Balder X subsea contract goes to Baker Hughes and Ocean Installer
- Business & Finance
Norwegian oil and gas company Vår Energi has awarded a contract covering engineering, procurement, construction and installment (EPCI) of subsea systems (SPS/SURF) for the Balder X project to a consortium of Baker Hughes, a GE company (BHGE), and Ocean Installer.
The ongoing Balder X Project includes the redevelopment of the Balder and Ringhorne field area in the North Sea offshore Norway.
The Balder X Project will extend the life of the Jotun A FPSO towards 2045 through refurbishing it and relocating it to the Balder license PL 001, the first production license on the Norwegian continental shelf.
If production proceeds according to the current estimates, the Balder X Project will give PL 001 a total lifespan of over 80 years, Vår Energi said in a statement on Friday.
Kristin Kragseth, CEO of Vår Energi, said: “We are pleased to award this important contract to the BHGE and Ocean Installer consortium. It will provide new activity to the world-class oil service industry we have in the Stavanger region. Both consortium companies a have strong local presence, and large portions of the construction and engineering work will come from local suppliers, securing employment in the region.”
Under the contract the consortium companies will engineer, procure, construct and install new subsea production systems (SPS), umbilicals, risers and flowlines to the Jotun A FPSO. BHGE and Ocean Installer will also carry out decommissioning and cleaning up the seabed by removing redundant subsea systems and equipment from the Jotun field.
Kevin Murphy, CEO, Ocean Installer said: “The Balder X project is the largest award in Ocean Installer’s history, it doubles our order backlog and allows us to be part of Vår Energi’s first major development in this region.”
The redevelopment of the Vår Energi-operated Balder and Ringhorne fields entails major future project activities. This includes extending the lifetime of the Jotun A FPSO towards 2045, extending the life of the Balder FPSO towards 2030, drilling of 15 new production wells in the Balder field area and 11 new production wells in the Ringhorne field area.
Vår Energi is also planning to execute several exploration drilling campaigns, in addition to the extensive production drilling program.
Tom Huuse, Director, Norway and Denmark, BHGE said: “Through our Subsea Connect approach, leveraging early engagement with our customer, we were able to optimize the development cost of this significant award.”
Vår Energi has reserves and resources of more than 1,250 million barrels of oil equivalent (Mboe), and is expected to reach a daily production of 250,000 barrels of oil equivalent by 2023. This will require developing more than 500 million barrels of oil equivalent in over ten existing projects in Vår Energi’s development portfolio on the Norwegian continental shelf.
Vår Energi is on track to become Norway’s second-largest E&P company following an agreement with ExxonMobil to buy its offshore oil field interests in Norway for $4.5 billion.