Fossil Energy – Trion in Mexico
Australian Woodside Energy Group said on Tuesday it had approved the development of the $7.2 billion Trion ultra deepwater oil project in the Gulf of Mexico.
This is Woodside’s first major investment since its merger with BHP Group’s petroleum arm last year.
Woodside, 60% owner and operator of Trion, forecast its share of the capital expenditure at $4.8 billion. The remainder is set to be funded by Mexican state-owned oil company Pemex, which owns 40% of Trion.
The resource will be developed through a floating production unit (FPU) with an oil production capacity of 100,000 barrels per day, Woodside said. First production is targeted for 2028.
The investment is expected to deliver an internal rate of return greater than 16%, with a payback period of less than four years, Woodside said.
Woodside CEO Meg O’Neill said in the statement that the investment exceeded the company’s capital allocation framework targets and would be a strong contributor to its cash flows and shareholder returns.
Trion was discovered by Pemex in 2012. It is located at Mexico’s Perdido basin, about 180 km (112 miles) off the Mexican coastline at a depth of 2,500 metres.