Latest update February 1st, 2025 6:45 AM
Aug 03, 2022 News
as country remains in the dark on leasing costs for oil ships…
Kaieteur News – Deep-water projects in Guyana, Brazil, and Mexico are expected to buoy the market for drill ships; floating, production, storage and offloading (FPSO) vessels, and subsea equipment.
This is according to the Norwegian group, Rystad Energy, an independent energy research and business intelligence company that provides data, tools, analytics, and consultancy services to the global energy industry.
While Rystad reported that the mega projects in the three Latin American countries will benefit the drillship, FPSO, subsea and subsea umbilicals, risers, and flow lines (SURF) markets over the next three to four years, Guyanese are still in the dark on the leasing bills for its Stabroek Block oil resources.
The Norwegian group reported that in the coming years, upstream capital expenditure (CAPEX) in Latin America will shift into deeper and deeper water with Guyana, Brazil, and Mexico likely to lead the charge for new spending. However, every new spending on oil ships in Guyana by Exxon comes with a new bill for monies to be deducted from Guyana’s share of oil money.
Rystad said, “By 2025, we estimate that deep-water investment in seismic, drilling, and facilities will exceed $25 billion…driven by Brazil’s pre-salt fields. Three countries will lead upcoming growth: Brazil will retain its dominant position with Guyana growing on the back of recent discoveries and Mexico extending exploration from legacy shelf regions to deeper waters.”
According to Rystad, developments in Guyana and Brazil salvaged the subsea supply chain from total devastation in 2020 and 2021 when operators curtailed sanctioning activity. In fact, within Latin America, deepwater expenditure is dominated by Brazil, Guyana, and Mexico which together account for over 90 percent of investments.
“Deep-water projects in Brazil and Guyana will rely primarily on FPSO vessels to produce from these remote fields,” it was noted.
Petrobras and ExxonMobil Guyana are the largest operators in Brazil and Guyana, respectively.
On the local front, in the prolific Stabroek Block, Exxon’s affiliate, Esso Exploration and Production Guyana Limited (EEPGL) is the operator and holds a 45 percent interest in the block. Meanwhile, Hess Guyana Exploration Ltd. holds a 30 percent interest and CNOOC Petroleum Guyana Limited, a wholly-owned subsidiary of CNOOC Limited, holds a 25 percent interest.
“Following ExxonMobil’s discovery of the Liza field in 2015, there has been a string of exploration successes leading to a growing backlog of FPSO projects,” Rystad said. To this end, it was noted that the oil ships feature a new generation of FPSO based on modularity and scale.
Dutch manufacturer, SBM Offshore, is the one designing the FPSOs for Exxon’s projects. Rystad noted that SBM’s design can hold up to 2.3 million barrels of oil, slightly more than a very large crude carrier (VLCC), with space for up to 50,000 tonnes of topside equipment and options for different mooring configurations.
The group pointed out that while running some additional financial risk, a pipeline of standardised hulls also allows operators to reduce the delivery time of these deepwater projects. Given the current investment environment, this has become a dominant model for commercialising fields in these countries.
Kaieteur News had reported that the Dutch manufacturer has been the preferred shipbuilder for Guyana’s FPSO vessel since 2015.
To date, the company has built the FPSOs for the Liza Destiny, the Liza Unity, Payara – each costing approximately US$1B, US$1.2B, and US$1.6B respectively.
It was on July 21, 2022, when SBM announced that it has completed the project financing of the ONE GUYANA FPSO vessel—Guyana’s fourth and largest oil ship—for a total of US$1.75 billion.
While Guyanese continue to remain in the dark as it relates to the leasing arrangements in place for these vessels, which are being paid for from its Stabroek Block oil resources, SBM Offshore was nonetheless pleased to announce that EEPGL handed it another contract to build Guyana’s fourth FPSO [ONE GUYANA].
Under this latest contract, SBM Offshore said it will construct, install and then lease and operate the ONE GUYANA FPSO for a period of up to two years, after which the FPSO ownership and operation will transfer to EEPGL. The said award follows the completion of front-end engineering and design studies, receipt of requisite government approvals, and the final investment decision on the project by ExxonMobil and block co-venturers.
Notably, to date, the Stabroek Block partners have discovered 11 billion oil-equivalent barrels and the oil company anticipates up to 10 projects [10 FPSOs] on the Stabroek Block to develop this resource. With 10 projects estimated at US$1.5B a piece with over US$15B set to be deducted from Guyana’s Stabroek Block oil resources.
Feb 01, 2025
2025 CWI Regional 4-Day Championships Round 1… Kaieteur Sports-A resilient century from middle-order Kevlon Anderson coupled with 9 wickets from off-spinner Richie Looknauth saw the Guyana Harpy...Peeping Tom… Kaieteur News-It is peculiar the way the PPP/C government often finds itself staring down the barrel of... more
Antiguan Barbudan Ambassador to the United States, Sir Ronald Sanders By Sir Ronald Sanders Kaieteur News- The upcoming election... more
Freedom of speech is our core value at Kaieteur News. If the letter/e-mail you sent was not published, and you believe that its contents were not libellous, let us know, please contact us by phone or email.
Feel free to send us your comments and/or criticisms.
Contact: 624-6456; 225-8452; 225-8458; 225-8463; 225-8465; 225-8473 or 225-8491.
Or by Email: [email protected] / [email protected]