Norway has awarded 24 production licenses in the 22nd licensing round – 20 in the Barents Sea and four in the Norwegian Sea. Twenty-nine companies will be offered participating interests, while 14 companies will be offered operatorships.

Two of the 24 production licences are extensions to existing production licences.

Although activity levels in the petroleum industry on the Norwegian continental shelf are currently high, it is crucial to maintain exploration levels to ensure future activity through the discovery of new resources. The new production licences awarded in the 22nd licensing round will only begin contributing to production in 10 to 15 years’ time.

Twenty-three of the 24 production licences on offer lie north of the polar circle. Twenty of the licences relate to the Barents Sea.

“Interest in our northernmost seas has increased in recent years. We are now laying the foundation for long-term and efficient exploration of our northern seas, in both the Barents Sea and Norwegian Sea. This will promote further growth and employment not only in the north of Norway but also in the rest of the country,” says Minister of Petroleum and Energy Ola Borten Moe.

The 22nd licensing round was announced on 26 June 2012, and comprised 86 blocks in the Barents Sea and Norwegian Sea. By the application deadline on 4 December 2012, 36 companies had applied for production licenses.

NOIA 2013; Play on the Edge
June 17 – 20, St John’s Newfoundland

NOIA’s, Newfoundland & Labrador Oil & Gas Industries Association, annual conference and exhibition kicks off this Monday with over 1,100 delegates and speakers expected to attend. The focus of this year’s event will be on oil and gas developments offshore east coast Canada and how the region can get further involved in supporting activity in the Arctic region. Lessons learnt from the Deepwater Horizon accident and subsequent response will also be debated with environmental and safety the main issues discussed. The city of St John’s is well located for upstream activity as it goes further north to the deeper, colder and very challenging environments in the Arctic Region.

Delegates will hear from a high level range of industry experts including Malcolm Maclean, senior vice-president of Husky Energy; Atle Aadland, vice president of Statoil Canada Offshore and Andrew Barry, president of ExxonMobil Canada. Francois Durvye, chief economist of Schlumberger will give a presentation discussing how one of the world’s biggest service companies assesses the market outlook for the world’s oil and gas markets.

The conference will provide updates on all the major regional offshore projects including Hebron and will hear from Amy Myers Jaffe is a leading expert on the geopolitics of oil, energy, security, and risk and author of a new book published by Cambridge University Press, titled ‘Oil, Dollars, Debt, and Crises’.

Established in 1977, and now with more than 600 members, NOIA is Canada's largest offshore petroleum association. NOIA’s core members provide products and services for the petroleum industry and associate members represent operators, trade associations, educational institutions and government bodies.

For more details about the event, click here.

A Polar Code regulating shipping in the high Arctic, where maritime traffic is expected to increase as the ice cap recedes, is due to be implemented in 2016, the U.N. shipping agency said, reports Reuters. Shipping along the Arctic northern sea route is set to grow more than 30-fold over the next eight years and could account for a quarter of the cargo traffic between Europe and Asia by 2030. “We are preparing a mandatory code for polar navigation,” Koji Sekimizu, secretary-general of the United Nations International Maritime Organisation (IMO), said this week. “It will be operational in 2015 (and) will probably be implemented in 2016.” The code aims to ensure safe navigation in a fragile ecological environment, where infrastructure is few and help in case of an accident is far away.

“A new code will govern all technical requirements covering design and operations,” Sekimizu told reporters.“It will ensure the competence of seafarers … We will ensure that unless we have trained competent seafarers on board to navigate, then that vessel cannot be allowed to navigate.” With global warming thawing sea ice, the route, which runs along Russia’s northern coast and links Europe with ports in East Asia, is opening for longer and longer each year.

Nearly two dozen applications have been sent to Russian regulators to explore for reserves in the Arctic, energy company Gazprom said, reports UPI. Gazprom said it sent applications to subsurface resources agency Rosnedra for 20 licenses for blocks in the Barents, Kara, East Siberian and Chukchi seas. Gazprom said parts of the Russian continental shelf haven't been explored well. It estimated the continental shelf could hold as much as "100 billion tonnes of fuel equivalent, of which some 80% is (natural) gas." The company this year produced its first volumes of oil from the Prirazlomnoye oil field in the Pechora Sea using a stationary platform designed specifically for operations in Arctic conditions. Melting Arctic sea ice is exposing areas believed to hold deposits of oil and natural gas. Greenpeace campaigners last year occupied the Prirazlomnoye oil rig, saying it was trying to stop "the destruction of the planet'". Gazprom said it was looking to tap into the estimated 527 million barrels of reserves in the Pechora Sea. Regarding its ambitions, the company said it was paying "special attention" to safety issues as it looks to tap into Arctic reserves.

Alaska would put up $50 million to share the costs of a seismic program and exploration planning that would be part of a new oil and gas resource assessment in the coastal plain of the Arctic National Wildlife Refuge, Governor Sean Parnell, reports Platts. "The Department of the Interior is now developing a long-range conservation plan for ANWR and it is disappointing to us that an updated oil and gas resource assessment is not included in this," Parnell, a Republican, said during a press briefing in Washington, which was available on teleconference.

"Alaska has always offered its geologic expertise to the department and now we are offering financial resources," Parnell said.The state's offer, which must be approved by Alaska's legislature, is one-third of the estimated cost of a proposed winter three-dimensional seismic program the state is suggesting, Parnell spokeswoman Sharon Leighow said. The remaining funds could come from the federal government or the private sector, she said.

In the 1980s, oil and gas companies contributed to a two-dimensional seismic program in ANWR's coastal plain, a 1.5-million-acre section of the Arctic refuge, which totals 18 million acres overall.

The federal Alaska National Interest Lands and Conservation Act, which created the Arctic refuge in 1980, kept the so-called "Section 1002" coastal plain out of a wilderness designation on most of the refuge because of its oil and gas potential.

International cpontracting firm Technip was awarded by Husky Oil Operations two contracts, with a combined substantial value, for the planned subsea tieback of the South White Rose Extension field. The field is an extension of the White Rose field, located in the Jeanne d’Arc Basin, approximately 350 kilometers southeast of St. John’s, Newfoundland and Labrador, Canada. The first contract will be executed in 2013 and will include the supply and installation of gas injection flowlines, umbilicals, and subsea structures. The second contract will take place in 2014 and will cover the supply and installation of flowlines and subsea structures to support oil production and water injection.Technip’s operating center in St. John’s will perform the management and engineering of both projects, with various materials and equipment being supplied from within the Group and local supply chain. Knut Boe, Senior Vice President of Technip’s North Sea-Canada Region, commented: “These two awards reinforce Technip’s continuous involvement in Atlantic Canada’s offshore oil and gas projects. They also mark a new step in the relationship between Technip and Husky Oil Operations, for whom we successfully completed the subsea production system contract for the White Rose field development in 2005.”

