Page 10 - NorthAmOil Week 20 2022

NorthAmOil INVESTMENT NorthAmOil

Chevron sanctions Ballymore

project in deepwater Gulf

GULF OF MEXICO CHEVRON announced on May 17 that it had in the project, with France’s TotalEnergies hold-
taken a final investment decision (FID) on the ing the remaining 40% stake.
Ballymore project in the US Gulf of Mexico. Brining the project online is anticipated to
The project has a design capacity of 75,000 cost $1.6bn and first oil is expected in 2025.
barrels per day (bpd) of oil and will be developed Chevron also talked up the project’s emis-
as a subsea tieback to Chevron’s Blind Faith plat- sions profile and cost-saving features in its
form, the super-major said. Ballymore will con- announcement.
Ballymore will be tied sist of three production wells tied back to Blind “Chevron’s US Gulf of Mexico production is
back to Chevron’s Blind Faith via one 3-mile (4.8-km) flowline. The wells some of the lowest carbon intensity production
Faith platform. will be drilled in the Mississippi Canyon area, in in our portfolio at around 6 kg CO2 equivalent
water depths of around 6,600 feet (2,000 metres). per barrel of oil equivalent and is a fraction of the
Ballymore will be Chevron’s first develop- global industry average,” stated Chevron’s pres-
ment in the Norphlet trend. It has previously ident of North America exploration and pro-
been reported that there were unique challenges duction, Steve Green. “The project is designed
associated with designing a subsea production to lower development costs by using a subsea
system for the high pressures and temperatures tieback approach, standardised equipment and
and unique fluid properties associated with the repeatable engineering solutions – leveraging
Norphlet trend and tying it back to an existing existing operated infrastructure.”
Miocene-based production facility. In a separate statement, TotalEnergies said
The asset, which was discovered four years that thanks to the tieback development concept,
ago, is estimated to contain more than 150mn the FID fitted with its strategy of focusing on oil
barrels of oil equivalent (boe) of recoverable projects that have both low breakeven prices and
reserves. Chevron owns a 60% operating interest low emissions.™

Diamondback to acquire remaining

publicly owned Rattler units

PERMIAN BASIN US independent Diamondback Energy has Rattler is a Delaware limited partnership that
struck a deal to acquire all of the publicly held Diamondback formed in mid-2018 to acquire,
common units in Rattler Midstream that it does operate and develop midstream and energy-re-
not own already. lated infrastructure assets in the Permian Basin,
The all-stock transaction will see each public where its upstream operations are also located.
unitholder of Rattler receive 0.113 of a share of Diamondback took Rattler public in 2019, but is
common stock in Diamondback in exchange for now responding to different market conditions
each Rattler common unit owned. According to as it prepares to roll up the company.
the announcement, this exchange ratio implies “The energy landscape has transformed dra-
a premium of 17.3% for Rattler common units matically since Rattler was taken public in 2019,
based on the closing prices of both companies’ and we believe this agreement to merge compa-
stock as of May 13. It also represents a premium nies is in the best interests of both Diamondback
of 9.3% based on Rattler and Diamondback’s and Rattler stakeholders,” stated Travis Stice,
30-day volume-weighted average trading price CEO of Diamondback and of the general partner
as of the same date. of Rattler. “This merger will allow both compa-
Based on the closing share prices that day, the nies to benefit from the simplicity and scale of
transaction is estimated to be worth $575.2bn, the combined entity going forward.”
and it values Rattler at around $2.2bn. The agreement has been approved by both
Diamondback already owns 74% of the the board of directors of Rattler’s general part-
roughly 145.96mn units outstanding for Rat- ner and by Diamondback E&P, the subsidiary
tler, leaving a balance of 38.1mn common units, that holds the majority of the Rattler units. The
according to a note by Tudor, Pickering, Holt & transaction is anticipated to close in the third
Co. (TPH). quarter of 2022.™

P10 www. NEWSBASE .com Week 20 19•May•2022