Saipem to Deliver Subsea Structures for Exxon's Most Expensive Offshore Oil Project in Guyana

Italian offshore energy services firm Saipem has received from ExxonMobil the authorization to proceed with the final phase of its contract related to the delivery of subsea systems for the Uaru oil field development project in Guyana.

In December 2022, pending regulatory approvals, Saipem was awarded a large contract by ExxonMobil Guyana for the Uaru oil field development project, located in the Stabroek block offshore Guyana at a water depth of around 2,000 meters. For Saipem, with reference to this specific contract, a "large" contract is defined as having a value between $500 million and approximately $1 billion.

The final phase of the awarded scope of work includes the design, fabrication and installation of subsea structures, risers, flowlines, and umbilicals for a large subsea production facility. Saipem will perform the operations using its flagship vessels, FDS2 and Saipem Constellation.  

The authorization to Saipem comes just days after ExxonMobil and its Stabroek block partners approved a $12.7 billion investment for Uaro, the fifth and most expensive offshore oil project in Guyana.

Under the terms of the original award communicated on December 15, 2022, Saipem had initiated some limited activities, such as detailed engineering and procurement.

Saipem was previously awarded four other subsea contracts by ExxonMobil Guyana for developments in the same area, namely Liza Phase 1 and 2, Payara, and Yellowtail.

ExxonMobil expects Uaru to add approximately 250,000 barrels of daily capacity after a targeted start-up in 2026.

Two FPSOs, the Liza Destiny and Liza Unity, are currently operating offshore Guyana and produced an average of 375,000 barrels of oil per day in the first quarter. A third FPSO, the Prosperity, is expected to be operational later in 2023, adding 220,000 barrels of daily capacity from the Payara development. 

ExxonMobil made a final investment decision on the fourth offshore project, Yellowtail, in 2022. 

ExxonMobil is targeting to have six FPSOs online by the end of 2027, bringing Guyana’s production capacity to more than 1.2 million barrels per day.

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