The pipelay vessel Castoro 6 passes under the Great Belt Bridge on its way to start construction for the Nord Stream project.

The pipelay vessel Castoro 6 passes under the Great Belt Bridge on its way to start construction for the Nord Stream project.

Offshore pipeline construction activity remains strong, as operators are developing numerous crude and natural gas pipeline transportation systems around the world. The overall worldwide total remains high, with an estimated 11,954 miles being built or planned.
A review of projects worldwide finds that the Europe continues to be the leader in offshore pipeline activity, with projects underway or planned for the Baltic, North and Blacks seas.

Other notable offshore projects are being planned and developed in the offshore waters of the Middle East, South America, the Far East, and the U.S. Gulf of Mexico. Some of the more notable projects being planned and built are described below.

Europe
Operators continue to make plans for the development of the Nord Stream project, which is designed to move natural gas from Russia to Germany via the Baltic Sea. The project calls for the construction of two parallel 745-mi, 48-in. pipelines from Vyborg, Russia, to Greifswald, Germany, running through the Baltic Sea.

Nord Stream says it has received the last of the permits required to start constructing the first pipeline through the Baltic Sea. The Regional Administrative Agency for Southern Finland has approved Nord Stream’s detailed plans to construct, operate and maintain its gas pipeline along a 230-mile route through Finland’s EEZ. The Finnish “Water Permit” complements the earlier permit granted by the Finnish Government for the Nord Stream consortium to use Finnish waters. The consortium plans to start construction in April, since it has already received all the permits required by the four other countries through whose territorial waters or Exclusive Economic Zones (EEZ) the pipeline will pass: Russia, Sweden, Denmark and Germany. The Nord Stream consortium plans has award a pipeline installation contract to Saipem, which will use two pipelay vessels to complete the laying of the first line in the first half of 2011. Technip was recently awarded a contract to work on four tie-ins on the project.

In late March, Nord Stream reported that the pipelay vessel Castoro 6 passed under the Great Belt Bridge, one of Europe’s greatest bridges, on its way to start construction on the project. Nord Stream says that it is the first time that a large pipelay vessel has ever entered the Baltic Sea. The vessel is planned to stay there for approximately two years, laying the majority of the Nord Stream pipeline. Pipe-laying activities will commence in the Swedish Exclusive Economic Zone, about 30 kilometers off the coast of the Swedish island of Gotland. From there, the Castoro 6 will slowly move north toward the Gulf of Finland, laying the pipeline at the rate of up to 2.5 kilometers per day.

When completed in 2012, Nord Stream’s twin pipelines will be able to transport 55 billion cubic meters (bcm) of gas a year from Russia to Germany, where it will join the European energy grid. Gazprom has already signed long-term contracts to supply over 20 bcm of gas a year through Nord Stream to customers in several EU countries including Germany, Denmark, The Netherlands, Belgium, France and the United Kingdom.

In southern Europe, the Bulgarian parliament has ratified an agreement between the governments of Bulgaria and Russia that calls for mutual cooperation in the construction of the proposed $20-billion South Stream natural gas pipeline, being developed by Russia’s Gazprom and Italy’s Eni. The governments of Russia and Hungary have also announced plans to create a joint venture to work on the Hungarian section of the pipeline. Current plans call for the 560-mi (900-km) long offshore section of South Stream to begin at the Beregovaya compressor station at Russia’s Black Sea coast, and then run through the Black Sea to the Bulgarian city of Varna. From there, the pipeline will branch off to the southwest through Greece and the Ionian Sea to reach southern Italy, and also run northwest through Romania, Hungary, Slovenia and Austria to reach northern Italy. The project is scheduled for a 2015 completion.

Elsewhere in the region, StatoilHydro says it has signed an accord with EGL of Switzerland to take part in the construction of a gas pipeline in the Adriatic Sea between Greece and Turkey. The (EU) $1.5-billion Trans Adriatic Pipeline (TAP) would likely run some 320 miles to transport gas through Greece and Albania and across the Adriatic Sea to reach Italy’s southern Puglia region. The system’s offshore section will be about 71 miles. In its upstream portion, TAP will interconnect with Greece’s existing pipeline system, which is linked further to the east with systems in Turkey. The project will enable the opening of a new delivery corridor from the Caspian Sea and the Middle East towards Europe as it will link existing Greek pipelines with southeastern Italy. Current plans call for a 2011 completion.

