Odfjell Drilling wins North Sea contracts worth up to $1.04 Billion

Jun 15, 2015 12:00 AM

Norwegian oil major Statoil has awarded rig firm Odfjell Drilling contracts worth up to $1.04 billion for work on the giant Johan Sverdrup field in the North Sea, Odfjell said on Monday.

The Deepsea Atlantic drilling rig has won a three year contract worth $330 million for drilling production wells, with additional options to extend the work by up to three years worth between $370 million and $470 million, it said.

Odfjell was also awarded a four year contract, with six one-year options to extend, to provide platform drilling services worth $240 million, including the optional periods.

Statoil has been recommended as operator of the field by the other partners including Lundin Petroleum, Petoro, Det norske and Maersk Oil, a unit under Denmark's A.P. Moeller-Maersk.

"The Deepsea Atlantic rig will drill minimum 13 pilot wells on the field prior to production start from Johan Sverdrup in late 2019. This enables us to utilise the production capacity from Johan Sverdrup as efficiently as possible," Statoil's project manager for the field, Oeivind Reinertsen, said in a separate statement from the oil firm.

The three-year deal for the Deepsea Atlantic drilling rig will give Odfjell a day rate of about $300,000, according to a Reuters calculation, in line with recent deals in the market but only half the level seen prior to last year's sharp drop in crude prices.

Sverdrup, Europe's costliest offshore energy project, contains up to 3 billion barrels of oil equivalent (boe) and could operate for 50 years, giving a boost to Norway's declining oil industry.

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