Talisman Scraps Yme Project after SBM deal

Dutch oilfield services firm SBM Offshore has settled its dispute over the Yme project, offshore Norway. The firm has agreed to pay to Talisman Energy Norge and its partners an additional $270 million, on top of an earlier payment of $200 million, to cover the decommissioning of the abandoned Yme platform.

Talisman and its partners have seen a number of delays, as well as safety issues, at Yme. This included an evacuation of 140 workers from the platform in July 2012 due to structural concerns.

Once it has received the settlement payment, Talisman said it will complete the work necessary to ensure the safe re-manning of the platform and will then remove the MOPU (mobile offshore production unit), which will subsequently be scrapped.

Paul Warwick, Talisman's executive vice-president for Europe-Atlantic, commented in a statement:

"Delays to first production on the Yme project have been a great disappointment to the Yme joint venture partners. Recent analysis has concluded that a new topsides solution is needed in order to develop the Yme field. The arrangement with SBM Offshore allows the Yme joint venture partners to continue to evaluate options for the field."

Meanwhile, SBM noted that the settlement paves the way for it to carry out a fundraising exercise required to help balance the firm's books.

"Today we have resolved the legacy difficulties of Yme at an agreed cost, bringing an end to a period of significant uncertainty for the company," SBM director Sietze Hepkema said.