INTERNATIONAL FOCUS

Dev George Houston Map A swelling tsunami of outrage and protest is surging across the Pacific and threatening to inundate Paris with a flood of resentment and rancor against France and French companies and products, including those in the petroleum industry. At issue is French President Jacques Chirac's decision to resume nuclear testing in the South Pacific despite denouncements of the decision by virtually all the countries of the Pacific rim as well as Austria, Germany, Denmark, and

Sep 1st, 1995

Dev George
Houston

Boycott France?

A swelling tsunami of outrage and protest is surging across the Pacific and threatening to inundate Paris with a flood of resentment and rancor against France and French companies and products, including those in the petroleum industry. At issue is French President Jacques Chirac's decision to resume nuclear testing in the South Pacific despite denouncements of the decision by virtually all the countries of the Pacific rim as well as Austria, Germany, Denmark, and other countries around the world.

The Chirac government announced two months ago that it would be detonating eight atomic bombs beneath the small island of Mururoa, some 1,000 km east of Tahiti, between this month (September) and May 1996. Thereafter, it said France would sign the worldwide Comprehensive Nuclear Test Ban Treaty.

In New Zealand and Australia, where the prospect of another nuclear test on their doorstep has provoked political contempt, more than 100 legislators have called for censure, and a boycott of French companies and products is growing rapidly. French oil companies active in the area are being pressured to intercede with their government, and French contractors have either been eliminated from possible contracts or have been told they may be bypassed in favor of other providers.

Neither Elf Aquitaine nor Total hold exploration and production concessions in the South Pacific, but are providers of most of French Polynesia's petroleum products. French drillers such as Sedco Forex are, however, active in the area, as are a number of drilling, seismic survey, and supply companies.

In Japan, the Japanese government has lent its voice to the protest under leadership of Finance Minister Masayoshi Takemura, and other Pacific nations such as Papua New Guinea, Samoa, Tahiti, the Cook Islands, Fiji, Tonga, and the Solomon, Marshall, and Marquesas Islands have called for a permanent cecessation of such nuclear tests.

To try to stop the atomic testing, scores of ships, yachts, sailboats, a replica of a Viking warship, and even Polynesian catamaran are joining in a protest armada that is set to surround the tiny South Pacific atoll, and numerous politicians from around the world plan to land on the island.

Environmentalists maintain that past tests on the tiny atoll have weakened its substrata considerably, opening large caverns and causing degradation of its coral base, leading to leakage of radioactivity into the ocean. Since 1975, more than 130 nuclear warheads have been exploded in deep shafts in the atoll (in addition to the 44 atmospheric tests prior to that date).

Oil, Obasanjo & status quo

Ordinarily, oil companies working on the international stage don't overtly become involved in the politics of the countries in which they find themselves. Democracies or dictatorships, monarchs or mayhem matter very little as long as their machinations don't interfere with the industry status quo. That has not been the case, however, in Nigeria recently, There the current dictator, General Sabi Abacha, who seized power less than two years ago, appears to be trying to wipe out his opposition in the old fashion way - by prison and firing squad. Several international oil companies have become embroiled in the political tensions that ensued.

Abacha by any standard is Nigeria's worst dictator to date, having succeeded the former despot, General Ibrahim Babangida. He has ruthlessly suppressed his political opponents, silenced independent newspapers, and abandoned all civil and human rights in the country. To feather his own nest even beyond dipping into the national coffers, he reportedly has allowed if not encouraged transhipment through Nigeria of heroin and other illegal drugs. And he has attempted to eliminate those who speak out against his regime, its corruption and repression.

Former head of state General Olesegun Obasanjo is one such critic. In 1979, he kept his promise to restore democracy and relinquished power to an elected president. Since that time, he has become an international statesman, democracy advocate, and an outspoken opponent of the Abacha regime. As a consequence, he and about 60 other renowned dissidents were arrested, secretly tried for treason by military tribunals, and sentenced - some say to life imprisonment and death.

Nigeria's Nobel Prize winning author Wole Soyinka has called for seizing Abacha's foreign bank accounts and a boycott of Nigerian oil. Others, including diplomatic missions from the United States, the UK, and scores of other countries, have called for freeing Obasanjo and the other political prisoners and hinted at various punitive measures.

In reaction, Abacha's oil minister Dan Etete threatened BP and Shell, among other major oil companies, with expulsion and expropriation of their Nigerian holdings because of their country's "interference in Nigeria's internal affairs". Foreign Minister Tom Ikimi later rescinded the threat and reassured all oil companies that their operations in Nigeria were safe.

