Subsea 7 Secures Services Contract Offshore Egypt

Oilfield services firm Subsea 7 S.A. announced Thursday that it has secured a “substantial” services contract offshore Egypt, worth between $150-300 million, from Pharaonic Petroleum Company.

Under the agreement, Subsea 7 will work at water depths of around 3,000 feet in the Atoll field. The contract scope includes the engineering, procurement, construction and installation of more than 24 miles of rigid pipelines and associated structures for the field, tying into the existing Taurt field. A 65 mile umbilical will also be installed linking the Atoll field to shore.

Engineering and procurement services have already commenced. Offshore campaigns will take place in the second half of 2017 and the early months of 2018, using the Subsea 7 vessels Seven Borealis, Seven Eagle, and Seven Arctic.

“We are delighted to strengthen our presence in Egypt. This substantial contract award recognizes our technical expertise and track record of strong execution for Pharaonic Petroleum Company,” said Subsea 7 Region Vice President for Africa, Gilles Lafaye.

When asked to comment on the employment opportunities offered by the new contract, a company spokesperson told Rigzone that no new jobs would be generated by the award and stated that the company will be using its existing team to support the Atoll project.

Earlier this year, Subsea 7 revealed that it would be cutting 1,200 jobs by early 2017. The group plans to resize its global workforce to approximately 8,000 by early next year, with up to five vessels also scheduled to leave Subsea 7’s current active fleet by early 2017.

These cost reduction and resizing measures, together with those already initiated since the start of the year, are expected to deliver approximately $350 million in annualized cost savings. The charge related to the resizing will be recognized in 2016 and is expected to be less than $100 million.

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