Equinor Dishes Out Supplier Agreements Worth $10B

Equinor revealed, in a statement posted on its website on Thursday, that it has awarded 12 framework agreements to seven supplier companies with a total value of around NOK 100 billion ($9.9 billion).

The company highlighted in the statement that these new framework agreements are for maintenance and modifications on the company’s offshore installations and onshore plants. The supplier companies comprise Aibel AS, Aker Solutions AS, Wood Group Norway, Apply AS, Rosenberg Worley AS, Head Energy AS, and IKM Gruppen AS, Equinor revealed.

Agreements start in the first half of this year, have a duration of five years, and include extension options of three and two years, Equinor pointed out in its statement. The company noted that the final portfolio distribution will be assigned when the contracts are signed, which it revealed “is planned in week four”.

“These agreements lay the foundation for safe and competitive operations at Equinor’s offshore installations and onshore plants in the years to come,” Equinor said in the statement.

“The agreements create predictability and ripple effects for the Norwegian supplier industry across the country,” it added.

In its statement, Equinor revealed that, “to support the ambition of maintaining production around 1.2 million barrels of oil equivalent per day (2020 level) on the Norwegian continental shelf towards 2035”, the company is planning a series of actions.

These include investing “about NOK 60-70 billion” ($5.9 billion to $6.9 billion) annually in increased recovery and new fields on the Norwegian continental shelf, drilling “around 250 exploration wells and about 600 wells for increased recovery”, performing 300 well interventions annually and “around 2,500 modification projects”, and maturing and developing over 75 subsea developments that can be tied to existing infrastructure, the statement outlined.

They also include reducing the company’s own greenhouse gas emissions towards nearly 50 percent by 2030, compared to 2015 figures, “while delivering stable and predictable energy supplies to Europe”, and investing in maintenance and modifications at installations and onshore facilities “to strengthen safety and maintain high regularity, while reducing climate and environmental footprints”, Equinor outlined.

“The Norwegian continental shelf will remain the backbone for Equinor for a long time,” Kjetil Hove, executive vice president for the Norwegian continental shelf at Equinor, said in the statement.

“Our ambition is to maintain a high production level and predictable energy deliveries to Europe towards 2035. At the same time, the shelf is entering a mature phase that will require new solutions,” Hove added.

“To succeed, we must, together with the supplier industry, find new ways of working that strengthen our competitiveness. These agreements facilitate long-term collaboration and continuous improvement on core tasks at Equinor’s offshore installations and onshore facilities in Norway,” Hove continued.

Jannicke Nilsson, chief procurement officer at Equinor, said in the statement, “these are strategically important agreements, and collectively among the largest Equinor has awarded”.

“The agreements will ensure long-term activity and value creation across Norway, with job creation estimated at around 4,000 man-years at the suppliers. The goal is close, long-term, and predictable cooperation that strengthens the culture for safety and security and our shared competitiveness,” Nilsson added.

“Together, we will work safer and smarter, and scale up the use of new technology,” Nilsson continued.

In a statement posted on its site on Thursday, Aibel announced that it had been awarded “major” Equinor frame agreements.

“Since 2022, we have had a strategic long-term collaboration agreement with Equinor where a key focus area has been improvements within M&M,”  Aibel President and CEO Mads Andersen said in that statement.

“We are therefore proud of the trust Equinor has shown us by once again choosing us as the supplier for maintenance and modification of critical infrastructure at both offshore and onshore facilities,” Andersen added.

“We look forward to continuing a close and strong collaboration, where we can contribute to the ongoing safe, profitable and sustainable development of the Norwegian continental shelf,” Andersen stated.

In a statement posted on its site yesterday, Aker Solutions announced that it had secured long-term maintenance and modifications frame agreements with Equinor.

“We are grateful for this renewed trust, which we view as a strong endorsement of the quality of service we’ve provided to Equinor for decades,” Kjetel Digre, Chief Executive Officer at Aker Solutions, said in this statement.

“Our commitment to supporting safe and efficient operations, along with our proven ability to adapt to changing conditions on the Norwegian Continental Shelf, have been clearly recognized,” Digre added.  

In a statement posted on Moreld Apply’s website on Thursday, Moreld ASA announced that its wholly owned subsidiary, Moreld Apply, had been awarded a frame agreement to compete for large, complex modifications on Equinor’s onshore and offshore facilities.

“The frame agreement is strategically important for the company and is estimated to contribute a volume as a major contract over the contract period including options,” Moreld Apply said in that statement.

A statement posted on Head Energy AS’s website in Norwegian on January 8, which was translated, stated that the company had been awarded a framework agreement for maintenance and simple projects on the Troll, Gullfaks and Oseberg fields.

“We are very pleased with the award and thank Equinor for the trust,” Morten Leikvoll, CEO of Head Energy Gruppen, said in this statement.

“We have been working strategically for this for ten years and look forward to taking on the task. Our ambition going forward is to deliver cost-effective and good projects in line with Equinor’s goals,” Leikvoll added.

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