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US$720M Liza Destiny to be leased to Guyana
By Kiana Wilburg
SBM Offshore, a Dutch global group of companies selling systems and services to the oil and gas industry, was able to put together the Liza Destiny, Guyana’s first Floating Production Storage and Offloading (FPSO), at a cost of US$720M. The contract was awarded to the firm in 2017 by ExxonMobil. According to SBM, project financing was secured by a consortium of 12 international banks.
The Liza Destiny
Kaieteur News understands that FPSO Liza Destiny is owned and will be operated by SBM Offshore for a couple of years. In fact, the lease and operate contract, which it has with ExxonMobil’s subsidiary Esso Exploration and Production Guyana Limited (EEPGL) includes an initial period of 10 years with extension options up to an additional 10 years.
There are discussions however between the two regarding a potential accelerated transfer of ownership using the purchase option in the 10 year lease contract. The outcomes of these discussions are expected to lead to a transfer of the FPSO ownership and operation to EEPGL.
Kaieteur News understands that the FPSO, which is designed to produce up to 120,000 barrels of oil per day, will have associated gas treatment capacity of circa 170 million cubic feet per day and water injection capacity of circa 200,000 barrels per day.
The converted Very Large Crude Carrier (VLCC) FPSO will be spread moored at the Liza field located in the Stabroek block circa 200 kilometers offshore Guyana, in water depth of 1,525 meters and will be able to store 1.6 million barrels of crude oil.
SBM also won the contract from Exxon to build perform Front End Engineering and Design (FEED) for a second Floating Production, Storage and Offloading vessel (FPSO) for the Liza development located in the Stabroek block in Guyana. Following FEED and subject to requisite government approvals, project sanction and an authorisation to proceed with the next phase, SBM Offshore will construct, install and then lease and operate the FPSO for a period of up to two years, after which the FPSO ownership and operation will transfer to EEPGL.
The second Liza FPSO design is based on SBM Offshore’s industry leading Fast4WardTM programme as it incorporates the company’s new build, multi-purpose hull combined with several standardised topsides modules. The FPSO will be designed to produce 220,000 barrels of oil per day, will have associated gas treatment capacity of 400 million cubic feet per day and water injection capacity of 250,000 barrels per day. Furthermore, the FPSO will be moored in water depth of about 1,600 meters and will be able to store around two million barrels of crude oil.
All costs being handled by ExxonMobil’s subsidiary for the FPSO will be recovered.
KEY DIFFERENCES
According to documents held by the Environmental Protection Agency (EPA), there are some key differences between the Liza Phase Two Development and the Liza Phase One Development.
In the area of Oil Production Rates, the Phase Two production rate will be approximately 190,000 to 220,000 barrels of oil per day while Phase One’s production rate is 100,000 barrels of oil per day with the ability to operate at sustained peaks of 120,000 barrels per day.
With respect to FPSO Oil Storage Volume, Phase Two storage volume will be approximately 1.6 to 2 million barrels, depending on the hull selected. Phase One storage volume is 1.6 million barrels.
In terms of the number of wells, Phase Two will have approximately 35-40 wells. Phase One has 17 wells.
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