Woodside JV approves $1.8bn NWS project

The joint venture partners in the Cossack Wanaea Lambert Hermes oil operation, located offshore Western Australia, have approved a $1.8 billion redevelopment project that will extend production beyond 2020.

Majority partner and operator Woodside Energy, 33.3 per cent, said the scope of the project includes the replacement of floating storage and offloading facilities and associated subsea infrastructure.

Partner BHP Billiton Petroleum said the redevelopment project is expected to be completed by early 2011.

The CWLH oil fields, located some 135 kilometres northwest of Karratha, have produced 395 million barrels of oil since production started in 1995.

Other participants in the project include BHP Billiton Petroleum (16.67 per cent) BP Developments Australia (16.67 per cent), Chevron Australia (16.67 per cent and Japan Australia LNG (16.67 per cent.).

Both announcements from Woodside and BHP Billiton are pasted below:

Woodside

One of Australia's most productive oil developments will remain in production beyond 2020 after participants in the Cossack Wanaea Lambert Hermes (CWLH) Joint Venture committed to the redevelopment of the project.

The CWLH fields 135km northwest of Karratha in Western Australia have produced 395 million barrels of oil since production began in 1995.

The project scope of the redevelopment work includes the purchase and conversion of the Okha floating storage and offloading facility into a floating production storage and offloading facility to replace the Cossack Pioneer in 2010, as well as the replacement of associated subsea infrastructure.

At a total investment of about A$1.8 billion (Woodside share A$600 million), the CWLH Redevelopment Project will support ongoing safe and reliable production from the CWLH fields beyond 2020.

Woodside Executive Vice President, North West Shelf, Eve Howell said the redevelopment decision was a vote of confidence by the CWLH participants in the future of the 13-year-old project.

"The CWLH project is one of Australia's most enduring and reliable oil developments and this redevelopment decision will ensure continued safe and reliable production from these fields for many years to come," Ms Howell said.

The CWLH Joint Venture participants are: Operator Woodside Energy Ltd (33.33%); BHP Billiton Petroleum (North West Shelf) Pty Ltd (16.67%); BP Developments Australia Pty Ltd (16.67%); Chevron Australia Pty Ltd (16.67%); and Japan Australia LNG (MIMI) Pty Ltd (16.67%).

BHP

BHP Billiton today announced approval for the North West Shelf Cossack, Wanaea, Lambert, Hermes (CWLH) redevelopment project for a capital investment of US$245 million (BHP Billiton share).

The CWLH redevelopment project comprises the replacement of the existing Cossack Pioneer Floating Production Storage and Offtake (FPSO) vessel, selected refurbishment of existing subsea infrastructure and the existing riser turret mooring. It will also capture additional oil production from the Cossack, Wanaea, Lambert and Hermes fields located in approximately 75 to 135 metres (245 to 440 feet) of water, approximately 135 kilometres (84 miles) offshore north west Western Australia by extending existing field life and through tieback of exploration opportunities.

It is expected the CWLH redevelopment project will be completed and fully operational by early 2011 calendar year.

The Cossack Pioneer FPSO is to be replaced by the SBM owned "Okha" which is currently configured as a Floating, Storage and Offtake vessel and will require conversion to add topside production facilities.

BHP Billiton Petroleum Chief Executive J Michael Yeager said the fields, which commenced production more than a decade ago (Cossack and Wanaea production commenced 1995, Lambert and Hermes were later), have performed above expectations, and now have much longer field life than originally expected.

"We anticipate this project will generate over 10 million barrels of oil (BHP Billiton share) during its life and it will also extend the life of these fields beyond 2020. During the 2008 calendar year, BHP Billiton has approved the investment of over US$1.1 billion in the overall North West Shelf infrastructure with North Rankin B gas compression and now this project. North West Shelf is a world class asset and represents a significant part of Petroleum's deep portfolio of growth projects that will carry us forward," Mr Yeager said.