Major contract to Subsea 7 for underwater installations

May 15, 2007, 16:00 CEST

Hydro has awarded a contract worth approximately NOK 1.7 billion to Subsea 7 Norway for underwater installations to the Vega and Vega South fields in the North Sea.

The deliveries comprise delivery and installation of one 14" and two 12" flowlines, 51 km total length, and umbilical from Vega Sør to Vega to the Gjøa platform. The contract includes also necessary protection of the flowlines and umbilicals on the seabed.

The engineering on both projects will start immediately at Subsea 7’s Norway office. Flowlines will be fabricated at Subsea 7’s new spoolbase, which is being built at Vigra on the west coast of Norway. The offshore installation work for both projects will be conducted during spring and summer 2009 by Seven Seas, Skandi Navica and Toisa Perseus.

The Hydro-operated Vega and Vega South fields are due to start production in the fourth quarter of 2010.

The gas and condensate fields Vega and Vega South lie in 380 meters of water in the blocks 35/8 and 35/11 about 80 kilometers west of Florø in Sogn and Fjordane. The finds are distributed between the licenses PL 248 Vega (Vega North and Vega Central) and PL 090C Vega South. The plan for development and operation was submitted to the authorities in December last year at the same time as the plan for development and operation of the Gjøa field.

Recoverable reserves are estimated to be 18 billion standard cubic meters of gas and 26 million barrels of condensate. At peak production, seven million cubic meters of gas and 25,000 barrels of condensate will be produced per day.

A new gas pipeline from the Gjøa field is to be connected to the British FLAGS-pipeline. The Vega/Vega South gas will be transported through this pipeline to the reception facility in St. Fergus in Scotland. The condensate from Vega/Vega South will be exported via a new oil pipeline from Gjøa. This pipeline will be connected to Troll Oil Pipe II, which will transport the oil and condensate to the refinery at Mongstad.

Licensees of PL 248 Vega

  • Hydro (operator) – 40 percent
  • Statoil – 20 percent
  • Petoro – 40 percent

Licensees of PL 090C Vega South

  • Hydro (operator) – 25 percent
  • Revus – 25 percent
  • Statoil – 20 percent
  • Idemitsu – 15 percent
  • Gaz de France – 15 percent