Samsung Heavy Industries (SHI) and arch rival Hyundai Heavy Industries (HHI) are in the final showdown for the multi-billion dollar prize of engineering and building the giant Floating Production, Storage and Offloading (FPSO) vessel planned for one of Shell’s flagship deepwater West African fields.

DI hears that commercial bid documents have been received by the South Korean rivals for the operator’s Bonga South West-Aparo project spanning Blocks 118, 132 and 140 offshore Nigeria. The 225,000 b/d FPSO is one of the first major deepwater project awards up for grabs in 2015, with Shell understood to be planning to make a decision on the winner – and take the Final Investment Decision on the field – before the end of the first quarter of 2015.

The Bonga SW-Aparo development will involve capital expenditure estimated at up to US $12 billion, with the FPSO to be one of the largest ever built. Despite the industry’s ongoing concerns over a lower oil price and high costs generally, DI hears that Shell wants to stick with its long-term view on West Africa and move ahead – albeit cautiously – with the development in order to stay on target with its own internal production growth goals.

DI understands that Samsung remains in pole position for the job, especially as it built the original 200,000 b/d Bonga field FPSO (onstream since 2005), and earlier in 2014 also clinched another major FPSO job – Total’s giant Egina floating production system, also offshore Nigeria. But sources indicate HHI is bidding very aggressively on this project.

The single point moored facility itself will be able to store 2.5 MMbbl of oil, process 225,000 b/d of oil, 270 MMcf/d of gas and handle 400,000 b/d of water injection. First oil is planned for 2020. Integration work on the floater is expected to be carried out at Ladol’s facilities in Lagos port, with the Nigerian government demanding a high level of local content.

Also still up for grabs is the SURF (Subsea Umbilicals, Risers and Flowlines) package, which covers the engineering, procurement, construction, transport and installation of flowlines, risers and pipelines (85 km of pipe-in-pipe, 65 km of umbilicals and 98 km gas export pipeline). Bonga SW-Aparo will have a 44-well (22 producers, 22 injectors) subsea production system feeding oil and gas to the newbuild floater.

Technical EPC bids were submitted earlier in 2014 in order to clarify and approve issues such as the proposed level of local content, before the operator then filtered down the bid list to the final two for the commercial tender phase.

Shell’s partners in Bonga are ExxonMobil (20%), Total (12.5%) and Eni (12.5%). Shell holds 55% as oper­ator.

Bonga SW itself was discovered in 2001 and is estimated to hold 820 MMbbl of recoverable oil reserves, while in 2004 Bonga North was discovered in block 140.

In August Shell also began production from its Bonga North-West satellite field to the Bonga FPSO, with the satellite expected to hit peak production of approximately 40,000 boe/d via six wells (four producers, two injectors).

DI has also previously reported that Shell has plans on the drawing board for a third FPSO to be sited on the 525 MMbbl Bonga North (see DI, 21 April 2014, page 1) field. Jerry Jackson, Shell’s general manager for deepwater Nigeria, confirmed at the MCE DD event that the company was considering a “possible concept” for a standalone FPSO for Bonga North in OML 118. That facility would sit in 1,100 m (3,608 ft) of water, with the aim of producing the field via up to about 29 subsea wells.

However with the industry’s current belt-tightening since then, little further news on that option has emerged, with any decision likely to be delayed until conditions approve. The operator is also likely to further examine cost-efficiencies that can be brought about by increased standardization and replication, as well as lower-cost phased options including an alternative subsea tieback option for Bonga North to the Bonga SW-Aparo FPSO.

Offshore