ExxonMobil continues to defy guyana…FPSO builders give out more contracts despite no approval
The development plans for a third oilfield in the Stabroek Block are yet to be approved by the Department of Energy (DoE) but this has not stopped Oil and Gas Logistics Company, SBM Offshore from continuing business as usual, issuing more contracts.
According to the company, it, this past week placed orders for two hulls, for use in the construction of two new FPSOs. The deal was inked with Shanghai Waigaoqiao Shipbuilding and Offshore and China Merchants Industry Holdings.
These include the hull for the Liza Prosperity for the Payara Field and the other for a Brazilian Offshore development.
The Liza Unity for the second field in the Stabroek Block is already under construction while the Liza Destiny is about to be commissioned for first oil in a matter of days
DoE had placed on hold the third field development plan submitted by Esso Exploration and Production Guyana Limited (EEPGL) and its partners Hess Corporation and CNOOC.
DoE Director, Dr. Mark Bynoe said this was to facilitate a better vetting of the plans that had been submitted by the oil companies, given the “lessons learnt” on the previous two field development plans—Liza I and Liza II.
This has not stopped SBM Offshore from handing out contracts related to the Liza Prosperity.
In fact, the company only recently announced that it had inked a Letter of Intent and a Front End Engineer and Design (FEED) Contract for the contract.
At the time it said the award was the first under the long-term FPSO “supply agreement with ExxonMobil and also secures the third Fast4Ward® hull under construction.”
It noted however that the next phase of the project, to deliver FPSO Prosperity, remains subject to government approvals, project sanction and authorization.
Dr. Bynoe, on placing the approvals for the Payara plan on hold, said it was in order to hire a third party to vet the proposal.
Guyana decided to hire somebody to tell the country if the plan submitted by ExxonMobil, is in keeping with the best interests of the country and not necessarily the company.
The ExxonMobil’s Guyana subsidiary recently also gave Italian-based Saipem, a multi-million US dollar contract, for the subsea systems, for the still to be approved Liza Prosperity.
According to the contract scope, Saipem will perform the detailed engineering, procurement, construction, and installation of a large subsea production facility that will include 130 km of flow-lines, risers, associated terminations and jumpers together with the installation of manifolds, flexible risers, dynamic and static umbilical, and flying leads.
Testing and pre-commissioning of the subsea field will follow installation.
According to reports, the company, before obtaining the necessary Government approvals and project sanction, had been directed through the contract to start ‘limited’ activities, namely detailed engineering and procurement.
This means, the company has been contracted and directed to begin at least, the designing and purchasing of required subsea apparatus
Saipem was awarded earlier subsea contracts for the first two phases of the Liza development in Guyana by EEPGL in 2017 and in 2018,
The Payara discovery where ExxonMobil is hoping to develop a third oil field in the Stabroek Bloc, is located northwest of the Liza Phase 1 project.