Snøhvit Future: Aibel Wins EPCI Contract for Melkøya Plant Upgrades

The Hammerfest LNG plant.
(Photo Øivind Haug  Equinor)
The Hammerfest LNG plant. (Photo Øivind Haug Equinor)

Norwegian oil and gas company Equinor, on behalf of its partners in the Snøhvit offshore gas field in the Barents Sea, has awarded Aibel a major contract for Hammerfest LNG modifications in connection with the Snøhvit Future project.

The Snøhvit field lies in the central part of the Hammerfest basin in the southern part of the Barents Sea, in a water depth of 310 meters.

The Snøhvit Future project involves upgrading the Hammerfest LNG Plant at Melkoya island, through which the Snohvit field has been developed, sending gas through a 143-kilometer pipeline.

Aibel has won an EPCI contract that involves the engineering, procurement, construction, and installation of two new processing modules related to the onshore compression and electrification of the Melkøya plant. Aibel will also build a new receiving station for power from shore and carry out integration work at the plant.

The contract is an option in the FEED contract (front-end engineering and design) awarded to Aibel in September 2020.

Mette H. Ottøy, Equinor's chief procurement officer said: "Aibel has been one of our main suppliers for Hammerfest LNG since the start-up in 2007. They know the plant well, have set up a local department in Hammerfest, and have solid experience from other major modification projects on plants while on stream. I, therefore, have high expectations of them doing a good job safely. This contract will have major ripple effects locally, regionally, and nationally.

Aibel will also carry out further upgrades of existing systems at Hammerfest LNG to make the plant more resilient for extended life until 2050.

In 2023 and 2024, Aibel will award several major contracts to its subcontractors for work at the plant and will facilitate the use of local suppliers in several phases of the project, including construction. The engineering/design work starts immediately.

Aibel will carry out large, complex modifications at Hammerfest LNG. The company will also build larger modules at their yards and most of the work will be carried out in the period of 2024-2026.

"The largest project at Melkøya since the plant came on stream, Snøhvit Future will create significant ripple effects. It is expected that about 70 percent of the value creation will go to Norwegian companies, and more than a third of this to Northern Norway. Regional employment during the project period is estimated at 1 680 person-years (5 400 person-years nationally)," Equinor said.

The Snøhvit Future project consists of online compression and electrification of Hammerfest LNG at Melkøya.

As the pressure drops in the reservoirs, compression is required to ensure sufficient flow of the gas to the plant. The project will extend plateau production and ensure high gas exports, jobs, and ripple effects also after 2030, while reducing CO2 emissions from the plant by 850,000 tonnes annually, corresponding to 2 percent of Norway’s total emissions, according to Equinor The Norwegian parliament has decided to reduce Norwegian emissions by 55 percent by 2030.

According to Equinor, NOK 13.2 billion (currently around $1,3 billion) will be invested in the Snøhvit Future project, ensuring the continued operation of the plant towards 2050."

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