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Williams to invest $400 million in Gulf of Mexico deepwater project Associated gas from Devils Tower field will go to company’s own facilities for natural gas liquids separation, natural gas distribution By Petroleum News Alaska
Williams said Sept. 18 that it will invest more than $400 million to develop the infrastructure for its Devils Tower deepwater project. Williams said that under this first of its kind agreement for the Gulf of Mexico, signed Aug. 29, Williams will provide the infrastructure for the Devils Tower field co-owned by Dominion Exploration & Production Inc. and Pioneer Natural Resources Co. Dominion E&P and Pioneer will make fixed monthly payments for the use of the facilities required to produce the Devils Tower field.
Williams will own the floating production facility and export pipelines and has contracted with Dominion E&P to operate the floating production facilities. Devils Tower is an oil discovery with associated gas. Williams energy marketing and trading group will directly purchase associated gas produced through the facility. Dominion will market its own oil production.
Williams will build both oil and gas export pipelines from the floating production facility. The raw gas will go to the Mobile Bay lateral owned by Transco, a unit of Williams, and then to Williams’ Mobile Bay gas processing plant.
Natural gas liquids will be shipped to Williams’ Baton Rouge fractionator and other downstream markets and the natural gas will be available for delivery to Southeast markets through area pipelines.
Total Williams solution “This project is a total Williams solution that involves marketing and trading, our midstream facilities and our gas pipeline systems,” said Steven Malcolm, executive vice president of Williams and CEO of Williams’ energy services unit.
Williams said it will use the floating production facility and export pipelines as a hub, and will market transportation and production services to producers developing other fields in the Mississippi Canyon. Producers will be able to tieback to the Devils Tower facilities to ship their oil and gas to shore without the expense of building their own production and pipeline systems.
The facilities are scheduled to be in operation by mid-2003. The floating production facility will handle up to 60,000 barrels of oil per day.
The oil pipeline will have a capacity of 150,000 barrels of oil per day and the gas pipeline will have a capacity of 350 million cubic feet of gas per day.
Devils Tower is Williams’ first floating production facility. It will be built at the Devils Tower field about 140 miles southeast of New Orleans at Mississippi Canyon Block 773 in 5,610 feet of water. Williams said that the floating production facility will be the world’s deepest dry tree platform.
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