Wedoany.com Report-Nov 29,   A consortium between Saipem SpA and a local partner has won an offshore engineering, procurement, construction and installation (EPCI) contract for the BP PLC-led Tangguh Ubadari, CCUS, Compression (UCC) Project in Indonesia.

Earlier this month BP announced a $7 billion final investment decision (FID) to develop the Ubadari gas field to supply feedstock to the existing Tangguh liquefaction facility and build an associated carbon capture facility. The UCC project is in Papua Barat Province.

The EPCI contract awarded to Saipem and Jakarta-based PT Meindo Elang Indah amounts to about $1.2 billion. Saipem’s share is around $1 billion, the Italian offshore driller, which also provides engineering services to the oil, gas and offshore wind sectors, said in a press release.

“Saipem’s activities include the engineering, procurement, construction and installation of two wellhead production platforms, a wellhead platform for the re-injection of CO2 and approximately 90 km [55.92 miles] of associated pipelines”, it said.

“The platforms will be fabricated locally in Karimun, Saipem’s largest yard worldwide and one of the largest in the Southeast Asian region, with over 5,000 employees and approximately 1.4 million square meters area including the marine base and docks.

“The award of this important contract in Indonesia consolidates Saipem's position in the segments of natural gas and of CO2 capture and storage projects, thanks to a unique combination of world-class assets with engineering and technological know-how”.

BP expects to extract about three trillion cubic feet of gas in the Ubadari field to feed Tangguh LNG, which will “help meet growing energy demand in Asia”, the British energy major said in a statement November 22 announcing the FID.

Ubadari is expected to start production 2028. The liquefaction facility, which went online 2009, has been expanded last year with a third train, bringing Tangguh LNG’s total capacity to 11.4 million tons per annum.

Meanwhile the carbon capture, utilization and storage (CCUS) portion of the UCC project is expected to sequester approximately 15 million metric tons of carbon dioxide in its initial phase. The CCUS component will capture emissions from the gas portion of the project.

“This project not only unlocks a fantastic gas resource, it also represents an Indonesian first through the use of CCUS to maximize gas recovery”, BP chief executive Murray Auchincloss said.

Approved by the government August 2021, the UCC project will have three injection wells, one offshore injection platform, one offshore CO2 pipeline and onshore facilities for CO2 removal, processing and compression, BP said.

BP is the operator of the Tangguh production sharing contract (PSC) with a 40.22 percent stake. The partners are MI Berau B.V. (16.3 percent), CNOOC Muturi Ltd. (13.9 percent), Nippon Oil Exploration (Berau) Ltd. (12.23 percent), KG Berau Petroleum Ltd. (8.56 percent), Indonesia Natural Gas Resources Muturi Inc. (7.35 percent) and KG Wiriagar Petroleum Ltd. (1.44 percent). The Tangguh PSC encompasses the Berau, Muturi and Wiriagar PSCs.