Fitzroy Awarded Tui Contract

An important part of the subsea equipment required for the $US 225 million Tui Area oil field development project offshore Taranaki, will be fabricated in New Plymouth under a contract jointly announced by Australian Worldwide Exploration Ltd (AWE) and Fitzroy Engineering Group Ltd.

The $NZ 6 million contract involves the fabrication of Mid Water Arches and associated equipment, a critical component in the Tui Area development.

The fabrication contract will provide a boost to the local economy and significantly increase the local New Zealand content of the project.

The Tui Area offshore oil project requires the use of flexible flowlines to connect four production wells on the sea floor to a Floating Production Storage and Offloading (FPSO) vessel that will process the oil.

In order to reduce the stresses on the flowlines as they rise 125 meters from the sea floor to the moored FPSO, they are draped over the Mid Water Arches, so named as they are suspended at a mid water depth.

Four arches are required for each of the four wells and each one needs to accommodate three lines; a flowline carrying production from the wells, one carrying gas back to the wells and a third line that carries chemicals and electrical and hydraulic control signals that allow the wells to be safely operated from the FPSO.

The Mid Water Arches consist of guides and clamps for the flowlines that are supported on a steel frame which also houses buoyancy tanks.

These modules are tethered by chains to gravity bases that will sit on the sea floor.

AWE is the operator of the Tui Area development on behalf a joint venture in which they own 42.5% of the project equity, Mitsui & Co. Ltd 35%, New Zealand Oil and Gas Ltd 12.5% and Pan Pacific Petroleum Ltd 10%. Fitzroy Engineering is a New Plymouth based engineering company with a long history of performing construction work for the local oil and gas industry.

Fitzroy has already begun work already on the contract and expects to deliver the completed equipment in January next year.

AWE has contracted the Rockwater 2 construction vessel, which has recently been in New Plymouth for work on the Pohokura gas development, to install the Mid Water Arches and the other subsea equipment required for the Tui Area development project.

The Managing Director of Fitzroy Engineering, Peter White-Robinson said "We are delighted and appreciative to be involved with another significant development in the oil and gas industry, and very pleased that we have been selected to do the work in Taranaki rather than have this imported. Our Company has a long history of safely undertaking complex projects meeting all the requirements of the industry, and I know our team will ensure we meet all the client's expectations for this critical equipment."

AWE's New Zealand Operations Manager based in New Plymouth, Dennis Washer, complimented Fitzroy on successfully tendering for this work.

"The job was bid out to a number of construction yards mainly in Asia, and Fitzroy's bid was the most attractive proposal received. As well as being competitive on price, Fitzroy was able to provide advantages of local fabrication.

"While its true that a lot of the equipment for a project such as Tui - being a subsea development with an FPSO - can only be built by specialist contractors in Europe, USA or Singapore, its heartening to see the project generating work in our local community.

"A good number of local candidates are being offered jobs on the FPSO, and companies with a local presence are picking up contracts to support the operational phase of the project.

"When combined with AWE's eight well offshore Taranaki drilling program starting later this year, you can see a good boost to the local economy coming through."

AWE is targeting to have the Tui Area development completed and up and running by the end of the 2nd quarter next year.