by Tina Olivero

    BHP: Rig Required To Drill Orphan Basin

    BHP Petroleum (New Ventures) Corporation (BHP) plans to undertake a drilling program in the Orphan Basin Region, offshore eastern Newfoundland and Labrador (Exploration licenses EL1157 and EL1158).

    It is anticipated that the initial campaign will consist of two wells, approximately twelve months apart. Subject to regulatory approval, drilling activity is anticipated to begin between July 2021 and July 2022. Accordingly, BHP seeks Expressions of Interests from interested contractors who can demonstrate the capability to deliver the following goods and services.

    BHP: The Company

    Steve Pastor, BHP President Operations Petroleum said the successful bids offshore Newfoundland are an exciting opportunity for BHP to explore for world-class conventional oil assets as an early mover in this prospective region. He envisions, “This frontier opportunity has large oil resource potential which we identified through our Global Petroleum Endowment Study in 2016 and is in a low-risk country, with competitive fiscal terms. This opportunity delivers on our exploration focus in conventional petroleum and will leverage our global deep-water development and operational expertise.”

    Canada Newfoundland and Labrador Offshore Petroleum Board announced that BHP has been successful in its bids to acquire a 100% participating interest in, and operatorship of, two exploration licences for blocks 8 and 12 in the offshore Orphan Basin in Eastern Canada. BHP’s aggregate bid amount of US$625 million covers the drilling and seismic work required by the exploration work programs under the licence agreements over the six-year term. BHP’s minimum commitment under the licence agreements is for US$157 million.

    BHP’s initial planned capital expenditure on the exploration work programs for blocks 8 and 12 is US$140 million up to FY2021, and is within BHP’s current exploration budget.


    BHP is a world-leading resources company. BHP extracts and processes minerals and oil and gas, with more than 62,000 employees and contractors, primarily in Australia and the Americas. BHP products are sold worldwide, with sales and marketing led through Singapore and Houston, United States.

    BHP global headquarters are in Melbourne, Australia with offices around the globe and have now expanded into Eastern Canada as an offshore exploration investor.

    BHP operates under a Dual Listed Company structure with two parent companies (BHP Billiton Limited and BHP Billiton Plc) operated as if they were a single economic entity,  referred to as BHP.


    BHP Petroleum unit comprises conventional and unconventional oil and gas operations,
    and includes exploration, development and production activities.

    BHP has a high-quality resource base concentrated in the United States and Australia.
    Core production operations consist of conventional assets located in the US Gulf of Mexico,
    Australia and Trinidad and Tobago and unconventional Onshore US assets.

    BHP produces crude oil and condensate, gas and natural gas liquids (NGLs) that are
    sold on the international spot market or delivered domestically under contracts
    with varying terms, depending on the location of the asset.

    Goods and Service Description: Provision of Mobile Drilling Unit (Rig)

    Provision of harsh environment dynamically positioned mobile drilling unit (Rig) to operate offshore Newfoundland in the Orphan Basin.  Drilling two (2) exploration wells of approximately 100 days duration separated by a non-operational period of approximately 12 months.

    Minimum Requirements and Capabilities for Scope of Work

    Minimum capabilities of the rig are as follows:

    1. Currently holding/ability to obtain a Canadian Certificate of Fitness (CoF) for year-round operations.
    2. Pre-existing or commitment to establish adequately staffed Canada based office for the duration of the campaign (including planning).
    3. Harsh environment capable of operating offshore Newfoundland.
    4. Safety case meeting IADC guidelines.
    5. In class. No special or periodic surveys planned within the contract period or 6 months thereafter.
    6. DP3 Dynamic positioning system.
    7. Water depth capability 2500 m (~ 8500 ft)
    8. Drilling Depth capability 8000 m (~ 25000 ft)
    9. Ability to accommodate 130 POB.
    10. Helideck rated for Rated for S92, S61-N, EH101 and Super Puma, compliant with CAP 437
    11. Hookload of 6700 Kn (~ 1500 klbs)
    12. Minimum of 3 x 51701 kPa (7500 psi) rated mud pumps
    13. Liquid weighted mud 800 m3 (5000 bbls) minimum
    14. 5,000 tons minimum variable deck load
    15. Sufficient deck space to accommodate cuttings dryer package and centrifuge simultaneously
    16. Commitment to local employment and use of local suppliers that are properly qualified for any upcoming work

    EOI Submission Requirements

    The contractor shall provide the equipment, personnel, ground base support, and any and all provisions necessary to efficiently provide goods or perform services for the duration of the campaigns. Interested and qualified contractors shall provide the following submission details.

