Oilfield services giants win big as Equinor hands out over $2 bln worth of contracts

Norwegian oil and gas company Equinor is extending its contracts with three oilfield services giants – Baker Hughes Norge, Halliburton, and Schlumberger Norge – for integrated drilling and well services on its operated fields on the Norwegian continental shelf (NCS).

At the same time, the company is extending its contracts for additional services with the same companies and 13 other suppliers. The contracts will apply for two years from 1 June and the total value is about NOK 20 billion (about $2.1 billion), Equinor informed on Friday.

The contract extension for drilling services has an estimated total value of approximately NOK 14 billion and will give work to around 2000 people distributed on 18 fixed platforms and 10 mobile rigs.

The total value of specialist services in the same period is calculated at close to NOK 6 billion. The specialist services will employ some 600 people.

“Long-term supplier relations have proved to be important in an industry swaying rapidly between good and more challenging times. It ensures predictability and is important to develop this industry in a safe, efficient and sustainable way.” said Mette H. Ottøy, chief procurement officer.

In the drilling service contracts established in 2018, the services were gathered in one contract format, giving one supplier the main responsibility for integrated drilling services, cementing and pumping, drilling and completion fluids, electrical logging and completion on each installation.

Erik G. Kirkemo, Equinor’s senior vice president for drilling & well operations, said: “We see clear benefits from integrated contracts. They have been fundamental to modernise the way we work, both by the establishment of operations centres, solving tasks jointly across disciplines and applying new technologies for close communication between the offshore and onshore organisations. The integrated contracts are well complemented by the framework contracts for specialist services.”

Under the new drilling service contracts, Baker Hughes will work on Grane A, Oseberg B – C – East – South, Transocean Equinox, Transocean Endurance, Noble Lloyd Noble, Visund A, Deepsea Atlantic, Rowan Stavanger, Heidrun A, Askepott, and Johan Sverdrup.

Halliburton will work on Njord A, Heidrun A, Snorre A – B, Kvitebjørn A, Noble Lloyd Noble, Transocean Enabler, Transocean Encourage, and Transocean Spitsbergen.

Schlumberger will cover Gullfaks A – B – C, Kvitebjørn A, Statfjord A – B – C, Visund A, Deepsea Stavanger, Askeladden, Noble Lloyd Noble, COSL Promoter, Deepsea Aberdeen, Johan Sverdrup, and Transocean Enabler.

The specialist service contracts will be extended with Halliburton, Schlumberger, Baker Hughes, Weatherford, Ramex, NOV Wellbore Technologies, Petroleum Technology Company, TCO, Interwell, Welltec Oilfield Services, Roxar Flow Measurement, Sekal AS, Archer Oiltools, Silixa, Tendeka and Ardyne.

The specialist services include electrical submersible pumps, downhole monitoring, tubing conveyed perforation, wired drill pipe, liner hanger, additional completion equipment and services, sand screens, fibre optics, fishing services, downhole mechanical isolation, multilateral technology, coring services, one trip steerable drilling liner system, and expandable hydraulic screens.

Earlier this year, Equinor also extended existing contracts with Archer, KCA Deutag, and Odfjell Drilling for drilling, completion, intervention services, plugging, maintenance, and modifications on 19 assets on the Norwegian continental shelf.