New job for Subsea 7 on deepwater oil project in Gulf of Mexico

Subsea 7, a Luxembourg-domiciled subsea engineering, construction and services company serving the offshore energy industry, has secured work on a deepwater project in the U.S. Gulf of Mexico with LLOG Exploration Offshore (LLOG), a U.S.-based privately-owned exploration and production company.

Independence Hub; Source: Intermoor

Subsea 7 revealed on Tuesday, 2 May 2023, the award by LLOG, as project manager for the Salamanca development project, encompassing the Leon and Castile fields, in the U.S. Gulf of Mexico. The company describes this contract award as “sizeable,” between $50 million and $150 million.

Furthermore, the subsea player explains that the contract scope covers the installation of three infield subsea pipeline systems and the design and fabrication of subsea structures. According to Subsea 7, the subsea development will consist of two pipeline systems for the Leon field, located in Keathley Canyon 686, and one pipeline system for the Castile field, located in Keathley Canyon 736.

The company further explains that the infield pipelines will produce and flow from wellsite PLETs to the Salamanca FPS in water depths ranging from 1,800 to 2,000 metres. In addition, the firm’s scope of work includes the installation of oil and gas export pipelines, which depart from the Salamanca FPS and tie into existing pipeline transport systems approximately 48 kilometres away.

Craig Broussard, Vice President for Subsea 7 U.S., commented: “We are excited about the opportunity to work closely and openly with LLOG on this fast-paced, greenfield development. Our strengths as a collaborative partner and the versatility of our fleet will be instrumental in ensuring predictable, safe, and timely project delivery.”

While the project management and engineering are expected to start immediately at Subsea 7’s office in Houston, Texas, the offshore activity is slated to begin in 2024. Located about 250 miles southwest of New Orleans in approximately 6,000 feet of water, the Leon discovery, drilled by Repsol in late 2014 on KC 642, was drilled to a total depth of about 32,000 feet and encountered nearly 700 feet of high-quality net oil pay in multiple sands in the Lower Tertiary.

On the other hand, the Castile discovery was drilled on KC 736 in over 6,500 feet of water to a total of over 31,000 feet and encountered nearly 400 feet of high-quality net oil pay, also in the Lower Tertiary. As reported by Offshore Energy in May 2022, LLOG decided to reuse what was previously the world’s deepest floating production platform to develop its Leon and Castile discoveries in the deepwater Gulf of Mexico.

For that purpose, LLOG bought the old Independence Hub platform from Genesis Energy with plans to refurbish it and turn it into a floating production unit (FPU) named Salamanca. Following the refurbishment, the platform will have a capacity of 60,000 barrels of oil per day and 40 million cubic feet of natural gas per day.

Although the Salamanca FPU is expected to be completed in 2Q 2024, the first oil from the project is anticipated in mid-2025. LLOG has awarded several deals to bring this project to life. The latest one was handed out to Trendsetter Engineering in March 2023.

As a result, the Texas-based player will design and manufacture the subsea production manifold featuring its TCS subsea connectors, along with valves sourced from Advanced Technology Valve (ATV) in Colico, Italy, for the Salamanca subsea developments at Leon and Castile.