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Decision time arrives for Barossa hopefuls

ConocoPhillips gets ready to choose contractors for three gas project packages

Major oilfield services companies are on tenterhooks in Australia as ConocoPhillips prepares to select its preferred contractors for three significant packages linked to the Barossa gas project, which will provide backfill gas to the Darwin LNG facility.

The three major packages are the floating production, storage and offloading vessel; the subsea gas export pipeline; and the offshore development drilling contract.

For the FPSO, there are two competitors — Modec and TechnipFMC-Samsung Heavy Industries.

Commercial bids were submitted in late May following on from the earlier technical offers.

ConocoPhillips first needs to decide whether the FPSO will be leased or built on a turnkey basis.

Sources said Modec offered both solutions, while TechnipFMC-Samsung offered the turnkey basis.

ConocoPhillips will then have to decide which of the two contractors it prefers.

Sources said Modec has not announced which shipyard it is partnered with, but the yard will be in either Singapore or China where the Japanese FPSO giant performs the lion’s share of its construction work.

The Barossa FPSO will be 350 metres long and 60 metres wide.

The topsides will weigh between 25,000 and 35,000 tonnes, and the vessel will be capable of processing 800 million cubic feet per day of gas and 6000 barrels per day of condensate.

As for the subsea gas export pipeline, which includes components of the subsea umbilicals, risers and flowlines workscope, the two competitors are Allseas and Saipem.

The gas export pipeline will be a 260-kilometre 26-inch carbon-steel line with concrete coating for stability and mechanical protection. It will be installed using the S-lay method to a tie-in point on the existing Bayu-Undan pipeline.

Finally, the contract for offshore development drilling will also be keenly contested.

A semi-submersible drilling rig is required for six subsea production wells in water depths of between 240 and 260 metres.

ConocoPhillips recently requested information from interested drillers on their ideas about the proposed well delivery and sequencing of the work, as well as identifying efficiency and design opportunities.

The contract for the subsea production system was awarded in May 2019 to TechnipFMC.

DNV GL, meanwhile, was awarded the independent validation body services contract, which brings with it commitments in every aspect of the project execution.

The Barossa project, which has an estimated capital cost of US$4 billion to US$4.8 billion, was given a morale boost last week when it was announced the Barossa joint venture and the Darwin LNG joint venture had entered into exclusive negotiations for the supply of backfill gas in to Darwin LNG.

The two sides will now work to reach a processing services agreement as well as settle on a tariff in anticipation of a Barossa final investment decision early next year, said Barossa co-owner Santos.

The Barossa project was vying for the backfill position against the Eni-operated Evans Shoal project.

Only one of the two projects is required to replace the current Darwin LNG feedstock volumes from the Bayu-Undan field.

Santos’ chief executive Kevin Gallagher said: “This exclusivity confirms the confidence we had to commit to long-lead items last month and maintain project schedule to deliver gas to DLNG as early as possible.”

The Barossa field is 300 kilometres north of Darwin, in Block NT/RL5.

The development is operated by ConocoPhillips on 37.5%, with partners Santos on 25% and SK Energy on 37.5%.

The Darwin LNG facility is operated by ConocoPhillips with a 56.9% ownership interest. Its co-venturers are Santos on 11.5%, Inpex on 11.4%, Eni on 11% and Tokyo Electric and Tokyo Gas on 9.2%.

876a55d61136f8a153cc9b6033d875ac Exclusivity: Santos chief executive Kevin Gallagher Photo: APPEA
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