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US$617M spent on gas pipeline to date by ExxonMobil
President, ExxonMobil Guyana, Alistair Routledge
Kaieteur News – ExxonMobil Guyana Limited (EMGL) has expended US$617M on the 12-inch natural gas pipeline to date.
The structure is being constructed to transport gas from the Liza One and Liza fields in the Stabroek Block to the Wales development site, West Bank Demerara, where the government of Guyana (GoG) is pursuing the construction of a Natural Gas Liquids (NGL) facility and a 300-megawatt power plant as part of the Gas-to-Energy (GTE) project.
During a media conference on April 30, President of ExxonMobil Guyana, Alistair Routledge explained that 70% of the offshore pipeline works were completed by the company and 68% of the onshore works.
At that time, he explained, “We currently have two elements of installation ongoing in the shallow waters near to shore. There’s one vessel that’s leading that installation (there) and then there’s another vessel out in the deep water that is laying pipe there.”
Routledge said the entire structure was about 70% completed and will be ready to hand over to government by year end.
Between July and August, Exxon is expected to take the Liza Unity and Liza Destiny Floating Production Storage and Offloading (FPSO) vessels offline to facilitate installation of the gas pipeline.
“The major piece of work that we will have to do for tying in the pipeline to the two FPSOs in the Liza Field…we will take shut downs on each of those two FPSOs in July and August independently…there is one installation vessel that will install the risers to connect the pipeline to those two FPSOs,” Routledge explained.
Exxon estimates that each FPSO will be shutdown for a period of two weeks.
Meanwhile, Routledge in response to a question from this publication informed that the project is on budget. He said, “Its on budget, the project for the pipeline is on budget so we don’t anticipate at this stage, given that we’re 70% of the way through the installation any significant increases in the cost of the project.”
The GoG had said the pipeline under construction by Exxon would cost US$1B and would be financed over a 20-year period through the purchase of gas.
Project Head, Winston Brassington previously revealed that Guyana will be required to pay back ExxonMobil some US$55 million annually.
“That US$55 million is the amortized cost of US$1 billion for 20 years at a discount rate,” he said.
Exxon has hired SICIM and Gaico to conduct the onshore pipeline works, while the contract for the offshore works was awarded to Van Oord. The pipeline will be buried some 9-feet below the surface and will be tested to ensure it meets the required safety and pressure standards. Markers will be installed along the pipeline route onshore. Most of the offshore pipeline will remain above the sea floor.
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