ExxonMobil will not be using the Netherlands-headquartered SBM Offshore to build its fifth planned FPSO as it has signed a contract with Japanese floating oil and gas production systems provider, MODEC to build the vessel to support its planned Uaru project.
“Yes, it’s true…this is all MODEC,” ExxonMobil Media Relations Advisor Kwesi Isles yesterday confirmed with Stabroek News.
It was MODEC which shared the news that it had reached a contract agreement with the US oil major to perform Front End Engineering and Design (FEED) for an FPSO vessel for ExxonMobil’s “Uaru” oil field development project in the Stabroek Block.
“MODEC, Inc. (“MODEC”) is pleased to announce that it has signed a contract to perform Front End Engineering and Design (FEED) for a Floating Production, Storage and Offloading vessel (FPSO) for the “Uaru” development project. The FEED contract award relates to the initial funding by ExxonMobil’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL), to begin FEED activities related to the FPSO design and to secure the second M350TM hull for FPSO service,” a release from the company yesterday stated.
“Following FEED and subject to government approvals in Guyana of the development plan, project sanction including final investment decision by ExxonMobil, and EEPGL’s release of the second phase (EPCI) of work, MODEC is expected to construct the FPSO and install in Guyana,” it added.
The company said that it is also anticipating operating the FPSO for “an initial duration of 10 years, with potential options for continuation”.
On design specifications, MODEC said it will design and construct the FPSO based on its M350 new-build design. “Uaru will be the second M350 hull used for FPSO service. The FPSO will be designed to produce 250,000 barrels of oil per day, will have associated gas treatment capacity of 540 million cubic feet per day and water injection capacity of 350,000 barrels per day. The FPSO will be installed in a water depth of about 2000 meters, using a SOFEC Spread Mooring System and will be able to store around 2 million barrels of crude oil,” the company explained.
It quoted its President and CEO Takeshi Kanamori as saying, “We are extremely honored and proud to be selected to provide the FEED services for an FPSO for the Uaru project”. He added, “We are equally proud of our robust track record of successful project deliveries in the South America region, and we look forward to cooperating closely with the client and its partners to make this project a success.”
According to the company, the FPSO will be MODEC’s first for use in Guyana, however it will be the 18th FPSO/FSO vessel delivered by MODEC for use in South America.
The Uaru is ExxonMobil’s fifth development in the Stabroek Block after Liza 1, Liza 2, Payara and Yellowtail.
In April of this year, the company had announced that it was seeking approval for the project.
Then in late September, government announced that having received US$20 million from the World Bank in 2020, the Ministry of Natural Resources is using some of the funds to find a consulting firm to help review and evaluate the Uaru project.
“The Government of the Cooperative Republic of Guyana (GCRG) has received financing in the amount of US$20 Million equivalent from the World Bank (WB) toward the cost of the Guyana Petroleum Resources Governance and Management Project (GPRGMP) and it intends to apply part of the proceeds to pay a consulting firm to provide advisory services, technical support and training and capacity strengthening services to the Government of Guyana (GoG),” a Request for Proposals notice states.
Assignment
“…The assignment will include the following areas: A. Detailed Assessment of the Uaru Concept Selection Process and Field Development Plan B. FDP Management, Oversight, Monitoring and Reporting C. Detailed Assessment of the Environmental and Social Impact Assessment of the Proposed Uaru FDP D. ESIA Management, Oversight, Monitoring and Reporting E. Training and Institutional Capacity,” the notice explained.
The Request for Proposal also pointed out that the objective of the assignment is “for the Consultant to provide advisory services, technical support and training and capacity strengthening services to the GoG, through the Ministry of Natural Resources (MNR), and the Sector Regulator – the Guyana Geology and Mines Commission (GGMC) or the Petroleum Commission (PC) once established – and other attendant Ministries with the aim of enhancing the country’s core capacity to review, approve, authorize, and oversee, monitor and report on the implementation of Field Development Plan(s) (FDP).”
Firms have to indicate their interest in providing the services and must provide information demonstrating that they have the required qualifications and relevant experience to perform the services, such as, description of similar assignments, experience in similar conditions and availability of appropriate skills among staff.
The ministry said that a consultant will be selected in accordance with the “Quality-And-Cost Based Selection (QCBS)” method set out in the procurement regulations.
With two discoveries late last month, ExxonMobil’s ongoing offshore exploration in Guyana has a recoverable resource of more than 10 billion oil-equivalent barrels. The company says it anticipates up to 10 projects on the Stabroek Block to develop this resource.
It was pointed out by ExxonMobil that more than 3,500 Guyanese are supporting its activities in Guyana, an increase of more than 50% since 2019. The company and direct contractors have also spent more than US$600 million with more than 880 local suppliers since 2015. More than 3,000 Guyanese companies are registered with the Centre for Local Business Development, which was founded by ExxonMobil and its co-venturers in 2017 to build local business capacity.
ExxonMobil affiliate, Esso Exploration and Production Guyana Limited, is the operator and holds 45% interest in the Stabroek Block. Hess Guyana Exploration Ltd holds 30% and CNOOC Petroleum Guyana Limited holds 25%.
