Kvaerner bags $481m contract from Statoil for Johan Castberg project

Norwegian engineering company Kvaerner has bagged a contract of around NOK 3.8 billion ($ 481 million) related to the Johan Castberg project in offshore Norway from Statoil.

Under the contract, Kvaerner will construct and install the topside structure for the floating production, storage and offloading vessel (FPSO) of the offshore oil and gas project located in the Norwegian Barents Sea. The Norwegian engineering company will also provide hook-up and integration of the topside modules with the hull, as per the contract terms.

The offshore oil and gas project will see the development of the Johan Castberg field with an investment of NOK 49 billion ($ 5.91 billion). The Johan Castberg field is estimated to contain recoverable resources of 450–650 million barrels of oil equivalent.

Commenting on the Johan Castberg contract to Kvaerner, Torger Rod – Statoil’s senior vice president for project development, said: “The contract includes building a total of ten modules, a flare boom and central pipe rack. The international competition for the contract has been tough, and we look forward to working closely with Kværner in the years to come. Norwegian suppliers have again demonstrated their competitiveness.”

Image of Johan Castberg FPSO. Photo courtesy of Statoil ASA.

According to Statoil, Kvaerner will use various yards such as Sandnessjoen, Verdal, Egersund, Stord and others along the Norwegian coast for the construction work related to the Johan Castberg project.

Kvaerner’s construction work is slated to last until 2021, after which it will take up a complex assembling work. Statoil says that during this period, the topside structure of the FPSO will be installed on the hull and linked to the turret.

Jan Arve Haugan – president & CEO of Kvaerner, commenting on the Johan Castberg contract said: “We are pleased that we in a strong competition have been selected as contractor for one of the most important projects in the global oil and gas market.

“Additionally, it is a strategic advantage for Kvaerner that we further develop our expertise for floating production vessels, as several upcoming field development projects are likely to utilise similar concepts.”

Statoil, which is the operator of the Johan Castberg field with a stake of 50%, says that the first oil from the field is expected to be drawn in the first half of 2022. The Norway-based oil and gas company is partnered in the Johan Castberg project by Eni (30%) and Petoro (20%).