Sakhalin Energy Completes Installation of Lunskoye A Platform

In a unique moment for Russia, Sakhalin Energy has successfully completed the installation of the Lunskoye A platform concrete gravity base structure (CGBS) at its location in the Lunskoye field offshore northeast Sakhalin.

In a near perfect operation commencing early Thursday morning (June 30) and lasting about 4 days, the CGBS was slowly and carefully lowered to the seabed in a water depth of 48 meters. The structure settled to its final resting place at 15.00 hours yesterday (Sunday, July 3rd).

The installation process was a delicate operation requiring skill from the engineers controlling the flooding of the base caisson of the structure, and the marine teams on the tugs that maintain the structure in position as it is lowered.

David Greer, Deputy CEO and Project Director for Sakhalin Energy, said: "This particular achievement is a great example of the ingenuity of man where the triumph of engineering coupled with consummate professionalism from the marine team that towed the structure all the way from Vostochny to Lunskoye, successfully placed the anchors, stabilised the structure and enabled it to be gracefully lowered to the seabed in accordance with our plans. This is a great day for Russia and for Sakhalin Energy."

The weight of the structure – some 103,000 tons - will hold it in place on the seabed. Special navigation aids will be employed to ensure vessels in the area can maintain a safe distance from the structure, which now has only about 20 meters of its four 56 meter shafts remaining above the water. The structure will continue to be checked periodically until the platform topsides are installed in summer next year.

This is one of the most important milestones for the Sakhalin II Phase 2 Project – for the Lunskoye platform lies at the very heart of the Sakhalin II Project as the main source of gas production for the LNG plant at Prigorodnoye.

"The fact that so many Russian companies and Russian workers have played a key role in the construction and installation of the CGBS – possibly the biggest concrete structure ever built in Russia – in record time is a source of great satisfaction. The Lunskoye CGBS – along with the PA-B CGBS – are the first of their kind to be built in Russia, and I am sure that our Russian staff and the Russian people as a whole will rightly feel great pride in this magnificent achievement," David Greer added.

CGBS Installation process

In a carefully controlled process that is operated automatically from a command vessel, ballast water is introduced into compartments in the base caisson of the CGBS at rates of up 5000 cu m per hour.

One side of the structure is carefully rotated, or tilted, and allowed to submerge slowly until the caisson bottom edge rests on the sea bed. Further careful flooding of compartments then gently lowers the rest of the caisson base until it is resting in a flat and stable condition on the seabed.

The operations to place the CGBS on the seabed commenced at 06.15 hours on Thursday morning June 30 , when ballast water was introduced into the structure to start the careful rotation and lowering of the structure to the seabed. The operation requires reasonably calm sea conditions, and ballasting operations were temporarily suspended to ensure the structure remained safe during a period of sea swells.

By early Sunday morning, the sea swells had died down and ballasting operations restarted at 00.42 hours. At 03.45 hours, the leading edge of the structure gently touched the seabed.

Final rotation of the structure to complete placing the full base of the CGBS horizontally on the seabed was completed just under 12 hours later at 15.00 hours on Sunday 3 July

The tow operation

The Lunskoye CGBS was floated out the purpose built dock into Vostochny bay in Primorsky Krai on 14 June, where it remained for approximately12 hours while the tow teams made all the necessary preparations for the journey to the installation site on the Lunskoye field. The tow operation, which started on 16 June, used three ocean tugs escorted by an offshore support vessel and a guard vessel. It took 12 days journey from Vostochny Bay through the La Perouse strait to reach the installation site on the northeastern Sakhalin shelf – a journey of 1765 km (953 nautical miles).

CGBS details

The Lunskoye CGBS consists of a base caisson and four shafts topped by cylindrical steel deck connector legs that support the topsides of the new offshore platform. It has a total dry weight of 103,000 tons. The base is 105 meters by 88 meters and 13.5 meters high. The diameter of each shaft measures more than 20 meters and they are some 56 meters high. Total height of the entire structure is 69.5 meters. The thickness of the concrete for the structure ranges between half and three quarters of a meter, and is reinforced with steel bars throughout the structure.

The LUN-A CGBS is located 15 kilometers off the northeastern coast of Sakhalin Island, and construction commenced in March 2004. By November 2004, the final concrete pour was made, marking the completion of concrete slip forming works for the structure. Subsequent work saw the completion of the mechanical parts of the CGBS – well slots, hydrocarbon export pipes, water injection systems and pumping equipment

CGBS design and engineering

Norwegian GBS specialist Aker Kvaerner Technology AS – a company with unparalleled worldwide experience of CGBS design, was responsible for the design and engineering of the LUN-A CGBS to meet the challenges of low temperatures, ice and seismic conditions required offshore Sakhalin. But it was Finnish Company Quattro Gemini OY – which has experience with the construction of complex concrete structures – and a number of key Russian contractors that were responsible for the actual construction of the enormous structures – including Russian companies such as NPO Port, Massis and NSRZ.

