COVINGTON, La. – LLOG Exploration Co. has announced the development of the Salamanca production facility, which comprises an FPU that will be created from the refurbishment of a former GoM production facility that was previously decommissioned.
The FPU will serve as the collection point for production from the joint development of the Leon discovery located in the deepwater GoM in Keathley Canyon blocks 642, 643, 686 and 687 as well as from the Castile discovery in KC 736.
LLOG will operate the development, and its partners include Repsol E&P USA Inc. and Beacon Offshore Energy LLC. The facility will be located on KC 689 in approximately 6,400 ft of water.
Both discoveries are expected to be jointly developed through a total of three subsea wells at initial production that will be tied back to the Salamanca FPU. Two of the initial three development wells are planned for the Leon field and one for the Castile field. Initial production from the joint development is expected mid-2025.
The FPU is being refurbished to have a capacity of 60,000 barrels of oil per day and 40 million cubic feet of natural gas per day. By modifying a previously-built production unit, the time and cost to refurbish the unit will be greatly reduced compared with construction of a new facility, says LLOG.
LLOG also says that the project has a significantly positive ESG impact since it reuses an existing unit compared with abandonment of the unit, while also accomplishing approximately a 70% reduction in emissions impact compared to the construction of a new unit. All of the major topsides repurposing and modifications will be done in the United States. Regulatory approvals required to proceed with the development have been received.
Leon is a discovery drilled by Repsol in late 2014 on KC 642 and is located about 250 miles southwest of New Orleans in approximately 6,000 ft of water. The discovery well was drilled to a total depth of about 32,000 ft and encountered nearly 700 ft of net oil pay in multiple sands in the Lower Tertiary where LLOG says it has significant experience from past drilling and development in the GoM.
The Castile discovery was drilled on KC 736 in over 6,500 ft of water to a total of over 31,000 ft and encountered nearly 400 ft of high quality net oil pay, also in the Lower Tertiary.
Philip LeJeune, President and CEO of LLOG, commented: “Our ability to execute on our strategy of developing deepwater projects in areas of prolific regions that can be drilled, developed and placed on production safely, efficiently, and economically is key to our ongoing success. We are excited with this joint development of discoveries. By modifying a previously-built production unit compared with constructing a new facility, we are able to reduce significantly the time and cost to bring these discoveries online. Just as important as strong economic returns, this innovative FPU project has a significant positive ESG impact. We are repurposing an existing unit which reduces the emissions impact compared to the construction of a new unit by approximately 70%. We are pleased to be able to do the refurbishing of the FPU fully in the United States, utilizing local labor. This development will add a significant new source of needed domestic oil and natural gas production when it comes online. We remain focused on operational excellence and continue to build on the many successes that we have achieved in the deepwater GoM.”