HOUSTON, Dec. 12, 2018 /PRNewswire/ -- McDermott
International, Inc. (NYSE: MDR) today announced they, with Baker
Hughes, a GE company, have signed a memorandum of understanding
(MOU) with Western Gas Corporation Pty Ltd to be the exclusive
development partners for the Equus Gas Project in Western Australia. The companies were also
awarded a contract to support the planning phases of the
project.
As part of this initial contract, McDermott and BHGE will work
with Western Gas to advance the pre-front end engineering design
(pre-FEED) and front-end engineering design (FEED) to final
investment decision (FID). McDermott and BHGE's joint venture, io
Oil & Gas Consulting, will provide the pre-FEED support to
deliver a technically robust and cost-efficient development plan.
McDermott's portion of the contract is classified as sizable*.
Pre-FEED work will commence immediately and is estimated to be
complete by Q2 2019. McDermott and BHGE will continue with FEED
work thereafter.
Upon FID, McDermott and BHGE are expected to undertake the
engineering, procurement, construction, installation and
commissioning (EPCIC) of the entire field development scope under a
separate contract. The scope will cover reservoir evaluation,
drilling and completions, subsea, production facilities, an export
pipeline, an LNG facility and a domestic gas connection
facility.
"This project underscores the value of McDermott's
vertically-integrated capabilities and our collaboration with BHGE,
who will leverage their broad portfolio to support the project,"
said Ian Prescott, McDermott's
Senior Vice President for Asia
Pacific. "In close collaboration with BHGE, we are taking a
holistic approach to field development from drilling, subsea,
production facilities and an export pipeline to an LNG facility and
onshore gas connection. By more closely connecting each stage of
the project, we aim to drive significant efficiencies and cost
savings for Western Gas through the full life of the field."
"It was important to us to engage with partners that could offer
a full field development and execution solution that would help
deliver an efficient development plan, enhance project economics
and reduce time to first gas," said Andrew
Leibovitch, executive director for Western Gas. "BHGE and
McDermott bring a wealth of global expertise, products and services
to help drive efficiencies across the life of the field."
The contract award will be reflected in McDermott's fourth
quarter 2018 backlog.
Project Details
The Equus gas fields are located about 124 miles (200
kilometers) north-west of the Western Australian town of Onslow.
The fields' water depth ranges from 3,280 feet (1,000 meters) to
3,937 feet (1,200 meters) with an anticipated downstream nearshore
LNG facility and pipeline connection to the Western Australian gas
market.
The Equus Gas Project is a development-ready asset with an
extensive history of exploration and appraisal activities and
development studies.
McDermott and BHGE have participated in the exploration
appraisal drilling program and FEED studies with the previous owner
Hess before Western Gas acquired the asset in November 2017. This includes BHGE's Gaffney,
Cline & Associates having independently certified the
contingent resource.
io has also performed a number of technical studies for Western
Gas to assess development options. The MOU and the expected scope
of work for the EPCIC were built on these past studies.
* - McDermott defines a sizable contract as between USD
$1 million and USD $50 million.
About McDermott
McDermott is a premier, fully integrated provider of technology,
engineering and construction solutions to the energy industry. For
more than a century, customers have trusted McDermott to design and
build end-to-end infrastructure and technology solutions to
transport and transform oil and gas into the products the world
needs today. Our proprietary technologies, integrated expertise and
comprehensive solutions deliver certainty, innovation and added
value to energy projects around the world. Customers rely on
McDermott to deliver certainty to the most complex projects, from
concept to commissioning. It is called the "One McDermott Way."
Operating in over 54 countries, McDermott's locally focused and
globally-integrated resources include approximately 40,000
employees, a diversified fleet of specialty marine construction
vessels and fabrication facilities around the world. As used in
this press release, McDermott includes McDermott International,
Inc. and its subsidiaries and affiliates. To learn more, visit
www.mcdermott.com.
About io Oil & Gas Consulting
io Oil & Gas Consulting is a strategic consultancy created
to provide greater certainty and higher decision quality to
operators and help bring more projects to sanction by disrupting
traditional approaches. io is unique with its integrated
strategic-techno-commercial capabilities ensuring a balanced
approach between commercial, technical and strategic priorities
capitalizing on multi-discipline capabilities in subsurface,
drilling, subsea, marine, facilities, decommissioning/life
extension and environmental alongside economic modelling. We are a
joint venture between Baker Hughes, a GE company, and McDermott and
are unique in having their know-how, expertise and data 'hard
coded' into our DNA. For powerful thinking, visit
www.iooilandgas.com.
Forward-Looking Statements
In accordance with the Safe Harbor provisions of the Private
Securities Litigation Reform Act of 1995, McDermott cautions that
statements in this press release which are forward-looking, and
provide other than historical information, involve risks,
contingencies and uncertainties that may impact McDermott's actual
results of operations. These forward-looking statements include,
among other things, statements about backlog, to the extent backlog
may be viewed as an indicator of future revenues or profitability,
the expected value, scope, execution and timing of the project and
the expected follow-on EPCIC contract upon FID. Although we believe
that the expectations reflected in those forward-looking statements
are reasonable, we can give no assurance that those expectations
will prove to have been correct. Those statements are made by using
various underlying assumptions and are subject to numerous risks,
contingencies and uncertainties, including, among others: adverse
changes in the markets in which we operate or credit markets, our
inability to successfully execute on contracts in backlog, changes
in project design or schedules, the availability of qualified
personnel, changes in the terms, scope or timing of contracts,
contract cancellations, change orders and other modifications and
actions by our customers and other business counterparties, changes
in industry norms and adverse outcomes in legal or other dispute
resolution proceedings. If one or more of these risks materialize,
or if underlying assumptions prove incorrect, actual results may
vary materially from those expected. For a more complete discussion
of these and other risk factors, please see McDermott's annual and
quarterly filings with the Securities and Exchange Commission,
including its annual report on Form 10-K for the year ended
December 31, 2017 and subsequent
quarterly reports on Form 10-Q. This press release reflects
management's views as of the date hereof. Except to the extent
required by applicable law, McDermott undertakes no obligation to
update or revise any forward-looking statement.
Contacts:
McDermott
Investor Relations
Scott
Lamb
Vice President, Investor Relations
+1 832-513-1068
Scott.Lamb@McDermott.com
Global Media Relations
Gentry Brann
Global Vice President, Communications
+1
281-870-5269
Gentry.Brann@McDermott.com
Local Asia Contact
Philip
Ng
Communications Manager, Asia
+6017 200 4238 (mobile, Kuala Lumpur,
Malaysia)
Fng2@McDermott.com
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SOURCE McDermott International, Inc.