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Angola’s Kaombo to break capex records at $16 billion

The Total deep-water development off Angola will cost a record figure for Angolan waters, and possibly worldwide

Total is to go ahead with its deep-water Kaombo oil development off Angola, at a capital expenditure (capex) cost to full production of $16 billion – a record figure for Angolan waters, and possibly worldwide. The company said it had cut $4bn from an earlier capex estimate to allow the partners to reach a positive final investment decision.

Kaombo is the first development in the ultra-deep Block 32, where geological and engineering challenges, together with water-depths ranging from 1,400-1,900 metres and the 260 km distance from the coast, have all added to costs. The development links six fields to two hubs, to produce 230,000 barrels a day (b/d) from reserves of 650 million barrels. First oil is due in 2017.

Facilities will include two floating production, storage and offloading (FPSO) vessels, each capable of handling 115,000 b/d, 59 subsea wells (including a large number of water-injectors) and about 300 km of seabed flowlines. Associated gas will be sent to the country’s liquefied natural gas complex.

The fields to be developed – Gengibre, Gindungo, Caril, Canela, Mostarda and Louro – are spread out over an area of 800 square km in the central and southeast part of the block, which also holds six other discoveries. Individually, the fields are not as large as most others developed up to now in Angolan waters, and costs are raised by the large area over which they are distributed.

Exploration of Block 32 was complicated by the number of salt structures overlying the reservoirs, which led Total to rely on wide-azimuth seismic surveying and 3-D pre-stack depth migration – a company geologist said there was “almost no successful exploration” in the block until the latter technique was applied. Wells have had to be designed to counter hazards including shallow gas-zones, pressure differentials between different parts of the reservoirs, and the uneven salt structures. The seabed in the area has troughs and hills, presenting challenges in the design and installation of subsea facilities.

Because of the widely spaced fields, flowlines are long and costly, and cooling of the multiphase wellstream – risking hydrate formation – was a design problem. Total’s response is an innovative “hybrid loop” configuration which uses a single flowline – instead of the usual pair – together with a parallel water-injection line. Injection water is used to flush the wellstream through the production line when the field has to be shut down, saving the cost of the second production line.

Interests in Block 32 are Total, 30%, the state’s Sonangol, 30%, Sonangol Sinopec International, 20%, ExxonMobil, 15% and Galp Energia, 5%. Total says its operated production in Angola is close to 600,000 barrels of oil-equivalent a day (boe/d), of which equity production amounts to 186,000 boe/d. The firm’s four-field Clov development in Block 17 is due to start flowing at mid-year, adding 160,000 b/d to the operated total.

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