Norwegian major weighs up options for two prized FPSOs

Norwegian major Aker BP is upgrading two of its prized floating production, storage and offloading vessels to extend their use beyond their design life, while in parallel looking at alternatives to potentially replace one of the pair.

The two FPSOs are located in Norway's Skarv and Alvheim areas, and serve as the production stations for multiple fields.

With Skarv and Alvheim both mature and very successful areas — and ongoing infrastructure-led exploration indicating both areas have promising futures — Aker BP is taking a long-term view on both assets out beyond 2040, and therefore needs to upgrade the FPSOs.

Both floaters are producing as normal at their field locations while certain upgrades are carried out, and it is understood that neither unit will be brought onshore to a shipyard.

Market sources said it is more cost effective for Aker BP and its project partners to upgrade the FPSOs offshore if possible.

Upgrades of multiple floating production units at Norwegian yards have been problematic in recent years, sources reminded Upstream. Cost overruns and schedule delays have been a common problem, exemplified by Vaar Energi’s Jotun FPSO, which is still in the shipyard more than four years after arriving.

Potential Alvheim FPSO replacement

In Alvheim’s case, however, there is a possibility the FPSO could be replaced if the economics of a new production solution are superior to the cost of upgrading and maintaining the current FPSO, market sources said.

Aker BP has a project team looking at several alternative solutions for potential deployment before 2030 but only if there is a compelling financial case, said sources.

The project team is studying three options: a new FPSO, a redeployed FPSO, and a mobile offshore production unit such as a jack-up drilling unit with production capacity.

Water depth at Alvheim is shallow enough for a fixed structure, potentially allowing for a MOPU solution alongside a storage unit for the produced liquids, added one source.

Several Norwegian contractors are understood to be involved in design and engineering work on each of the three potential solutions.

A spokesperson for Aker BP said the company has no comment on the potential replacement, and said the current technical lifetime of the Alvheim FPSO is 2028.

“Our base case is to implement the necessary measures to prolong the lifetime of the existing FPSO to 2040,” he told Upstream.

The upgrade of the floater's turbine generator control system was recently performed offshore.

The FPSO began producing in June 2008 after delivery from main contractor Technip with a turret mooring system by APL. The Aibel and Keppel shipyards were responsible for the topsides and hull, respectively.

ConocoPhillips is the sole joint venture partner in the main Alvheim field, but there are more companies that have in recent times tied in their discoveries to the Alvheim FPSO.

They include Vaar Energi (Boyla and Frosk), PGNiG Upstream Norway (Skogul, Tyrving and Vilje), Petoro (Tyrving) and DNO (Vilje).

Sources told Upstream there are several recent discoveries that could also be developed through the Alvheim infrastructure including the high-profile Busta and Norma fields.

Skarv is a newer FPSO

Meanwhile, upgrade works are ongoing at the Skarv FPSO to prepare it for the tie-in of the Alve Nord, Idun Nord and Orn satellite discoveries, also known as the Skarv Satellite project.

Aker BP’s spokesperson said topside modifications are ongoing, to be followed by planned maintenance and various other upgrades.

The floating accommodation vessel Flotel Endurance has been connected to the Skarv FPSO for eight months to help enable the works, the spokesperson added.

The 14-year-old Skarv FPSO was a newbuild design with a gas production capacity of 670 million cubic feet of gas per day, as well as 85,000 barrels per day of oil.

It was the largest North Sea FPSO of its kind when delivered by Samsung Heavy Industries in 2010, and still has one of the world’s largest offshore gas processing capabilities on an FPSO.

Aker BP is the operator of Skarv on behalf of partners Equinor, Harbour Energy and PGNiG Upstream Norway.