Drilling of an appraisal well on the Total-operated Norvarg discovery in PL 535 in the Barents Sea has started, reports junior partner North Energy. The site lies in 377 metres of water about 275 kilometres north of the Hammerfest LNG plant on Melkøya.Being drilled by Ocean Rig's Leiv Eiriksson semi, it is expected to take 69-104 days. The main objective of the well is to prove up the volume potential in the north-eastern segment of the Norvarg closure. The partners in the licence are Total (operator - 40% interest), North Energy (20%), Det Norske (20%), Valiant Petroleum Norge (13%) and Rocksource Exploration Norway (7%). The Barents Sea is now a key frontier exploration region, boosted by Statoil's 2011 Skrugard discovery, followed by Total's Norvarg discovery. Total is now developing the Martin Linge field, which is expected to come onstream in 2016 and become one of the group's major hubs in the region.

Aker Solutions has won a £30m ($46m) contract to provide hook-up, commissioning and facility management services to Premier Oil at the operator's Solan field development, west of Shetland. The hook-up project will see two subsea production and two subsea injection wells tied back to a fixed production platform located in block 205/26a of the UK North Sea, the first of its kind west of Shetland. The platform, which will not be permanently manned, will produce oil that will be stored in a subsea tank before being exported via an oil-offloading system to shuttle tankers. The contract is valid for three years from first oil, with two one-year extension options. Work will be led from Aker Solutions in Aberdeen. First oil is expected in the fourth quarter of 2014. The UK government’s Department of Energy and Climate Change approved Premier's plans for the Solan oil field in April 2012. Once brought online, Solan is expected to produce 40 million barrels of oil at an initial rate of 24,000 barrels per day.

The non-profit forum, Arctic Circle, will hold its first meeting in Reykjavik, Iceland's capital, in October. Such a gathering is needed, Iceland President Ólafur Ragnar Grímsson said, because, while most countries have a stake in the melting of Arctic ice, only eight - Canada, Denmark, Finland, Iceland,Norway,Russia, Sweden and the United States - are members of the Arctic Council, an intergovernmental group set up in 1996. Some non-Arctic countries can observe the deliberations, but they have no formal voice on the Council about sustainable development and environmental protection in the region, reports Reuters. The group’s first meeting of the Arctic Circle will take place at the Harpa Reykjavík Concert and Conference Center from October 12-14, 2013. Also, China and Iceland signed a free trade agreement this week, offering financial support to the small North Atlantic country for its recession-battered economy and giving Beijing another foothold in its drive for influence in the Arctic.

Russian energy giant Gazprom's oil arm and Royal Dutch Shell PLC are planning to jointly develop two sections of Russia's Arctic shelf in the Chukchi and Pechora Seas, Russian Natural Resources Minister Sergei Donskoi said. The agreement between Shell and Gazprom Neft is expected to be signed on April 8. The companies are preparing to sign an agreement that will cover joint offshore drilling in the Russian Arctic as well as shale oil projects onshore in Western Siberia. Mr Donskoi said the terms of the deal are likely to be the same as for other foreign firms that have partnered with state-controlled oil company Rosneft, including Exxon Mobil, Interfax news agency reported. Those deals see the foreign firms provide capital for initial exploration in exchange for one-third of eventual production. State oil giant Rosneft has struck a series of deals with the likes of ExxonMobil, Statoil and ENI for Arctic exploration and last month confirmed it was also now looking at projects with BP, its 20pc shareholder. The companies have yet to comment publicly on the proposal.

Russia's gas giant Gazprom expects to reach an agreement on the price of gas to be supplied to China via the eastern route in June, and sign a deal by the end of this year, Gazprom chairman Viktor Zubkov said in an interview.

"I think that some time in June, the final price [of gas to be supplied to China] will be determined, and by year-end, all the documents regarding the agreed supply volumes and the price will be signed," Zubkov said, reports Platts. At the end of March,
Gazprom and China National Petroleum Corporation (CNPC) signed a memorandum of understanding on Russian pipeline gas supplies via the eastern route from East Siberia.
Under the 30-year deal, supplies are expected to start in 2018 at a rate of 38 billion cubic meters/ year, with a possibility to increase volumes to up to 60 bcm/year, Gazprom CEO Alexei Miller said at the time, adding that there is a possibility of pre-payment for the gas supplies.

Ratings agency Fitch noted that the gas deal "will dramatically improve [Gazprom's] position in Asian gas markets, which is currently represented only by a 50% share in the 9.6 million mt/year Sakhalin-2 project."

Gazprom had previously expected to sign a final contract on supplies of 30 Bcm/year of pipeline gas over 30 years via the so-called western route, from West Siberia to western China, in mid-2011, but that project was repeatedly delayed as the parties failed to agree on a gas price, reports Platts. Earlier this year, Gazprom also approved a decision to build a three-train, 15 million mt/year LNG plant in the Russian Far East near Vladivostok, with the first train to be commissioned in 2018, and plans to supply LNG from there to Asian markets.

After a year’s delay, the United Nations body tasked with developing polar shipping regulations has recommended provisions to address the environmental impacts of Arctic shipping – but they don’t go far enough, says conservation organization WWF. The International Maritime Organization (IMO) met last week to shape the Polar Code, a legally binding set of rules for shipping in polar regions. Although the final Polar Code won’t be adopted this year, recommendations made now will strongly influence the environmental provisions of the final Code. “The provisions proposed on environmental protection issues are simply too weak”, says Lars Erik Mangset, Advisor for WWF-Norway. “Major risks, like acute pollution from heavy fuel oil, are not even addressed. And although the Polar Code is legally binding, many of the most pressing issues have been placed in the voluntary section of the code or deferred to later discussions, potentially outside the Code.” Rapid warming in the Arctic has led to the opening up of commercial sea routes in the region. While destination ship traffic in and out of the Arctic is expected the greatest traffic increase the next decades, transport over the Northern Sea Route (above Russia and Scandinavia) has seen substantial growth over the past few years and is in particular being targeted as a route for tanker and bulk traffic. Increased traffic in these waters, coupled with the fact that the Arctic is up to 95% unsurveyed and chart coverage is generally inadequate for coastal navigation, means that the risks of operating should be matched with suitable precautionary measures in order to protect the environment. For example, banning the use and carriage of heavy fuel oil in sensitive areas would reduce the environmental impacts of a spill significantly. “Arctic shipping will expand massively in the next few decades. The recommendations are disappointing, but they are not yet set in stone. Arctic countries have an opportunity now to advocate world-class environmental protection measures, which this region needs and deserves”, says Dr. Simon Walmsley, Marine Manager for WWF-International. Solid international and domestic legislation, respectively in the Antarctic and in Canada, sets a good precedent. Canada already in place close to zero-tolerance limit on oil and oily discharge and other waste streams from ships, and has advocated for similar provisions in the Polar Code. This is a positive precedence for other Arctic states to follow. WWF is calling on IMO member states to commit to meaningful environmental protection in the Polar Code, through a ban on heavy fuel oil in the Arctic, as well as heightened restrictions on operational discharges, carbon emissions and the spread of alien species in ballast water.

ExxonMobil Canada has the option for Kvaerner's joint venture company Kiewit-Kvaerner Contractors to provide the full scope of engineering, procurement and construction (EPC) services for the Hebron Project gravity based structure (GBS), offshore east Canada. The contract value for Kvaerner's share of the full EPC contract is approximately $1.5 billion and includes work conducted to date on the Hebron project. The work will be performed in Newfoundland and Labrador, Canada, with engineering in St. John's and construction at the Bull Arm fabrication yard. The completed GBS will be installed at the Hebron field on the Grand Banks in the Atlantic Ocean located 350 kilometers offshore from St. John's, Newfoundland and Labrador, Canada. First oil is anticipated by the end of 2017.

