Offshore oil and gas giants extended agreements signed this year for exploratory fields until February 2023
Shell company, UK-based giant, and its partners have extended limited notice period (LNTP) with BW Offshore and Saipem, covering early-stage engineering and vendor bookings for the delivery of an FPSO targeting an oil field and offshore gas in Brazil.
BW Offshore announced the extension of the LNTP related to the supply of an FPSO for the Gato do Mato oil and gas field, on Thursday the 10th. This follows the LNTP concession, valued at up to US$50 million, in May 2022 and the extension is valid until February 15, 2023.
Upon completion of the extension period, a consortium comprising BW Offshore and Saipem (Shell not included) has the option of receiving the lease and operating agreement, depending on funding and the project reaching a final investment decision (FID) .
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HOW IS AN FPSO?
What is provided for in the contract?
As stated by the BW Offshore, this consortium signed with Shell will be responsible for the engineering, acquisition, construction and installation (EPCI) of the FPSO with delivery expected in 2026. If this pre-salt development project reaches the FID and moves forward, the FPSO lease and operation will have a term term of 18 years with seven years of options.
Located in the Santos Basin, approximately 200 km from the Brazilian coast, in a water depth of around 2.000 meters, the Gato do Mato oil exploration project is a pre-salt gas-condensate discovery that covers two blocks neighbors: BM-S-54 and South of Gato do Mato.
After Shell handing over a 30% stake in its Gato do Mato project to Colombia's Ecopetrol, the oil company has a 50% stake in this project, while TotalEnergies owns the remaining 20%.
In relation to BW Offshore and Shell's activities elsewhere, it is worth noting that the oil exploration FPSO operator has recently secured a short-term contract extension for an FPSO operating offshore Nigerian waters.