighting to either existing production or development and exploration sites has got to be a concern for companies operating in the area. If the conflict persists for months on end, as some geopolitical and military analysts are predicting, then a delay in some activity is likely to occur. 

Fig. 1. The Tamar gas field platform, offshore Israel. Image: Chevron.

Offshore Israel. There already has been an impact on gas production operations off the coast of Israel. On Oct. 9, 2023, operator Chevron shut down output at its Tamar field, 15 mi off the coastline, at the request of officials in the Ministry of Energy. They told Chevron that the Tamar platform (Fig. 1) was in the range of rocket fire from the Gaza Strip.  

According to Chevron, Tamar field has been meeting roughly 70% of Israel’s energy needs to generate electrical power. In addition, a prolonged shutdown could lead to a drop in, or cessation of, Israeli gas exports to neighboring Egypt and Jordan. It also could tighten further the global gas market, which is going to see demand for gas to heat homes and businesses grow, as winter approaches.    

In the short run, Chevron has continued to supply its customers in Israel and neighboring countries with gas from the larger Leviathan platform.   

Onshore Israel. As some of you are aware, Zion Oil & Gas drilled an exploration well on its Megiddo Valleys license during second-half 2021. After analysis of the well logs and other interpretation during 2022, the company decided this year to re-enter the well and do a re-completion, to see if Zion actually has a bonafide commercial hydrocarbon discovery. 

While the company was working on preparations for the re-entry, the Hamas attack on Israel took place. On Oct. 7, company CEO Rob Dunn said, “All our staff in Israel are safe and accounted for. Our drill pad/re-completion site remains unaffected at this time, and our office in Israel remains secure. We are taking precautionary measures set by the government.” On Oct. 9, the firm’s Founder and Chairman, John Brown, along with Dunn, reconfirmed that their well site and personnel remained safe. And on Oct. 11 and Oct. 25, safety of the crew and site was again confirmed. But one has to wonder how much the conflict to their southwest, as well as to their northwest, is slowing down operations.  

Lebanon. Meanwhile, only the second well to ever be drilled offshore Lebanon’s coast was spudded in late August by the Transocean Barents semisubmersible rig. Operator TotalEnergies was testing a location on its Qana prospect and looking for natural gas. Unfortunately, during the first half of October, word began to leak out that the well was unsuccessful, that it had not found commercial quantities of gas.  

This status was confirmed by Lebanese caretaker Energy Minister Walid Fayad, when he spoke with Reuters at an energy conference during the back half of October. Nevertheless, it was quite obvious that Fayad wants TotalEnergies and its partners to drill another well on Block 9, and quickly. “They drilled in one single location in Block 9; they have the obligation to do another well, but the obligation comes later in time," Fayad told Reuters. “We will try to convince TotalEnergies, Eni, and QatarEnergy to drill a second well in Block 9 as early as possible, starting maybe early next year."  

Even if TotalEnergies can move as fast as Fayad would like them to, a lot will depend on whether the skirmishes between Israel and Hezbollah expand to the scope of the conflict raging between Israel and Hamas. If it does, then all bets are off, as regards the spudding of a second well at Qana, not to mention any other oil and gas projects in the Eastern Mediterranean. 

Offshore Cyprus.  Then, there is the situation in Cyprus, where it is now 12 years since the discovery of natural gas reserves offshore, and the country has yet to even begin a field development, much less put its first cubic foot onstream. Nevertheless, the situation has been edging closer to the country’s first field development being approved. During mid-2023, Chevron drilled appraisal well at its Aphrodite gas field that it said, “met our expectations, and we’ve submitted a development concept to the government.” And Eni reportedly plans to approve an offshore gas field development, based on one of its two finds struck last year. In all, the Cypriot government told World Oil for our mid-year forecast that it expected three wells to be drilled off its shores this year. 

Again, just how far anything proceeds offshore Cyprus may well depend on how widespread the conflict on the southeastern side of the Mediterranean becomes. It will be interesting to see how the various operators evaluate the situation as conditions evolve. 

Fig. 2. TotalEnergies’ Myrtle Solar utility-scale power plant lies south of Houston, Texas. Map: TotalEnergies.

Large solar power plant starts up south of Houston. Speaking of TotalEnergies, the firm announced on Oct. 24, 2023, that it had begun commercial operations at Myrtle Solar, its “utility-scale” operated solar farm in the U.S. Located south of Houston, Texas, Myrtle has a capacity of 380 megawatts peak (MWp) of solar production and 225 MWh of co-located batteries. Its 705,000 ground-mounted photovoltaic panels are installed over an area equivalent to 1,800 American football fields. Myrtle will produce enough electricity to cover the equivalent consumption of 70,000 homes.  

However, 70% of Myrtle’s capacity will supply electricity to the company’s industrial plants in the U.S. Gulf Coast region. It is part of the Company’s “Go Green” Project, which will enable the Company to cover, by 2025, the power needs and curtail the Scope 1+2 emissions of its industrial sites in Port Arthur and La Porte in Texas, and Carville in Louisiana.  

The remaining 30% of Myrtle’s capacity will supply green electricity to Kilroy Realty, a publicly traded real estate company, under a 15-year corporate power purchase agreement (CPPA).  

In addition to the photovoltaic installations, the solar power plant also features battery energy storage equipment to meet the need for grid stabilization. The Myrtle project benefits from the IRA (Inflation Reduction Act) Tax Credit mechanisms, passed by the U.S. Congress in 2022.   

