Page 6 - NorthAmOil Week 34 2021

NorthAmOil COMMENTARY NorthAmOil

Beacon sanctions Shenandoah

project in deepwater Gulf

Beacon Energy Offshore has made a final investment decision on the

Shenandoah project in the deepwater US Gulf of Mexico

GULF OF MEXICO BEACON Energy Offshore has made a final Shenandoah is located 160 miles (257 km) off
investment decision (FID) on the Shenandoah the coast of Louisiana in the Walker Ridge area
WHAT: project in the deepwater US Gulf of Mexico, it of the Gulf. It is part of the Paleogene – or Lower
Beacon has sanctioned emerged this week. Tertiary – trend, which has contributed some
the Shenandoah project The news follows a series of announcements giant Gulf discoveries, especially in the early
in the deepwater US Gulf relating to the project in recent weeks. In June, part of the past decade.
of Mexico. Williams secured a contract for gas-gathering The Paleogene is characterised by ultra-deep
and transportation, as well as onshore process- waters and reservoirs, as well as extreme tem-
WHY: ing, for Shenandoah via the Discovery pipeline peratures and pressures. In addition, explora-
The decision comes as system. Then in early August, Hyundai Heavy tion of the trend required major technological
Gulf operators become Industries secured a $577mn order to build a advances in seismic imaging, to allow operators
increasingly confident floating production system (FPS) for the pro- to identify subsalt oil and gas reservoirs.
about developing new ject. The semi-submersible FPS will have the While the play’s potential is significant, the
projects. capacity to produce 100,000 barrels per day technical challenges involved in exploration
(bpd) of oil. and production meant that its development
WHAT NEXT: This week, Transocean announced that it had had been limited even prior to the oil industry
More deepwater projects, been awarded a $252mn contract for its new- downturn that began in 2014. Following the
including other ultra- build ultra-deepwater Deepwater Atlas drill- downturn, it seemed even less likely that more
high-pressure ones, ship. The company said the contract award had Paleogene discoveries would be developed any-
could move forward in stemmed from the FID on Shenandoah. time soon, as operators backed away from major
the near future. Beacon itself did not make any announce- new deepwater projects and focused instead on
ments about the FID, but one of the Shenan- smaller, less complex subsea tiebacks.
doah partners, Navitas Petroleum, confirmed Now, though, things seem to be looking up
to media that an FID had been made. for the region once again. The Shenandoah
FID marks a continuation of high-pressure
Long road to FID offshore development, which began when
It has been a long road to FID for Shenandoah, Chevron sanctioned the Anchor project in the
which was discovered in 2009 by Anadarko Gulf in 2019. Anchor, which is due for start-up
Petroleum, and has since changed hands several in 2024, was the first high-pressure deepwater
times. Most recently, Beacon bought the oper- development to reach FID, requiring new tech-
ating 30.95% stake in the project from LLOG nology that is capable of handling pressures of
Exploration in 2020. 20,000 psi.

P6 www. NEWSBASE .com Week 34 26•August•2021