South Korea’s Hanwha Ocean and Dutch floating production specialist SBM Offshore have emerged as the final contenders to build the floating production, storage and offloading (FPSO) vessel for Namibia’s giant Venus oil development, with a contract award expected to follow TotalEnergies’ anticipated final investment decision (FID) on the project.
Industry sources in South Korea say TotalEnergies is expected to make its FID on the Venus development as early as next month after submitting its environmental and social impact assessment (ESIA), environmental and social management plan (ESMP) and field development plan (FDP) to the Namibian authorities for regulatory approval.
According to a South Korean media outlet, Chosun Biz, the FPSO contract is among the most valuable awards in Namibia’s emerging offshore petroleum industry. It is expected to pave the way for the country’s first deepwater oil production.
The vessel is designed to process between 150,000 and 200,000 barrels of oil per day from subsea production wells in Block 2913B in the Orange Basin, where TotalEnergies discovered the Venus field in 2022. First oil is targeted for 2030.
The initial phase of the Venus development is expected to require an investment estimated at between US$1 billion and US$10 billion, making it one of the largest industrial projects ever undertaken in Namibia.
The development includes up to 40 subsea production wells, subsea gathering systems, export infrastructure and the FPSO. At the same time, TotalEnergies has previously indicated that the integrated subsea production facilities package alone is worth at least US$2.5 billion.
The FPSO itself is expected to account for several billion dollars of the overall development cost, making it one of the most closely watched contract awards in the global offshore industry.
The competition pits two companies with sharply contrasting business models against each other.
SBM Offshore enters the race as the world’s largest FPSO operator, having delivered more than 40 units globally and currently operating 15 FPSOs in South America, including Brazil and Guyana.
The Dutch company provides a full-lifecycle service covering design, construction, installation, and long-term operation of floating production facilities.
To improve its commercial competitiveness for the Venus project, SBM Offshore has reportedly assembled a consortium involving several Chinese shipyards, with hull fabrication, topside construction and final integration expected to be split among multiple facilities to reduce costs.
Hanwha Ocean, by contrast, is promoting its ability to construct the entire FPSO within a single shipyard. The company argues that integrated fabrication reduces engineering mismatches that can arise when hulls and topsides are built at different locations, improving quality control while reducing construction risk and delivery delays.
The Korean shipbuilder is also keen to secure the Venus contract to strengthen its offshore engineering business. Its energy plant division has faced a challenging period because of permitting delays on other projects and a slowdown in new offshore awards.
Winning the Venus contract would provide a significant workload while positioning Hanwha Ocean for additional opportunities emerging from Namibia’s rapidly expanding offshore petroleum sector.
Industry observers believe success at Venus could also strengthen the winning contractor’s prospects for future FPSO developments linked to discoveries elsewhere in the Orange Basin, including Galp Energia’s Mopane discovery and other projects expected to move towards commercialisation over the coming years.
The timing of the award is also important for the global offshore construction market. Strong demand for FPSOs in Brazil and Guyana has left many major shipyards operating near full capacity, limiting the availability of construction slots for new projects.
According to industry sources, TotalEnergies is under increasing pressure to place the order soon if it intends to maintain its current development schedule and achieve first oil by 2030.
The FPSO award represents another major milestone in transforming the Venus discovery from an exploration success into a producing oil field. Once operational, the facility will become the centrepiece of the country’s first offshore oil production system, processing crude from deepwater wells before storing and offloading it to export tankers.
The Venus development is operated by TotalEnergies, which holds a 50.5% interest in Block 2913B. Its partners are QatarEnergy (30%), Impact Oil & Gas (9.5%) and NAMCOR (10%).
Once sanctioned, the project is expected to become Namibia’s first commercial offshore oil development and establish the Orange Basin as one of the world’s most significant new deepwater petroleum provinces.
