BP 2015 Annual Report Download - page 227

In Trinidad & Tobago BP holds exploration and production licences and
PSAs covering 1.8 million acres offshore of the east and north-east coast.
Facilities include 13 offshore platforms and two onshore processing
facilities. Production comprises gas and associated liquids.
BP also has a shareholding in Atlantic LNG (ALNG), an LNG liquefication
plant that averages 39% across four LNG trains*with a combined
capacity of 15 million tonnes per annum. BP sells gas to each of the LNG
trains, supplying 100% of the gas for train 1, 50% for train 2, 75% for
train 3 and around 67% of the gas for train 4. All LNG from train 1 and
most of the LNG from trains 2 and 3 is sold to third parties in the US and
Europe under long-term contracts. BP’s remaining equity LNG
entitlement from trains 2, 3 and 4 is marketed via BP’s LNG marketing
and trading function to markets in the US, UK, Spain and South America.
• Development of the Juniper project continues following its sanction in
2014. The lift and cellar decks are now completed. Fabrication of the
jacket and subsea structures has commenced. The first two wells have
been drilled and work in preparation for drilling the remaining three is
complete.
Africa
BP’s upstream activities in Africa are located in Angola, Algeria, Libya,
Egypt and Morocco.
In Angola BP is present in eight major deepwater licences offshore and is
operator in four of these, blocks 18 and 31 that are producing oil and
blocks 19 and 24 that are in the exploration phase. BP also has an equity
interest in the Angola LNG plant (BP 13.6%).
• In April oil production started ahead of schedule at the Kizomba
Satellites Phase-2 development in block 15 (BP 26.67%), offshore
Angola. The project is a subsea infrastructure development of the
Kakocha, Bavuca and Mondo South fields. Mondo South was the first
to begin production, with the remaining two also starting up in 2015.
This deepwater project is operated by a subsidiary of ExxonMobil.
• Our Greater Plutonio Phase 3 project, in block 18, achieved first
production from the subsea well, Pu-PQ, in the Plutonio reservoir in
June – six months ahead of schedule. The project is a subsea tie-in to
the existing Greater Plutonio FPSO in a water depth of approximately
1,300 metres. BP is the operator with a 50% interest and Sonangol
Sinopec International Limited has the remaining 50% interest.
• On 21 July Total announced that they started production from Dalia
Phase 1A, a new development on its offshore operated block 17
(BP 16.7%). The project involves drilling seven infill wells tied back to
the Dalia FPSO.
• Katambi-1, the first pre-salt play drilled by BP in the Benguela basin in
block 24 discovered hydrocarbons. Technical and commercial
evaluation of this is ongoing.
• Pandora-1, the first pre-salt play drilled by BP in the Kwanza basin in
block 19 also discovered hydrocarbons but will require nearby
developments to be potentially commercial. Due to the uncertainty BP
wrote off the costs of the well and the associated block 19 licence
($336 million) in 2015.
• The Angola LNG plant (BP 13.6%), which has been shut down for
planned repairs since April 2014 is expected to fully restart in 2016.
• In December, several fields in Angola were subject to impairment
charges as a result of falling oil prices. In total, $1.2 billion was
recognized, a significant portion of which relates to the Angola LNG
plant and is reflected in equity accounted earnings.
In Algeria BP, Sonatrach and Statoil are partners in the In Salah
(BP 33.15%) and In Amenas (BP 45.89%) projects that supply gas to the
domestic and European markets. BP’s total assets in Algeria at
31 December 2015 were $1,625 million ($310 million current and
$1,315 million non-current).
• The Bourarhat agreement expired in September 2014 and talks with
Sonatrach to negotiate new terms were not successful. Discussions
with them to close out the project were initiated in the first half of
2015 and are ongoing.
• In February 2016 the In Salah Southern Fields project start-up was
announced. The project is the latest stage in the development of the In
Salah Gas joint venture, which commenced production in 2004. The
project’s scope includes a new 500mmscfd gas dehydration central
processing facility, brownfield modifications to existing processing
facilities, 150km of carbon steel export pipelines, 160km of infield
flowlines and the drilling and tie in of 26 new wells.