Meanwhile, operators continue to develop plans for the proposed Algeria-to-Italy (Galsi) gas pipeline. Current plans call for the pipeline to start from the Hassi R’mel field in Algeria, and the 640-kilometer (400-mile) section will run to Koudiet Draouche at the coast of Mediterranean Sea. The 285-kilometer (177-mile) offshore section with two legs will be laid between Koudiet Draouche and Porto Botte, Sardinia. The Sardinian section is planned approximately 300 kilometers (190 miles) from the south to Olbia. The offshore section between Sardinia and Italian mainland will be 280 kilometers (170 miles) and will make landfall at Piombino (LI). The line will be connected to the existing Italian gas grid in Tuscany. The diameter of pipeline will vary between 22-in. and 48-in. The Galsi pipeline, now expected be operational in 2012, is being developed by a consortium of Sonatrach, Edison S.p.A., Enel, Sfirs and Hera Trading (Italy)

Work is also being planned for the North Sea. Corus says it has secured a letter of award for a £200-million line pipe order from Total E&P UK Ltd for its Laggan-Tormore offshore gas field development in the North Sea, in the region West of the Shetlands. Corus will produce over 150,000 tons of line pipe, around 500 kilometers in total length. The pipe to be supplied will be 18 and 30-in. diameter and will meet exacting specifications required for such offshore environments. The pipe will be manufactured at the company’s Hartlepool site through 2010 and into 2011.

Work is also underway on Melrose Resources’ Galata field development project, in the Bulgarian portion of the Black Sea. Engineering contractor Grup Servicii Petroliere (GSP) says it has been awarded a contract for subsea gas pipeline engineering, procurement, fabrication and installation in the Galata field, and it will fabricate and install an 8.5-km (5.3-mi), 6-in. (15.2-cm) pipeline between the Galata platform and the Kavarna 2 wellhead; and a 14.5-km (9-mi), 10-in. pipeline between the same two structures plus associated piggy-backed liquids lines, in an average water depth of 80 m (262 ft). The offshore contractor says it is mobilizing several vessels, including its GSP Bigfoot 1 shallow water pipelay and heavy-lift barge; the GSP Prince, its new diving and ROV support vessel; and two platform supply vessels, the GSP Licorn and GSP Perseu.

Gulf of Mexico
In the Gulf of Mexico, Enbridge says it has entered into a Letter of Intent with Chevron, Statoil and Marubeni Oil & Gas (USA) Inc. to construct and operate an oil pipeline from the proposed Big Foot ultra deepwater development in the Gulf of Mexico. This proposed crude oil pipeline project is complementary to Enbridge’s previously announced plans to construct the Walker Ridge Gathering System, which will provide natural gas transportation for the proposed Chevron-operated Jack, St. Malo and Big Foot fields. The estimated cost of the Big Foot Oil Pipeline, which will be located about 170 miles south of the coast of Louisiana, is approximately US $250 million. Combined with the Walker Ridge Gathering System project, the proposed oil pipeline would bring the total Enbridge investment for the projects to US $750 million. The Big Foot Oil Pipeline will consist of approximately 40 miles of 20-in. pipe at depths of up to 5,900 ft, and will have capacity to transport up to 100,000 barrels per day. Big Foot will deliver to a sub-sea connection on existing deepwater pipeline infrastructure. Early plans call for a 2014 completion date.

On another project, the Energy Products Division (EPD) of Parker Hannifin Corporation has been awarded a contract by LLOG Exploration Co. for their Green Canyon 448 discovery in the Gulf of Mexico. The project consists of 28.3 miles of subsea tieback. Parker, through its Parker Cabett Subsea business unit, will provide a steel tube electro-hydraulic control umbilical of 150,000 continuous feet, along with interface terminations and installation assistance. This project is one of the longest offset oil producing subsea tiebacks in the world. EPD’s manufacturing facility, located in the Port of Freeport, Texas, will manufacture the umbilical and execute the complete contract. Delivery is scheduled for June 2010.

Offshore Florida, the Manatee County Port Authority has approved a long-term $30 million agreement with Port Dolphin Energy LLC for construction of an LNG port facility and offshore pipeline. Port Dolphin is a subsidiary of Hoegh LNG, which operates a fleet of five LNG carriers. Port Dolphin will also base an operations center at Port Manatee. The proposed project will consist of two submerged turret unloading and mooring buoys for receiving gas from Hoegh’s vessels; a 42-mile offshore pipeline for transportation of gas from the offshore terminal to Port Manatee in Tampa Bay; and a six-mile onshore pipeline connection to the Florida gas network. Construction is to begin in 2012 with completion in 2013. The terminal would lie 28 miles off Tampa Bay and use LNG carriers specially designed to regasify LNG for shipment through the pipeline.

