Saturday, May 21, 2022

SBM Offshore to build largest producing unit in company’s history for Exxon’s Yellowtail project

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SBM Offshore announced on Wednesday that it has been awarded contracts to perform Front End Engineering and Design (FEED) for a Floating Production, Storage and Offloading vessel (FPSO) for Guyana’s Yellowtail Development project.

The Dutch floater specialist said the award triggers the initial release of funds by ExxonMobil’s subsidiary Esso Exploration and Production Guyana Limited (EEPGL) to begin FEED activities and secure a Fast4Ward® hull.

Following FEED, subsequent government approvals in Guyana for the development plan, and project sanction including final investment decision by ExxonMobil, and EEPGL’s release of the second phase of work, SBM Offshore said it will construct, install and then lease the FPSO and operate it for a period of up to 2 years.

Furthermore, SBM Offshore said it will design and construct the FPSO using its industry leading Fast4Ward® programme allocating the Company’s sixth new build, Multi-Purpose Hull combined with several standardized topsides modules.

The Dutch firm said the FPSO will be designed to produce 250,000 barrels of oil per day, will have associated gas treatment capacity of 450 million cubic feet per day and water injection capacity of 300,000 barrels per day. The FPSO will also be spread moored in water depth of about 1,800 meters and will be able to store around 2 million barrels of crude oil.

Building on the experience to date on the Liza Destiny, Liza Unity and Prosperity FPSOs, SBM Offshore was keen to note that it continues to commit to local content development in Guyana through sourcing fabrication scope locally and the integration of Guyanese engineers in the execution and operational teams.

SBM Offshore providing training opportunities for Guyanese to work on FPSOs

In order to strengthen its execution model given the current challenging market environment, SBM Offshore said it established a special purpose company (SPC) with McDermott– a fully integrated provider of engineering and construction solutions to the energy industry– for the execution of the turnkey phase of the project. OilNOW understands that this SPC will benefit from the combined engineering and fabrication capacity as well as the experience of both companies in delivering EPC solutions to the energy industry. SBM Offshore will hold 70% and McDermott will hold 30% equity ownership in this SPC. The FPSO will be fully owned by SBM Offshore.

SBM Offshore moving forward with record-breaking project financing, delivers second floater to Guyana

Bruno Chabas, SBM Offshore’s Chief Executive Officer commented that the company is proud to announce the details of the award. Chabas said when finished, the FPSO will be the largest producing unit ever built by the Company. The CEO said, “This project again demonstrates the value that our industry leading Fast4Ward® program continues to bring to our clients and other stakeholders. We are also pleased to announce our partnership with McDermott and look forward to working together through the execution phase and deliver this world class project.”

In an invited comment, Samik Mukherjee, McDermott’s Executive Vice President and Chief Operating Officer said, “Our people and resources bring the proven project execution, integrated engineering and modularization capabilities essential for delivery assurance and success.” He added, “We will align these strengths with those of SBM Offshore to drive a cohesive, efficient execution strategy together.”

The Yellowtail Project is poised for first oil in 2025.

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