OIL

Worley consortium wins US$90m Russian oil contract

TWO of the world’s biggest oil companies – US-based ConocoPhillips and Russia’s LUKOil – have awarded a US$90 million (A$122.15 million) contract to the GWZ Consortium, which includes contract company WorleyParsons Ltd.

The other GWZ partners include Russian-based Globalstroy-Engineering and Zarubezhneftstroymontazh.

GWZ will provide a US$1.5 billion project northeast of Moscow with front-end engineering design (FEED), detailed engineering, procurement, construction management, and commissioning services for grassroots production and transportation facilities.

The Yuzhnoye Khylchuyu (YK) field, a NaryanMarNefteGaz joint venture between ConocoPhillips and LUKOil, is 120km northeast of Naryan-Mar and 2300km northeast of Moscow on the Barents Sea coast.

Worley’s chief financial officer, David Housego, says the consortium project management team will be based in Moscow, with satellite offices in Samara and Naryan Mar and at the YK Field construction site.

“[They] will ensure adherence to a tight construction-driven schedule shaped by the required date for first oil production, weather windows and restricted overland access, and will also ensure that Russian sources be used for project procurement to the maximum practicable extent,” Housego said.

FEED studies, detailed engineering, and procurement will be performed primarily in Samara, supported by WorleyParsons’ London office, Housego said.

The YK field will be developed in two phases. The first production phase involving Train 1 will deliver 60,000 barrels per day of oil by the end of 2007 to the nearby LUKOil Varandei terminal. The full field production phase, using Trains 2 and 3, will then raise production to 165,000 barrels/day by the end of 2008, Worley said.

The work includes oil-gathering lines, metering facilities, a central processing facility (CPF), and a 162-kilometre pipeline to LUKOil’s Varandei terminal.

In addition to oil production, the CPF will include 90 million standard cubic feet per day of gas treatment to meet fuel gas and re-injection specifications, sulphur removal and disposal, and a 125 megawatts of power generation and distribution to Varandei.

It will also involve a high-pressure compressor station to transfer and re-inject excess gas into the nearby Yareiyu field, produced water treatment, 780,000 barrels of oil storage, and emergency flare facilities.

The infrastructure work includes permanent living quarters, offices, utility systems, offloading dock, roads, warehouses, shops, garages, fuelling stations, helicopter landing pads, and temporary construction facilities, Worley said.

The GWZ Consortium is led by Globalstroy-Engineering, one of Russia’s largest oil and gas engineering and construction companies.

WorleyParsons, a worldwide provider of services to the energy, resource, and complex process industries, will contribute engineering, procurement, and project control services.

Zarubezhneftstroymontazh, a subsidiary of the Russian oil services company Zarubezhneft, owns Samara-based design institute Giprovostokneft, which will be the major design services subcontractor for the GWZ Consortium.

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