    1. Contractors full company profile along with incorporation documentation.
    2. Information respecting the Contractor’s qualification as a Canadian and/or as a Newfoundland and Labrador corporation in respect of benefits commitments as noted below.
    3. Brief corporate resume of the goods and services that you can provide from the listing above which should include the following:a. Proposed organization structure, including names of managers and key personnel who would be providing the service including phone, e-mail and experience with the relevant scope.b. Include references from past and/or existing clients who have contracted you to provide materials and/or services that you are proposing to provide. You shall include the name of the client, year of the duration of the services, description of services, the value of the services/goods and contact details.c. Identify any joint venture, agency or subcontract arrangements and give the identity of the proposed subcontracting party.d. Audited financial statements for the past three (3) calendar years (2016, 2017, and 2018). Such information will be kept confidential by BHP and will be used for the sole purpose of the EOI evaluation process.e. Listing of litigation or arbitration resulting from contracts completed or ongoing under its execution over the last five (5) years.f. Summary of experience with Benefits Plans under the Canada-Newfoundland and Labrador Atlantic Accord Implementation Act and the Canada Newfoundland and Labrador Offshore Petroleum Board processes.

      g. Summary of experience with the environmental assessment processes under Canadian Environmental Assessment Agency 2012 and Canada Newfoundland and Labrador Offshore Petroleum Board processes.

    Submission details of suitably qualified contractors that can provide, meet or exceed the requirements stated above are to be sent to Mark Dahlin, Category Management Specialist at mark.dahlin@bhp.com, by 9:00am CDT of the 16th of May 2019.

    General Requirements

    Contractors must be qualified to conduct the work outlined in the Scope of Work and must be able to demonstrate previous experience and the delivery of such services. In addition, contractors will be required to register in BHP’s Global Contracting Management System to receive and participate in an upcoming Request for Proposal (RFP) and the successful contractor must comply with the terms and conditions which will be included in the RFP or Purchase Order.

    Benefits Commitment

    BHP is committed to providing processes and procedures to ensure businesses, manufacturers, consultants, contractors and service companies in Canada, and in particular in Newfoundland and Labrador, are given “full and fair opportunity to participate on a competitive basis” to provide good and services to the project, consistent with the Canada-Newfoundland and Labrador Atlantic Accord Implementation Act and with Canada-Newfoundland and Labrador Exploration Benefits Plan Guidelines, where applicable.

    Contractors of BHP must comply with the requirements of the Canada-Newfoundland and Labrador Atlantic Accord Implementation Act, and Canada-Newfoundland and Labrador Exploration Benefits Plan Guidelines, as applicable in the Scope of Work, in providing residents of Newfoundland and Labrador first consideration in the provision of employment and training opportunities ,that are consistent with the Canadian Charter of Rights and Freedoms, and in the selection of subcontractors whenever possible in connection with supplying goods and services as listed in this Scope of Work. BHP’s Exploration Benefits Plan is subject to regulatory approval.

    Health, Environment & Safety

    BHP is committed to providing a safe, healthy and environmentally sound workplace for its employees, contractors, subcontractors and the communities in which we operate. Contractors must have a Health, Environmental, Safety (HES) and quality management system which meets, at a minimum, the requirements of BHP. BHP’s HSE requirements and procedures can be found at the following link: https://www.bhp.com/info/supplying-to-bhp.

    Interested Contractors may be considered in an RFP process, which is subject to BHP receiving final regulatory and management approval to proceed.  For this reason, the request for this EOI is subject to change or cancellation at any time.  Under no circumstance is BHP under any obligation to proceed with an RFP or to award any contract with respect to this request for EOI or a RFP.   All expenses incurred by the Contractor relating to this request for EOI shall be the Contractor’s sole responsibility.


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