Norwegian seismic company TGS is kicking off its the Europe 2013 acquisition season with two 3D multi-client surveys in the Norwegian Barents Sea; Finnmark Platform 2013 (FP13) covering 3,500 km2 and the Hoop to Fingerdjupet 2013 (HF13) covering 8,600 km2. Data from both surveys will be processed utilizing TGS' Clari-FiTM broadband processing technology. The HF13 survey will also tie-in TGS' successful Hoop 3D in the east. The FP 13 survey is scheduled to start this month and will be acquired by the Geo Barents towing 8 streamers. The HF13 survey is scheduled to commence in early Q2 2013 and will be acquired by the Oceanic Challenger with 12 streamers. Data processing for both surveys will be performed by TGS and initial data will be available to clients during Q3 2013. The surveys are supported by industry funding.

Recent historic observed lows in Arctic sea ice extent, together with climate model projections of additional ice reductions in the future, have fuelled speculations of potential new trans-Arctic shipping routes linking the Atlantic and Pacific Oceans, according to the US-based National Academy of Sciences (NAS). However, numerical studies of how projected geophysical changes in sea ice will realistically impact ship navigation are lacking. To address this deficiency, NAS researchers have analysed seven climate model projections of sea ice properties, assuming two different climate change scenarios and two vessel classes, to assess future changes in peak season (normally September) Arctic shipping potential. By around 2050, changing sea ice conditions are expected to enable increased September navigability for common open-water ships crossing the Arctic along the Northern Sea Route over the Russian Federation, robust new routes for moderately ice-strengthened (Polar Class 6) ships over the North Pole, and new routes through the Northwest Passage for both vessel classes. Although manyother non-climatic factors also limit Arctic shipping potential, these findings have important economic, strategic, environmental, and governance implications for the region. www.pnas.org

Canada invited oil and gas companies to nominate drilling lands in the country's Arctic archipelago for inclusion in a future property auction and said one small oil field that was discovered in the tax-dollar-fueled exploration rush that swept the region 40 years ago will also be up for grabs, reports Reuters. The government's nomination process asks oil companies to select blocks of land they would like to see posted for bidding in a future auction. The remote region, part of Canada's Nunavut territory, has been little explored since the 1970s, when high oil prices, protectionist energy policies and government grants encouraged oil companies to drill there. That exploration boom led to the discovery of 16 fields containing 300 million barrels of oil and 14 trillion cubic feet of natural gas, including the 12-million barrel Bent Horn field, reports Reuters. The field, on Cameron Island about 1,600 kilometers (1,000 miles) south of the North Pole, produced 2.8 million barrels of crude from 1985 to 1996 before it was abandoned by Petro-Canada, the former government-owned oil company acquired by Suncor Energy Inc in 2009. The government gave notice that Bent Horn would be included in the next drilling-rights auction. The call for nominations runs until April 24.

Spanish oil company Repsol has spudded the Darwin well in the Barents Sea. (7218/11-1) (Faroe 12.5%). The Darwin prospect is located on the Veslemøy High in the frontier western part of the Barents Sea approximately 60 to 80 km to the south west of the recent significant Statoil Skrugard and Havis oil discoveries. Multiple targets have been identified on 3D seismic and this well will test the main Darwin prospect and contribute towards further de-risking of the large upside potential in the remainder of the licence area. The drilling operations are being operated by Repsol Exploration Norge AS (20%) utilising the Transocean Barents semi-submersible drilling rig. The other joint venture partners are Faroe Petroleum (Faroe 12.5%). Talisman Energy Norge (12.5%), Marathon Oil Norge (10%), RWE Dea Norge (15%), Det norske oljeselskap (10%) and Concedo (20%). 



A US Army Corps of Engineers permit giving US oil major ConocoPhillips access to leases within the National Petroleum Reserve-Alaska has been challenged in federal court by seven residents of Nuiqsut, the only village within the reserve, according to local reports. Through a lawsuit filed this week by non-profit environmental law firm Trustees for Alaska, the villages contend the Corps violated the Clean Water Act by not explaining why it reversed its original decision to deny ConocoPhillips' request for a bridge and above-ground pipeline access across the Colville River. The lawsuit also claims the agency did not consider new information about the effects of petroleum development. Nuiqsut residents in an announcement of the lawsuit said petroleum development on the Colville River Delta is harming their subsistence life of hunting and fishing.

Shell will not drill for oil offshore Alaska's Arctic this year following a series of high-profile setbacks in 2012. The company is now focused on repairing its two drillships ready and answers to U.S. federal investigators. The postponement of Shell's drilling in the Chukchi and Beaufort Seas comes after the company said in February 2013 its two Arctic offshore rigs would head to Asia for repairs an upgrades. At the same time, ConocoPhillips reaffirmed that it will continue with its own plans to drill one or two exploration wells in the Chukchi Sea in 2014, and expected to submit more information on it to the federal regulator by the end of March. Shell has spent more than $4.5 billion searching for oil in Alaska's Arctic seas since it won licences to drill in 2005. Yet its season last year was delayed by problems with equipment, and 2012 then ended dramatically with the grounding of the Kulluk drillship in a storm, while it was towed south for the winter.

The Norwegian Petroleum Directorate’s (NPD’s) mapping of the southeastern Barents Sea and the area surrounding Jan Mayen will result in an approximate increase of 15 per cent in the estimates of undiscovered resources on the Norwegian shelf. This corresponds to about 390 million standard cubic metres (Sm3) of oil equivalents (o.e.). The figures were released as part of the government’s work to open these areas to oil and gas exploration. The mapped area in the south-eastern Barents Sea along the Russian border constitutes about 44000 square kilometres. The NPD’s calculations show that expected resources total approx. 300 million Sm3 o.e., with an uncertainty range of 55 – 565 million Sm3 o.e. This means that the most pessimistic estimates lie at the low end of the spectrum, but that the petroleum volumes present could be considerably greater. Most of the resources in this part of the Barents Sea are expected to be gas. About 15% are expected to be oil. In the resource analysis for the south-eastern Barents Sea, the NPD assessed the probability of discovering oil and gas in various geological areas. The Bjarmeland Platform furthest north and the Fedinsky High in the east are considered to be pure gas provinces, while the Nordkapp Basin, Tiddlybank Basin and Finnmark Platform are considered to be combined oil and gas provinces. On the Fedinsky High, there is a possibility of petroleum deposits that span across the border between Norway and Russia.

A Barents Sea wild cat well is scheduled to be spudded in March by operator Repsol Exploration Norge. Well no 7218/11-1 (Faroe 12.5%) is located on the Veslemøy High in the frontier western part of the Barents Sea approximately 70 kilometres to the south west of Statoil’s recent Skrugard and Havis oil discoveries. This is a high impact wildcat well targeting a large closure at multiple levels and is expected to spud in Q1 2013. Junior oil company Faroe Petroleum has a 12.5% stake in the well.

