ExxonM hands out $1.5B contract to build underwater platform for 6th Oil Project

Apr 16, 2024 ExxonMobil, News, Oil & Gas

A representation of Exxon’s subsea umbilicals, risers, and flowlines (SURF) equipment used for production activities

Kaieteur News – Days after the Guyana Government granted a Production Licence for the ExxonMobil led consortium to begin the development of its sixth offshore production—Whiptail—the US super major has already handed out another contract.

According to Italian contractor Saipem, it has won an engineering, procurement, construction and installation (EPCI) contract worth up to $1.5 billion to supply a subsea production facility for ExxonMobil’s Whiptail ultra-deepwater field development offshore Guyana. The US supermajor last week took the final investment decision on its US$12.7 billion Whiptail field development, located on the prolific Stabroek block, which will exploit an estimated resource base of 850 million barrels of crude.

Saipem in making the announcement said it has already started initial activities — the detailed engineering and procurement of long lead items for Whiptail and following FID, now has the issued authorisation to proceed with the execution of the remaining project activities.

The company’s vessels FDS2, Castorone and Constellation will be used for the offshore installation of the Whiptail subsea production facilities. Also, for the on-site construction of part of the subsea items, Saipem will deploy its Guyana Offshore Construction Facility, located at the Port of Georgetown, and an additional local fabrication facility, which the company said is proof of its “continued commitment to the sustainable growth in the country”.

Saipem had previously worked on ExxonMobil’s Liza Phase 1 and Phase 2, Payara, Yellowtail and Uaru field developments offshore Guyana.

The $1.5B contract is the second largest contact handed out by the ExxonMobil led consortium in relation to the Whiptail Development Project. This past week, this publication reported Dutch shipbuilder, SBM Offshore confirmed that it will be constructing Guyana’s sixth Floating Production Storage and Offloading (FPSO) vessel, Jaguar. The vessel will be designed to produce 250,000 barrels of oil per day, and will have associated gas treatment capacity of 540 million cubic feet per day and water injection capacity of 300,000 barrels per day. The FPSO will be moored in water depth of about 1,630 meters and will be able to store around 2 million barrels of crude oil.

In a public missive, SBM said that ExxonMobil Guyana Limited (EMGL) has confirmed the award of contracts for the Whiptail development. Under these contracts, SBM Offshore will construct and install the Jaguar FPSO. Ownership will transfer to EMGL prior to the FPSO’s installation in Guyana, and SBM Offshore expects to operate the FPSO for 10 years under the Operations and Maintenance Enabling Agreement signed in 2023. SBM said the award follows completion of front-end engineering and design studies, receipt of requisite government approvals and the final investment decision on the project by ExxonMobil and the Stabroek block co-venturers. “The FPSO Jaguar’s design is based on SBM Offshore’s industry leading Fast4Ward program that incorporates the Company’s 7^th new build, multi-purpose floater hull combined with several standardized topsides modules,” the shipbuilder explained.

It said it remains committed to working with Guyanese companies and will continue to expand these activities, as more Guyanese engineers will be recruited and employed as part of the FPSO Jaguar project team. To date, SBM has constructed four FPSOs for Guyana, including the Liza Destiny, Liza Unity, Prosperity and One Guyana. Exxon had recruited the services of Japanese ship builder, MODEC, for its fifth FPSO, Errea Wittu.

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