BW Offshore announced it has signed a contract with Santos Ltd. for the supply of a FPSO for the Barossa gas field 300 kilometres offshore Darwin in Australia. The contract is subject to Final Investment Decision (FID) by Santos and its partners.
The Lease and Operate contract has a firm period of 15 years, with 10 years of options. The firm period contract value is USD 4.6 billion. BW Offshore will be responsible for engineering, procurement, construction, installation, and operation of the FPSO.
The unit will be a large FPSO with processing capacity for up to 800 million standard cubic feet per day (MMSCFD) of gas and design capacity of 11,000 barrels per day of stabilised condensate. The FPSO will be turret moored with a new built hull based on BW Offshore’s RapidFramework® design. The topside weight is approximately 35,000 tons. Initial gas production from the FPSO is expected during the first half of 2025.
“This award confirms our ability to leverage extensive operational and development capabilities to win and execute offshore energy transition related projects. The Barossa FPSO represents a new type of infrastructure-like contract for BW Offshore with attractive long-term returns, supported by strong partnerships with equity co-investors and banks,” said Marco Beenen, the CEO of BW Offshore.
The project capex of around USD 2 billion will be financed by banks and equity partners, in combination with BW Offshore, as well as approximately USD 1 billion in total advance lease payments during the construction period.
A syndicate of international project finance banks will provide 14-year debt financing during both construction and operation. BW Offshore and international infrastructure equity partners will contribute 51% and 49% of the project equity respectively. Both the debt and equity agreements are well advanced.