In Libya we partner with the Libyan Investment Authority (LIA) in an
exploration and production-sharing agreement (EPSA) to explore acreage
in the onshore Ghadames and offshore Sirt basins (BP 85%). BP served
the National Oil Corporation with notices of force majeure in August
2014. This is the result of continued civil unrest in Libya which has made
it impossible for BP to undertake its obligations under the EPSA safely
and securely. As a result of this uncertainty, balances associated with
Libya were written off in 2015, incurring an exploration write-off of $432
million and other charges of $166 million.
In Egypt BP and its partners currently produce 10% of Egypt’s liquids
production and almost 30% of its gas production. BP’s total assets at
31 December 2015 were $7,860 million, of which $1,739 million were
current and $6,121 million were non-current. The current assets include
trade receivables and Egyptian pound-denominated cash.
• In March BP announced a gas discovery in the North Damietta offshore
concession in the East Nile Delta at the Atoll-1 Deepwater exploration
well (BP 100%). A Heads of Agreement was signed with the Egyptian
government in November securing gas prices and key terms for the
acceleration of Atoll development, with an estimated investment of
around $900 million for the development of phase 1 of the project.
• BP signed final agreements for the development of two West Nile
Delta projects – Taurus/Libra and Giza/Fayoum/Raven (BP 82.75%).
Production from West Nile Delta is expected to start in 2017.
• The West Nile Delta project concessions amendment, approved by the
Egyptian cabinet in December 2014, was ratified in March 2015 and
will be submitted to Parliament. The amendments agree a new
development plan along with associated start-up dates.
• In May BP signed a sales and purchase agreement with DEA Deutsche
Erdoel AG under which BP increased its working interest in the West
Nile Delta project concessions from 60% in North Alexandria
Concession and 80% in West Mediterranean Deep Water Concession
to 82.75% in both concessions. The transaction completed in
December.
• In August BP announced a further gas discovery at the Nooros
prospect (BP 25%), located in the Abu Madi West concession in the
Nile Delta in Egypt, operated by Eni.
• In October BP was awarded three new exploration blocks in the
Egyptian Natural Gas Holding Company 2015 bid round. The blocks are
North El Tabya (BP 100%), North Ras El Esh (BP 50%) and North El
Hammad (BP 37.5%). We and our partners have committed to
investing over $200 million in the blocks across various phases.
In Morocco, BP has a non-operating interest in each of the Essaouira
Offshore (BP 45%), Foum Assaka Offshore (BP 26.325%) and
Tarhazoute Offshore (BP 45%) blocks in the Agadir Basin, offshore
Morocco. The exploration periods run until 2017.
Asia
BP has activities in Western Indonesia, China, Azerbaijan, Oman, Abu
Dhabi, India, Iraq and Russia.
In Western Indonesia, BP participates in LNG exports through our
interest in Virginia Indonesia Company LLC (VICO), the operator of Sanga-
Sanga PSA (BP 38%) supplying gas to the Bontang LNG plant in
Kalimantan. Sanga-Sanga currently delivers around 13% of the total gas
feed to Bontang, Indonesia’s largest LNG export facility and one of the
world’s largest LNG plants. It has a capacity of 22 million tonnes of LNG
per annum and an output of more than 13 million tonnes.
In addition, BP participates in the Sanga-Sanga CBM PSA, where our
working interest increased from 38% to 50% in January following
withdrawal of Japan CBM Limited and Opicoil Energy at the end of 2014
and pending the Indonesian government’s approval.
BP also exited the Tanjung IV PSA (BP 44%) in the Barito basin of Central
Kalimantan in 2015, in accordance with the PSA and with government
approval.
In China BP has a 30% equity stake in the 6.8 million tonnes per annum
capacity Guangdong LNG regasification and pipeline project, making it
the first foreign partner in China’s LNG import business. The terminal is
supplied under a long-term contract with Australia’s North West Shelf
venture (BP 16.67%).
In Azerbaijan, BP operates two PSAs, Azeri-Chirag-Gunashli (ACG) (BP
35.8%) and Shah Deniz (BP 28.83%) and also holds other exploration
leases.
Additional disclosures
*Defined on page 256. BP Annual Report and Form 20-F 2015 223