Woodside Achieves First Oil at Sangomar in Senegal
Woodside has achieved first oil production from the Sangomar field offshore Senegal, marking the country's first offshore oil project. The Sangomar Field Development Phase 1 includes a floating production storage and offloading (FPSO) facility with a capacity of 100,000 barrels/day. This project aims to generate shareholder value and reflects Woodside's project execution capabilities amid global challenges. CEO Meg O'Neill highlighted the significance of this milestone, while PETROSEN E&P's General Manager Thierno Ly emphasized its impact on Senegal's industry and economy.
- First oil production achieved from Sangomar field.
- Sangomar project includes a standalone FPSO facility with a capacity of 100,000 barrels/day.
- Project expected to generate shareholder value according to the production sharing contract.
- Successful execution of Senegal's first offshore oil project despite global challenges.
- Strong relationships formed with PETROSEN, the Government of Senegal, and key contractors.
- No specific financial figures or timelines provided for future earnings or production phases.
- Potential risks associated with deepwater projects and global market volatility.
Insights
Woodside's achievement of first oil from the Sangomar field represents a substantial milestone, carrying significant implications for the company and its stakeholders. The project's deepwater nature and the deployment of a floating production storage and offloading (FPSO) facility with a capacity of 100,000 barrels/day underscore Woodside's technical proficiency and commitment to operational excellence. This milestone is likely to enhance Woodside's revenue streams and profitability in the long term, as it taps into a new and potentially lucrative resource.
From a financial perspective, the Sangomar project is notable not only for its production capacity but also for its ability to generate shareholder value under the terms of the production sharing contract. Investors should be aware that project execution in such environments often involves high capital expenditures and operational risks. However, the successful delivery in a period of global challenges highlights Woodside's resilience and project management capabilities.
Moreover, this achievement may positively impact Woodside's stock price as it demonstrates the company's ongoing growth and expansion efforts. However, investors should monitor future updates on production levels and any potential operational issues that may arise.
The development of the Sangomar field is game-changing for Senegal's oil industry, marking the country's first offshore oil project. For Woodside, this milestone is a strategic entry into the West African oil market, which has significant long-term growth potential. The project's success strengthens Woodside's market position and enhances its portfolio diversity, reducing reliance on any single region or resource.
For investors, the Sangomar project represents a strategic shift towards a more geographically diversified asset base. The market will likely view this positively, as diversification can mitigate risks associated with geopolitical and regional uncertainties. Moreover, the collaboration with PETROSEN and the Senegalese government could pave the way for future partnerships and projects in the region, bolstering Woodside's growth prospects.
In the short term, market reactions could be tempered by the initial capital outlays and the inherent risks of deepwater projects. However, the long-term outlook appears promising as production stabilizes and operational efficiencies are realized.
The Sangomar project's successful initiation of oil production is a testament to Woodside's technical capabilities and project execution. The use of an FPSO facility in the deepwater environment is noteworthy. FPSOs are vessels used in the offshore oil and gas industry to process and store oil until it can be offloaded onto a tanker or sent through a pipeline, which is important for such remote projects. The FPSO's capacity of 100,000 barrels/day positions Sangomar as a significant contributor to Woodside's overall production metrics.
It's important to consider the technological and logistical challenges involved in such a project. Deepwater drilling and production involve high technical risks and costs. However, the successful initiation of the Sangomar field indicates that Woodside has effectively navigated these challenges, which bodes well for future phases of development in the field.
Given the complexities of deepwater oil production, ongoing monitoring of operational performance and maintenance will be key. Investors should be aware that while initial success is promising, long-term success will depend on consistent production levels and effective management of the technical challenges that may arise.
The Sangomar Field Development Phase 1 is a deepwater project including a stand-alone floating production storage and offloading (FPSO) facility with a nameplate capacity of 100,000 barrels/day, and subsea infrastructure that is designed to allow subsequent development phases.
