Fire breaks out aboard MISC tanker in Labuan

A fire broke out early today on board a chemical/palm oil tanker of MISC Berhad in Labuan, causing a loud explosion which rocked Labuan, and has claimed one life as of now.

Three people were injured in the fire, which occurred on board the vessel, Bunga Alpinia, and an operation has been mounted to search for one missing person, according to a fire and rescue team.

The cause of the 2.30am incident is still under investigation.

Labuan has gained recognition as an oil and gas hub, and it is home to many international oil and gas companies.

MISC said in a statement that the 38,000 DWT IMO II vessel had 29 crew, comprising 23 Malaysians and six Filipinos. It said 24 of the crew had been brought to shore.

The vessel was alongside the Petronas Methanol Sdn Bhd terminal in Labuan when the incident took place at about 2.30am.

“No further details of the incident are available at this point,” the statement said.
It added that all authorities had been notified accordingly and MISC was working closely to render necessary assistance.

Firefighters were at the scene in an effort to put out the blaze, and the ship could be seen listing following the fire and explosion that rattled Labuan.

Search and rescue crew were also scrambling to locate the missing persons.

Meanwhile, in a statement, Petronas Chemicals Group Berhad said that it was undertaking all necessary action to ensure the safety of all personnel at its subsidiary, Petronas Chemicals Methanol Sdn Bhd, where the fire incident took place.

Following the incident, the operations of the Patau-Patau Power Station owned by Sabah Electricity Sdn Bhd (SESB) located adjacent to the terminal was temporarily halted for safety reasons.

SESB managing director Abdul Razak Sallim said this was to enable the fire and rescue personnel to take the necessary preventive and safety measures.

Channelling of gas stopped

The channelling of gas from Petronas Chemicals Methanol to the Patau-Patau power station was stopped immediately until after the situation returned to normal and it was safe, he said in a statement.

Abdul Razak said the temporary shutdown was expected to affect SESB’s capability to channel electricity to all consumers in duty-free Labuan.

He also said that several emergency measures to meet the shortfall in electricity generation capacity would be implemented, including Demand Side Management (DSM), during the period of peak demand.

Rationing of electricity supply would only be implemented in stages if the implementation of the DSM was unable to cope with the demand and the station could not operate at optimum capacity, he said.

The Patau-Patau Power Station has the capacity to generate 103.5MW of electricity, and is the only power station in the Federal Territory of Labuan.

SPK-Sentosa in oilfield services JV

SPK-Sentosa Corporation Bhd is venturing into the oilfield services and equipment via a joint venture with the Netherland's Superior Energy Services B.V. (SES).

SPK said on Wednesday it had signed a shareholders agreement with SES and Superior Energy Services (KL) Sdn. Bhd to provide the oilfield services and equipment.

"The proposed JV will enable SPK to provide specialised oilfield services and equipment, focused on serving the drilling and production-related needs of oil and gas companies, as well as plug and abandonment and decommissioning services required at the end of a well's life," it said.

SES's major shareholder is Superior Energy Services Group B.V., which holds a 100% stake.

SPK's core activities are homes, construction, technology and oil and gas.

Tanjung Bin Power to issue up to RM4.5bil Sukuk

Independent power producer Tanjung Bin Power Sdn Bhd has proposed a Sukuk Ijarah programme of up to RM4.5bil in nominal value (2012/2029).

RAM Rating Services Bhd said on Tuesday it had assigned a preliminary AA2 long-term rating to the proposed programme while the long-term rating had a stable outlook.

Tanjung Bin Power was granted the right to build, own and operate a 2,100MW coal-fired power plant in Tanjung Bin, Johor, for 25 years under a power purchase agreement (PPA) with Tenaga Nasional Bhd (TNB). The PPA expires on Sept 27, 2031.

“Proceeds from the Sukuk Ijarah will mainly be utilised to refinance the outstanding RM3.53bil under the company's existing RM5.57bil Istisna' medium-term notes programme (2003/2018) and for working capital purposes, and/or to provide payment/advance to its shareholder(s),” said the ratings agency.

RAM Ratings said the preliminary rating reflected Tanjung Bin Power's robust debt-coverage levels; its minimum finance service coverage ratio was expected to be 1.66 times, which was in line with an AA2 rating.

