Equinor awarding Northern Lights contracts

December 17, 2020 07:02 CET | Last modified December 17, 2020 07:40 CET
Photo of Sverre OverÄ with Northern Lights template in the background
Sverre OverÄ, project director for Northern Lights, in front of the Northern Lights template. (Photo: Arne Reidar Mortensen)

Equinor awards two key contracts worth NOK 1.3 billion in connection with the Northern Lights project.

KvĂŠrner AS has received a letter of award for the engineering, procurement and construction (EPC) contract for the onshore plant facilities at Energiparken in Øygarden. The onshore plant will receive and store liquid CO2 before it is exported through a pump and pipeline system for injection offshore. The value of the contract is estimated at around NOK 1.05 billion. The start-up of the work is planned in January 2021, and completion is planned by Q1 2024. KvĂŠrner AS is a fully owned subsidiary of Aker Solutions.

Aker Solutions AS has been awarded an EPC contract for delivering a subsea injection system for the CO2 well in the North Sea. The contract is awarded as a call-off under the framework agreement signed with Equinor in 2017. The value of the contract is around NOK 250 million. The work will start in January 2021 with installation and completion in 2023. The contract also includes options for equipment for future wells.

Northern Lights will be the first of its kind – an open and available infrastructure enabling transport of CO2 from industrial capture sites to a terminal in Øygarden for intermediate storage before being transported by pipeline for permanent storage in a reservoir 2600 meters under the seabed.

“These contracts are key to the success of the Northern Lights project. We look forward to working together with Aker Solutions and KvĂŠrner to deliver on our part of the solution to reduce industrial emissions,” says project director for Northern Lights Sverre OverĂ„.

Photo of Peggy Krantz-Underland
Peggy Krantz-Underland, Equinor’s chief procurement officer. (Photo: Christian Djupvik Brandt-Hansen)

The pre-fabrication for the onshore facilities will be done at Aker Solutions’ yard at Stord before site installation. The scope includes facilities at jetty for import of CO2 from ships, storage tanks for intermediate storage of CO2 and process systems.

“Equinor aims to become a net-zero energy company by 2050. This requires that we together with our suppliers develop new value chains and projects such as offshore wind, hydrogen and carbon capture and storage. These projects will enable the supply industry to build new competencies and will create important activity and spin-offs going forward,” says Peggy Krantz-Underland, Equinor’s chief procurement officer.

The Northern Lights project is the transport and storage part of Longship, the Norwegian Government’s full-scale carbon capture and storage project. Equinor is developing the project together with Shell and Total as equal partners.

The procurement process for the onshore plant facilities is being performed in accordance with the Public Procurement Act (“Lov om Offentlige Anskaffelser”) and the Public Procurement Regulations (“Forskrift om offentlige anskaffelser”). In line with the requirements all the bidders in the competition were yesterday informed of the award decision and there is a standstill period that expires on 5 January 2021 when the onshore plant facilities contract will be signed.

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Facts about Northern Lights

  • The Northern Lights project is part of the Norwegian full-scale carbon capture and storage (CCS) project “Langskip” (Longship), supported by the Norwegian government. The project will initially include capture of CO2 from Norwegian industrial capture sources. The Northern Lights project comprises transportation, receipt and permanent storage of CO2 in a reservoir in the northern North Sea.
  • The funding for the project was approved by the Norwegian Parliament on 14 December 2020. A white paper concerning “Langskip” (Longship) will be debated in January 2021. The Plan for Development and Operation will be approved after this debate.
  • Initially, Northern Lights includes capacity to transport, inject and store up to 1.5 million tonnes of CO2 per year. Once the CO2 is captured onshore, it will be transported by newly designed ships, injected and permanently stored 2,600 meters below the seabed of the North Sea.
  • The facilities are scheduled to be operational in 2024.
  • The CO2 receiving terminal will be located at the premises of Energiparken industrial area in the municipality of Øygarden in Western Norway.
  • Exploitation licence EL001 "Aurora" was awarded in January 2019.
  • In March 2020 the Eos confirmation well was successfully drilled and completed, confirming the reservoir characteristics and storage capacity.
  • Plans exist to increase the capacity to 5 Mt per year through additional phases of development and an increasing customer base.