Aker Solutions has secured an engineering, procurement and construction (EPC) contract from Altera Infrastructure for the complete upgrade of a floating production storage and offloading vessel (FPSO) to be redeployed at an Equinor-operated oil and gas field offshore UK.
Under the contract defined as “substantial”, Aker Solutions will deliver the upgrade of the Petrojarl Knarr FPSO set to be reused and redeployed at the Rosebank field development.
The work will be performed in a joint venture (JV) with Drydocks World-Dubai, and the upgrade will take place at the company’s yard in Dubai, UAE. The detail design will be carried out in Norway by Aker Solutions in collaboration with Citec Norway, ABB Norway and OneSubsea Processing.
The EPC contract is a combination of work with new build, demolition and life extension (hull, marine systems and topsides) required for the FPSO to be kept on the field for 25 years without drydocking.
“We will execute this project together with our long-standing partner Drydocks World-Dubai, and we are looking very much forward to continuing our long-term relationship,” said Sturla Magnus, Executive Vice President and Head of Aker Solutions’ topside and facilities business.
“Collaboration and partnerships are core to Aker Solutions’ strategy and to how we work. It also enables us to handle capacity in the most safe and efficient way, with a strong focus on solutions that reduce emissions.”
The EPC work is planned to start during the first half of this year and is scheduled to be completed at the end of 2025. The Petrojarl Knarr FPSO was transported to Aker Solutions yard at Stord in August 2022 and will be stored there until the planned tow to Dubai during the second half of 2023.
Aker Solutions expects to book an order intake of around NOK 2.5 billion (circa €234.8 million) related to the contract in Q1 2023 in the Renewables and Field Development segment, pending final investment decision and regulatory approvals.
The Rosebank oil and gas field, located about 130 kilometers off the coast of the Shetland Islands in the UK, has an estimated 300 million bbl of potentially recoverable reserves.
Equinor acquired operatorship in 2019 and has since been working to optimize and mature a development solution for the field, originally discovered in 2004, together with partners Suncor and Ithaca Energy. The environmental statement (ES) related to the development of the oil field was filed to the UK authorities in August 2022.
However, Rosebank has been facing obstacles that may hinder its progress and delay its sanctioning. Namely, environmentalists are opposing the project and demanding a halt under the campaign slogan #StopRosebank.
Activists have stated that “burning the oil and gas from Rosebank would produce more CO2 than the annual CO2 emissions of the 28 lowest-income countries in the world combined” and have asked MPs to oppose the development of this project, same as they previously did with the Cambo oil field.
Worries do not stop there. The UK’s government decision to increase the windfall tax on oil and gas producers’ profits to 35 per cent from the rate of 25 per cent is said to represent a risk to driving out oil and gas investments from UK waters, as well as to the development of the Rosebank field.
Offshore Energies UK (OEUK) warned that the UK offshore industry will be “hit hard” by these tax changes, threatening to drive out investors and drive up imports, leaving consumers increasingly exposed to global shortages.