It said the preliminary rating was also supported by Tanjung Bin Power's strong business profile, underscored by the favourable terms of its PPA with TNB.

“We derive further comfort from the sturdy credit profile of TNB, whose debt facility carries an AAA rating, with a stable outlook,” it said.

However, RAM Ratings said the plant had been increasingly experiencing operational hiccups since 2010.

In fiscal 2011, its total unscheduled outage hours resulted in an unscheduled outage rate (UOR) that exceeded the PPA limit of 6%, resulting in availability capacity payments (ACPs) losses; in any case, the ACPs losses have been fully recovered though reimbursement from TNB for unutilised scheduled outage hours.

“We note that the Plant's UOR had eased below 6% as at end-February 2012. In any case, our sensitised cashflow analysis assumes ACP losses due to operational hiccups throughout the tenure of the Sukuk Ijarah.

“In the meantime, and similar to all other IPPs, Tanjung Bin Power remains exposed to regulatory and single-project risks,” it said.

Perisai Petroleum To Focus On Production And Drilling

Perisai Petroleum Teknologi Bhd is expected to focus on production and drilling going forward, says HwangDBS Vickers Research Sdn Bhd.

The research firm said Perisai Petroleum's flagship mobile offshore production unit (MOPU) for Petronas Carigali is under long-term contract until Sept 13, which may be extended by a year.

"Securing contracts for its MOPU upon expiry should not be an issue, given the MOPU's versatility, mobility and relatively lower operating costs," it said in a research note today.

HwangDBS also said that Perisai Petroleum may be able to participate in EOC Ltd's floating production, storage and offloading project at Petronas-Hess' US$5.2 billion North Malay Basin development.

"Under the project, gas floater Lewek Arunothai will undergo modification to meet the first gas production timeline in the first quarter next year," it said.

PetroChina, Total, Petronas Calgari Start Oil Production at Iraq's Halfaya

HALFAYA, Iraq - PetroChina Co. Ltd. and its partners Total SA and Petronas Calgari, said Wednesday oil production has commenced at the Halfaya oil field in southern Iraq.

Iraq Deputy Prime Minister Hussein al-Shahristani said the consortium has started production of 100,000 barrels a day from the field, with some 16 billion barrels of oil in place.

PetroChina, a subsidiary of China National Petroleum Corp., or CNPC, China's largest energy producer, holds 37.5% of the consortium. Total and Petronas Calgari each hold a 18.75% stake in the consortium, while Iraq's state partner holds the remaining 25%.

In late 2009, the PetroChina-led group won the right to develop the oil field some 35 kilometers south of the city of Amarah in southern Iraq.

The second phase of Halfaya will involve production capacity reaching 200,000 barrels a day by the end of 2013, while the third phase will have the field pumping a total of 400,000 barrels a day by the end of 2014, Iraq's oil minister, Abdul Kareem Luaiby, said. The consortium is planning to hit production of 600,000 barrels a day by the end of 2016, he added.

Mr. Shahristani said Iraq's total output has reached around 3.1 million barrels a day, up from three million barrels a day last month.

Iraq, a member of the Organization of Petroleum Exporting Countries, holds the world's third-largest oil reserves and has become the second-largest oil exporter in OPEC after Iran, whose output is retreating following sanctions imposed by the European Union against Iran's oil exports.

So far, PetroChina has invested some $700 million in Halfaya and the investment is expected to reach $1 billion by the end of this year, said Adnan Sajet, head of the joint-management committee of the field.

Some 22 new wells have been drilled in the field. Five wells existed before PetroChina started work on the project.

Six rigs are in operation in the field, Mr. Sajet said. The consortium is employing 2,000 Iraqis, he added.

CNPC and its subsidiary PetroChina are developing two more Iraqi fields. Along with BP PLC (BP, BP.LN), CNPC is developing Iraq's largest oil field, Rumaila, in southern Basra province, where production is hitting 1.35 million barrels a day.

The firm is also developing Ahdab oil field in Wasit province in central Iraq. The field recently started pumping 140,000 barrels a day.

CNPC has invested $3.3 billion in developing oil projects in Iraq so far, the company's vice president, Wang Dongjin, said.

