Repsol YPF has hired hydrocarbons reserves and resources Ryder Scott to carry out an external audit of its reserves, contingent resources and prospective resources of non-conventional hydrocarbons (shale oil and gas) in the Argentinean Vaca Muerta formation in the Neuquén province. The technical analysis is based on the criteria set out by Argentinean stock market regulator Comisión Nacional de Valores de Argentina and the United States´ Securities and Exchange Commission. At the same time, the evaluation of the contingent and prospective resources complies with the requirements of the Comisión Nacional de Valores de Argentina and the Society of Petroleum Engineers’ Petroleum Resources Management System.

The Vaca Muerta formation is estimated to cover an area of 30,000 km² (7.4 million acres) of which Repsol YPF has a net 12,000 km² (3 million acres). Preliminary results indicate that 77% of the area contains oil, with the rest containing dry and wet gas.

The evaluation carried out by Ryder Scott covers a total area 8,071 km² (1,994,378 acres), of which Repsol YPF holds a net interest of 5,016 km² (1,239,407 acres) in the Neuquén area.

The audit has determined that in an area of 1,100 km² there are 1.115 Bbbl of oil in associated contingent resources, and 410 Mboe of gas, making a total of 1.525 Bboe. For the YPF participation the contingent resources would amount to 883 Mbbl of oil and 330 Mboe of gas, resulting in a total of 1.213 Bboe.

To reach these results, Repsol YPF has made a significant technical effort in a record time, leading the exploratory effort for non-conventional resources in Argentina, after analyzing all the successful technologies used in the USA and adapting them to the geological conditions in the country. To do this, the company co-operated with a number of leading shale developers in the US that, because of the expectations generated by the Vaca Muerta shale, have partnered YPF for exploratory activity in a number of areas. Repsol YPF’s technical teams have since 2009 developed the project, spending $300 million on exploration, mapping and initial development in the Vaca Muerta formation. By 31 December 2011, the Vaca Muerta formation had produced 700,000 boe.

The encouraging results obtained so far have prompted Repsol YPF to continue exploring the area to determine the play’s full extension and productivity in oil, gas and wet gas. The company aims to drill 20 wells in 2012, solely and jointly with several partners, to continue investigating prospective resources.

With the current results, Argentina has the opportunity to reproduce the revolution in nonconventional hydrocarbons seen in the United States by developing the resources contained in the Vaca Muerta formation.

The development of the 1,100 km² explored so far by Repsol, containing gross contingent resources of 1,525 Bboe could make possible a 50% increase in Argentina’s current gas production. This would require a total investment by all stakeholders of $28 billion in the coming years to drill 2,000 producing wells which would require 60 drilling rigs more than currently operating in Argentina.

If the positive results of the exploratory wells underway are confirmed, the country’s gas output could rise 50%. This would require 1,000 wells to be drilled in a first phase, with an additional required investment of $14 billion, necessitating 40 drilling rigs more than Argentina currently has.

These 100 new rigs would more than double the current number of rigs in the Argentine, currently totalling 80.

If exploration proves successful in the Vaca Muerta formation and immediate intensive development began in the area, in 10 years its capacity could double Argentina’s existing gas and oil production. This would require a vast investing effort that would reach $ 25 billion per year in order to develop all the existing prospective resources.

A programme of such magnitude would require an important capital investment in Argentina from international markets; a powerful domestic industry (equipment, services, etc.) and competitive and highly technically qualified human resources since Argentina competes against other similar developments worldwide (USA, China, Australia, Eastern Europe, etc.).

Essar Projects has today announced the completion of Rs.1,064crores D1 Development Project for ONGC by end-March 2012. The project includes installation of three offshore platforms, layingof subsea pipelines to connect the three platforms to the existing floating production, storage and offloading (FPSO) through a Pipeline End Manifold (PLEM). All new platforms, the PLEM and the existing D1 Platform will be connected with a network of subsea rigid and flexible pipelines and composite cables totalling about 14.5 Kms.

Essar Projects is completing this project on a fast-track basis within 24 months for the client. The scope of work includedEngineering, Procurement, Construction, Installation & Commissioning of the three unmanned four-legged fixed Jacket SMART Platforms – D1B, D1C & D1D in water depths of approximately 90 meters, 200 kms off Mumbai.

Commenting on this project, Alwyn Bowden, President & CEO of Essar Projects said,”TheD1 Project bears testimony to the engineering and execution capabilities of Essar Projects team in implementing a project of such scale in the Indian offshore environment on a fast-track basis. Our experience and excellent track record in the offshore construction has enabled us to complete this project to international quality standards”

D1B platform will receive the 35,000 bopd of crude produced by the D1, D1C and D1D platforms and this will then be transferred for processing to the D1 field FPSO via the PLEM.

Each platform has two main parts – Jacket and Deck. The Jackets for each of the three platforms were fabricated at the CUEL Yard in LaemChabang, Thailand. And the threeDecks were fabricated at the Profab yard in Batam, Indonesia.

The Projects Team split the fabrication scope at two yards to meet the fast-track project completion deadline.

The D1B deck weighs approximately 1500MT and is due to be installed on the D1B Jacket to complete the installation of D1B platform in entirety. This Platform is likely to rank amongst the heaviest Wellhead Platformsto be installed in Bombay High, using the Lift Installation Method.

Mr PCB Nair, CEO & MD, Essar Offshore & Subsea, Limited, the Offshore & Subsea Business Unit of Essar Projects said, “We are proud to have been associates with this project which has many of the complexities of a large offshore project. We have successfully executed many projects in Mumbai High in the past. The D1 Development Project represents a technical & fast-track project execution achievement for the Essar Projects Team, given the size and complexity of the project. This is also the largest offshore project that we have ever executed”.

17,000 tonnes of steel was used in fabrication and Jackets and Decks have been transported over 3,500 nautical miles to reach Bombay High, the destination. The Jackets are embedded into sea bed at a depth of 90 metres and the decks are placed on the Jacket to complete the Platform. One of the jackets-D1 Bhas already been installed and subsea lines of 14.5 km have been laid to connect the three Platforms. The installation of the second and the third Platforms will be completed by mid-March and the entire D1 Development project is scheduled to be completed by end-March.

About Essar Projects
Essar Projects Limited (EPL), is a class-leading Engineering, Procurement & Construction (EPC) contractor offering innovative execution and project delivery solutions for projects of scale and complexity whilst simultaneously managing interfaces with licensors and technology partners to its clients in multiple sectors.

Essar Projects operates through eight Specialized Business Units (SBUs) aimed at leveraging the company’s sectorial expertise and track record. Each of these businesses – Power, Hydrocarbons, Civil & Buildings, Minerals & Metals, Offshore & Subsea, Pipelines & Terminals, Ports & Jetties, and Heavy Engineering – is run and managed by a team that has first-hand experience of delivering large projects on an EPC basis in its core sector.

The company is transforming itself into an EPC company of repute and is bidding and winning projects internationally to expand its global footprint. Its revenue for FY2011 was US$ 1.7 billion and Order Book stood in excess of US$ 6 billion.