SBM Offshore has updated its 2024 earnings guidance to US$1.9 billion, representing a 46% increase from the previous US$1.3 billion projection.
This significant boost is primarily attributed to the completion of the US$1.23 billion sale of the Prosperity floating production, storage and offloading (FPSO) vessel to ExxonMobil Guyana on November 7, and the anticipated sale of the Liza Destiny FPSO by year-end 2024.
ExxonMobil’s decision to exercise its purchase right for FPSO Liza Destiny comes ahead of the maximum lease term, which would have expired in December 2029. The sale will allow ExxonMobil to assume ownership of the unit while SBM Offshore will continue to operate and maintain it. Proceeds from the sale will be applied to fully repay the US$405 million outstanding project financing for Liza Destiny and the US$979 million outstanding for Prosperity. The Dutch shipbuilder expects this to significantly reduce its net debt position.
SBM Offshore’s Chief Executive Officer (CEO), Øivind Tangen, said, “Our SBM teams continue to deliver a strong performance, driving improved results. We have increased our EBITDA guidance for the year from around US$1.3 billion to around US$1.9 billion.”
Exxon already purchased the Liza Unity FPSO in November 2023.
The Liza Destiny, Liza Unity, and Prosperity FPSOs are operating in the Stabroek Block offshore Guyana, producing a combined 660,000 barrels per day (b/d). SBM Offshore is also expected to deliver the ONE GUYANA and Jaguar FPSOs to Guyana in 2025 and 2027.
Meanwhile, SBM Offshore said the award by TotalEnergies of the FPSO contract for the Gran Morgu project in Suriname demonstrates the value of its lifecycle offering and the advantaged positioning this can give it in the market. The 220,000 b/d capacity vessel, to be delivered in partnership with Technip Energies, will utilize all-electric drive to help optimize emission intensity.
SBM Offshore expects three of its units to achieve first oil in 2025. The first of these units, Almirante Tamandaré, arrived safely in Brazil and has entered the final offshore commissioning scope. Once in production, this unit will be the largest producing FPSO in Brazil and is also the first in Brazil with a Sustainability-1 Notation, the company said.