Missan oil fields--Halfaya, Buzurkan, Fuka and Abu Ghareb--are producing nearly 200,000 barrels a day, generating some $200 million a day for Iraq, Mr. Shahristani said.

Production from Missan oil fields is expected to hit one million barrels a day in the next few years, Mr. Shahristani added.

Petronas and Versalis in petrochemical project

Petronas has signed a Heads of Agreement (HOA) with Italy-based Versalis SpA to jointly own, develop, construct and operate elastomer plants within Petronas’ proposed refinery and petrochemical integrated development (Rapid) complex in Pengerang, Johor.

The proposed joint venture will produce and market synthetic rubbers using Versalis’ technology licence and technical know-how.

The elastomer plants will be part of the world-scale facilities to be developed within the RM60bil Rapid complex.

Petronas was represented by its chief operating officer Datuk Wan Zulkiflee Wan Ariffin who is also executive vice-president for downstream business. Versalis was represented by its chief executive officer Daniele Ferrari.

Versalis will bring into the partnership elastomer operation records and wealth of experience and expertise that would contribute towards strengthening Petronas and Malaysia’s position as a key downstream petrochemical player in the region.

Headquartered in Milan, Versalis (formerly known as Polimeri Europa) is a petrochemical company wholly-owned and controlled by Eni SpA, an Italian multinational oil and gas company.

It manages the production and marketing of a wide portfolio of petrochemical products, using a range of proprietary technologies and state-of-the-art production systems and a wide-reaching and efficient distribution network.

The agreement with Versalis is the fourth of such arrangement secured by Petronas for Rapid and the engineering activities will commence immediately.

Prior to this, Petronas had inked similar agreements with BASF of Germany, Itochu Corp of Japan and PTT Global Chemical Public Co Ltd of Thailand for various high value-added downstream chemicals.

Petronas is currently pursuing the selection of other potential partners and licensors for the various facilities to be developed within Rapid.

Petronas’ proposed Rapid project is by far the largest liquid-based green-field downstream undertaking in Malaysia.

It will have a 300,000 barrels per day refinery to supply the petrochemical complex, apart from producing a host of refined petroleum products, including gasoline and diesel that meet the Euro 4 and Euro 5 fuel specifications.

The petrochemical component of the project will allow Petronas to expand its product portfolio from commodity petrochemicals to premium differentiated and specialty chemicals, capitalising on the growing demand for these higher value products in the Asia-Pacific region.
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Labuan Shipyard Expects Results Of Petronas Bids Early Next Year

Labuan Shipyard and Engineering Sdn Bhd (LSE), which is making billion-ringgit bids for Petroliam Nasional Bhd's (Petronas) projects, expected the results in the second half of this year or at least early next year.

Its chief executive officer, Mohd Azman Nasir, said LSE's facilities and the over 500 employees, be it in the engineering or technical fields, should help the company realise its objective.

He said Petronas officials had carried out an assessment of the yard's facilities and hopefully more projects, particularly fabrication, would be channelled to LSE.

"This is a great challenge for us to meet the high standard and expectation of Petronas," he said at the completion of the fabrication of of two single-point mooring (SPM) buoys for the Sabah Oil and Gas Terminal at Kimanis, Sabah.

The RM150 million project was awarded to LSE by marine offshore service provider, Alam Maritime (M) Sdn Bhd.

Shell loses 12.58m barrels of crude to illegal bunkering in six months

Shell Petroleum Development Company (SPDC) has lost 12.58 million barrels of crude oil between December 2011 and June this year, to illegal bunkering.

The company’s Operations Manager, Swamp 1, East, Mesh Maichibi, released the figure  at the weekend, while briefing journalists during an over-flight of the Nembe Creek Trunk line (NCTL) in Rivers and Bayelsa states.

Maichibi said that out of the number, 1.44 million barrels were deferred due to low pressure on the trunk line caused by trip-offs during the illegal bunkering activities.

He explained that when crude oil stayed under ground and did not come out for use, it was called deferment since there was a lost in production.

The operations manager said the NCTL consisted of two major trunk lines, San Batholomew and Cawthorne Channel Junction Manifold, adding that crude oil theft on the facilities had increased recently.