South America
Weatherford International Ltd.’s Pipeline & Specialty Services group has been awarded a contract by Saipem for precommissioning services on the Uruguà-Mexilhão pipeline in the Santos Basin, offshore Brazil. The 18-in., 174-kilometer long gas pipeline will link the floating production, storage and offloading vessel Cidade de Santos, located in the Exploratory Block BS-500 at Uruguá field, in 1,372 meters water depth, to the Mexilhão gas platform in the Mexilhão field in 172 meters water depth. Weatherford’s scope of work includes filling, testing, dewatering, conditioning and geometry inspection of the pipeline, along with onshore preparation operations. The project is expected to be completed in 2010.

Middle East
Dana Gas says it has completed early work on a 25-year oil and gas concession in the Persian Gulf, offshore Sharjah in the United Arab Emirates. The concession covers over 1,000 sq km (386 sq mi) and includes part of the Zora gas field, which has proven gas reserves and a ready market. The project is in its initial phase, which includes upstream development and transportation of produced gas and condensates via a 25-km (15.5-mi) offshore pipeline. Detailed engineering has been completed for the offshore platform, as has conceptual engineering design for the onshore gas processing plant. Dana Gas is preparing to award management, engineering, procurement, construction, and installation contracts.

Elsewhere, J. Ray McDermott says it has been awarded a project to upgrade crude gathering and power supply facilities in Saudi Aramco’s Safaniya field in the Persian Gulf. The facility, infrastructure upgrade and electrification project will help sustain crude oil production to meet Saudi Aramco’s Maximum Sustainable Capacity targets for the field by 2013. The work includes engineering, procurement, construction, and installation – EPCI – of a new tie-in platform (STP-20) with a 6,000-ton topside, a new electrical deck module for an existing platform (STP-18), a 53-kilometer, 42-in. trunkline, four new in-field lateral flowlines and valve skids, 156 kilometers of subsea electrical cable, and the modification and electrification of nine existing wellhead platforms. Engineering design work will begin in the second quarter of 2010 with contract completion expected during 2013.

Africa
Acergy has announced the award of the Block 17/18 GEP Phase 2 Project, a contract valued at approximately $110 million from Total E&P Angola and BP Angola (Block 18) B.V. for the installation of over 43 miles of 24-in. pipeline from Block 2, together with the associated jumper, PLET and tie-ins, to the nearshore/onshore pipeline in water depths up to 40 meters. Engineering will commence with immediate effect with offshore installation scheduled to commence in the second quarter of 2010, using Acergy Polaris, Acergy Hawk and Acergy Legend.

Far East
State-run PetroVietnam Gas Corp. has signed a $1-billion business cooperation contract with Chevron Corp., MOECO and PTTEP to build and operate a gas pipeline in South Vietnam, according to Dow Jones Newswires. The consortium will build the nearly 400-kilometer pipeline to bring natural gas from Block B offshore to an existing power complex in Can Tho city in the Mekong Delta region for 25 years. The pipeline is expected to help transport 18.3 million cubic meters of natural gas a day. Of the pipeline’s total length, 246 kilometers will be undersea and 152 kilometers will be onshore.

Elsewhere in the region, J. Ray McDermott says that it has won its first SURF (Subsea Infrastructure, Umbilicals, Risers and Flowlines) project in Asia Pacific since its strategic push into this high growth area. PetroVietnam Technical Services Corporation awarded this contract on behalf of its customer, PetroVietnam Exploration & Production (PVEP Dai Hung Petroleum Operating Co. Ltd.). J. Ray’s scope of work includes the engineering, procurement, construction and installation of new production and export lines, umbilical and cable. This includes tie-in, testing and pre-commissioning of two 2.2-kilometer flexible flowlines, replacement of two 2.3-kilometer export flowlines and umbilical, installation of a subsea cable and 4.8 kilometers of insulated flexible flowlines Work will take place in the Dai Hung oilfield is located in Block 05-1A, approximately 250 kilometers offshore Vietnam, in a water depth of about 110 meters. Initial engineering and procurement work starts immediately with the offshore installation expected to commence in the third quarter of 2011.