LNG

Sembcorp Marine, the Singapore-headquartered global offshore, marine and energy platforms providers, is continuing to build its Brazilian shipyard business by completing its second floating, production, storage and offloading (FPSO) vessel for Brazil’s oil and natural gas rich offshore Santos Basin.

Semmarine's yard is called the Estaleiro Jurong Aracruz (EJA) facility and has been located since 2014 in the Espirito Santo state of southeast Brazil in the municipality of Aracruz.

The yard employs up to 4,500 workers during peak periods of production and in addition to tapping into the revived Brazilian offshore oil and gas industry, the EJA yard is offering field developments services for the in the Atlantic, Gulf of Mexico and West African regions.

The Sembmarine-owned yards “Petrobras P-71” FPSO is the second completed for the Tupi B.V. joint venture, majority-owned by state energy company Petróleo Brasileiro, known as Petrobras.

“The FPSO vessel, P-71, has just sailed away from EJA’s shipyard and will be deployed to the ultra-deepwater Itapu field,” said EJA.

Former LNG plan

Atapu is an oil and natural gas field with a shared deposit, located at a water depth of over 2,000 metres in the Santos Basin pre-salt.

Analysts note that for several years BG Group of the UK had spoken about an LNG production project in Brazil’s Santos Basin before being taken over by Shell in 2016. However, EJA’s the new FPSO is oil focused.

“When launched into operation, P-71 will produce up to 150,000 barrels of oil per day (BOPD). Measuring 316 metres in length and 54 metres in width, ‘P-71’ has a 1.6-million-barrel storage capacity and can accommodate 166 persons,” explained EJA.

EJA’s “P-71” work scope included fabricating six modules, pipe-racks and a flare, and integrating them on the vessel along with other modules and items supplied by the customer.

The yard said it also executed modification works on the FPSO’s topsides and hull to meet Itapu field requirements.

Premier facility

“Despite pandemic-related challenges which affected the project over a period of 20 months, EJA successfully delivered the P-71 FPSO on schedule, cementing its status as a premier facility in Brazil capable of taking on full engineering, procurement, construction and commissioning work for large-scale offshore projects,” said EJA President Thangavelu Guhan.

“We thank Petrobras and its partners for choosing to work with us on the ‘P-68’ and ‘P-71’ FPSO projects. We would also like to recognise our employees, vendors and community leaders whose assistance is important to our continued success,” stated Guhan.

EJA Chairman William Goh said that as a Brazilian shipyard with international expertise and advanced capabilities, the company had also become a major commercial entity and part of the social and economic fabric of Espirito Santo state and its local communities.

“We are committed to growing our business here by providing world-class engineering solutions for the offshore renewables, oil & gas and other clean energy sectors,” declared Goh.

Kosmos Energy, the US-based shareholder in the floating liquefied natural gas joint venture offshore the West African nations of Mauritania and Senegal, has acquired bigger shareholdings in oil and gas fields offshore Ghana from Occidental Petroleum of the US for $550 million.

Kosmos Energy, the partner of UK major BP in the Greater Tortue-Ahmeyim floating LNG project in territorial waters of Mauritania and Senegal, has given a project update after BP “force majeure” delay notice on Golar liquefaction vessel.

UK major BP has issued a “force majeure” notice to a subsidiary of Golar LNG relating to the delivery of a floating LNG production hull, the “Gimi”, for a start-up date in 2022 for the Greater Tortue Ahmeyim project offshore Mauritania and Senegal.

Kosmos Energy, the Dallas-based exploration and production company, posted a net fourth-quarter loss as it continued to make progress on the floating LNG export projects being developed with BP of the UK offshore Mauritania and Senegal in West Africa.

“The Greater Tortue Ahmeyim project located offshore Mauritania and Senegal remains on track with Phase 1 approximately 25 percent complete,” stated Kosmos.

“Pre-FEED work is ongoing for Phases 2 and 3 and these phases are expected to expand capacity to almost 10 MTPA of LNG export capacity,” added the US company.

Kosmos said that for the final three months of 2019 its losses came to $35.7 million compared with a profit of $185.5M in the same three months of 2018.

Oil and gas revenues in the quarter came to $450M versus $301M in the 2018 quarter.

Annual oil and gas revenues amounted to $1.49 billion compared with $886.6M in 2018.

