Floater plans: Nexus boss Ian Tchacos
Start gun fires in Crux floater race
The race is under way for major contracts for the A$480 million (US$375 million) Crux gas and condensate project off north-west Australia, including a leased floating production, storage and offloading vessel.
Project operator Nexus Energy has issued a pre-qualification document to a host of FPSO providers, inlcuding SBM Offshore, Modec, Prosafe, Tanker Pacific, Teekay and Vanguard Oil & Gas.
Another player that sources believe may also be on the list is Melbourne-based operations specialist Upstream Petroleum, which was acquired this month by Norway's AGR Group.
Several other companies such as Fred Olsen Energy and Nortechs FPSO have also shown an interest in the floater.
Nexus will issue an invitation to tender next week and bids will be due in the middle of March, sources said.
Talks are also under way between Nexus and the suppliers of long-lead subsea items and the turret mooring system.
Three production wells and three gas injection wells are required. Selection of the mooring type was a complex issue, said sources.
SBM Offshore, Sofec (Modec) and possibly Bluewater have been talking to Nexus about the merits of external and internal turrets, with the operator thought to be moving toward a permanently moored FPSO.
The field development plan for Crux involves a gas recycling scheme with about 960 million cubic feet per day being produced through the three wells.
More than 25,000 barrels per day of condensate would be stripped from the gas, which would be compressed and re-injected into the Crux reservoir through the three injection wells.
Production and compression equipment will be located on the deck of the Aframax-size FPSO, and sources said the volumes of gas being handled and reinjected would be a technical challenge. Nexus has previously looked at Twister gas processing technology and two gas re-injection compression trains.
Sources said there were uncertainties about which companies would bid for Crux, given Nexus' inexperience as a field operator and its potential financial constraints.
Nexus sprung to prominence in Australia in 2005 following its acquisition of the Crux field for A$12 million.
The company has no existing oil and gas production, but is pushing ahead with the Longtom gas project in Australia in tandem with Crux. It has a 100% stake in both projects.
A farm-in agreement between Nexus and Petrofac fell through in October 2006, leaving the Australian to go it alone.
Its managing director Ian Tchacos has sold the Crux gas reserves to Shell for US$40 million.
That sale, combined with the success of the recent Longtom-3 appraisal well, and the availability of a A$30 million bridge finance facility with BOS International, gave Nexus the ability to fund the next stage of the Crux liquids project, said Tchacos.
Nexus' best estimates of the Crux field's contingent resources are 71 million barrels of condensate and 2 trillion cubic feet of gas, based mainly on the Crux-1 discovery well.
The semi-submersible drilling rig Songa Venus is currently drilling the Crux-2 appraisal well.
The field lies in Block AC/P23 in the Browse basin, which also contains the Echuca Shoals gas discovery. Crux was discovered in 2000 by Nippon Oil, but the Japanese company sold it to privately owned Mogal Marine, which then sold the 100% stake to Nexus.