Final approval for a license to export LNG export license from a Royal Dutch Shell planned LNG export plant on British Columbia's Pacific coast, reports Reuters. The approval, which was expected, was given this week by Canadian Natural Resources Minister Joe Oliver and allows exports of up to 670 million tonnes of LNG over the 25-year period covered by the license, or 3.23 billion cubic feet of gas per day. The license was given to LNG Canada Development Inc, a Shell-led consortium that includes Mitsubishi Corp, PetroChina and Korea Gas Corp. While a number of LNG plants have been proposed for the northern British Columbia coastline, the license is only the third given out by Canada, reports Reuters. Kitimat LNG, co-owned by Apache Corp and Chevron Corp was granted a license in 2011, while privately owned BC LNG Export Cooperative received one early last year.

Inocean has developed an Arctic-ready drillship, based on the company's INO-80 concept. The new unit has been named IN-ICE, by the Norwegian/ Polish maritime design and engineering outfit. The ship is completely enclosed and winterized, is environmentally friendly, and has enhanced logistics/ storage facilities, says Inocean. The ice class is for a substantially extended drilling season for a large part of the Arctic – with a PC-4 ice class. “This gives us the opportunity to keep a conventional bow for operations in rough open water wave conditions, as well as to implement a moderate stern for aft-way operations in managed ice,” says Jørgen Jorde, Project Manager for Inocean. “We envisage the stern more optimized for avoiding ice into the moon pool than for ice breaking, but also because drilling operations in Arctic areas are expected to be conducted primarily in ‘managed ice’. “Positioning will be done through ‘thruster assisted turret mooring in the shallow parts of the operational area, and by DP in the deeper parts,” says Jorde. As there is a lack of experience with drilling operations in heavy ice conditions with a floating drilling unit, in addition to the limited qualified rescue- and oil collection concepts in ice, Inocean believes a heavy ice class (e.g. PC-1/2) will not come into use for some years yet. “We are very aware of the environmental challenges related to Arctic Operations and all the requirements that will apply for activities in this area. This aspect has been crucial for the development of our IN-ICE concept,” says Jorde.

 

Rosneft and ExxonMobil have agreed to expand their cooperation under their 2011 Strategic Cooperation Agreement to include approximately additional 600,000 square kilometers (150 million acres) of exploration acreage in the Russian Arctic, and potential participation by Rosneft in the Point Thomson project in Alaska. They have also agreed to conduct a joint study on a potential LNG project in the Russian Far East. The agreements, which include plans to explore seven new blocks in the Chukchi Sea, Laptev Sea and Kara Sea, were signed by Igor Sechin, president of Rosneft and Stephen Greenlee, president of ExxonMobil Exploration Company, in the presence of Russian President Vladimir Putin. The license blocks include Severo-Vrangelevsky-1, Severo-Vrangelevsky-2 and Yuzhno-Chukotsky blocks in Chukchi Sea, Ust’ Oleneksky, Ust’ Lensky and Anisinsko-Novosibirsky blocks in Laptev Sea and Severo-Karsky block in Kara Sea, which are among the most promising and least explored offshore areas globally. A separate Heads of Agreement was signed providing Rosneft (or its affiliate) with an opportunity to acquire a 25 percent interest in the Point Thomson Unit which covers the project of developing a remote natural gas and condensate field on Alaska’s North Slope. It is estimated that Point Thomson contains approximately 25 percent of the known gas resource base in Alaska’s North Slope.

Norway’s Ministry of Petroleum and Energy has announce the APA (awards in pre-defined areas) 2013, with blocks in the North Sea, the Norwegian Sea and Barents Sea. The application deadline for is 12:00 a.m. hrs on Wednesday, 11 September 2013. The awards are planned to be made in early 2014. The predefined areas (APA boxes) have been extended with more blocks since APA 2012, with new areas are in the Norwegian Sea. Applications can be made for any blocks or parts of blocks within the predefined areas which are not already included in a licence at the closing date for application. This entails that acreage which is relinquished in the application period is regarded as announced at the time of governmental approved relinquishment. For more details, click here.

Dolphin Geophysical of Norway has entered into two heads of agreements with GC Rieber Shipping, the Norwegian offshore support company, for two high-end 3D seismic vessels. The first vessel, Geo Atlantic, is an existing 3D seismic vessel built in 2002 which will be upgraded by the owner to a 14 streamer seismic vessel at a yard in Singapore. The vessel is expected to be delivered to Dolphin in late 2013. The agreement has a fixed contract term of three years and 6 months, with additional options for 2+2 years extensions. The second vessel, newbuild, is a top-end 22-streamer 3D seismic newbuild vessel with highest ice-class, to be constructed at Kleven yard in Norway and expected delivery to Dolphin in March 2015. The vessel is based on an upgraded version of the proven design used for Polar Duke and Polar Duchess. The agreement has a fixed contract term of five years, with additional options for 2x3 years extensions. As part of the two new charter agreements, Dolphin has extended the firm contract term for Polar Duchess with 2 years to give a total initial firm period of 5 years. At the same time, Dolphin says it intends to redeliver Artemis Arctic following the expiration of its fixed contract term.

Norwegian shipbuilder Kleven has won a contract with GC Rieber Shipping for the building of an advanced ice-class seismic vessel. The vessel is actype ST 324 XT from Skipsteknisk, and will be delivered from Myklebust Verft yard in March 2015. The contract value is worth around NOK700 million (US$126m) and includes an option for a second vessel. The advanced seismic vessel will meet ice class ICE 1A*, providing a solid base for operations in Arctic areas, says Kleven. Irene Waage Basili, chief executive of GC Rieber Shipping says this is, “a unique competence in operations in harsh environments has always been GC Rieber Shipping’s trade mark. In order to offer our customers the best solutions for demanding operations in vulnerable waters, quality, safety and environment is on top of our agenda." Kleven has 15 vessels on order, at a total value of around NOK8.1 billion.

The Polar Research Board (part of US-based National Academy of Sciences) has named the people and companies whom will make up an committee hoping to answera key question – ‘Emerging research question in the Arctic’. The study will include a community workshop to be held in Alaska in late spring of 2013, and the Committee's report is expected to be released by spring 2014. The committee membership is: Co-Chair: Stephanie Pfirman, Barnard College; Co-Chair: Henry Huntington, Pew Charitable Trusts; Carin Ashjian, Woods Hole Oceanographic Institution; Jennifer Francis, Rutgers University; Sven Haakanson, Alutiiq Museum and Archaeological Repository; Robert Hawley, Dartmouth College; David Hik, University of Alberta; Larry Hinzman, University of Alaska, Fairbanks; Amanda Lynch, Brown University; Michael Macrander, Shell Alaska; Gifford Miller, University of Colorado, Boulder; Kate Moran, NEPTUNE Canada; Ellen Mosley-Thompson, The Ohio State University; Samuel Mukasa, University of New Hampshire; Thomas Weingartner, University of Alaska, Fairbanks. More information about the committee members can be found here.

