Petrofac awarded major Australian decommissioning contract

Petrofac, a leading provider of services to the global energy industry, has been awarded a major decommissioning contract by the Australian Government, heralding the start of an era of decommissioning in the nation's offshore oil and gas sector.

Petrofac's Australia team based in Perth, WA, has been contracted to complete Phase 1 of the decommissioning of the Northern Endeavour FPSO (floating production, storage and offtake) facility.

The contract, awarded by the Federal Department of Industry, Science, Energy and Resources, follows a stringent selection and due diligence process by the Government of Australia. The value to Petrofac of Phase 1 has the potential to be up to AUD$325 million (US$236 million). 

The contract sees Petrofac as Outsourced Operator responsible for decommissioning and disconnection of the FPSO from its subsea equipment, and temporarily suspending the wells. Disconnection of the FPSO is expected to occur over approximately 18 months. Petrofac's scope includes the provision of its unique integrated services, working with both local and global suppliers. 

The Northern Endeavour is a 274-m long FPSO facility, currently not producing oil, moored between the Laminaria and Corallina oil fields about 550 km (341 miles) northwest of Darwin in the Timor Sea.

"This contract builds on 15 years of working in Australia and is further proof of our growing and long-term ambitions in the country,” said Josie Philips, Petrofac's regional director, Australia. “A critical element will be upskilling the local workforce to meet the challenges of billions of dollars of decommissioning work in Australia now and in the future. It is Petrofac's aim to be a local company, growing local jobs, local skills and the local supply chain. I'm delighted that we have Monadelphous and Linch-pin already on board."

"This contract recognizes our unrivalled decommissioning credentials, as the only tier one contractor with the in-house capability to manage all well and asset decommissioning phases,” said Nick Shorten, COO for Petrofac's Asset Solutions business. “The contract builds on our existing track record for delivering well operator and project management services for clients globally, having successfully delivered numerous multi-well decommissioning campaigns."

Together Petrofac and its supply chain partners, including Monadelphous and Linch-pin, will ensure the safe and cost-effective removal of the FPSO from the field in accordance with good industry practice. All activities will be done in close consultation with the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) to make sure strict safety and environmental protections are in place.