– as ExxonMobil to submit FDP this month-end
Dutch Company, SBM Offshore, has bagged the contracts to perform Front End Engineering and Design (FEED) for a Floating Production Storage and Offloading (FPSO) vessel for the Whiptail Development Project in Guyana.
Whiptail will be United States oil major, ExxonMobil’s sixth development project on the oil-rich Stabroek Block, offshore Guyana.
In a statement on Friday, SBM said it will eventually construct and install the FPSO upon the completion of the FEED contract. This, however, will be subject to the Guyana Government’s approval of the Whiptail Development Plan and project sanction including the final investment decision by ExxonMobil Guyana Limited – an affiliate of the ExxonMobil Corporation, to release the second phase of work.
According to the Dutch company, the FEED contract award triggers the initial release of funds by ExxonMobil Guyana to begin FEED activities and commits a Fast4Ward® hull for the execution of the Whiptail development project in Guyana.
Under the contracts, the FPSO’s ownership is expected to be transferred to Exxon at the end of the construction period and before the start of operations offshore Guyana. The construction costs are expected to be partially funded by senior loans which will be repaid at the time of the FPSO’s transfer to the client.
SBM Offshore said it is expected to operate the FPSO through its integrated operations and maintenance model combining SBM Offshore and ExxonMobil’s expertise and experience, leveraging key learnings and the operational excellence of the units currently deployed in Guyana.
SBM Offshore will design and construct the FPSO using its industry-leading Fast4Ward® program using the Company’s seventh new build, a Multi-Purpose Floater hull, combined with several standardized topside modules. The FPSO will be designed to produce 250,000 barrels of oil per day and will have an associated gas treatment capacity of 540 million cubic feet per day and a water injection capacity of 300,000 barrels per day. The FPSO will be spread-moored in a water depth of about 1,630 meters and will be able to store around 2 million barrels of crude oil.
Building on the experience to date of FPSOs Liza Destiny for the Liza Phase One Project, Liza Unity for the Liza Phase Two Project, Prosperity for the third project – Payara, and ONE GUYANA for the fourth project – Yellowtail, the Dutch company said it continues to commit to local content development in Guyana by sourcing fabrication scope locally and integrating Guyanese engineers into the execution and operational teams.
“We are proud to announce ExxonMobil Guyana has awarded the contracts for a fifth FPSO from SBM Offshore in Guyana. This project demonstrates once more the value that our industry-leading Fast4Ward® program brings to our clients and other stakeholders while delivering carbon-efficient energy to the world,” SBM’s Chief Executive Officer, Bruno Chabas, stated.
SBM Offshore designs, builds, installs, and operates offshore floating facilities for the offshore energy industry. As a leading technology provider, the Dutch company put its marine expertise at the service of a responsible energy transition by reducing emissions from fossil fuel production, while developing cleaner solutions for renewable energy sources.
Development Plan
Back in August, ExxonMobil Guyana President Alistair Routledge disclosed that the oil company intends to submit its Field Development Plan (FDP) for the Whiptail Project in October 2023.
“[There will be] 1 million barrels per day of production by 2028. That reflects six projects… the five already sanctioned and the Whiptail project is the one we’re working on right now. We plan to submit a development plan to the Government in October of this year,” Routledge had explained at a seminar hosted by the University of London’s Chancellor Hall.
It was subsequently reported in August that the Environmental Impact Assessment (EIA) for the Whiptail development has been completed and the project documents indicate that the project will cost US$12.9 billion.
ExxonMobil had approached the Environmental Protection Agency (EPA) for approval for the Whiptail development. According to the EIA, the project will target between 33 and 72 wells. The documents further detailed that development drilling is expected to last from late 2024 or early 2025 through mid-2030, with the possibility of extending it as late as 2031.
Installation of subsea components of the project is meanwhile slated to begin in the 2025 second half or early 2026. The installation of the FPSO vessel as well as commissioning and start-up, are expected to occur in 2027. The life of the project is expected to last for at least 20 years.
According to the US oil company, the project will employ over 500 persons during drilling and installation. Additionally, between 100 and 180 persons will be employed during production. It was further explained that the Whiptail FPSO vessel will be similar to the one for Yellowtail and will be designed to target 300,000 barrels per day.
When it comes to any potential impacts from the project, the EIA states that the project will not disturb any natural onshore habitats since it is taking place over 195 kilometres off the coast. However, it states that the project may potentially have a meaningful impact on water quality, climate, and certain marine biological and socio-economic resources. However, mitigation measures were included in the assessment for the EPA to peruse.
Meanwhile, the EPA issued a notice in August inviting citizens to submit any concerns they may have about the project, within 60 days.
The Stabroek Block is 6.6 million acres (26,800 square kilometres). Exxon, through its local subsidiary Esso Exploration and Production Guyana Limited (EEPGL), holds 45 per cent interest in the block. Hess Guyana Exploration Ltd holds 30 per cent interest and CNOOC Petroleum Guyana Limited, a wholly-owned subsidiary of CNOOC Limited, holds the remaining 25 per cent interest.
ExxonMobil has said it anticipates at least six projects offshore Guyana, including the now Whiptail project, will be online by 2027. Production has already started on the Liza Phase 1 and 2 projects, while the third development, Payara, will start up at the end of this year. (G-8)
