Norwegian contractor Framo Engineering has landed a coveted Nkr900 million ($155 million) contract from Statoil for a subsea gas compression installation at the Gullfaks South field off Norway.
It marks the second such project to be pursued by the Norwegian state oil company, following a similar scheme to be implemented at Aasgard in 2015, though the award is contingent on a positive final investment decision.
Framo, a subsidiary of Schlumberger, will carry out design and construction of the subsea plant under an engineering, procurement and construction contract, after earlier being awarded a technology development deal in 2009.
Work on the contract, which runs until November 2015, will start immediately.
It is the first such award for the Bergen-based contractor after it was earlier pipped by Norwegian rival Aker Solutions for the Nkr3.4 billion contract on Aasgard.
Further contracts for platform modifications and marine operations in connection with the Gullfaks South development are set to be awarded during the summer and autumn, subject to investment being given the green light.
The operator aims to use subsea compression to boost recovery from mature fields off Norway by increasing pressure to compensate a natural decline in reservoir pressure, thereby extending their producing lives.
The company is looking to boost the recovery rate at Gullfaks to 74%, from the current level of 62%, through the application of subsea compression as well as low-pressure production, which could extend the life of the field to 2030.
“This may increase the production from the field by 3 billion cubic metres of gas, enabling Gullfaks to sustain plateau production for gas export,” said head of North Sea West operations Jannicke Nilsson.
The compression facility would be located in the southern part of the field, about 15 kilometres from the Gullfaks C platform.
The ground-breaking technology – the first of its kind in the world – is considered a key building block towards Statoil’s goal of developing a complete subsea factory with processing facilities on the seabed by 2020.
Such facilities could prove key to developing fields in challenging locations such as the Arctic, located in deep waters, far from shore and in harsh environments.
Statoil's senior vice president for technology Siri Espedal Kindem said: ”Subsea gas compression represents an important leap forward in the efforts to improve recovery and extend the producing life of several gas fields."
Statoil is also involved in technology qualification for Anglo-Dutch supermajor Shell for a subsea compression concept at Ormen Lange.