Exxon in talks with ship builders even before getting permission for 4th Project

May 13, 2021 News

The Liza Unity under construction in Singapore by SBM Offshore.

Kaieteur News – US oil major, ExxonMobil, is reported to have been in talks with its Floating Production Storage and Offloading (FPSO) vessel builders, SBM Offshore and Modec, months before it even submitted a project summary to the Guyanese authorities seeking environmental permissions for the development of its fourth oilfield in the Stabroek Block, Yellowtail.
The company over the weekend submitted the project summary for the project to the Environmental Protection Agency (EPA) but according to reports, the company has been in talks with Dutch Floater Specialists, SMB Offshore and Japanese owned Modec, for the supply of the FPSO, since March this year.
According to international reports published by the Canadian organisation, Newfoundland and Labrador Oil and Gas Industries Association (NOIA), ExxonMobil is engaged in early discussions with the world’s two leading floater specialists over the contracting of a fourth large FPSO for the flagship Stabroek Block offshore Guyana.
According to the report, ExxonMobil, is fast-tracking activities in Guyana, as the company aims to have as many as six FPSOs in operation at Stabroek by 2027, shooting for a total processing capacity of more than one million barrels per day of oil by then.
It was noted that in addition to the Liza Destiny FPSO currently in operation in the Stabroek Block Liza 1 field, two more units — Liza Unity and Prosperity — are earmarked to produce from Liza 2 and the Payara-Pacora development in 2022 and 2024 respectively.
Industry sources reported at the time of the publication that ExxonMobil was already conducting technical analysis on the scope of the floater to be contracted for the potential development of the Greater Yellowtail area, with initial talks taking place with Netherlands-based, SBM Offshore and Japanese archrival, Modec.
SBM Offshore won the bidding process for the Liza Destiny floater and was subsequently awarded contracts for the Liza Unity and Prosperity FPSOs as a result of direct negotiations, with ExxonMobil taking advantage of the Dutch company’s standardised Fast4Ward building concept.
It was reported too, that ExxonMobil being in dialogue with SBM and Modec suggests the operator might opt for a competitive tender for the Yellowtail FPSO. Notably, a similar process occurred in the contracting process for the subsea risers, umbilicals, risers and flow lines package, which has been thrown open to competition for Yellowtail, interrupting a sequence of direct negotiations with preferred vendor, Saipem.
The Greater Yellowtail area encompasses the Yellowtail-1, Yellowtail-2 and Redtail-1 discoveries in the center portion of the Stabroek Block.

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