BW Offshore has signed a Head of Agreement (HoA) with Equinor Canada, confirming its selection as preferred bidder for the Floating Production, Storage and Offloading (FPSO) unit for the Bay du Nord project offshore Newfoundland and Labrador in Canada.
Bay du Nord, Canada’s first deepwater oil project, is operated by Equinor in partnership with BP and holds an estimated 400 million barrels of recoverable light crude in its initial phase.
Under the HoA, BW Offshore and Equinor will continue to advance discussions on all technical and commercial aspects of the FPSO project.
These include further maturation of a smart and cost-effective design through Front End Engineering Design (FEED) work, and agreeing on a commercial solution.
The FPSO will be tailored for the harsh environment of the sub-Arctic. The unit is expected to support production of up to 160,000 barrels of oil per day and will feature a disconnect able turret system and extensive winterization.
The topside will include emission reduction initiatives such as high-efficiency power generation and heat recovery, variable speed drives and a closed flare system. The FPSO will be designed for future tiebacks to enhance the project’s long term economic viability and value creation.
Following pre-FEED completion mid-September, BW Offshore and Equinor will enter into a bridging phase to prepare for FEED in early 2026, subject to approvals by Equinor and BP.
BW Offshore will establish a local office in Newfoundland during FEED, the company noted.
“We are honored to have been selected by Equinor, which shows confidence placed in BW Offshore’s capabilities to support such a pioneering Canadian project. This HoA follows a constructive and close dialogue with Equinor since late 2023 and highlights our commitment to bringing substantial value to the Bay du Nord project.
“It affirms BW Offshore’s commitment to continue work with Equinor to develop a fit-for-purpose and cost-attractive solution where safety, human rights and search for local value creation come first during all phases of the project and operations,” said Marco Beenen, CEO of BW Offshore.
The Bay du Nord discovery lies in waters approximately 1170 meters deep. The later discoveries are in adjacent exploration license EL1156 (Cappahayden and Cambriol) lie in waters approximately 650 meters deep, and are potential tie-ins in a joint project development.
In May 2023, following changing market conditions and subsequent high-cost inflation, Equinor and its partner BP decided to postpone the Bay du Nord development project up to three years.
Equinor said at the time that the postponement would be utilized to optimize the project and continue to actively mature Bay du Nord towards a successful development.
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