Maichibi noted that the Trunk lines, re-commissioned in 2010, had not experienced any significant oil theft until Dec. 24, 2011 when a major spill of 245 barrels was reported on it.

He said that the spill was at the Tora manifold and was caused by two failed six inches bunkering connections.

“The repairs required installation of coffer dams and took till January 23, at a total production deferment of 4.3 million barrels.

“Since the restart of production on January 23, there have been multiple facility trips caused by pressure drops, resulting from illegal off take.

“Once there are massive illegal bunkering activities, the pressure on the affected facility will drop and trip off,” Maichibi explained.

He said that after the commencement of production on January 23, another trip-off occurred from January 26, to January 31 due to low pressure on the line.

According to him, the situation reoccurred in February for 16 days, March for 10 days, and in April for 12 days all due to pressure trip-offs on export lines.

He pointed out that in May, the trunk line was shut down for 25 days and in June for 26 days due to leaks on failed illegal bunkering and fire at the Alakiri-Bonny line.

Maichibi said that from 2007 to 2010, the entire NCTL from Nembe 1 Manifold to Cawthorne Channel Manifold was replaced with a new 24”/30” pipeline at the cost of $960 million, saying that the replacement was necessitated by integrity issues resulting from militancy attacks, adding that the pipeline was designed for maximum gross output of 600,000 barrels per day (bpd).

In a bid to protect the line, he said, members of the Joint Task Force (JTF) were deployed to Cawthorne Channel, Awoba Manifold, San Barth and Tora Manifold, while 47-community surveillance contracts, employing 357 community workers at the cost of N1.09 billion, were also awarded.

The SPDC Right of Way Surveillance Officer, Mkpaka Jack, later conducted newsmen round the Cawthorne channel, Awoba, Bille, and Krakama fields where a lot of destroyed illegal refineries had polluted the waters.

Jack also conducted the newsmen round the Nembe axis, where evidence of illegal bunkering was seen.

He said it would take the commitment of the JTF and the communities in the creek to stop the economic sabotage.

More than 100 killed in Nigeria tanker fire as villagers tried to scoop up spilled fuel before blast

A petrol tanker crashed, caught fire and exploded in Nigeria yesterday, killing more than 100 people who had rushed to the scene to scoop up fuel that had spilled.

At least 50 others were injured in the incident in the southern Niger Delta region.
Witnesses said some charred corpses were still lying in the area hours after the explosion, including bodies the size of children.

Alagoa Morris, coordinator at advocacy group Oil Watch Nigeria, said: 'What did these small ones know about coming to scoop fuel?'

He said some women wailed at the scene of the explosion, desperately looking for their relatives.

The location of some of the bodies suggested that the victims were trying to run away when fire consumed them.

Mr Morris said: 'How can people who have enough to eat scoop oil that belongs to someone else? It is poverty.'

The tanker was trying to avoid a head-on collision with buses when it swerved into a ditch yesterday morning, said Rivers State police spokesman Ben Ugwuegbulam.

It then overturned, leaving its fuel to spill and people immediately swarmed to the scene to collect some of it.

Yushau Shuaib, a spokesman for the West African country's emergency management agency, said the 95 people were killed in the explosion that ensued.

It was not immediately clear what had caused the fire that left the truck burned to ashes.

Despite decades as an oil producing region, the majority of those living in the Niger Delta remain desperately poor and mostly without access to proper medical care, education or work.

Anger over the situation on several occasions has driven young people to attack foreign oil firms based there and steal fuel from pipelines.

The crude that flows from the Niger Delta is the lifeblood of Nigeria's economy. The OPEC member now pumps out about 2.4million barrels of oil a day, making it Africa's biggest producer.

Production dropped drastically during the militant attacks that targeted pipelines and saw foreign workers kidnapped. A 2009 government-sponsored amnesty program saw many fighters lay down their arms and the violence largely stop.

The truck accident took place near the town of Okogbe, about 40miles from Port Harcourt city, Nigeria's oil capital in the delta - a region of swamps, mangroves and creek.

A pipeline and a filling station were near the accident site, but neither was affected.

