CNOOC FEEDs on natural gas

China National Offshore Oil Corporation is on the hunt for FEED contractors for the company’s Lingshui 17-2 deepwater natural gas development.

Located in the strongly contested South China Sea territory, the project will be the first self-financed by CNOOC. Following an expression of interest released by CNOOC Research institute, Worley Parsons Intecsea, SBM, TechnipFMC, Saipem and a consortium composed of Wood Group Mustang and Richtech have emerged as frontrunners for the development.

Once awarded, the terms of the contract stipulate a new FEED study, which should take into account previous studies on the development, as well as FEED work on a subsea production system, subsea umbilical riser and flowline system.

Following successful completion of the FEED, bids for the subsea production system and subsea, umbiblical, riser and flowline could be issued as early as October 2017. The tender is likely to draw companies such as TechnipFMC, GE, Aker Solutions, OneSubsea and Oceaneering.

Development of the Lingshui 17-2 gas complex, which includes Lingshui 17-2-2, 17-2-3, 17-2-4 and 22-1-1, are part of China’s efforts to ramp up the use of natural gas in its energy mix. The national is targeting a 10% increase of natural gas used in its energy supply by 2020.

The government is issuing reforms and implementing projects that will encourage E&P, the construction of storage facilities and increased terminal capacity to meet its target. The Wenzhou LNG terminal along with the Lingshui development represent some of the government’s efforts to diminish the use of coal while implementing the use of natural gas.