SBM Offshore to build its largest producing unit ever for ExxonMobil

FPSO operator SBM Offshore has been awarded contracts to perform Front End Engineering and Design (FEED) for an FPSO vessel for ExxonMobil’s Yellowtail development project located offshore Guyana. This will be the largest producing unit ever built by SBM.

The FEED contract 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, SBM Offshore explained on Wednesday.

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 of work, SBM Offshore will construct, install, and then lease the FPSO and operate it for a period of up to two years. The first oil is expected in 2025.

SBM Offshore will design and construct the FPSO using its Fast4Ward programme allocating the company’s sixth new build, multi-purpose hull combined with several standardized topsides modules.

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

For the latest FPSO, SBM Offshore will be building on the experience to date on the Liza Destiny, Liza Unity, and Prosperity FPSOs. The Liza Unity arrived in Guyana in late October 2021 following a journey from Singapore. The production from the Liza Phase 2 development is on track to start in early 2022.

In order to strengthen its execution model given the current challenging market environment, SBM Offshore established a special purpose company (SPC) with McDermott for the execution of the turnkey phase of the project. This SPC will benefit from the combined engineering and fabrication capacity as well as the experience of both companies in delivering EPC solutions.

SBM Offshore will hold 70 per cent and McDermott will hold 30 per cent equity ownership in this SPC. The FPSO will be fully owned by SBM Offshore.

Bruno Chabas, SBM Offshore’s Chief Executive Officer: “SBM Offshore is proud to announce ExxonMobil has awarded the contracts for the fourth FPSO to be deployed in Guyana. When finished, the FPSO will be the largest producing unit ever built by the company.”

Chabas added: “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.”

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

ExxonMobil’s Yellowtail is the fourth project that has been identified within the Stabroek Block and will see the development of the Yellowtail and Redtail fields. The company in October 2021 submitted its Environmental Impact Assessment (EIA) and Environmental Impact Statement (EIS) for the Yellowtail development to Guyana’s Environmental Protection Agency (EPA) for evaluation and recommendations period of 60 days.

As reported earlier this week, TechnipFMC was awarded a contract to supply the subsea production system for the Yellowtail development. The scope includes 51 enhanced vertical deepwater trees (EVDT) and associated tooling, as well as 12 manifolds and associated controls and tie-in equipment.