Odfjell Drilling Chosen for Breidablikk Drilling

A letter of intent has been issued to Odfjell Drilling and the Deepsea Aberdeen rig for drilling of 15 wells for the Breidablikk group, for which the partnership recently submitted the plan for development and operation (PDO). Drilling is scheduled to start in the spring of 2022, and the campaign is estimated to last until the autumn of 2024.

The agreement includes options for drilling additional nine wells before continuous optionality apply. The estimated value of the fixed part of the agreement is USD 290 million. Additional costs include a number of integrated services, maintenance, modifications, mobilization and demobilization.

The contract is estimated to create 200 man-years in Norway connected to the rig, and an additional 20-40 man-years related to support functions.

“We have had excellent cooperation with Odfjell over time, and they have consistently delivered wells safely and efficiently to us by use of the Deepsea Atlantic drilling rig. This time a sister rig with the same technical design will be used and we have high expectations to Deepsea Aberdeen as well. Through this agreement we are enhancing our cooperation with Odfjell based on our good experience with the company, and it will be exciting to develop this further,” says Erik G. Kirkemo, senior vice president of drilling & well operations in Equinor.

Deepsea Aberdeen is a semi-submersible 6th generation rig with a dual derrick.

“In this contract we have further developed the performance-based compensation system, enabling the supplier to increase their profit per well delivery by completing safe and efficient operations. We regard this as an important step towards reaching our ambition of shifting focus from rate per day to cost per well, a move we believe is important to ensure sustainable costs in the future,” says Equinor’s chief procurement officer Peggy Krantz-Underland.

At the end of September, Equinor and its partners submitted the PDO for Breidablikk. Several contracts have been awarded and Norwegian companies are expected to account for around 70% of the value creation in the development phase. Estimated field recovery is around 200 million barrels and investments will be around NOK 18.6 billion.

All contracts are subject to the authorities’ approval of the PDO.

The licence partners in Breidablikk are Equinor (operator), Petoro AS, Vår Energi AS and ConocoPhillips Skandinavia AS.

Source: Equinor
Date: Oct 5, 2020