Buccaneer Energy has started production production from its 100% owned Kenai Loop # 4 well and is currently producing at an initial rate of 2.0 million cubic feet per day (mmcfd). The long term deliverable production rate from the Kenai Loop # 4 well is estimated to be 3 - 4 mmcfd, says the company. The gas production is in addition to the Company’s current production of 6.5 mmcfd from the Kenai Loop # 1 well. The majority of the current total production of 8.5 mmcfd (1,400 boepd) is being sold to the local gas utility Enstar. Buccaneer hope that permanent facilities will be completed by the end of April and once permanent production facilities are in place, it is anticipated that the Kenai Loop field’s total production rate may be increased to 10-11 mmcfd (1,666 – 1,833 boepd). This represents a near 100% increase over the average production rate achieved in 2012.

Royal Dutch Shell is to tow its two drill vessels from Alaska to Asian drydocks for significant repairs. The extra time needed for repairs may delay the energy super-group’s drilling plans for 2013. In addition, it may cause the Obama administration to rethink its Arctic exploration policy, which is currently a hot topic in Washington. “We have not made any final decision on 2013 drilling in Alaska,” said Curtis Smith, Shell’s spokesman in Alaska. “The outcomes of inspections and the scope of repairs needed in Asia will decide that.” Shell’s Kulluk drilling rig ran aground on an Alaskan island on New Year’s Eve and the drillship Noble Discoverer experienced propulsion problems pulling into Seward, Alaska last November. Inspections of the 29-year-old Kulluk conical drilling unit have revealed hull damage that warrants major repairs and further assessments, Shell said. The Discoverer is destined for a shipyard in Korea, and Shell is planning on sending the Kulluk to an undetermined Asian shipyard with a suitable dry dock, said spokesman Curtis Smith. Shell used the Kulluk and Discoverer to drill the first half of two wells in the Beaufort and Chukchi seas last summer, seven years after buying drilling leases in the region for $2.2 billion.

Statoil and its partners have chosen a development concept for the Skrugard field in the Barents Sea. The concept includes a floating production unit with a pipeline to shore and a terminal for oil from the Skrugard and Havis fields at Veidnes outside Honningsvåg in Finnmark, in the Barents Sea. The field is scheduled to come on stream in 2018, with Skrugard and Havis assets having a common infrastructure. Production from the two fields will be tied in to a semi-submersible floating installation through a subsea production system located in about 380 metres of water. The production is estimated at almost 200,000 barrels of oil equivalent per day. In 2011-2012 Statoil and its partners discovered Skrugard and Havis, which are two independent structures within the same licence and represent the Skrugard field development. 400-600 million barrels of recoverable oil have been proven in this area.

Abundant, affordable, clean, diverse and secure energy is in the U.S. national interest. So finds a report on the future of the country's energy system published on Monday by Senator Lisa Murkowski, the highest-ranking Republican on the Senate Energy and Natural Resources Committee, reports UPI. "Energy 20/20: A Vision for America's Energy Future" is a thoughtful attempt to discuss some of the energy choices and opportunities the United States will face by the end of the decade. Murkowski's report starts from the premise "energy is good" and the consumption of energy is and will remain the basis for rising living standards. It is positive towards the development of fossil fuels like oil, gas and coal -- natural for a Republican from the hydrocarbon-producing state of Alaska. Murkowski devotes only 31 pages out of 122 to fossil fuels. There are also intelligent sections dealing with renewables, nuclear, investment in gas and electricity transmission infrastructure, efficiency and links with water use as well as the need for regulatory reform (Click here for report.). Murkowski's recommendations included promptly approving the proposed Keystone XL crude oil pipeline project's cross-border permit, opening the Arctic National Wildlife Refuge's coastal plain for leasing, and reforming permitting processes for energy, natural resources, and infrastructure projects.

Interest in the Arctic is growing among the Big Oil operators, despite limited infrastructure, high royalties and taxes and safety concerns in the harsh environment that continue to challenge commercial success, according to an Ernst & Young report published this week. (Click here for report.)

Approximately 61 large oil and natural gas fields have been discovered so far within the Arctic Circle — 43 are in Russia, 11 in Canada, 6 in Alaska and 1 in Norway. Royal Dutch Shell, one of the first companies to attempt drilling in the U.S. Arctic, hasinvested $5 billion in the effort, but has faced regulatory, environmental and technical challenges.

Now changes n the oil industry may work against it, Ernst & Young said.

Shell started buying its US Arctic leases to drill in Alaska’s Beaufort and Chukchi seas in 2005, banking that the U.S. desire for energy security would trump environmental concerns. The shale oil and gas boomin North America, however, has made the perceived need for complicated Arctic explorationless pressing.

Shell frames Arctic work as a race for international resources. “The Arctic is really a global issue, not an Alaska issue,” said Marvin Odum, president of Shell North America, at a Shell technology conference in January. “There are a number of companies going into the Arctic. Russia, for example, has big plans to go in and explore and go after that very massive resource space.”

Argentina stepped up its row with Britain over the Falklands with its foreign minister thanking God for the decline of the British Empire and vowing to prosecute oil firms exploring off the remote South Atlantic islands, reports Reuters. In a defiant news conference, held in London on February 6 but conducted in Spanish, Hector Timerman called Britain the "greatest colonial empire from the 19th century ... that thank God has been defeated worldwide".

He insisted the islands' roughly 3,000 British inhabitants should not be referred to as Falklanders, but as "British inhabitants of the Malvinas islands", the name Argentina uses for the remote territory some 300 miles off its coast. Britain fought a 10-week war to eject Argentinian forces who invaded the islands in 1982. The Falklands are part of Britain's self-governing territories, and Buenos Aires has ramped up efforts to stake its claim to the territory as London-listed firms seek to tap oil and gas deposits around the islands.

A referendum on the Falklands' future is scheduled for March, a vote in which the islanders are almost certain to choose to remain British, and which Timerman likened to asking Israeli settlers whether they want to be Israeli or Palestinian. Argentina has tried to deter ships from travelling to the Falklands, banning Falklands-flagged ships and other vessels involved in trade with the islands from stopping at its ports, report Reuters. On Wednesday Timerman vowed to take legal action to stop energy firms from exploring for oil and gas around the islands, accusing them of stealing Argentine resources and not being capable of guarding against accidental oil spills.

"We will continue the legal action against the oil companies who are doing hydrocarbon-related exploration activities in the south Atlantic, because they are stealing part of the natural resources of Argentina," he said. Argentine hostility has not deterred companies and the islands are set to start producing their first oil in 2017. Rockhopper Exploration has formed a $1 billion partnership with Premier Oil to pump oil from its find north of the islands. Last month, another British firm, Borders and Southern Petroleum, said its gas condensate discovery in the Falkland Islands was also commercially viable.

US president Obama has nominated Recreational Equipment Inc. (REI) chief executive Sally Jewell to head the Interior Department. The choice of Jewell, who began her career as an engineer for Mobil Oil and worked as a commercial banker before heading a nearly $2 billion outdoors equipment company, represents an unconventional choice for a post usually reserved for career politicians from the West. Jewell replaces Ken Salazar in the post. The Department of the Interior oversees more than 500m acres (202m hectares) of national parks and other public lands. It is responsible for 1bn acres offshore, including Alaska.

