Senegal - Mauritania: Bp seeks over $500 million in damages from McDermott on GTA

BP has filed a lawsuit against McDermott, a US company specializing in subsea engineering and construction, for failing to meet its contractual obligations on the Greater Tortue Ahmeyim (GTA) project offshore Mauritania and Senegal.

Kosmos Energy, BP's partner in the GTA project, disclosed this information when releasing its fourth-quarter results. They reported that unexpected costs associated with subsea work for phase 1 of the Tortue project forced McDermott to be replaced by Allseas for subsea pipeline installation.

Kosmos has estimated recoverable damages of up to $160 million, if the claim reaches the maximum recoverable amounts, as targeted by the partnership. Depending on the share of each shareholder, potential damages for BP could amount to $534 million.

To provide further context, McDermott and Baker Hughes had won contracts with BP to supply subsea umbilicals, risers, flowlines and subsea production system equipment for the GTA project in 2019.

Initially, McDermott was to use its pipelay vessel Amazon, along with other vessels, to complete the project. However, the Houston-based company halted work on the GTA project due to a payment dispute with BP.

BP then called on Allseas and its huge construction vessel, the Pioneering Spirit, to take over after the Dutch company had won the agreement to complete the installation. The offshore construction support vessel Oceanic would also be mobilized for the project.

The contract involved the installation of approximately 75 km of two 16-inch export pipelines, with on-site termination assemblies, in water depths ranging from 1,500 to 2,800 meters, as well as four 10-inch CRA inland lines in 2,800-meter water.

The GTA project, located on the maritime border between Mauritania and Senegal, is being developed as a gas field with a 30-year production potential. The initial phase is expected to supply around 2.5 million tonnes per year of natural gas. GTA is estimated to contain over 15 trillion cubic feet of potentially recoverable gas resources.