Netherlands-based SBM Offshore has taken a significant step in the offshore energy sector by securing multimillion-dollar financing for the development of a new floating storage and offloading (FSO) unit, set to operate at a deepwater oil project off the coast of Mexico.
SBM Offshore has successfully signed project financing for the new FSO Chalchi amounting to $465 million. This financial arrangement involves a consortium of international banks and institutional investors, alongside partial insurance coverage from the China Export & Credit Insurance Corporation. This marks a milestone for SBM Offshore as it diversifies its funding sources for offshore projects.
The significance of this financing is underscored by its structure; it will be drawn during the construction phase of the FSO. Notably, the financing will transition to a non-recourse model once the FSO begins operational activities. With a maximum tenor of around 14 years post-completion, the financial backing is structured to ensure robustness throughout the project’s lifecycle.
Douglas Wood, the CFO of SBM Offshore, expressed his enthusiasm about the financing deal, stating: “We welcome the signing of the project financing of FSO Chalchi, marking our first transaction combining commercial banks, institutional investors, and support from an export credit agency.” He further highlighted that this financing structure delivers innovative, long-term solutions for clients, paving the way for scalable options for future lease and operate projects.
The FSO Chalchi is currently under construction and will operate under 20-year lease and operate agreements with Woodside Energy through its Mexican affiliate. Based on a Suezmax-type hull, the new FSO will be equipped with an innovative disconnectable turret mooring system developed by SBM Offshore, tailored for deepwater applications.
Strategically positioned at the Trion field, located about 180 kilometers offshore from the Mexican coastline and 30 kilometers south of the U.S./Mexico maritime border, the FSO will have the capacity to store approximately 950,000 barrels of crude oil. This critical project is a joint venture between Woodside, which holds a 60% operating stake, and Pemex, with a 40% share.
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