Kosmos said one highlight happened after the fourth quarter with the signing on the 11th of February 2020 with its partners, the state energy companies of Senegal and Mauritania, of a Sale and Purchase Agreement (SPA) with BP Gas Marketing for 2.45 million tonnes per annum of LNG from Phase 1 of the project for an initial term of up to 20 years.

“Signing the SPA has allowed Kosmos to book approximately 100 million barres of oil equivalent of proven reserves associated with the project,” said the US company, listed on the New York Stock Exchange.

Kosmos announced during the fourth quarter that the Orca-1 exploration well made a major gas discovery offshore Mauritania in the Bir Allah area. 

The company noted that Orca was the largest deepwater hydrocarbon discovery in 2019 and the results continue the 100 percent success rate from nine wells targeting the inboard gas trend in Mauritania and Senegal.

“It was a strong year for Kosmos with the business generating approximately $250 million of free cash flow, the third successive year of material organic cash generation,” said Chief Executive Andrew G. Inglis. 

“It was also one of the most active years in the company’s history with over 1.7 million man hours operating five wells,” added the CEO.

“Our exploration and appraisal program delivered five successes from seven wells drilled and we continue to make excellent progress with our developments in Mauritania and Senegal with Tortue Phase 1,” stated Inglis.

Kosmos has other oil and gas operations offshore the US Gulf of Mexico, as well as Ghana and Equatorial Guinea in West Africa.

Excluding Mauritania and Senegal, the company said it expected to spend around $325M to $375M in 2020.

In Mauritania and Senegal, total 2020 capital expenditure for Kosmos will be about 30 percent working interest, or around $250M, and is expected to be funded from proceeds from the previously announced and ongoing farm-down process, whereby a stake is being sold by Kosmos.

US energy engineering company KBR was awarded the preliminary front-end engineering contract by BP of the UK for the second and third phases of the Tortue natural gas project being pursued with Kosmos Energy of the US that will underpin floating LNG production on the maritime border between the West African nations of Senegal and Mauritania.

Kosmos Energy, the US partner of BP in the Mauritania-Senegal floating LNG projects, has completed its acquisition for more than $1.22 billion of Deep Gulf Energy as it keeps faith in the deepwater Gulf of Mexico as other operators retreat to the US onshore shale basins.

Kosmos, based in Dallas, said it purchased Deep Gulf Energy to expand its assets in the Atlantic Margin exploration area of the most distant parts of the Gulf that can have similar deepwater challenges to offshore West Africa.

“By acquiring DGE, Kosmos adds to its deepwater Atlantic Margin portfolio an established business with attractive assets and a strong record of growing production and reserves through infrastructure-led exploration,” said Kosmos.

“This immediately accretive acquisition enhances the scale of the company and is expected to generate significant free cash flow,” added Kosmos.

Houston, Texas-based DGE was founded in 2005. The company has drilled 20 wells, 16 of which have been completed. The company achieved its first production in 2007 and the acquisition would add around 25,000 barrels of oil equivalent per day of production for Kosmos.

Kosmos notes that while many competitors have been leaving the Gulf of Mexico to pursue onshore shale plays, their departures have created an opportunity to further open up the Gulf.

“The best deepwater assets can compete with the best of shale, and now is a good time to enter the Gulf of Mexico,” said Kosmos.

The completion of the DGE deal comes as Kosmos and BP are moving forward with contract awards for the Tortue-Ahmeyim natural gas project in the Atlantic Margin of Mauritania and Senegal that will underpin several FLNG ventures.

The Tortue-Ahmeyim project will produce gas from a deepwater subsea system and transfer it to an FLNG production facility at a nearshore hub located on the Mauritania and Senegal maritime border.

The FLNG facility for Phase 1 is expected to deliver about 2.5 million tonnes per annum of LNG on average.

The full project will target 10 MTPA of LNG output as well as making gas available for domestic use in both Mauritania and Senegal.

First gas from the African project is expected in the first half of 2022.

BP of the UK and Kosmos Energy of the US have decided to go ahead with their multi-billion dollars of investments in developing floating liquefied natural gas projects offshore West Africa with their state partners Mauritania and Senegal.

French energy major Total and the West African state of Mauritania have signed an agreement on two new exploration and production contracts near an area where natural gas has been discovered and is underpinning two floating LNG projects also involving Senegal.

Kosmos Energy, the partner of BP in two floating LNG projects offshore Senegal and Mauritania, said the front-end engineering and design for phase one was almost completed and the development plan had been submitted to both governments.