Woodside Awards Scarborough Contracts
Australia’s Woodside has awarded four contracts for front-end engineering design (Feed) activities for the proposed Scarborough project without any financial support from its joint venture partner BHP.
Each contract was awarded by Woodside in its corporate capacity as a Scarborough titleholder and will be funded initially by Woodside on a 100% basis, it said January 16. Woodside hold 75% in the project while BHP owns the remaining 25%.
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The contracts are for engineering activities related to the upstream development’s floating production unit, the export trunkline and the subsea umbilical risers and flowlines, Woodside said. Each contract includes an option to progress to execute phase activities, which is subject to, among other conditions, a positive final investment decision (FID) being taken on the project by the Scarborough joint venture.
McDermott Australia has been awarded a contract to undertake engineering studies for the floating production unit, which includes the option to progress to an engineering, procurement and construction (EPC) contract for execute phase activities.
Subsea Integration Alliance, a consortium between OneSubsea Australia and Subsea 7 Australia Contracting, has been awarded a contract to undertake engineering studies for the subsea umbilical risers and flowlines, with the option to progress to an engineering, procurement, construction and installation contract for execute phase activities.
Saipem Australia has been awarded a contract to provide export trunkline engineering support services with an option to execute line pipe coating and installation activities; while Intecsea has been awarded a contract for export trunkline engineering.
Woodside CEO Peter Coleman said the award of these contracts would support the project schedule and Woodside’s targeted FID for the Scarborough project next year. “We have made good progress since announcing last year that we had increased our stake in Scarborough. The award of these contracts brings us closer to unlocking the Scarborough resource.”
Early last year, Woodside entered into a sale and purchase agreement with ExxonMobil to take its 50% interest in the project, hiking its stake to 75%.
“We want to continue to maintain the momentum that has been generated during 2018 towards a targeted final investment decision in 2020,” he added.
Woodside’s preferred concept for development of the 7.3 trillion ft3 Scarborough gas resource is through new offshore facilities connected by a 430-km export pipeline to the Burrup Peninsula with onshore processing at the expanded Pluto LNG facility in Western Australia.
Woodside is proposing a brownfield expansion of the Pluto LNG facility, including construction of a second LNG train with a targeted capacity of 5mn mt/yr, to facilitate development of the Scarborough gas resource. Woodside said in March 2018 it plans to develop the Scarborough gasfield through its Pluto LNG onshore facility.
Woodside has granted joint venture partner BHP the option of purchasing an additional 10% interest in Scarborough on equivalent consideration and terms to the transaction with ExxonMobil. BHP has until December 2019 to decide.