GE’s subsea systems, financing for Alpha’s Cheviot field
Alpha Petroleum is partnering up with GE Oil & Gas on the advancement of the subsea infrastructure for the Cheviot oil field, in the UK North Sea.
The field, described by Alpha Petroleum as one of the largest undeveloped fields in the UK North Sea, is estimated to hold 55 mmbbls of oil and 20 mmboe of future gas production.
Alpha Petroleum has named GE Oil & Gas as the exclusive supplier of early engineering, project management, and procurement activities for the project.
GE Oil & Gas will supply subsea trees, a full control system, three manifolds, flexible jumpers, flowlines, risers and umbilicals. It will also provide subsea construction and installation services, and support commissioning.
In addition to the provision of services and technologies, GE Energy Financial Services is helping to raise the needed debt financing for the project and is in discussion with Alpha Petroleum with the intention, subject to due diligence, of making a significant capital investment at the time of final investment decision (FID), which is expected in the fourth quarter of 2017, Alpha Petroleum said. GE Energy Financial Services is GE’s energy investing business.
According to Alpha Petroleum, the company has, for more than a year collaborated with GE, co-creating from project inception the scope of delivery and equipment specifications required to meet Alpha Petroleum’s performance objectives.
Andy Crouch, Alpha Petroleum’s Chief Executive said: “By taking this unconventional, collaborative approach, we have been able to really draw on GE’s expertise, enabling us to minimise costs and timescales. This partnership marks another key milestone in Cheviot’s development and we are excited to see the project move forward to the next stage.”
“Through this full life-of-field partnership, Alpha Petroleum is defining the performance characteristics they require and empowering GE Oil & Gas to design the necessary solutions. While the benefits are clear, this represents another very positive example of how the traditional, transactional relationship between industry players is evolving into a partnership approach,” said GE Oil & Gas Europe CEO, Michele Stangarone.
The Cheviot field is 100 per cent owned by Alpha Petroleum and its core development will consist of 18 firm and 5 contingent wells. Alpha Petroleum recently announced an exclusivity agreement with Teekay Offshore Partners L.P. on the project for use of its Varg Floating Production Storage Offloading unit as well as FEED capabilities to the project. First oil is expected in 2019 at an expected rate of at least 30,000 barrels per day.