"The Alvheim field is a significant part of Marathon's defined production growth profile during the next five years," said Steven B. Hinchman, Marathon senior vice president of Worldwide Production. "We have been very pleased with the progress we continue to make on this important project. We look forward to further success in our efforts to realize the full resource potential of our holdings on the Norwegian Continental Shelf."
Keppel Shipyard Limited, a subsidiary of Keppel Offshore & Marine Ltd, carried out the FPSO Hull Conversion in Singapore. Some of the major work included modifications to shipboard fire, cargo and ballast systems, fabrication and installation of pipe rack for topsides, as well as installation of new shipboard equipment, turret mating cone and green water protection along the ship's sides. Working environment upgrades were also completed.
"Both of our companies have demonstrated a strong commitment and partnership in carrying out the conversion in accordance with the stringent requirements of the Norwegian regulatory standards," said Nelson Yeo, Executive Director, Keppel Shipyard Limited.
Topsides work will include the design and construction of production separators, gas compression and dehydration, water treatment and power generation systems. In addition, the vessel will be commissioned in Vetco Aibel's yard before being towed to the field for production in early 2007.
In addition to the use of the Alvheim FPSO, the Alvheim development will include subsea infrastructure consisting of five drill centers and associated flow lines. The development also provides for the transportation of produced oil by shuttle tanker, and transportation of produced natural gas to the existing U.K. SAGE system using a new 14-inch, 24-mile cross border pipeline.
The Alvheim development comprises the Kneler, Boa and Kameleon fields and is estimated to contain resources of approximately 180 million gross barrels of oil equivalent. Marathon holds a 65 percent interest in Alvheim and serves as operator.
In addition to the fields noted above, the nearby Vilje development, in which Marathon holds a 46.9 percent interest, also will be tied back to Alvheim. Production from a combined Alvheim/Vilje development is expected to ramp up to more than 50,000 net barrels per day during 2007. The combined Alvheim/Vilje development is estimated to contain resources of approximately 200-250 million gross barrels of oil equivalent.
Also, the Hamsun discovery announced in 2004, in which Marathon holds a 65 percent interest, is being examined as another potential tie-back to Alvheim. Marathon anticipates requesting Norwegian government approval for the Hamsun plan of development and operation in late 2006.
Marathon's partners in the Alvheim development are Norske ConocoPhillips AS with a 20 percent working interest, and Lundin Norway AS, which holds the remaining 15 percent interest. The Alvheim field applies to Production Licenses PL 203, PL 088BS and PL 036C on the Norwegian Continental Shelf.
Norsk Hydro Produksjon a.s. holds a 28.853 percent interest in Vilje and serves as operator. Other Vilje interest owners are Marathon Petroleum Norge AS (46.904 percent) and TOTAL E&P Norge AS (24.243 percent) as licensees in PL 036 on the Norwegian Continental Shelf.
Key Alvheim Vessel Facts
* Alvheim overall length is 252.2 meters (827.43 feet)
* Alvheim overall breadth is 42 meters (137.8 feet)
* Double hull
* Storage capacity is 560,000 barrels of oil
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