Murphy Oil acquires GoM FPSO, notes $60-million/year operating cost reduction
A Murphy Oil Corp. subsidiary has signed a deal to acquire the BW Pioneer floating production storage and offloading vessel (FPSO) from BW Offshore for $125 million.
The FPSO will remain at its current location in the Gulf of Mexico supporting operations at Cascade field (Walker Ridge 206 and 250, Murphy-operated 80%) and Chinook field (Walker Ridge 469 and 425, Murphy-operated, 86%).
BW Offshore will continue to provide operations and maintenance services under a new 5-year reimbursable contract.
The BW Pioneer has been in service since its conversion in 2009 at Keppel Shipyard. The vessel has a storage capacity of about 600,000 b/d of oil and processing capacity of about 80,000 b/d.
By acquiring the FPSO and restructuring the contract, Murphy Oil expects to achieve a $60-million/year reduction in operating costs “with a payback of about 2 years independent of oil price, while enhancing returns for future infield development and exploration and increasing net proved developed reserves by approximately 8 million barrels of oil equivalent,” said Eric M. Hambly, Murphy Oil president and chief executive officer.
Hambly said the FPSO’s location “in the prolific Wilcox trend” allows for “operated and non-operated exploration prospects to tie back to a cost-advantaged facility.”
The purchase price was included in the company’s 2025 capital expenditure guidance of $1.135-1.285 billion. First quarter capex of $425 million is expected.
For full-year 2025, Murphy Oil has allocated about $410 million of its 2025 capex budget to the Gulf of Mexico for operated and non-operated development drilling and field development projects.
