Williams is designing, building, and installing the Gulfstar 1 spar and associated pipelines as owner of the facility, which is being leased to Hess.
It has a production capacity of 60,000 barrels of crude per day and 200 million cubic feet per day of natural gas. It can also support seawater injection, according to Williams.
“We expect Gulfstar FPS to be capable of serving as a central host facility for other deep-water prospects in the area,” Williams says.
The manager of the Gulfstar development, Stafford Menard, says the construction phase remains on schedule.
The hull should leave the Gulf Marine Fabricators yard in Aransas Pass, Texas, around the end of the year with the topsides following from Gulf Island Fabrication in Houma, Louisiana, in early 2014.
The installation date depends on offshore contractor availability, Menard says.
Williams’ overall strategy is to provide large-scale energy infrastructure — pipelines and production facilities — to process and transport oil, natural gas and associated products. The proprietary Gulfstar design is the primary vehicle for accomplishing that strategy in the deep-water US Gulf.
However, building, owning and operating major pipelines is still big business for Williams.
This year it plans to lay a new 20-inch diameter, 215 mile-long pipeline called the Keathley Canyon Connector, which will transport more than 400 million cubic feet per day of natural gas from the Lucius field and other facilities to the existing Discovery 30-inch diameter gas transmission pipeline.
Keathley Canyon Connector is expected to go into service mid-2014.
“We seek to accomplish this through further developing our scale positions in current key markets and basins and entering new growth markets and basins where we can become the large-scale service provider,” Williams says.
Menard is already talking to operators about building Gulfstar 2, but he hesitates to reveal who he is talking to or where it might go.
However, it may not be long before another Gulfstar project is disclosed.
Williams — led by chief executive Alan Armstrong — envisages the spar, with the classic cylindrical hull and “traditional” three-level topsides to be a repeatable, standard design that can reduce the time from discovery to first oil.
It is “wet-tree” only, and can be built in just 30 months, according to Williams.
The deck can be installed in a single lift of 6600 tonnes, thereby reducing time spent on offshore hook-up and commissioning.
Gulfstar can also be moored in water depths as deep as 8500 feet. Williams is financing the construction along with advance payments from its producer customers including the operator, Hess.
The company estimates the remaining construction cost to be less than $475 million.
If Hess were to decide not to proceed with development of Tubular Bells, it would be liable for the entire price of building the spar.
Last January, Williams agreed to sell a 49% ownership interest in the Gulfstar FPS project to an unnamed third party.
That transaction, which is expected to close this quarter, will result in $225 million to fund its newly acquired share of the project costs, “following with monthly contributions to fund its share of ongoing construction”, Williams says.
