Woodside increases Sangomar development cost, moves first-oil to 2024

Woodside has increased the cost of its initial Sangomar development project and moved the date of expected first oil from the field offshore Senegal after identifying remedial work required on the project’s floating production, storage, and offloading (FPSO) vessel.

First oil for Sangomar Field Development Phase 1 has moved to mid-2024, the company said in a July 18 release. Production was previously expected to begin later this year. Project costs have increased 7-13% to $4.9-5.2 billion from the previous estimate of $4.6 billion.

Safe completion of activities is the team’s priority, said Woodside chief executive officer Meg O'Neill, and conducting the unexpected remedial work at the shipyard in Singapore “minimizes the impact to the project schedule as it is safer, more efficient, and more cost effective” than undertaking the work offshore Senegal.

As of June 30, the overall project was 88% complete. The subsea installation campaign was 76% complete, with the subsea work scope 95% complete. Development drilling continues with 12 of 23 wells drilled and completed. The Ocean BlackHawk drillship completed its work scope in July. Remaining drilling activity will be completed by the Ocean BlackRhino. Well results to date have confirmed the quality of the resource, the company said.

Sangomar oil and gas field lies 100 km south of Dakar and will be Senegal’s first offshore oil development. Development work began in early 2020. The 400 sq-km field lies in water depths of 700-1,400 m. First-phase development will target about 230 million bbl of oil.

The Léopold Sédar Senghor FPSO is expected to have production capacity of about 100,000 b/d of crude oil. Construction is comprised of conversion of a very large crude carrier oil tanker and fabrication of the topsides, turret and mooring systems. MODEC International is the lead contractor for the FPSO. Conversion and construction activities begin in first-half 2021 in China. The FPSO was moved in November 2022 to the Keppel Shipyard in Singapore to complete topside integration and commissioning scope.

Following production start, a ramp up of operations is expected to continue as planned, and the start-up schedule change will have no impact on the operator’s 2023 production guidance, O’Neill continued.

Woodside operates the Sangomar exploitation development area with 82% interest. Petrosen holds the remaining 18%.