ExxonMobil has formally submitted its application to develop the Hebron oilfield — outlining heftier production platform costs, an additional $3.5-billion subsea tieback, and first oil by late 2017.
The cost of building the Hebron platform and drilling dev-elopment wells is now estimated at more than $8.3 billion, according to the development plan application.
It was filed April 15 with the Canada-Newfoundland and Lab-rador Offshore Petroleum Board (CNLOPB).
Previously, Hebron development costs were pegged around $5 billion, though that estimate was several years old.
ExxonMobil estimates production operations will cost more than $5.8 billion over the life of the oilfield until 2046.
As part of the development, the partners envision a potential subsea tieback to the platform to pump oil from a portion of Hebron known as Pool 3.
The application anticipates a $3.5-billion price tag for Pool 3, but it could go as high as $5 billion if it’s fully developed.
Discovered in 1981, the Hebron oilfield consists of three main fields — Hebron, West Ben Nevis and Ben Nevis — containing a combined 700 million barrels of oil.
Pool 3 is located in both the West Ben Nevis and Ben Nevis fields.
The Hebron application includes a timeline chart that suggests Pool 3 will be developed at the same time as the rest of the oilfield.
“Specific duration and timing of the development is under evaluation with the earliest startup date envisioned to be concurrent with the platform first oil date,” said the development plan.
The Pool 3 schedule said excavation of drill centres to house wellhead equipment on the seabed would start in 2012. By 2015, that wellhead equipment would be installed on the seabed and hooked up to the Hebron platform the following year.
First oil is scheduled for either mid-2017 or by the end of that year.
The application said all cost estimates are based on mid-2009 price levels.
“If approved, the Hebron project will extend the life of the offshore oil and gas industry in Newfoundland and Labrador,” said the development plan.
Hebron will be the province’s fourth offshore oilfield on the Grand Banks.
The Hebron development plan is posted on the CNLOPB website at: http://www.cnlopb.nl.ca/devplan.shtml.
The offshore regulator said the benefits plan and supporting documentation were not included in the application, but ExxonMobil expects to file them this month or in early May.
They will also posted on the board’s website.
CNLOPB spokesman Sean Kelly said the next step is a “completeness review” — making sure all the information required under offshore regulations has been included in the application.
Once that is done, CNLOPB staff will review the merits of the Hebron development plan.
At the same time, a public review that can take up to nine months will be carried out.
The CNLOPB hasn’t decided what form the public review will take. Kelly said that decision will be made by the CNLOPB’s board of directors.
Public hearings for the Terra Nova project were held by a review panel, while White Rose was reviewed publicly by a lone commissioner. Both made recommendations to the CNLOPB.
Under offshore rules, the regulator can approve a development application as is, approve it with conditions, or reject it.
The CNLOPB decision then goes to the federal and provincial ministers of natural resources and they have 30 days to accept or reject it.
The Hebron partners are ExxonMobil (36 per cent), Chevron Canada (26.6 per cent), Suncor Energy (22.7 per cent), Statoil Canada (9.7 per cent) and Nalcor Energy (4.9 per cent).
Hebron platform construction
• Third quarter of 2012: project is expected to be sanctioned; i.e. the Hebron partners will formally commit to moving ahead with the oilfield development.
• 2012-2015: construction of the concrete gravity base structure (GBS) at Bull Arm.
• 2013-2015: construction of the steel topsides modules.
• Summer/fall 2016: scheduled tow-out of the combined topsides and GBS.
• Late 2017: first oil anticipated.