Saipem moving forward with ExxonMobil’s sixth oil development offshore Guyana

Italy’s engineering, drilling, and construction services provider Saipem has been given the go-ahead by ExxonMobil Guyana Limited, a subsidiary of the U.S.-headquartered energy giant ExxonMobil, to proceed with work on the sixth oil development at the Stabroek block off the coast of Guyana.

The Italian player was hired in November 2023 to handle the design, fabrication, and installation of subsea structures, risers, flowlines, and umbilicals destined for a large subsea production facility on the Whiptail oilfield development. This is ExxonMobil’s sixth project in the Stabroek block offshore Guyana located at a water depth of approximately 2,000 meters. After securing regulatory approvals, ExxonMobil made a final investment decision (FID) to develop the project at the end of last week.

Following the FID, ExxonMobil Guyana Limited and its Stabroek block coventurers authorized Saipem to proceed with the execution of the Whiptail oilfield development project. The company’s scope of work encompasses detailed engineering, procurement, construction, and installation (EPCI) of a subsea production facility. The contract’s value is estimated to be between $750 million and $1.5 billion. 

The Italian heavyweight has already started initial activities, including the detailed engineering and procurement of the long lead items, and will now be able to proceed with the execution of the remaining project activities. Saipem’s FDS2, Castorone, and Constellation vessels will be used for the offshore installation activities.

The firm will deploy its Guyana Offshore Construction Facility, located at the Port of Georgetown, and an additional local fabrication facility, for the on-site construction of part of the submarine items. Saipem describes this as proof of its continued commitment to sustainable growth in the country. 

The Whiptail project entails the development of the Whiptail, Pinktail, and Tilapia fields, along with potential additional resources, should they be feasible and economically viable. The development concept for the project covers drilling operations via drillships to produce oil from around 40 to 65 production and injection wells. With an expected field life of at least twenty years, the project is slated to be brought on stream in 2027.

SBM Offshore is in charge of front end engineering and design (FEED) work for the FPSO Jaguar, which will work on the Whiptail project. This vessel will be the fifth FPSO built by the Dutch player for operations in Guyana. With a production capacity of 250,000 barrels of oil per day, the FPSO will have an associated gas treatment capacity of 540 million cubic feet per day and a water injection capacity of 300,000 barrels per day.

Saipem previously won deals for ExxonMobil’s five other projects in Guyana: Liza Phase 1 and Phase 2, Payara, Yellowtail, and Uaru. The Stabroek block, which covers 6.6 million acres or 26,800 square kilometers, is operated by ExxonMobil with a 45% interest while the company’s partners in the block are Hess Guyana Exploration (30%) and CNOOC Petroleum Guyana (25%).

Saipem has been busy with work lately. Recently, the firm finished its assignment on a Greek LNG project and made progress with the shipment of the first three topsides for another LNG project off the northeast coast of Qatar.