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Murmansk supplier center to be opened

November 17, 2005, 08:45 CET

Hydro is establishing a supplier development center for Russian industry in Murmansk, as well as its own representation office. These activities mark new steps forward in Hydros ongoing commitment to Northwest Russia.

The latest developments in the cooperation between Northwest Russia and Hydro were formally agreed upon during a meeting between the governor of Murmansk Province, Yury Evdokimov, and Hydro Oil & Energy senior vice-president Bengt Lie Hansen on Wednesday November 16.

“Hydro is further expanding its activities in Northwest Russia to prepare Russian suppliers for future oil and gas developments in the region, such as the Shtokman project,” said Bengt Lie Hansen during a press conference held in Murmansk on Wednesday.

As part of the agreement, a supplier development center will be established in Murmansk during December 2005. A further supplier development center will be established in Arkhangelsk.

“We will also establish a Hydro representation office in Murmansk in order to support our increasing activities in the region, such as the drilling of Shtokman appraisal well 7, which is planned for 2006,” added Lie Hansen.

As part of the agreement with Murmansk Province, Hydro will also establish a social program fund to support social and environmental initiatives in Murmansk.

In September Hydro signed an agreement with Murmansk State Technical University with the intention of training future specialists in the development of oil and gas resources in the Russian Barents Sea. The first grants to students, teachers and doctorates were announced in October.

Part of supplier development program
Hydro’s cooperation with Murmansk Province is part of Hydro ongoing Shtokman Supplier Development Program which aims to prepare Russian suppliers for the upcoming offshore development.

“We wish to apply Hydro’s Ormen Lange development project model which accumulates over 30 years’ offshore experience gained on the Norwegian Continental Shelf, “ explains Lie Hansen.

“Through our close cooperation with governmental bodies, academia and suppliers we have achieved a very high degree of national content in Norway’s largest ever industrial project. Such broad cooperation is essential in order to deliver large-scale petroleum projects on time and budget.”

“We now wish to share our experience with Russia and Russian organizations in order to secure successful offshore projects with a high component of Russian supplies.”

Hydro’s Supplier Development Program was launched three years ago, following a 2002 meeting between Russian President Putin and Norwegian Prime Minister Bondevik, when the two leaders addressed the importance of closer cooperation in Northwest Russia between the countries.

So far Hydro has identified over 450 suppliers, assessed 60 of them, and pre-qualified 11 Russian suppliers for work on the Norwegian and British Continental Shelf through the Achilles system. Two of these companies, Murmansk Ship Yard and Mostotryad 9, are currently supplying Norwegian companies.