Two key contracts awarded for Northern Lights project

Norway’s Equinor has awarded two key contracts in connection with the Northern Lights carbon transport and storage project worth a total of NOK 1.3 billion ($149.8 million).

Earlier this week, following a historic vote in parliament, the Norwegian Government announced its funding decision for the Northern Lights CO2 project.

The project will enable the shipping, reception, and sequestration of CO2 in geological strata in the Northern North Sea, approximately 2,600 meters below the seabed.

The first big contract for the project was awarded back in October for building site preparation and the construction of jetty facilities for the CO2 receiving terminal. The contract was awarded to Skanska.

Now, following the decision by the Norwegian government, Equinor has awarded further contracts for the project.

Kværner has received a letter of award for the engineering, procurement and construction (EPC) contract for the onshore plant facilities at Energiparken in Øygarden.

The onshore plant will receive and store liquid CO2 before it is exported through a pump and pipeline system for injection offshore. The value of the contract is estimated at around NOK 1.05 billion ($121 million).

The start-up of the work is planned in January 2021, and completion is planned by 1Q 2024. Kværner is a fully owned subsidiary of Aker Solutions.

Furthermore, Aker Solutions has been awarded an EPC contract for delivering a subsea injection system for the CO2 well in the North Sea. The contract is awarded as a call-off under the framework agreement signed with Equinor in 2017.

The value of the contract is around NOK 250 million ($28.8 million). The work will start in January 2021 with installation and completion in 2023. The contract also includes options for equipment for future wells.

Northern Lights will be the first of its kind – an open and available infrastructure enabling transport of CO2 from industrial capture sites to a terminal in Øygarden for intermediate storage before being transported by pipeline for permanent storage in a reservoir 2600 meters under the seabed.

“These contracts are key to the success of the Northern Lights project. We look forward to working together with Aker Solutions and Kværner to deliver on our part of the solution to reduce industrial emissions”, says project director for Northern Lights Sverre Overå.

The pre-fabrication for the onshore facilities will be done at Aker Solutions’ yard at Stord before site installation. The scope includes facilities at jetty for import of CO2 from ships, storage tanks for intermediate storage of CO2 and process systems.

“Equinor aims to become a net-zero energy company by 2050. This requires that we together with our suppliers develop new value chains and projects such as offshore wind, hydrogen and carbon capture and storage. These projects will enable the supply industry to build new competencies and will create important activity and spin-offs going forward”, said Peggy Krantz-Underland, Equinor’s chief procurement officer.

The Northern Lights project is the transport and storage part of Longship, the Norwegian Government’s full-scale carbon capture and storage project. Equinor is developing the project together with Shell and Total as equal partners.

The procurement process for the onshore plant facilities is being performed in accordance with the Public Procurement Act and the Public Procurement Regulations .

Equinor noted that, in line with the requirements, all the bidders in the competition were yesterday informed of the award decision and there is a standstill period that expires on 5 January 2021 when the onshore plant facilities contract will be signed.