ExxonMobil to proceed with $14B Hebron heavy oil project off Canada’s East Coast; more than 700B barrels of oil
Exxon Mobil Corporation will develop the Hebron oil field offshore the Canadian province of Newfoundland and Labrador using a gravity-based structure that will recover more than 700 million barrels of oil, an increase from earlier estimates. Capital cost for the project, which is expected to begin oil production around the end of 2017, is estimated at $14 billion. The platform is being designed for daily production of 150,000 barrels of oil.
|Location of Hebron field. Source: Chevron. Click to enlarge.|
The Hebron field, which comprises the Hebron, Ben Nevis and West Ben Nevis reservoirs, is located offshore Newfoundland and Labrador in the Jeanne d’Arc Basin, about 350 kilometers (217 miles) from St. John’s in 90 to 100 meters (295 to 328 feet) of water. In addition to the complexities faced by development of the nearby Hibernia field, the Hebron field also faces challenges associated with the recovery of heavy oil.
Hebron is one of several large-scale oil developments that ExxonMobil will bring on stream in the next five years. ExxonMobil will employ its expertise in Arctic development and project execution to develop this world-class resource in challenging operating conditions.—Neil W. Duffin, president of ExxonMobil Development Company
The project received regulatory approval from the governments of Canada and Newfoundland and Labrador in May.
Hebron will be developed using a stand-alone gravity-based structure (GBS) consisting of reinforced concrete designed to withstand sea ice, icebergs and meteorological and oceanographic conditions. The base will be designed to store approximately 1.2 million barrels of crude oil and will support an integrated topsides deck that includes a living quarters and facilities to perform drilling and production.
ExxonMobil Canada Properties (EMCP) had earlier awarded Kiewit-Kvaerner Contractors (KKC), a 50/50 Partnership between Peter Kiewit Infrastructure Co and Kvaerner Corporation, a contract for the Hebron Project Front End Engineering and Design (FEED) and site preparation.
Front-end engineering and design was completed last year and significant progress has been achieved on detailed engineering. Current cost estimates reflect advanced project definition and current market and foreign exchange rates.
Construction of the gravity-based structure is under way at the project’s primary construction site in Bull Arm, Newfoundland and Labrador. Topsides fabrication is expected to begin later this year.
Hebron will be operated by ExxonMobil affiliate, ExxonMobil Canada Properties, which holds 36% equity in the project. Hebron co-venturers are Chevron Canada Limited (26.7%), Suncor Energy Inc. (22.7%), Statoil Canada (9.7%) and Nalcor Energy Oil and Gas (4.9%).