McDermott and BHGE Join Australia Gas Project

McDermott and BHGE Join Australia Gas Project
McDermott and BHGE have struck a deal with Western Gas to be the exclusive development partners for the Equus Gas Project.

McDermott International, Inc and Baker Hughes, a GE company (BHGE) have signed a memorandum of understanding (MOU) with Western Gas Corp. Pty Ltd to be the exclusive development partners for the Equus Gas Project in Western Australia, McDermott reported Wednesday.

Also, Western Gas awarded McDermott and BHGE a contract to support the project’s planning phases. McDermott did not specify the contract amount but classified its portion as “sizable” – meaning between $1 million and $50 million.

“This project underscores the value of McDermott’s vertically integrated capabilities and our collaboration with BHGE, who will leverage their broad portfolio to support the project,” Ian Prescott, McDermott’s senior vice president for Asia Pacific, said in a written statement emailed to Rigzone.

Located approximately 124 miles (200 kilometers) offshore Western Australia, the Equus Gas Project comprises 11 natural gas and condensate fields in the Carnarvon Basin, according to Western Gas’ website. The company, which acquired the project from Hess Corp, in November 2017, stated that the fields hold an independently certified resource of more than 2 trillion cubic feet (Tcf) of gas and 42 million barrels of condensate.

Western Gas also noted that it will expand upon the exploration, appraisal and engineering activities that Hess undertook, which included:

  • Drilling 17 exploration wells resulting in 15 discoveries
  • Drilling and testing four appraisal wells
  • Acquiring more than 9,000 square kilometers of 3D seismic data

In addition, Western Gas has stated that five wells have been drilled and suspended for production. In its statement Wednesday, McDermott also noted that the Equus gas fields’ water depth ranges from 3,280 feet (1,000 meters) to 3,937 feet (1,200 meters) with an anticipated downstream nearshore liquefied natural gas (LNG) facility and pipeline connection to the Western Australia gas market.

Under the contract, McDermott and BHGE will collaborate with Western Gas to advance the pre-front engineering design (pre-FEED) and FEED to final investment decision (FID), McDermott stated. The McDermott-BHGE joint venture (JV) io Oil & Gas Consulting will launch pre-FEED work immediately and anticipates concluding that phase by second quarter 2019, the company added. The JV would subsequently continue with FEED work.

Pending a positive FID, McDermott and BHGE expect to take on the engineering, procurement, construction, installation and commissioning (EPCIC) of the entire Equus field development scope under a separate contract, McDermott stated. The company pointed out that contract would include:

  • Reservoir evaluation
  • Drilling and completions
  • Subsea
  • Production facilities
  • An export pipeline
  • An LNG facility
  • A domestic gas connection facility

“In close collaboration with BHGE, we are taking a holistic approach to field development from drilling, subsea, production facilities and an export pipeline to an LNG facility and onshore gas connection,” said Prescott. “By more closely connecting each stage of the project, we aim to drive significant efficiencies and cost savings for Western Gas through the full life of the field.”

“It was important to us to engage with partners that could offer a full field development and execution solution that would help deliver an efficient development plan, enhance project economics and reduce time to first gas,” Western Gas Executive Director Andrew Leibovitch said. “BHGE and McDermott bring a wealth of global expertise, products and services to help drive efficiencies across the life of the field.”



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