Russian participation

The construction of the Lunskoye CGBS and its sister PA-B CGBS – which will be installed shortly on the Piltun feature as part of the development of the Piltun Astokhskoye field - required a workforce of some 2,000 Russian nationals and involved the extensive use of Russian industry, labor and materials. Overall, the level of Russian Content, which is made up of manhours and materials, exceeded 85 percent. Through the transfer of knowledge and technology it has provided an opportunity for Russian industry to gain extensive knowledge in the construction of such unique structures, and has become a tangible illustration of how Russia is gaining experience in a major new construction technology, which could lead to opportunities in the future for construction of such structures for other offshore developments.

In addition, it has created significant business opportunities for Russian companies who provided thousands of workers, materials such as steel and cement and many other services and equipment to the construction site.

Over 250 Russian companies and suppliers – local ones from Nakhodka, those from the Primorsky Krai and from other parts of the Russian Federation – worked on the construction and supplied materials for the two concrete structures. In addition to those already mentioned, Komplex, DV-Cement, Hydrotex, NPO Port, Astrakhan Korabel, Dalgidrostroy , Daltekhflot, Massis, NSRZ, Zvezda and many others also contributed. Russian manhours during the construction added up to almost 6 million – and account for more than 80 percent of the overall labour used to build the LUN-A and PA-B CGBS. Russian nationals accounted for more than 92 percent of the overall construction workforce of workers, engineers and other staff. Russian subcontractors carried out work at all stages of construction and on virtually all elements of the activities.

Ninety-Seven percent of the total volume of materials used to build both CGBS were purchased in Russia. Altogether, the construction of both CGBS required a huge amount of steel - over 43,000 tonnes - including reinforced, post tension, structural and other steel. Much of this was supplied by Russian companies such as Amurmetal, Nosta, and Severstal. Some 63,800 cubic meters of concrete was supplied by Russian DV-Cement to make these huge objects a reality.

The Lunskoye platform

The Lunskoye Platform will comprise drilling facilities, accommodation and minimum processing facilities. It will have the capacity to produce 51 million cubic meters of gas per day (1,800 million standard cubic feet per day), and approximately 50,000 barrels of condensate per day (8,000 cubic meters per day). Separation, including treatment and separation of the Lunskoye gas and condensate will be undertaken onshore at the Onshore Processing Facility (OPF), which will also supply power to the platform via submarine cable.

The Sakhalin II Project

Sakhalin Energy Investment Company Ltd. is an incorporated company, established in April 1994 and based in Yuzhno-Sakhalinsk, Russia for the purpose of the implementation of and development of the Sakhalin II integrated oil and gas project. The shareholders in Sakhalin Energy are: Shell Sakhalin Holdings B.V. with 55 % interest (parent company – Royal Dutch/Shell), Mitsui Sakhalin Holdings B.V. with 25% (parent company – Mitsui & Co., Ltd.) and Diamond Gas Sakhalin B.V. with 20 % (parent company – Mitsubishi Corporation).

The Sakhalin II development represents the largest foreign direct investment project underway in Russia. It was the first Production Sharing Agreement (PSA) to be signed in Russia and the first PSA to go into operation.

Phase 1 has been producing oil from the Vityaz Complex offshore Sakhalin since July 1999. The Vityaz complex consists of the Molikpaq production platform, a single anchor leg mooring buoy and the Okha floating storage and offloading unit, and is located on the Astokh feature of the Piltun Astokhskoye (PA) reservoir offshore Sakhalin. The Molikpaq is the first offshore oil production platform in the Russian Federation.

Production is currently limited to the ice-free period during the summer months. Production during the 2004 season amounted to 11.6 million barrels. Sakhalin Energy has sold its crude oil to refineries in seven different major markets - Japan, Korea, China, Taiwan, the Philippines, Thailand and the USA.

Phase 2 of the Sakhalin II Project is thought to be the biggest single integrated oil and gas project ever undertaken. It entails the further development of the PA field – an oil reservoir with associated gas – and the development of the Lunskoye field – a gas reservoir with associated condensate. Apart from the Lunskoye platform, the project also calls for a further oil and gas production platform on the PA field and a 9.6 million tonne per annum LNG plant. The topsides for the Lunskoye platform and the new PA-B platform are currently under construction in Korea.

An onshore processing facility is being built to separate gas and condensate from the Lunskoye field. Pipelines will transport the oil and gas more than 800 km to an oil export terminal and the LNG plant at Prigorodnoye on the southern end of Sakhalin Island, which remains largely ice-free year round. The Phase 2 Project will also enable year-round production from the Molikpaq platform.

Year-round oil production is expected in 2006, and deliveries from the new LNG plant are planned to commence end 2007.