Odfjell wins Johan Sverdrup drilling contracts

Statoil, on behalf of the Johan Sverdrup license, has awarded two contracts at a total value of more than NOK 4.35 billion to Odfjell Drilling for drilling wells on the Johan Sverdrup field.

Odfjell Drilling has been awarded contracts both for the Deepsea Atlantic semisubmersible rig and for drilling services on the fixed drilling unit to be installed on the Johan Sverdup field. The rig contract includes the charter of the Deepsea Atlantic rig for three years, starting from March 2016. In addition there are six 6-month options. The rig contract has a value of slightly more than NOK 2.5 billion.

Statoil has also signed a contract with Odfjell Drilling for drilling services on the fixed drilling unit on the Johan Sverdrup field complex starting in December 2018. This contract has an estimated value of NOK 1.85 billion, and a duration of four years, including six 1-year options. Drilling from Johan Sverdrup’s fixed installation will be supported from Odfjell Drilling’s office in Stavanger, Norway.

The drilling rig for the Johan Sverdrup field will be built by Aibel together with Nymo in Grimstad and National Oilwell in Kristiansand. In February, Odfjell Drilling was awarded a contract by Aibel for engineering support for the construction of the drilling platform. Odfjell will also act as a consultant during the rig engineering and construction process. The contract is an extension of the contract for drilling on fixed installations awarded in 2012, vesting the responsibility for the Grane, Visund, Heimdal, Njord, Snorre A/B, and Sleipner installations in Odfjell Drilling.

These contract awards are subject to the approval of the plan for development and operation of the Johan Sverdrup field by the Norwegian parliament in 2015. The investment costs for Phase 1 of the Johan Sverdrup development are estimated at some NOK 117 billion NOK (2015 value). Recoverable resources are projected at between 1.4 and 2.4 billion barrels of oil equivalent.

The development concept for Johan Sverdrup phase 1 will consist of four installations, including a utility and accommodation platform, a processing platform, a drilling platform and a riser platform, in addition to three subsea templates for water injection. The platforms will be bridge-linked. The project aims at a recovery rate of 70% for Johan Sverdrup.

The Johan Sverdrup partnership consists of Statoil, Lundin Norway, Petoro, Det norske oljeselskap, and Maersk Oil. The partnership has recommended Statoil as the operator of all field phases.

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