Front Runner spar installed in Gulf

Ray Tyson

Petroleum News Houston correspondent

Project troubled J. Ray McDermott, the marine construction unit of oilfield service company McDermott International, has finally completed installation of the Front Runner production spar in deepwater Gulf of Mexico, the company said June 1.

In March, McDermott projected about $85 million in negative cash flow during the first, second and fourth quarters of 2004, due to additional costs associated with completion of its Front Runner spar, as well as the Carina Aries project in Argentina, and the Belanak FPSO Batam Island facility.

J. Ray said it installed the 6,220 short ton topsides on the Front Runner spar hull and has commenced hook-up and commissioning activities. The spar is moored in 3,330 feet of water in the Gulf of Mexico Green Canyon block 338, about 100 miles south of Fourchon, La.

The lift was completed using J. Ray’s Derrick Barge 50 and Oceanic 93 “Shear Leg Crane.” The Front Runner project is operated by Murphy Exploration & Production. Partners are Dominion Exploration & Production and Spinnaker Exploration Co.

J. Ray also said it was awarded a $47 million contract by Apache Energy, a subsidiary of Houston independent Apache Corp., on behalf of the WA-214P joint venture participants, to procure, fabricate, transport and install the John Brookes platform and pipeline system offshore the North West Shelf in Western Australia.

J. Ray said it will fabricate the jacket and piles at its Batam Island, Indonesia, facility beginning in August 2004. Loadout of the substructure is expected to take place in January 2005. The pipeline and platform will be installed using J. Ray’s combination Derrick Barge DB26 commencing mid-January 2005.

Additionally, J. Ray has been awarded a contract by its Mexican joint venture company Construcciones Maritimas Mexicanas, valued at about $60 million. The contract between J. Ray and CMM calls for the charter of J. Ray’s Derrick Barge 101, Shear Leg Crane and Intermac 404, as well as related engineering work.