McDermott’s China JV to build modules for Arctic LNG 2 project

McDermott’s joint venture Qingdao McDermott Wuchuan Offshore Engineering (QMW) in Qingdao, China, has been awarded a large contract to provide three complex modules for Novatek’s Arctic LNG 2 Project in Russia.

Arctic LNG 2 project is a major liquefied natural gas development led by Novatek on the Gydan Peninsula, Russia. The development will consist of three liquefied natural gas (LNG) trains, each with a capacity of 6.6 Mtpa, which will be installed on three gravity-based structure platforms.

McDermott defines a large contract as between $50 million and $250 million. The designation refers to McDermott’s share of the award via its joint venture.

The scope includes the fabrication of three pre-assembled unit complex process modules, McDermott said on Tuesday.

QMW will undertake fabrication engineering, partial procurement, construction, and pre-commissioning scope. Fabrication for the modules is scheduled to start at the end of 2019 and be completed in mid-2022.

McDermott’s Senior Vice President Asia Pacific, Ian Prescott, said: “This award recognizes QMW’s experience and excellent performance in the Arctic on an earlier Yamal LNG project.”

He added: “Fabrication will be completed in QMW’s mega module workshop which provides increased certainty for safety, schedule and successful project delivery.”

Novatek last July closed the sale of participation interests in its Arctic LNG 2 Project to two Chinese companies and a consortium of two Japanese companies thereby forming the structure of the project’s participants. The project participants now include Novatek (60%), Total (10%), CNPC (10%), CNOOC (10%), and the Japan Arctic LNG (10%).

Front-end engineering and design for the project was completed last year, confirming preliminary cost estimates of between $20 billion and $21 billion.

Later that month, TechnipFMC was awarded a contract for work on the Arctic LNG 2. The scope of work covers the EPC of the three LNG trains and associated topsides, which will be manufactured on a modular basis in Asian and Russian yards.

At the beginning of August, Saipem reached an agreement with Technip France SA and NIPIgaspererabotka to participate in the Joint Venture for the realization of the Arctic LNG 2 project with a share worth approximately €2.2 billion.

Offshore Energy Today Staff


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