One has to wonder whether this project has taken away land that could have been productive for agriculture or other purposes. After all, it covers the equivalent of 1,800 U.S. football fields, and each football field is equal to 1.32 acres. Multiply that out, and you get 2,376 acres. Every 640 acres constitutes a square mile, so this equates to 3.71 mi2, or an area 2.0 mi long and 1.86 mi wide. That is a significant chunk of land relegated to solar power production. 

This editor can’t help remembering some years back, when the more extreme environmentalists kept yowling about oil and gas fields being “ugly” and “eyesores” while ruining the scenic view. But I ask you—isn’t it just as ugly to cover thousands upon thousands of acres with solar panels, or deface mountain ridges with lines of windmills? 

Back half of 25 myths in the media's Idalia coverage. As we mentioned last month, Hurricane Idalia was a powerful, destructive storm that caused significant damage across parts of the southeastern United States, especially in northern Florida, during late August. At one point, while still offshore, it was a Category 4 hurricane. 

Accordingly, fossil fuel advocate Alex Epstein, who speaks regularly to industry groups and maintains his “Energy Talking Points” website, compiled his “25 myths in the media’s Idalia coverage.” We brought you the first 13 of these myths in our September issue. Now, we offer the remaining 12 myths: 

Myth 14: Thanks to fossil fuels, more people are dying from extreme weather. 

Truth: Thanks to fossil fuels more people are not dying from extreme weather—and everything else. Fossil-fueled prosperity has driven climate disaster deaths down 98% and life expectancy up by decades. 

Myth 15: Thanks to fossil fuels, we are suffering overwhelming damage from extreme weather. 

Truth: The trend of real weather damage is flat—despite many factors increasing vulnerability, like increasing coastal populations and bad incentives from government bailout policies. 

Myth 16: Extreme temperatures are a bigger danger than ever, thanks to fossil fuels. 

Truth: Extreme temperatures are a smaller danger than ever, thanks to fossil-fueled heating and A/Cplus the net-benefits of warming in a world where far more people die of cold than heat. 

Myth 17: Storms are a bigger danger than ever, thanks to fossil fuels. 

Truth: Storms are a smaller danger than ever, thanks to the fossil-fueled machines that build sturdy buildings, as well as fossil-fueled weather warning systems and fossil-fueled disaster relief efforts. 

Myth 18: Drought is a bigger danger than ever, thanks to fossil fuels. 

Truth: Drought is a smaller danger than ever, thanks to fossil-fueled irrigation, crop transport, and agriculture. With more such mastery our crop productivity can continue to improve. 

Myth 19: Floods are a bigger danger than ever, thanks to fossil fuels. 

Truth: Floods are a smaller danger than ever thanks to fossil-fueled flood control infrastructure and disaster relief. 

Myth 20: The rich, fossil-fueled world has ruined the poor world by making them vulnerable to extreme weather. 

Truth: Fossil fuels have made everyone more prosperous and less vulnerable to extreme weather.  

Myth 21: We can expect fossil fuels to make extreme weather far more dangerous in the future. 

Truth: Fossil fuels’ climate mastery benefits have far overwhelmed any negative side-effects on extreme weather for 100+ years, and there’s every reason to expect this to continue. 

Myth 22: Rapidly eliminating fossil fuels will make us safer from climate disasters. 

Truth: Fossil fuels provide uniquely cost-effective energy in a world that needs far more energy. Rapidly eliminating fossil fuels means far less energy, which means catastrophic climate impotence—and mass death. 

Myth 23: Fossil fuel use made Idalia far more damaging. 

Truth: Idalia would have been far more dangerous without fossil fuel use. 

Myth 24: When a major storm hits, politicians like Governor Ron DeSantis (R-Fla.) should commit to anti-fossil-fuel policies. 

Truth: That would be pseudoscientific symbolism and would make their constituents poorer and more vulnerable going forward. 

Myth 25: The next extreme weather event you hear about would have been much better, if we had rapidly eliminated fossil fuels. 

Truth: We will be far safer from that event, thanks to fossil fuels. And we are also alive, with our current life expectancy, thanks to fossil fuels. 


Special focus: Advances in Drilling. Among the numerous features in our lead theme is an article from an NOV author, who describes how wellbore seal control and monitoring enhance deepwater MPD operations. Another article from SLB and Pluto7 authors discusses optimizing BHA and fluid selection with a machine learning-based drilling system recommender. A third feature from Canrig authors describes how engineers in the Bakken shale have proven that rig electrification drives down emissions, and bolsters efficiency, while improving onshore drilling economics. This section also contains three more highly informative articles. 

Reservoir management. Authors from the University of Coimbra, University of Marine Science and Technology; and Madhyanchal Professional University discuss an advanced model for hydrodynamic analysis and development planning of reservoirs. Their discussion includes a case study in southwestern Iran.  

Energy transition: Carbon capture. In one feature, an author from Worley says the journey from CCUS skepticism to solutions is driven by the need to capture 5,635 megatons of CO2 annually by 2050. While the target is steep, through embracing technology neutrality, collaboration, and lessons from existing projects, the CCUS industry should experience large-scale growth. Meanwhile, three QuantumPro authors discuss using science-driven measurements to maximize soil-based carbon credits. The note that sub-atomic and nano-laser diagnostics helped to quantify 25 times more CO2/acre in a Texas initiative.     

About the Authors
Kurt Abraham
World Oil
Kurt Abraham kurt.abraham@worldoil.com
Related Articles
Connect with World Oil
Connect with World Oil, the upstream industry's most trusted source of forecast data, industry trends, and insights into operational and technological advances.