McDermott scoops major Qatargas subsea contract

US contractor McDermott International landed a sizeable contract from Qatargas for work on the latter’s North Field Production Sustainability (NFPS) offshore fuel gas pipeline and subsea cables project (COMP 1).

McDermott confirmed the award on Wednesday and described it as a “major” contract — one that is valued between $750 million and $1.5 billion.

“The scope of the contract includes the installation of 190 kilometres of 32 inches diameter subsea pipelines, 17 kilometres of subsea composite cables, 186 kilometres of fibre optic cables, and 10 kilometres of onshore pipelines,” it stated.

The announcement by the US player confirms a recent Upstream report, which touted McDermott as the frontrunner for the offshore contract.

The engineering, procurement, construction, and installation (EPCI) deal is expected to be worth upwards of $1 billion, Upstream understands.

Qatargas is a subsidiary of state-owned QatarEnergy that is overseeing the emirate’s major expansion plans for the oil and gas sector.

Article continues below the advert

Offshore compression project

The offshore contract awarded to McDermott is part of the NFPS offshore compression project involving the installation of new assets in Qatar’s North Field, including compression complexes at seven locations to allow gas supply to the existing liquefied natural gas and new production trains, the company stated.

“The contract award follows the North Field Expansion project contract awarded to McDermott in 2022, which is currently under execution and remains one of the largest contracts McDermott has been awarded in its company history,” it noted.

The US player said the “project will be managed and engineered entirely from the McDermott Doha office with fabrication taking place at QFAB (in Qatar)”.

Mike Sutherland, senior vice president of McDermott offshore Middle East said that as the company continues to progress on the North Field expansion contract awarded last year, it is “helping the State of Qatar expand LNG production from 77 to 126 million tpa via the new LNG trains under construction.”

While Qatar is spending up to $50 billion on expanding the production potential of North Field, the nation is also spending massively on its multi-phased NFPS project that aims to maintain the offshore field’s gas production profile.

Key packages

A package dubbed EPCI 2 was awarded last year to a pairing of Saipem and China’s Offshore Oil Engineering Corporation (COOEC).

The $4.5 billion contract includes two compression complexes intended to sustain production at the North Field.

Saipem has said the project will include “two of the largest fixed steel jacket compression platforms ever built”, as well as flare platforms, living quarters, interconnecting bridges and interface modules.

Another key package — EPCI 3 — comprising multiple offshore facilities for the gas field, including at least two offshore riser platforms, one wellhead deck, intra-field subsea pipelines and subsea cables, was tendered by the operator this year, Upstream has reported.

In December, Qatargas launched the tender for a separate contract, EPCI 4, covering compression facilities that will form part of the further development of the NFPS project.

EPCI 4 requires two large offshore compression platform complexes that could together involve up to 100,000 tonnes of fabrication, with the work likely to be valued upwards of $4.5 billion.

The phased work on the NFPS compression facilities will be carried out over several years, Upstream understands.

Technip Energies is believed to have carried out the front-end engineering and design work for the offshore compression project.

QatarEnergy is carrying out the first expansion phase of North Field East, costing about $28.75 billion, which will increase its LNG output to 110 million tpa by 2026, from the current nameplate capacity of 77 million tpa.

The second phase, North Field South, will further increase Qatar’s LNG production to up to 126 million tpa.