US Gulf project takes delivery of production unit

The refurbished offshore production platform for LLOG Exploration's Salamanca project in the US Gulf of Mexico has been delivered by a local shipyard.

The Salamanca project comprises the development of the Leon and Castile oilfields in the Wilcox play of the Keathley Canyon area.

It is due to start production in July 2025, according to joint venture partner Repsol's recent guidance.

The two fields will be connected to a refurbished floating production unit that was previously called Independence Hub, which LLOG purchased in 2022 from Genesis Energy for $40 million.

Keppel AmFels, the US subsidiary of Singapore's Seatrium, was then contracted to refurbish the old platform. Seatrium said on Monday it had delivered the floater to Salamanca FPS Infra.

Seatrium had previously guided that the Salamanca FPU would have a production capacity of 60,000 barrels per day of oil and 40 million cubic feet of gas per day.

Repsol indicated earlier this year that Salamanca is an important strategic asset. It would increase Repsol's presence in a core area, while establishing a production hub in the Wilcox play.

The project would open up a wide range of follow-up opportunities in both the exploration and infrastructure side.

It had an estimated breakeven price of less than $45 per barrel, and estimated cash flow from operations of 49 per boe. Net peak oil production to Repsol would be 20,000 boe per day.

Other contractors involved in the Salamanca project include InterMoor for the FPU mooring piles, Audubon for front-end engineering and design, Subsea7 for subsea production equipment, and Seadrill for drilling services.

LLOG, the privately-owned operator, currently has two drillships on hire in the Gulf - Seadrill's West Neptune and Noble Drilling's Noble Valiant.