President Goodluck Jonathan said in a statement he is 'deeply saddened by the loss of many lives' caused by the explosion and 'particularly distraught by the fact that once again, so many Nigerian lives have been lost in an avoidable fuel fire disaster'.

A photographer who was at the scene said that the accident occurred on a major East-West highway that was being expanded.

Construction workers, however, hadn't yet reached the level where the accident occurred which remained a single lane, often forcing vehicles racing head-on to seek avoiding each other.

Mr Alagoa said the accident 'would not have happened' if the road had two lanes there.

At least two contracts have been signed over the last six years to expand the highway that runs through Niger Delta states, according to a government website. However, corruption often hinders or slows down road construction and maintenance projects.

Accidents are also common on Nigeria's poorly maintained roads. Drivers often travel at high speed and overtake slower vehicles, leading to head-on collisions with high death rates.

'This tells a tragic story about the state of national infrastructure and the poverty of the people,' said Nnimmo Bassey, executive director of Environmental Rights Action.

Petronas temui simpanan minyak, gas terbesar di Sarawak

BINTULU: Petronas telah menemui simpanan minyak dan gas terbesar melalui penggerudian NC3 dan Spaoh-1 di Blok SK316 dan SK306 di luar pantai Sarawak yang sekali gus bakal merangsang peluang perniagaan dalam industri terbabit, kata Menteri Kemajuan Tanah Tan Sri James Masing.

Katanya, pada Mac tahun lepas penggerudian NC3 telaga ‘wildcat’ telah membawa kepada penemuan Petronas kepada Blok SK316 dengan anggaran awal jumlah bersih simpanan di situ adalah sebanyak 2.6 trilion kubik kaki standard (tscf).

Beliau berkata, setiap telaga digerudi dengan kedalaman hampir 4,000 meter di bawah paras laut.

“Hasil penemuan melalui keputusan ujian aliran pengeluaran ke atas telaga itu me-nunjukkan bidang teknikal berdaya maju.

“Telaga Spaoh-1 dengan kedalaman penggerudian 3,000 meter terletak di lokasi Blok SK306 yang digerudi pada Disember 2010 juga te-lah membawa kepada penemuan minyak dan gas di situ,” ujarnya ketika berucap dalam Majlis Perasmian Ekspo Teknologi Minyak Sawit serta Minyak dan Gas Antarabangsa Malaysia 2012 anjuran Fireworks Event (M) Sdn Bhd di Dewan Suarah Bintulu semalam.

Katanya, syarikat minyak negara itu dilaporkan membuat penilaian masing-ma-singnya sekitar 100 juta tong minyak dan 0.2 tscf gas di kawasan itu.

“Kini telaga itu dalam persediaan untuk ujian penge-luaran. Penemuan ini diso-kong oleh strategi Petronas dengan memperhebatkan aktiviti penerokaannya di Malaysia dan dijangka meningkatkan penerokaan di kawa-san yang berpotensi di luar pantai Sarawak,” jelasnya.

Beliau berkata untuk tempoh tiga tahun akan datang, lebih 50 penerokaan telaga dijangka akan dilakukan membabitkan penggerudian luar pantai Malaysia oleh Petronas dan perkongsian pengeluaran dengan para kontraktor.

“Aktiviti hasil daripada penemuan itu dijangka akan merangsang peluang perniagaan dalam industri minyak dan gas sekali gus mempromosikan pelaburan huluan dalam negara khasnya di Sarawak,” katanya.

Mengenai ekspo itu kata- nya, difahamkan sebanyak 130 pondok pameran industri didirikan yang disertai oleh syarikat industri tempatan dan luar negara membabitkan sektor industri minyak sawit, gas dan minyak antaranya dari Singapura, Brunei, Britain, China, India dan Amerika.

Sementara itu, Pengarah Urusan Fireworks Event Jerel Soo berkata, ekspo itu tidak hanya mempamerkan tekno-logi dan produk terkini bah-kan memacu pertumbuhan industri dan pembangunan ke puncak yang lebih tinggi.

Katanya, ekspo itu adalah sebagai landasan kepada pe-nerokaan peluang perniagaan minyak sawit baharu, per-kembangan dan penembusan pasaran di Sarawak serta antarabangsa di samping hubungan kerja dalam industri berkaitan.