“This is an historic day for
“Delivering Senegal’s first offshore oil project safely, through a period of unprecedented global challenge, demonstrates Woodside’s world-class project execution capability. We are proud of the relationships we have formed with PETROSEN, the Government of
General Manager of PETROSEN E&P Thierno Ly said he was pleased to reach this milestone.
“First oil from the Sangomar field marks a new era not only for our country's industry and economy, but most importantly for our people.
“This achievement is the result of the unwavering commitment of our teams, who have worked diligently to overcome challenges and meet our strategic objectives in a complex and demanding environment. We have never been so well positioned for opportunities for growth, innovation, and success in the economic and social development of our nation.”
About Sangomar Field Development Phase 1
The Sangomar Field Development Phase 1 features the Léopold Sédar Senghor FPSO, named after the first president of
The Phase 1 development includes 23 wells (11 production wells, 10 water injection wells and 2 gas injection wells). 21 of the 23 wells have been drilled and completed including 9 production wells. The RSSD joint venture has also approved a 24th well (production well) that will be completed in the current campaign.
The Sangomar Project is being progressed by the Rufisque Offshore, Sangomar Offshore and Sangomar Deep Offshore (RSSD) joint venture, comprising Woodside (Operator and
The Sangomar Field Development Phase 1 project cost estimate remains within the provided range of
Crude quality is expected to be ~31 degrees API which is in demand in European and Asian markets.
Woodside’s historical acquisition of participating interests in the RSSD joint venture from both Capricorn Energy and FAR included certain contingent payments. Given current timing of first oil and oil prices Woodside anticipates making both these payments. The final payments are subject to ongoing production performance and oil price.
Teleconference
A conference call providing an update on Sangomar first oil with a question-and-answer session will be hosted by Woodside CEO and Managing Director, Meg O’Neill, on Tuesday, 11 June 2024 at 09:30 AWST/11:30 AEST/20:30 CDT (Monday, 10 June 2024).
A separate announcement containing the investor presentation that will be referred to during the conference call will be released shortly.
We recommend participants pre-register 5 to 10 minutes prior to the event with one of the following links:
- https://webcast.openbriefing.com/wds-inv-2024/ to listen to a live stream of the question-and-answer session
- https://s1.c-conf.com/diamondpass/10039456-ur5bd3.html to participate in the question-and-answer session. Following pre-registration, participants will receive the teleconference details and a unique access passcode.
This announcement was approved and authorised for release by Woodside’s Disclosure Committee.
Forward-looking statements
This announcement may contain forward-looking statements with respect to Woodside’s business and operations, market conditions, results of operations and financial conditions which reflect Woodside’s views held as at the date of this announcement. All statements, other than statements of historical or present facts, are forward-looking statements and generally may be identified by the use of forward-looking words such as ‘guidance’, ‘foresee’, ‘likely’, ‘potential’, ‘anticipate’, ‘believe’, ‘aim’, ‘estimate’, ‘expect’, ‘intend’, ‘may’, ‘target’, ‘plan’, ‘forecast’, ‘project’, ‘schedule’, ‘will’, ‘should’, ‘seek’ and other similar words or expressions.
Forward-looking statements are not guarantees of future performance and are subject to inherent known and unknown risks, uncertainties, assumptions, and other factors, many of which are beyond the control of Woodside, its related bodies corporate and their respective officers, directors, employees, advisers, or representatives. Details of the key risks relating to Woodside and its business can be found in the “Risk” sections of Woodside’s most recent Annual Report released to the Australian Securities Exchange, Woodside’s Climate Transition Action Plan and 2023 Progress Report, and in Woodside’s filings with the
Investors are strongly cautioned not to place undue reliance on any forward-looking statements. Actual results or performance may vary materially from those expressed in, or implied by any forward-looking statements.
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INVESTORS
Marcela Louzada
M: +61 456 994 243
E: investor@woodside.com
MEDIA
Christine Forster (
M: +61 484 112 469
E: christine.forster@woodside.com
Rob Young (
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E: robert.young@woodside.com
Source: Woodside Energy Group Ltd
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