Samsung Heavy Awarded $888m Johan Svendrup Contract

Johan Sverdrup Platforms

Published Jun 30, 2015 9:25 AM by The Maritime Executive

Norwegian oil major Statoil has awarded Samsung Heavy Industries an $888 million contract for two platform decks on the giant Johan Sverdrup field in the North Sea, it said on Tuesday.

The contract includes fabrication of decks for both the process and riser platforms for the Sverdrup field, a discovery with up to 3 billion barrels of oil equivalents that will cost as much as $28 billion to develop fully.

The function of the process platform, which weighs approx. 26,000 tons, is to ensure stabilization of the oil and processing into rich gas. 

The riser platform, which weighs approx. 22,000 tons, will serve oil and gas exports, water and gas injection, as well as any future connections. The power cable from onshore also ends at this platform, where the current is transformed from direct current into alternating current for further distribution to the field center.  

The platform deck will be manufactured at the Samsung’s shipyard in South Korea. 

According to Margareth Margareth Oevrum, executive vice president for Technology, projects and drilling at Statoil, Samsung was chosen for the contract because of its extensive manufacturing experience with similar types of installations. It also reportedly provided a competitive bid from a host of other international companies vying for the contract.

Other competitors for the platform deck contracts included Korea's Hyundai Heavy Industries and Daewoo Shipbuilding, Upstream reported in May.

With this latest award, all contracts for the four platform decks have been awarded. The decks for the drilling platform and accommodation platform have already been awarded to Aibel (EPC) and Kværner Stord (EPC). In addition, 65% of the equipment packages have so far been awarded to suppliers with Norwegian billing addresses.

Sverdrup, Europe's costliest offshore energy project, could give a boost to Norway's declining oil industry.

Øivind Reinertsen, project director of Johan Sverdrup field development emphasized the importance of the project saying, "Johan Sverdrup will be of major significance to the whole of society for at least 50 years into the future.”

Statoil has been recommended as operator of the field by the other partners including Lundin Petroleum, Petoro, Det norske and Maersk Oil, a unit under Denmark's A.P. Moeller-Maersk.