Actress Lucy Lawless says her sentence for boarding a drilling ship while protesting against Shell's oil exploration plans is "a total victory". Lawless and seven other Greenpeace activists were sentenced on February 7, 2013 to community work and ordered to pay reparation after earlier pleading guilty to being unlawfully on a ship, reports the News Zealand Herald. The group were arrested last February after they boarded the Noble Discoverer at the Port of Taranaki and spent 77 hours up a 58-metre tower in protest against Shell's oil exploration operation in the Arctic. In New Plymouth District Court this morning, Judge Allan Roberts sentenced each of the activists to 120 hours of community work and ordered them to each pay $651.44 in reparation to the port. But the protesters avoided paying more than $600,000 in reparation to Shell Todd Oil, the joint venture between Shell and Todd Energy which contracted the ship. The reparation to Shell Todd Oil had been sought by police but was dismissed by Judge Roberts.

As the Arctic Council’s environment ministers meeting this week in Jukkasjärvi, Sweden, influential environmental campaign group Greenpeace has questioned the group’s lack of commitment to a comprehensive oil spill clean up plan. “The agreement isn’t currently on the agenda, but we’re hoping to change that, says Greenpeace. The group has a been given a leaked draft document covering co-operation on marine oil pollution preparedness and response in the Arctic, and says: “With any luck, leaking this document will encourage sanity to prevail, and give the working group an opportunity to revise the document before it's adopted by foreign ministers in May. “We hope civil servants realise what a useless document it currently is. At the moment it only shows one thing: no nation or company is adequately prepared to deal with an oil spill in the far north. “So the question remains: will the Arctic Council do its job and actually protect this unique region from the likes of Shell and Gazprom? We’ll be watching very closely,” says the group.

Norway's ruling Labour Party is set to support oil exploration off a pristine northern archipelago, bringing to a head controversy over drilling in the Arctic in the run up to elections this year reports Reuters. The seas off the Lofoten islands, perched some 200 km (124 miles) north of the Arctic Circle, have unique cold water reefs and are the spawning grounds of the world's largest cod stock. The islands are also popular with tourists. But the seabed may hold some 1.3 billion barrels of oil equivalent, making it a prime area of interest for oil firms, such as Norway's Statoil, which has pushed for the areas to be open to drilling as oil production in the North Sea tapers off. Two years ago, and after months of dispute, Labour struck a deal with its small coalition partners to forbid oil exploration off the islands until the parliamentary term ends in 2013. "Given all the knowledge we have of the area, we believe it is a natural step to conduct an impact assessment study," Helga Pedersen, Labour's deputy leader, told Reuters. They will also lobby members of the Labour Party, which has to formally adopt the new policy at its party conference in April. "Drilling in Loften ... not only threatens precious natural resources, it also threatens several thousands jobs in the fishing and tourism industries," said Nina Jensen, head of the Norwegian branch of the World Wide Fund for Nature (WWF). With Labour's new stance, Norway's top three parties all now support drilling around Lofoten but government support is not yet ensured.

Norway has said it is ready to accept China as an observer in the Arctic Council, following the recent Arctic Council meeting in Tromsø, Norway. After a political dispute over Liu Xiaobo was awarded the Nobel Peace prize in 2010, Norwegian foreign minister Espen Barth said the matter was not relevant to Arctic Circle issues. "We want people to join our club. That means they will not start another club". Sweden foreign minister Carl Bildt added: "The Arctic Council should be the arena for Arctic issues.”
 China had earlier won support from Iceland for it pitch to become an Arctic Council observer. The Arctic Council consists of the eight Arctic countries and six non-Arctic countries have so far been admitted as observers. Twelve countries and organizations are currently applying for observer status. These include China, Italy, Japan, Korea, Singapore, India and the EU.

A small fire hit the Encana-operated Deep Panuke platform offshore east coast Canada in mid-January, said the regulatory body, the Canada-Nova Scotia Offshore Petroleum Board. Safety officers have visited the platform twice since January 19th, when a blaze broke out and was contained within an electrical cabinet in the emergency switchboard room (ESR) platform. The CNSOPB, along with the certifying authority Lloyd’s Register, have confirmed that necessary electrical repairs have been completed, and that the CO2 fire suppression system has been tested and put back in service. Natural gas from Deep Panuke will be processed offshore and transported, via subsea pipeline, to Goldboro, Nova Scotia for further transport to market via the Maritimes & Northeast Pipeline. First gas is expected from Deep Panuke in 2013.

Oil shipments from Nenets, Arkhangelsk and Murmansk regions in northwestern Russia to the European markets continue to drop for the second year in a row. While 14,8 million tons were exported by tankers through the Barents Sea in 2010, it dropped to 11,9 tons in 2011 and 11 million tons last year. The amount of oil is down, but the numbers of vessels grow by 10 percent to 301, nearly one tanker per day, shows the statistics provided to BarentsObserver by the Norwegian Coastal Administration’s Vessel Traffic Service in Vardø. The traffic center is located on Norway’s easternmost point to Russia and has a panorama view of all voyages along the coast. They have a special focus on risk transports, like oil, reports BarentsObserver. 2012 was the first year when oil tankers from Asia to Europe used the transit lane along Russia’s northern coast. Three vessels transported aircraft fuel from South Korea to Finland via the Northern Sea Route and a LNG tanker sailed the opposite route, from Hammerfest to Japan.

ConocoPhillips, the US oil and gas group, has urged Norway to open up more of its Arctic waters for development just months before a vote in the parliament in Oslo on whether to push ahead with such a move. “There is certainly potential for greater Arctic activity in Norway,” said Steinar Vaage, president of ConocoPhillips Europe, reports the Financial Times at the Arctic Frontiers conference held in Tromso, Norway. “We would like to see Norway open more areas,” he said, adding the country had a number of important advantages over others, such as ice-free waters, access to the European natural-gas market and a highly skilled workforce. Mr Vaage, whose company has been active in oilfields in the Norwegian sector of the North Sea for many years, said ConocoPhillips intended to remain a significant player and wanted to expand into new areas, including the Barents Sea. “Currently about 40 per cent of Norway’s continental shelf is closed for exploration,” he told the Arctic Frontiers conference of scientific, business and policy figures, adding it was estimated those areas contained about two-thirds of the undiscovered resources remaining on the Norwegian continental shelf.

Tom Hunter, chairman of the US-governments Ocean Energy Safety Advisory Committee, says if Arctic exploration and drilling is done at a measured pace, learning and improving “it can be done in a balanced way and effectively” He said he is happy for oil companies to continue to explore and develop in the Arctic with a lot of oversight, regulatory and legislation coverage and a “lot of engagement with stakeholder , particularly in the local community. I am not uncomfortable if it proceeds in a very balanced way and with a significant amount of oversight by the regulatory organisations with the federal government, and a lot of engagement with the stakeholders in the local area there,” said Hunter. His comments were made during the Platts Energy Week conference and can be seen here. Hunter worked closely with BP during the 2010 Macondo oil spill in the Gulf of Mexico.

