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Vale contracts awarded

January 17, 2001, 00:00 CET

Hydro has awarded two contracts worth about NOK 220 million in connection with the development of the Heimdal satellite Vale.

Stolt Offshore has been awarded the flowline and umbilical contract worth approximately NOK 160 million. The scope includes coating, laying and trenching of the 16.5 kilometres, 8-inch flowline between the Vale subsea production system and the Heimdal Riser Platform.

Furthermore Stolt will perform engineering, procurement, laying and trenching of the umbilical. Tie-ins of the lines at both ends are also included. The offshore installation work will be carried out in August this year and production start from Vale is planned for December 2001.

Fabricom has been awarded the contract for the required topside modifications on the Heimdal platform for the Vale and Vesterled projects. The scope contains detailed engineering, procurement, onshore fabrication and offshore installation including completion. Engineering starts immediately and the offshore work is planned for May - September this year. The contract value is approximately NOK 60 million.

The Vale development is representative of the significant future challenges Hydro faces on the Norwegian continental shelf. Vale is a marginal field that lies near existing platforms and pipelines. It is imperative Hydro exploit such deposits in the best possible way. Hydro has demonstrated the priority placed on rigorous economic demands to ensure optimal recovery of the resources.

Vale is a field with 2.5 billion Sm3 gas and about 21 million barrels of condensate. Vale will be developed as a satellite field with a subsea template tied in to the new riser platform on Heimdal.

The investments are estimated at NOK 800 million and include modifications on Heimdal, drilling, subsea template and pipelines. About NOK 260 million is already invested in connection with the Heimdal 2000 project in order to prepare for the Vale development.

Hydro is the operator with a 28.53 percent share in Vale. Other shareholders are Marathon (46.90 percent) ,TotalFinaElf (24.24 percent) and Ugland (0.32 percent).

Vesterled is a 50 kilometre long, 32 inch thick, gas pipeline which will connect the Heimdal platform to the existing Norwegian Frigg pipeline from Frigg to St. Fergus in Scotland. The pipeline will cost about NOK 600 million, have a capacity of 11 billion Sm3 gas per year, and is scheduled to come on stream October 1, 2001.