Breakthrough Award for Ormen Lange Subsea Compression

Hydro has awarded Aker Kvaerner a total contract which could be worth up to NOK 850 million for the Subsea Compression Pilot for Ormen Lange. This is a world first for subsea compression. If the project provides the expected results, the Ormen Lange partners will have a cost effective alternative to the offshore platform originally planned.

Full execution of the contract is subject to the Ormen Lange partners' approval of both work programme and budget for the subsea compression pilot programme, and a limited scope of work and cost exposure has been agreed. The aim of the project is to evaluate whether a subsea compression station, at approximately 900 metres water depth, is a viable alternative to an offshore platform. Later in the production phase, the challenge at Ormen Lange will be to boost the well stream in order to maintain production of gas and condensate from the reservoir. The Pilot is identical to one of four trains on the proposed full-scale subsea compression station. The contract includes an option for the partners to choose Aker Kvaerner to deliver the complete subsea compression station - a decision expected late in 2011.

"We are extremely happy to announce this breakthrough contract. For 20 years Aker Kvaerner has worked continuously to develop a robust subsea gas compression system in close cooperation with the industry. What's more, this technology is applicable to other field developments both in Norway and Russia - and all over the world," says Aker Kvaerner executive vice president Raymond Carlsen.

Currently, Aker Kvaerner is constructing the onshore process facility for Ormen Lange at Nyhamna with nearly 5000 people working in rotation. "By combining our subsea gas compression know-how with the extensive knowledge of the process facility at Nyhamna and our proven track record for executing projects, we are confident in the success of the Pilot," says Carlsen.

Subject to the partners' final approval, Aker Kvaerner's scope of work comprises concept development, engineering, procurement, construction and qualification of the subsea compression station pilot. The objective of the pilot project for Ormen Lange subsea compression is to perform a controlled endurance test from 2009 to 2011 at Nyhamna onshore terminal.

The engineering phase starts immediately. Approximately 90.000 engineering hours will be carried out at Aker Kvaerner's office in Oslo, Norway. The compact and modularised pilot will be constructed and assembled in Norway at Aker Kvaerner's Egersund yard and will be ready for installation in January 2009. A purpose-built test pit for the compression pilot is being prepared at Nyhamna.

The Pilot will be carried out as an integrated project, using Aker Kvaerner's project execution model, with resources from several Aker Kvaerner companies, including Subsea and Engineering & Technology. The contract partners are Aker Kvaerner Subsea AS and Hydro acting as operator on behalf of the Ormen Lange Group.

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Posted 10/06/07

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