Cairn Energy is to postpone exploration offshore Greenland and focus its drilling efforts in 2013 in the North Sea, and off the Atlantic coast of Morocco. The Edinburgh-based oil exploration and production firm is to wait until summer 2014 before re-starting its drilling efforts in Greenland waters on the Pitu Baffin Bay block and elsewhere to the south of the island. Cairn works there in partnership with Norwegian energy company Statoil and Greenland’s national oil company Nunaoil. This year, Cairn should complete analysis of data from other exploration blocks off the west coast of Greenland, and will then seek exploration investment partners. Simon Thomson, the chief executive of Cairn Energy, said: "Our balance sheet strength means we are funded for all planned exploration and development, whilst retaining the flexibility to consider further opportunities”.

Wismar, Germany-based shipyard Nordic Yards, has signed a contract to build two ice-breaking rescue and salvage vessels, sized 86 metres long and 19 metres wide. The contract is worth Euros 150 million ($196 m). The vessels have been ordered Russian Ministry of Transport and will support vessels transiting the Northern Sea Route in the Arctic particularly around Murmansk in north-western Russia and in Sakhalin Island in the far east of the country. The vessels will be used for patrols and rescue operations in offshore oil and gas fields. They can be used both for icebreaking operations in harbours and waters with an ice thickness of one metre as well as for fire-fighting and combating oil spills from the sea. Due to their specialised equipment, the vessels can study the ocean floor and damaged objects in water depths of up to 1,000 metres. Delivery is planned for spring 2015.

A salvage and rescue team has refloated the Kulluk drilling rig that ran aground last week offshore Alaska island. Towing is expected today (January 7) during daylight hours, Alaska time. Ongoing aerial and onboard inspections by recovery and response teams assessing the Shell-owned Kulluk drillship through the weekend confirmed the vessel remains firmly aground and stable with no sign of environmental impact and no leakage of the diesel fuel or hydraulic fluid stored onboard the vessel.
The US Coast Guard and Shell hope the rig can be towed from its grounding site on the coast of tiny Sitkalidak Island to a sheltered bay nearby, so experts can make a better assessment of its sea worthiness.“Following this initial step forward, we will continue to remain cautious while we assess the Kulluk’s condition,” said Martin Padilla, incident commander for the Kulluk responders. “We will not move forward to the next phase until we are confident that we can safely transport the vessel."”Sean Churchfield, Shell's Alaska ventures manager, has said salvage teams found no signs of breaches to any of the Kulluk's fuel tanks and only one area where seawater leaked onboard. The tow plan has been approved by government regulators.
The rig had been en-route for winter maintenance near Seattle when it grounded on December 31.

Iceland has awarded two licences for oil and gas exploration and production in the waters off the north east coast of the Atlantic island. The licences have gone to Faroe Petroleum and Valiant Petroleum, with Norway taking a 25% stake in both through state-owned oil firm Petoro. Experts have predicted the Arctic could be the next major oil-producing region. Iceland is hoping it will be able to generate much-needed revenues from any discoveries of oil and gas. "This is of course an important step, [as] these are the first real licences that we believe will be used, and they call for extensive research in the area," said Steingrimur Sigfusson, Iceland's Minister of Industries and Innovation."The Norwegian participation is also important - we think that it strengthens the matter in every way, not least to have the support of Norway and its massive knowledge in this field."

Temperatures in China have plunged to their lowest in almost three decades, cold enough to freeze coastal waters and trap 1,000 ships in ice, official media said at the weekend. Oil and gas production at the prolific northern Bohai Bay has also been hit, with up to 13 ice breakers being deployed to help free stuck vessels and maintain production. Since late November the country has shivered at an average of minus 3.8 degrees Celsius, 1.3 degrees colder than the previous average, and the chilliest in 28 years, state news agency Xinhua said, citing the China Meteorological Administration. Bitter cold has even frozen the sea in Laizhou Bay on the coast of Shandong province in the east, stranding nearly 1,000 ships, the China Daily newspaper reported.

Norway-based DNV and Germany-based GL classification societies have agreed to merge and will be known as the DNV GL Group. It will be one of the world’s leading ship classification societies and risk experts in the oil and gas, renewable energy and power sectors, and among the global top three within management system certification.

“The merger rests on a strong strategic rationale, and responds to challenges of increased globalisation, rapid technological change and the need for sustainable development. Our customers will benefit from an increased service offering and global competence base as well as one of the densest networks,” says DNV’s Group CEO, Henrik O. Madsen, who will be the CEO of the combined new company. “The merger with DNV supports our long-term goal of being recognized as one of the most respected technical assurance and advisory companies in the world," adds GL Group CEO, Erik van der Noordaa.

The 31-meter tug boat Ocean Raymond Lemay has been coated with Ecospeed on the Isle-aux-Coudres in Quebec, Canada. The vessel is owned by Ocean Group,which supplies harbour towing services in a number of ice-affected ports including Quebec, Montreal, Toronto. Ecopseed is a specially developed coating designed to handle very cold and abrasive conditions. Ocean Raymond Lemay is both an Ice Class and a Firefighting Class vessel, The ship is also used to open up the frozen passageways in ports during the winter season. Ecospeed is developed and marketed by Antwerp, Belgium-based Hydrex.

A high level meeting of scientists, indigenous group, explorers, policy makers, diplomats and politicians, business representatives raised a number of Arctic issues at the heart of Europe in Brussels, led by Arctic explorer and founder of The Polar Foundation, Alain Hubert led a two day summit, A topical issue raised at The Arctic Futures 2012 meeting was how the European Union could work with the Arctic Council, the eight-country group of Arctic nations. "The time has come to work together, constructively and with determination on the future of the Arctic," said Maria Damanaki, the European Commissioner for Maritime Affairs and Fisheries, who argued for more cooperation between the EU and Arctic states. Speaking at Arctic Futures, Damanaki said: The EU itself is "an Arctic actor by virtue of three Arctic states, Denmark, Finland and Sweden," she said - "four, if Iceland accedes to the EU." Keynote speaker Caroline Broun, economic officer for environment, science and technology at the US mission to the EU, gave the US view of Arctic co-operation: "The thing people have to remember is that, in the US, we do not have any national legislation on climate issues. We also work closely in the US with the private sector. "We are very different from the EU which, on issues such as emissions trading, has a 'top-down' approach. wever, all this is not to say that significant efforts have not been made. They have and they paid off. In the US we just work on more diverse levels than in Europe." German glaciologist Reinhard Drews was presented with the prestige €150,000 InBev-Baillet Latour Antarctica Fellowship for his proposal to investigate how melting ice shelves could contribute to increased ice flow, during a gala reception at the summit. A full report of the meeting will be published in Issue 3 of Frontier Energy, to be published in November.