BRIEFS...

Africa:

Nigerian seismic survey recently completed by Geco Prakla's Gamma for Statoil and BP, was the world's largest to date - 1,630 sq km of 3D data, 750 km of 2D data. It was shot both in late 1994 and this year using a five-streamer configuration and a 600-meter wide swath. Processing was onboard the Gamma. Drilling is set to be started right away.

Equatorial Guinea's Zafiro area in Block B has tested 18,055 b/d oil from two wells recently drilled by subsidiaries of United Meridian and Mobil. Zafiro 3 lies a half mile southeast of the discovery well, while Opalo 1 lies two miles northwest. Extensive 3D seismic is now underway.

Europe:

Romania's Doina 2 wildcat by Enterprise Oil has tested at 500,000 cm/d gas. It was the third well drilled by the Ocean Liberator in Block XV of the Romanian Black Sea, and has now been plugged and abandoned to await further evaluation.

The UK is oversupplied with gas, thus development of at least four North Sea gas fields scheduled to come on stream in the next three years has been postponed approximately two years due to the low price of gas. Some 22 other gas projects will go ahead.

Norwegian seismic contractor PGS Exploration's Ramform Explorer has proven so successful for large multistreamer acquisitions that a second Ramform is now under construction. The Ramform Triumph will be launched early in 1996.

Middle East:

Azerbaijan is capturing gas that was once flared on Guneshli and several associated fields in its Caspian aquatory. The JV of Pennzoil and Ramco recently completed the gas utilization project, which now achieves peak compression of 4.5 million cm/d, saving the country some $90 a year in gas imports.

Oman's pipeline to India project may be dead in the water. Rumor has it that the project has been scuttled in favor of development of LNG capabilities that can not only supply India but be more flexible vis-a-vis other markets.

Asia-Pacific:

The Sakhalin earthquake of just over three months ago damaged or totally destroyed some 230 oil wells. An environmental assessment is currently underway to determine the degree of damage done to the offshore shelf in the Okhotsk Sea.

Indonesian Natuna Sea KRA Field has begun production. Located some 7.5 miles from the Kapap facilities, it was part of the KG/KRA development. KRA Field is now producing at 5,700 b/d oil, but should peak at 35,000 b/d later this year. The KG Field is already producing over 25,000 b/d.

Vietnam's Block 15-2 Mitsubishi concession is proving highly successful. The first test well came in at 14,400 b/d oil, the second well was dry, and the third has now shown 1,100 b/d oil and condensate with 8 million cf/d gas.

China has signed Block 50/20 to Chevron for geophysical exploration. The 3,300 sq km tract lies in a highly gas prone region southwest of Hainan Island in the South China Sea. Chevron also received an option for the block if it proves prospective. It already holds adjacent Block 62/23, in a Vietnamese-contested area.

Western Australia's Wonnick Field has been tested by its operator, Ampolex. First flow rates have been produced of 1,050 b/d oil. The field holds both oil and gas.

Timor Gap Field Bayu-Undan, in the Zone of Cooperation between Australia and Indonesia, looks as though it's going to be a major gas and condensate producer. Estimates of reserves go as high as 3-6 tcf of gas. Santos, the operator, has tested it at 1.2 million cm/d gas and 2,286 b/d condensate.

Americas:

Petro-Canada is for sale. The Canadian government has named a three company team, ScotiaMcLeod, Gordon Capital, and Merrill Lynch, to advise it on how to go about selling its 70% interest in Petro-Canada, the country's not-so-successful state-owned oil company - approximately 173 million shares.

Another record for Brazil's Petrobras: The state oil company has now drilled the world's deepest offshore horizontal well. At 2,985 ft, it is part of the company's ongoing $50 million horizontal drilling program.

Venezuela's Cristobal Colon is still being studied, this time to try to cut some of its $5.6 billion cost. Plans are to study ways of improving the huge gas project's projected profitability as well. Partners are Mitsubishi, Lagoven, Shell, and Exxon.

US Gulf ultra deepwater development is being planned. A group led by Shell and including Exxon, Conoco, and BP are studying the feasibility of developing the Ursa Field, which lies at a depth of 3,950 ft in the Mississippi Canyon area.

Alaska's central Beaufort Sea is being proposed for lease by the state's Division of Oil & Gas. The area lies in Harrison Bay off the Colville River Delta and outward to the seaward boundary.

Copyright 1995 Offshore. All Rights Reserved.

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