FPSO’s sail-away to Australia’s offshore gas project on the agenda for next year

Australia’s energy giant Santos is on track to achieve the first gas next year from its project in Commonwealth waters, as a floating production storage and offloading (FPSO) vessel, which is currently still under construction, is slated to move to its giant field off the coast of Australia in the first quarter of 2025.

While BW Offshore won a contract in March 2021 for the construction, connection, and operation of an FPSO destined for the Barossa field, which is located 300 kilometers off the coast of Darwin, the final investment decision (FID) for the project was taken days after the award, kick-starting a $600 million investment in the Darwin LNG life extension and pipeline tie-in projects. Afterward, Dyna-Mac got tapped by BW Offshore to build the topside modules.

The Australian development project entails an FPSO unit, subsea production wells, supporting subsea infrastructure, and a gas export pipeline tied into the existing Bayu-Undan to Darwin LNG pipeline to extend the facility life for around 20 years. The Barossa project is a joint venture between Santos (50%), SK E&S (32.5%), and JERA (12.5%). 

BW Offshore disclosed a $1.15 billion project debt financing in September 2021 for the construction and operation of the unit, known as the FPSO BW Opal, which will handle natural gas production at the Barossa field, thanks to the 4.6 billion, 15-year FPSO contract, with additional ten-year extension options. The first shipboard turret module was integrated into the hull on February 4, 2024. 

According to Santos, the FPSO is on track to head to Australia in the first quarter of 2025, as it is currently 86% complete with all 16 modules loaded and installed onto the hull in Singapore. The vessel has moved to the commissioning yard and activities are now underway. The Barossa gas project is nearing the 80% completion mark with the first gas due in the third quarter of 2025.

The FPSO BW Opal is a large vessel with a processing capacity of up to 900 million standard cubic feet per day (mmscfd) of gas and a design capacity of 11,000 barrels per day of stabilized condensate. The Gas Export Pipeline (GEP) that will deliver gas from the field to Darwin LNG is complete. In addition, construction activities for the Darwin Pipeline Duplication are underway.

Furthermore, the drilling and subsurface scope of work is around 45% done. The first well has been drilled and completed with clean-up flow also conducted, thus, well finalization work is in progress with CO2 levels at the low end of the expected range.

The second well has also been drilled and suspended above the reservoir to allow for simultaneous subsea umbilicals, risers, and flowlines (SURF) operations. With the third well drilled and completed as well, the clean-up flow has been conducted. Santos claims that the reservoir quality is excellent, on prognosis with pre-drill expectations and the well test indicates deliverability.

The SURF program is 75% complete and the FPSO buoy was installed in June 2024. The Australian player explains that all six infield subsea flowlines have been installed and testing activities are ongoing. The Barossa project is estimated to contain P50 reserves of 5.1 Tscf gas and 50 MMstb of condensate.

Kevin Gallagher, Santos’ Managing Director and Chief Executive Officer, highlighted: “We’re excited with our progress and the outlook at Barossa with initial results from the third well showing excellent reservoir quality and thickness. At full production rates, Barossa is expected to add around 1.8 mtpa to Santos’ expanding LNG portfolio.”