The European Parliament's industry committee has thrown out attempts to introduce a moratorium on offshore oil and gas drilling in the Arctic, overruling a contrary vote by its environment committee cast in September. This week's key vote in the industry committee instead proposed a new directive to ensure that companies have "adequate financial security" to cover the liabilities that could be incurred by any accidents. Drilling companies would also have to submit to national authorities a safety hazard and emergency response report at least 24 weeks before starting operations. The EU is seeking a role in the Arctic because three EU countries have territory in the Arctic - Denmark, Finland and Sweden - while Iceland is an EU candidate. Last week, speaking at the Arctic Futures Symposium Gunnar Wiegand, a director at the EU's External Affairs Action Shttp://cdn.sansir.net/SiteFiles/Public/23/Temp/51bdf931-c0f7-45f8-9f26-7f8619dbaa01.jpgervice, said that he hoped EU legislation could inspire Arctic nations to firmer environmental legislation. "The acquis [accumulated legislation] in the Arctic Council doesn't go as far as any of the environmental legislation of the EU," he said. Elsewhere, Norway's deputy oil and energy minister, Per Rune Henriksen, said that for the EU to claim jurisdiction over the Arctic by banning drills there "would almost be like us commenting on a camel operations in the Sahara."

Faroes Petroleum working offshore Iceland

Iceland has awarded two licences for oil and gas exploration and production in the waters off the north east coast of the Atlantic island. The licences have gone to Faroe Petroleum and Valiant Petroleum, with Norway taking a 25% stake in both through state-owned oil firm Petoro. Experts have predicted the Arctic could be the next major oil-producing region. Iceland is hoping it will be able to generate much-needed revenues from any discoveries of oil and gas. "This is of course an important step, [as] these are the first real licences that we believe will be used, and they call for extensive research in the area," said Steingrimur Sigfusson, Iceland's Minister of Industries and Innovation."The Norwegian participation is also important - we think that it strengthens the matter in every way, not least to have the support of Norway and its massive knowledge in this field."

Russian shipping group Sovcomflot has launched the Vitus Bering, the first ship in a new series of multi-functional icebreaking supply vessels ordered from Arctech Helsinki Shipyard Oy (a joint venture of United Shipbuilding Corporation and STX Finland). The Vitus Bering series was ordered following an agreement signed in December 2010 following Sovcomflot winning a tender with Exxon Neftegas Limited (operator of the Sakhalin-I project). Sovcomflot will provide two new supply vessels on a long-term charter to the company-operator of the project for the year-round servicing of the Arkutun-Dagi platform. The construction of the Vitus Bering series is a joint project involving both Russian and Finnish shipbuilders. Around 90% (by weight) of the structural components for the vessels were produced in Russia at Vyborg Shipyard (part of ÎÀÎ OSK). Final hardware installation will be carried out by OAO OSK in Saint-Petersburg and will include navigation systems from Russian manufacturer Transas, as well as a Glonass satellite navigation system. Both vessels will be registered in Russia, will sail under the flag of the Russian Federation and will be manned by Russian crews. Future plans include the continued construction of a series of multifunctional icebreaking supply vessels at OAO OSK enterprises for work on the Sakhalin-II project (operated by Sakhalin Energy).
 According to maritime tradition, the lead ship in the series was given the name of a distinguished figure – Russian explorer of the Far Eastern seas, the Danish-born Captain-Commodore Vitus Bering.

Main particulars
Deadweight: 3,950 tonnes

Maximum length: 99.2m

Beam size: 21.7m

Maximum depth: 7.9m

Crew members: 22

ABB, the power and automation technology group, has won a $35 million order from the Baltic Shipyard Ltd. to supply powerful propulsion and energy efficient electrical systems for a new icebreaker vessel under construction for Russia's state shipping company Rosmorport FSUE. 
The 25 megawatt (MW) line diesel-electric icebreaker is the next-generation multifunctional diesel-electric icebreaker. The navigation area of the icebreaker is the Northern Sea Route, the Arctic seas and estuaries of rivers discharging into the Arctic Ocean. The icebreaker is able to proceed continuously both ahead and astern at the speed of 2 knots in compact ice field up to 2m thick with 20 cm of snow cover and temperatures as low as minus 35 degrees Celsius. Delivery is due to start in 2013 and the vessel will be delivered to Rosmorport in 2015.
ABB will provide integrated power generation and distribution systems, thruster motors, fire-fighting pump motors as well as 25 MW propulsion systems. The propulsion system of the vessel features two Azipod® thruster units (power output 2 x 7,5 MW) and one centerline arranged shafting with a fixed pitch propeller generating additional 10MW output. All Azipod propulsion units for this project are specifically designed for extreme Arctic ice class RMRS Icebreaker-8.

US interior secretary Ken Salazar has launched a lease sale scheduled for November 7 in Anchorage to make available some 400 tracts covering 4.5 million acres in the NRPA for oil and gas leasing. This follows a December 2011 sale involving 283 tracts and about 3 million acres. In August, Salazar announced a long-term management plan for NPRA that Alaska Senator Mark Begich and the rest of the Alaska delegation objected to because of its restrictions on acreage available for development and options for a pipeline corridor. Alaska-based senator Mark Begich welcomed the decision to hold a second NPRA lease sale. At the same time, Begich continues to push the Obama administration to revise its proposed management plan for the NPRA to ensure development of new oil and gas projects and a pipeline to carry oil from Alaska's Arctic offshore to the Trans-Alaska Pipeline. However, a group of senators have voices their concern about the sale, wrtign a letter to interior secretary Ken Salazar, urging him not to schedule new Arctic Ocean lease sales until a plan is in place that prioritizes protection of the Arctic's fragile and abundant marine ecosystem. The letters were signed by several senior politicians including Senator Jeff Merkley (D-OR), Senators Richard Durbin (D-IL), Patrick Leahy (D-VT), Barbara Boxer (D-CA), Frank Lautenberg (D-NJ) and Sheldon Whitehouse (D-RI), addresses the 2012-2017 Outer Continental Shelf drilling programme. The senators ask Secretary Salazar to ensure that exploration and drilling would not harm either the Arctic ecosystem or opportunities for subsistence by the people of Alaska's Arctic coast by deferring any additional Arctic Ocean lease sales from the five-year schedule.

The owners in the Snøhvit license have decided to stop the work on a possible capacity increase on Melkøya, said Statoil. The license has concluded that the current gas discoveries do not provide a sufficient basis for further capacity expansion. The license has not determined whether LNG or a pipeline solution is the best concept for a potential capacity increase at a future date. Over the last eighteen months, the Snøhvit license partners have carried out studies for the expansion of the gas export capacity from Melkøya. The increased capacity would enable the accelerated gas production of increased reserves in the Snøhvit license, together with existing discoveries in the area. Thorough studies have been carried out of both an LNG train II and a dew-point facility/pipeline solution, and the Snøhvit license has devoted considerable resources to finding solutions that could make a capacity expansion profitable. The pipeline solution was studied in collaboration with Gassco. The possibility of producing increased reserves in existing trains has been an alternative throughout the process, in addition to the two concepts for capacity increase. With new gas discoveries increased capacity may again be considered. The Snøhvit license will in the immediate future focus on optimising and upgrading the existing LNG facility on Melkøya (Train I) and further developing Snøhvit through phases 2 - 4 for Train I. "There will be major investments associated with phases 2 - 4, which include the development of Askeladd and a future compression solution," says Øystein Michelsen, executive vice president for Development and production Norway in Statoil. In total, the installation of five new subsea templates and a total of 12 production wells are planned. Snøhvit partners are Statoil (36.79%) (operator), Petoro (30%), Total E&P Norge (18.40%), GDF SUEZ E&P Norge (12%) and RWE Dea Norge (2.81%).