McDermott International Inc. (NYSE: MDR) said Dec. 12 that with Baker Hughes, a GE company (NYSE: BHGE), have signed a memorandum of understanding with Western Gas Corp. 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-FEED and 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 second-quarter 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 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.
“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,” Ian Prescott, McDermott’s senior vice president for Asia Pacific, said.
The contract award will be reflected in McDermott’s fourth-quarter 2018 backlog.
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