Kvaerner Enters Steel Jackets Deal with Statoil

Kvaerner and Statoil have established a frame agreement for delivery of steel jacket substructures to Statoil-operated fields.

Subject to all necessary approvals for the project to proceed, early estimates of the total value of the two jacket deliveries will be approximately $490m.

Johan Svedrup is located at a water depth of 120 meters off the West Coast of Norway. Statoil is the operator for the field, and first development phase of the field is to establish infrastructure and a field centre which includes four offshore platforms based on steel jacket substructures which will stand on the seabed.

“It is highly pleasing that Kvaerner has managed to come up with a competitive and forward-looking delivery model.

By doing so, Kvaerner has demonstrated that cost-reduction measures and increased efficiency do bear fruit.

 Safe and cost-effective resource utilisation and long-term value creation are our most important tasks,” states Statoil CEO Helge Lund.

With the Letter of Intent, Kvaerner will start the preparation work for the delivery of two complete jackets for Johan Svedrup, one for the Riser Platform, and one for the Drilling Platform.

Both deliveries will include engineering, procurement and construction.

The engineering will be performed at Kvaerner’s offices in Oslo, and will start late 2014.

The project management will be based at Kvaerner’s specialised jacket- facility in Verdal in Mid-Norway.

This is also where the assembly will take place from the first quarter of 2016.

The new project will entail work for many people working for Kvaerner’s suppliers, and some subcontractors will start pre-fabrication already during the summer of 2015.

The frame agreement between Statoil and Kvaerner includes studies, front end engineering design (FEED), detail engineering, procurement, fabrication and project management for deliveries of steel jacket substructures to Statoil-operated fields at the Norwegian continental shelf.

There are no limitations with respect to the number of jackets which may be ordered under the agreement.

The frame agreement lasts until 2020. The contract party is Kvaerner’s fully owned subsidiary, Kværner Verdal AS.

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Press Release; June 26, 2014