AFG Signs LOI with Heerema to Decommission 9 Platforms

AF Gruppen has signed a letter of intent with Heerema Marine Contractors regarding the decommissioning of nine platforms with an option for a further four from the Ekofisk-field for ConocoPhilips. This is AF's biggest contract ever. The contract value including options is MNOK 1 200.

AF Decom, part of AF's environmental business, will carry out the project. Preliminary work will start immediately, while decommissioning of the platforms will start in 2009. The project is scheduled to be completed in 2014. The project includes preliminary work offshore, decommissioning and recycling of a total of 140,000-ton steel constructions at AF Decom's decommissioning plant at Vats outside Haugesund.

"We are proud to be part of the largest decommissioning project in the North Sea, said Pal Egil Ronn, CEO of AF Gruppen. "The agreement strengthens our strategic targeting of environmental services and is an important recognition of our competence in dismantling and recycling of offshore steel constructions. The contract forms the basis for further growth in our environmental business offshore."

This is the third decommissioning work AF will carry out offshore. AF was pre-qualified for offshore work in 2002 based on the methods the company uses for onshore demolition of industrial facilities.

The company entered into a contract with ConocoPhilips in 2004 regarding the dismantling of the steel construction on Ekofisk 2/4T. Work was completed in May 2007, six months ahead of schedule and within budget. The recycling rate was 98%.

AF and Heerema cooperate in the decommissioning and recycling of bridges, tripods, flame stack and modules on Ekofisk for ConocoPhilips.