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Statoil cancels $1.8 bil contract for rig aimed at boosting Norwegian oil recovery

24 Jun 2013
Norwegian group Statoil has cancelled a $1.8 billion contract with engineering group Aker Solutions, to provide a new technology Category B rig which it had hoped would be an important contribution towards increasing recovery from existing fields.

In addition to rig rental, the contract also included rental of the necessary equipment and services to carry out well intervention, side-track drilling, ROV operations, well testing and cementing. The new rig was set to be in service during 2015 and was developed for undertaking different types of well intervention with the aid of cable and coiled tubing operations.

"The contract for Cat B services was signed in April 2012, since which time supplier Aker Solutions, supported by Statoil, has worked to define and solve the technical challenges posed by the rig's subsea systems," the 67% Norwegian state-owned company said. "Although significant progress has been made in tackling these challenges, further technology qualification still remains," it added.

Statoil said Aker Solutions took the initiative to talk with Statoil regarding the terms and conditions for the Cat B services, after which both parties agreed to cancel their contract and both will incur charges as a result.

"Unfortunately, we have to declare that it is impossible to achieve this important, major industrial project within the scope of the current contract," says Jon Arnt Jacobsen, Statoil's chief procurement officer.

Statoil had said development of technology for increasing the recovery from operating fields was a key area of commitment for the company, in its attempts to sustain production offshore in Norway and increase production globally.