Kvaerner has been awarded a large contract from Statoil for the construction and installation of the topside structure for the floating production, storage and offloading vessel (FPSO) to be located on the Johan Castberg field in the Barents Sea.
The contract has a total value of about NOK 3.8 billion. The development work will take place at several yards along the Norwegian coast.
“This is one of the large pieces of the Johan Castberg puzzle, and is a key component of the FPSO. The contract includes building a total of ten modules, a flare boom and central pipe rack. The international competition for the contract has been tough, and we look forward to working closely with Kværner in the years to come. Norwegian suppliers have again demonstrated their competitiveness,” says Torger Rød, Statoil’s senior vice president for project management control.
Work along the coast
Kværner will utilise a number of yards along the Norwegian coast for the construction work. Yards in Sandnessjøen, Verdal, Stord and Egersund will all be used.
The construction work is scheduled to last until 2021, followed by a complex assembly period. In this period the topside structure will be installed on the hull and connected to the turret. First oil from the field is scheduled for the first half of 2022.
“The Johan Castberg development will generate substantial spinoffs for Norwegian supply industry in the years ahead. The field is also essential to the further development of industry in Northern Norway, and we are pleased that this contract will help increase activities in the north,” says Pål Eitrheim, Statoil’s chief procurement officer.
Johan Castberg will be the sixth project on stream in Northern Norway. The field has been important to the further development of the oil and gas industry in the north. Thanks to Johan Castberg infrastructure will be developed in a new area of the NCS.
Capital expenditures for the Johan Castberg project are estimated at some NOK 49 billion (capex numbers in nominal terms based on fixed currency) and the jobs generated nationwide during the development are estimated at slightly less than 47,000 man-years.
The field will be producing for more than 30 years, and substantial spinoffs will be generated in the long production phase. Castberg will create considerable activities for Norwegian supply companies and generate ripple effects in Northern Norway. Recoverable resources are estimated at 450 – 650 million barrels of oil equivalent.
Statoil sanctioned projects worth NOK 90 billion in 2017 on the NCS. Norwegian suppliers have secured 70% of the contracts related to these projects so far.
The contact is subject to government approval of the plan for development and operation (PDO).