Exxon inks another US$1B contract for 6th Project

Apr 17, 2024 ExxonMobil, News, Oil & Gas

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Kaieteur News – One day after this publication reported on a US$1.5B contract handed out by the ExxonMobil led consortium to Saipem for an engineering, procurement, construction and installation (EPCI) contract, another firm has announced that it too has secured a contract for another component of the Whiptail Development Project.

According to reports, offshore contracting giant TechnipFMC has been awarded a contract in Guyana’s Stabroek Block by US supermajor ExxonMobil to supply subsea production systems for the Whiptail project.

This publication has since learnt that TechnipFMC will be responsible for providing project management, engineering, and manufacturing to deliver 48 subsea trees and associated tooling, as well as 12 manifolds and associated controls and tie-in equipment.

Exact financial details for the deal were not revealed but TechnipFMC did say that it was a “large” contract which means that it is worth between US$500M and $1B. According to the company, the award will be included in inbound orders in the second quarter of 2024.

TechnipFMC currently employs nearly 140 Guyanese workers and will continue hiring and training additional local staff in support of this award.

The contract was awarded a few days after Exxon announced the final investment decision for the project. The US$12.7B Whiptail is the sixth project on the Stabroek block and is expected to add approximately 250,000 barrels of daily capacity by the end of 2027.

Since the Final Investment Decision (FID), two companies were given the nod to proceed with work on the project. Namely, SBM started constructing the FPSO for the project, to be named Jaguar. It will be able to produce 250,000 bopd, have an associated gas treatment capacity of 540 mcfpd, and a water injection capacity of 300,000 bpd. The vessel will be spread moored in a water depth of about 1,630m and will be able to store around 2m barrels of crude oil.

Also, Saipem was told to proceed with its part of Whiptail work. Work entails the design, fabrication, and installation of subsea structures, risers, flowlines, and umbilicals for a subsea production facility.

This publication yesterday reported that the Saipem contract worth up to $1.5 billion was for the supply of a subsea production facility for ExxonMobil’s Whiptail ultra-deepwater field development offshore Guyana. Last week, the U.S. supermajor took the final decision 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 that announcement had 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 $1.5B contract is the second largest contract handed out by the ExxonMobil led consortium in relation to the Whiptail Development Project. This past week, this publication reported that 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.

The company 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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• Contract, Exxon, project, publication, TechnipFMC

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