Success with frame agreements

December 3, 2003, 09:00 CET

The principal gas pipeline contracts for the Ormen Lange transport and field project in the Norwegian Sea were awarded recently under Statoil’s frame agreements.

Worth about NOK 10 billion in all, these orders relate to weight coating and corrosion protection as well as steel and pipelaying for the Ormen Lange gas export system.

Statoil operated all the major gas pipeline projects from the Norwegian continental shelf to Belgium, Germany and France in the 1980s and 1990s.

The group thereby acquired experience with the technology for and execution of submarine pipeline projects, and is noted for its expertise in this field.

“Our earlier projects have allowed us to refine our contract strategies, with the optimum use of competing frame agreements,” says Odd Nøland, head of procurement for the project execution unit in Exploration & Production Norway.

Steel deliveries, weight coating and pipelaying account for almost 70 per cent of the investment in a typical pipeline project, he explains.

Such developments are characterised by a limited number of large contracts with international suppliers.

Norsk Hydro is development operator for Ormen Lange, including the transport system, and collaborates with Statoil on planning and executing the pipelaying work.

The Ormen Lange gas export system is due to run from the landfall terminal at Nyhamna in mid-Norway to Easington on the UK east coast.

Passing via Statoil’s Sleipner Riser platform in the North Sea, this pipeline will be 1,200 kilometres long.