DOT 2009: Project costs must reflect current economic environment

Project costs must reflect the current economic environment, says Frederic Garnaud, RD program manager surface technologies, Total E&P.

Offshore staff

MONTE CARLO-- Project costs must reflect the current economic environment, says Frederic Garnaud, RD program manager surface technologies, Total E&P. “We have to optimize the design of our projects and review our contract terms,” he said during the keynote address in the opening plenary at DOT in Monaco on Tuesday, Nov. 3. Garnaud warns that they may have to postpone some projects if costs do not come down.

Projects are changing, he says. They are larger, more complex, and more capital intensive, with more interfaces. Project capex runs in the range of $6-$8 billion with some reaching to $15 billion. Therefore, “we need to develop more project management capability and competent staff,” Garnaud says.

Garnaud points to subsea processing as one growing trend. But the technical challenges of subsea separation have to be considered, and bringing the costs down to reflect the current economic environment will be the next challenge, he says. Another trend is subsea tieback of smaller fields.

Gernaud says Total’s next deepwater development to get sanctioned will be Clov, which is expected in the coming months. The proposed development scheme is based on a spread moored FPSO, MPP, gas export, and 34 subsea wells.

A design competition has been launched for the FPSO and installation of subsea pumps will be considered, he says. The reason for the design competition is to get engineering contractors to bring more technical and cost-effective solutions to the table, Gernaud says.

The potential field development plan for Clov is becoming a standard of the company’s deepwater projects, he adds. Clov is in block 17 offshore Angola and comprises Cravo, Lirio, Orquidea, and Violeta discoveries.

11/3/2009

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