Giant subsea scheme offers contract bonanza

Development: Anadarko chief executive James Hackett.

ANADARKO Petroleum is set to use a massive subsea system to develop its giant Prosperidade gas project off Mozambique, with subsea players lining up to battle for a potential $3 billion contract covering umbilicals, flowlines and pipelines.

Subsea tree providers are also jostling for position to secure a possible $800 million contract covering 30 to 35 production wells, with about the same number in future phases.

In a major blow for floater contractors, industry sources said the US operator does not need a floating production system for Prosperidade’s initial phase — and it could be another 10 years before a surface vessel is required.

Gas from an initial 30 to 35 subsea production wells will be fed to an initial two-train liquefaction plant in Cabo Delgado province, a project set to involve supermajor Shell if its acquisition of Cove Energy succeeds.

Anadarko is pre-qualifying contractors for the UFP package and aims to launch a completive front-end engineering and design contest this July.

The exact FEED launch date may depend on the progress of Anadarko’s unitisation talks with Eni, operator of Area 4, into which Prosperidade extends.

The US player is evaluating prequalification documents, said sources, and will choose up to three bidders to take part in the design competition.

Project watchers said Saipem has linked up with Subsea 7 and JP Kenny and will have competition from a Technip/Genesis team, while Emas AMC is expected to be a sole bidder.

Sources suggested Heerema Marine Contractors, McDermott and Allseas could also be interested.

The FEED contest is expected to run for nine months or longer, at the end of which a proposal for a lump-sum installation package will be submitted.

After an evaluation period of up to three months, Anadarko is expected to arrive at its choice, before making a final investment decision.

Anadarko could possibly fast-track its final decision to secure construction vessels before they are contracted elsewhere.

“They’re going to pay all three (bidders) their FEED costs in developing the lump-sum price,” said one informed source. The lump-sum quote may be revised depending on what project execution methodology emerges.

One source said: “You’re talking a billion dollars at least,” while another said: “It’s a $3 billion job.”

IntecSea, which has significant experience with subsea-to-LNG projects off Egypt, is believed to be working directly for Anadarko as the owner’s engineering house and is likely to be influential in vetting FEED proposals, suggested one source.

As well as umbilicals and flowlines, a key element of the work scope will be a 45-kilometre, 20-inch gas export pipeline and its shore approach near the town of Palma.

The status of the bid process for the project’s subsea production systems is unclear, though the likes of FMC Technologies — which has a global frame agreement with Anadarko — Cameron, GE Vetco and Kvaerner are understood to be involved in meetings with the operator.

Also, on drillers’ radars, will be a development drilling contract worth up to $2 billion.

Sources were adamant there is no need for a floater during Prosperidade’s initial phase but a longer term requirement has not been discounted.

“They’re looking at possibly a floating facility going out in another 10 or 15 years.

“There’s enough reservoir pressure to drive the product to shore (initially).”

An Anadarko spokesman was more cautious: “A determination has not been made as to whether or not a floating production platform will be constructed with the initial development. Evaluations are still under way to determine the most optimal way to develop these resources both subsea and at the surface.”

Prosperidade the jewel in Shell deal to buy Cove: Page 108


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