Equinor ASA said Thursday it will continue to avail of the services of Archer AS, KCA Deutag Drilling Norway AS (KCAD) and Odfjell Operations AS on the Norwegian continental shelf under a four-year extension of existing contracts.
“The services they deliver to Equinor are drilling, completion, intervention services, plugging, maintenance and modifications on 19 of Equinor’s fixed installations”, the Norwegian majority state-owned Equinor said in a news release. “They also get support from sub-contractors for some of these services, generating additional jobs along the Norwegian coast”.
Of the fields covered Archer has been contracted for Gullfaks, Sleipner, Snorre and Statfjord. KCAD also has four assignments: Heidrun, Kvitebjørn, Njord and Oseberg. Odfjell has been signed for the Grane, Johan Sverdrup and Visund fields.
The contracts signed 2018 had already been extended once. The latest extensions, which represent the last two of the total three options for extension specified in the deal, take effect October 1, Equinor said.
"We appreciate the good collaboration we have had with these suppliers for many years, and have therefore added a fourth option of two years in addition to those agreed in the original contracts”, Equinor chief procurement officer Mette H. Ottoy said in a news release. “This will help ensure predictability and form the basis for continuous improvements over time. This is a clear signal that we have long-term plans for cooperation with all three suppliers”.
Equinor said it had conducted “a limited competition” to assess technical and commercial capacities. “This has resulted in some redistribution between these suppliers on four of the 19 installations in the contract portfolios”, the press release stated.
Erik G. Kirkemo, Equinor senior vice president for drilling and well operations, said in a statement, “We know these suppliers well, and look forward to continued collaboration about safety improvements, energy management and operational efficiency”.
Equinor highlighted, “The options for drilling services on fixed installations on the Norwegian continental shelf provide jobs for 2000 people per year, and have an estimated value of NOK 18.4 billion [$1.8 billion]”.
Equinor said in its 2023 fourth quarter and full-year results announcement Feruary 7, 2024, that while it expects production level in 2023, when it produced 2.1 million barrels of oil equivalent (boe) per day, to be sustained this year, it said, “Scheduled maintenance activity is estimated to reduce equity production by around 60 mboe [thousand boe] per day for the full year of 2024”.
It expects to spend $13 billion in organic capital for 2024.
The Norwegian Offshore Directorate expects “high activity” that was seen 2023 on the Norwegian shelf to continue this year, the agency said in a report January 11. Ninety-two fields were in operation and 27 projects were under development as of December, it said then.
“Preliminary figures for December indicate a new export record for a single month, with just under 12 billion standard cubic meters [423.78 billion cubic feet] gas”, the directorate said in the January activity update.
“The Norwegian shelf will continue to play an extremely important role for energy security in Europe for many years to come”, it added.
Norway continued to be Europe’s biggest supplier of natural gas in 2023 accounting for 30.3 percent, according to information from the European Council website. It has overtaken Russia following the Putin regime’s invasion of Ukraine 2022.
Official figures released February 20, 2024, showed Norway’s total oil and gas production this year so far was 773.4 million cubic feet (21.9 million cubic meters) of oil equivalent. Most of the volumes were oil at 317.8 MMcfoe (9.0 MMcmoe), followed by natural gas liquids at 42.4 MMcfoe (1.2 MMcmoe), according to the figures from the directorate.
The Nordic country sold 413.5 billion cubic feet (11.71 billion cubic meters) of gas January 2024, down 7.1 Bcf (200 MMcm) compared to December 2023, according to the directorate.
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