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ExxonMobil, Chevron, Suncor, Statoil and Nalcor go for Canada Hebron

ExxonMobil and partners to invest $14 billion by 2017

ExxonMobil, Chevron, Suncor Energy (Suncor), Statoil and Nalcor Energy Oil and Gas (Nalcor) made the final investment decision (FID) to develop the Hebron offshore oil field project in Canada.

The Hebron oil field is located offshore the Newfoundland and Labrador on Canada East Coast, in the Jeanne d’Arc Basin.

Discovered in 1980 on the Canadian Continental Shelf by 90 meters water depth, Hebron is 350 kilometers southeast far from St.john capital and 32 kilometers southeast close from ExxonMobil Hibernia project.

After revising up the estimations, ExxonMobil and its partner expects to extract more than 700 million barrels of oil from Hebron.

The Governments of Canada, Newfoundland and Labrador gave their formal approval in May 2012.

In Hebron, ExxonMobil and its partners hare the working interests as following:

 – ExxonMobil 36% is the operator

 – Chevron 26.7%

 – Suncor 22.7%

 – Statoil 9.7%

 – Nalcor 4.9%

To develop Hebron, ExxonMobil and its partners are planning to invest $14 billion capital expenditure until 2017 including offshore surveys, engineering, procurement, fabrication, construction, installation, commissioning, development drilling, production, operations and maintenance and decommissioning.

The offshore platform is designed to produce 150,000 b/d of oil.

Using its experience in Arctic exploration and production, ExxonMobil opted for a design capable to withstand sea ice, iceberg and the harsh environment of that region.

In that purpose, Hebron platform is based on a stand-alone gravity structure made of reinforced concrete.

This concrete structure will contain a reservoir of 1.2 million barrels of crude oil storage capacity and support a deck for the topsides including:

 – Drilling equipment 

 – Processing facilities

 – Living quarter

Among the critical equipment, the derrick module caused delay on Hebron final investment decision because of the location where it should be manufactured.

Finally ExxonMobil paid $152 million to the Newfoundland province as a compensation to wave local content obligations on this equipment in order to save time and costs for the whole project.

The concrete gravity-based structure is already in construction in Bull Arm, Newfoundland and Labrador.

The topsides will also be substantially engineered and manufactured in Newfoundland and Labrador to be integrated on the Bull Arm site.

In total, ExxonMobil Hebron project should generate $21 billion revenues to the province in 30 years.

WorleyParsons and Kiewit-Kvaerner to take Hebron topsides and gravity-based structure packages

In September 2010, ExxonMobil awarded the front end engineering and design (FEED) contract for the topsides package to WorleyParsons with the option to convert it into detailed engineering, procurement and construction management (EPCM).

WorleyParsons completed the FEED work in 2011.

In April 2012, ExxonMobil converted the FEED contract for the topsides into engineering, procurement and construction (EPC).

In addition WorleyParsons has been appointed as project management consultant for the whole project.

In parallel the FEED contract for the gravity based structure had been awarded to Kiewit-Kvaerner Contractors (KKC), a 50/50 joint venture between Peter Kiewit Infrastructure (Kiewit) and Kvaerner.

In April 2012, ExxonMobil authorized the Kiewit-Kvaerner joint venture to proceed to first phase of the engineering, procurement and construction management (EPCM) contract on the gravity-based structure.

The Kiewit-Kvaerner Contrators use for Hebron their experience developed for the previous Hibernia gravity based structure.

In selecting WorleyParsons and Kiewit-Kvaerner as key contractors for the Hebron main packages, ExxonMobil and its partners Chevron, Suncor, Statoil and Nalcor give priority to sub-Arctic experienced companies with high local content capabilities in the Newfoundlan and Labrador Province.

For more information and data about oil and gas and petrochemical projects go to Project Smart Explorer

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