Discovery of Hod and ValhallValhall orders for crisis-hit yards

Developing the Valhall centre

person Kristin Øye Gjerde and Finn Harald Sandberg, Norwegian Petroleum Museum
The first application from the AmocoNoco group for official consent to develop Valhall and Hod was submitted on 4 October 1976, and welcomed with enthusiasm by the Ministry of Industry.
— Valhall is an oil field located at approx. 70 meters water depth. In the early stages the field was developed with three platforms (quarters platform, drilling platform, and process and compression platform). Here, only the quarters platform (QP) is in place. To the right: the steel jacket of the drilling platform DP, and the process and compression platform PCP. Photo: BP/Norwegian Petroleum Museum
© Norsk Oljemuseum

Approval was initially sought for an export solution for the oil and gas, which had to be in place before field development could begin.[REMOVE]Fotnote: Øyvind Kvaal, AmocoViking.

Plans called for two 35-kilometre pipelines to Ekofisk. These would tie into the Norpipe system, which carried oil to Teesside in the UK and gas to Emden in West Germany.

The government considered the matter on 25 November 1976, but some additional rounds of discussions were needed with operator Amoco before it could be presented to the Storting (parliament).

At first, AmocoNoco wanted to build a field centre with two platforms for drilling/quarters and processing/compression. For several reasons, the group ended up installing three structures.

From two to three

A letter of 28 January 1977 from AmocoNoco to the industry ministry stated: “Reserves of 240 million barrels of oil and 880 billion cubic feet of gas are proven in the central part of the Valhall field, which permits a start to development.

“The plan we propose comprises a quarters/drilling platform (dimensioned for 24 wells and 120 men), which will be linked by a bridge to a processing/compression platform …

“The most important equipment on the platform where the living quarters are to be positioned will be a derrick, wellheads, valves and high-pressure piping. These components will be segregated at the end of the platform farthest from the living quarters …”[REMOVE]Fotnote: Report no 92 to the Storting (1976–77), Ilandføring av petroleum fra feltene Valhall og Hod . Appendix 2.

Amoco initially took the view that two platforms would be enough on Valhall. From the Valhall/Hod field study dated January 1977.

A practical consideration also underpinned the development solution chosen. AmocoNoco already had a steel jacket (support structure) for a planned process platform on South-East Tor.

But the latter development was halted after Norway raised its offshore taxes in 1975, leaving the group with a surplus jacket. (More on that below.)

This structure was only large enough to support the process equipment. So two platforms were planned rather than one.[REMOVE]Fotnote: Asbjørn Tansø in conversation with Kristin Øye Gjerde, 16 June 2014. That was also safer.

But the authorities were not convinced that the chosen solution was the best. New safety regulations for the Norwegian continental shelf (NCS) had been approved by the Storting in a royal decree of 9 July 1976, and these came to affect Valhall.

According to these rules, ultimate responsibility for monitoring permanent installations in the North Sea rested with the Norwegian Petroleum Directorate (NPD).

The first case handled by the NPD under the new regulations was the question of safety on the Statfjord field, and the directorate wrote in a letter of 7 July 1976:

“On the basis of ongoing work with safety conditions, it has been found necessary to adopt a more restrictive attitude to concepts involving combined drilling and production where the living quarters are also placed on the same platform.”

The NPD emphasised that combined drilling and production could only be accepted on the basis of individual analyses and assessments. That also applied to living quarters on a drilling/production platform, where a safety analysis was needed.

According to NPD section manager Harald Ynnesdal, the Condeep concrete platforms were particularly difficult to assess in safety terms because all functions were integrated on a single facility.

Since Statfjord was due to be developed with such structures, the NPD therefore maintained that plans should be based as far as possible on separate quarters platforms.

In its view, the additional cost would have a limited impact on profitability in the long term, but mean a lot for overall safety and the desire for an early start to production.

Statfjord operator Mobil did not agree with this assessment. Building a separate Condeep simply for accommodation would be expensive and of limited value.

The US company signalled that it would quit as operator. But none of the other licensees was prepared to take on the job, which remained with Mobil. Statfjord B was built as an integrated structure but with an extra firewall for the quarters section.[REMOVE]Fotnote:

The attention being paid to safety was further intensified by the incident which began at 22.00 on 22 April 1977, when the “abandon platform” alarm was sounded on Ekofisk 2/4 B (Bravo).

An uncontrolled blowout had occurred in well B-14, with large quantities of oil and gas spurting five-six metres into the air before landing directly in the sea.

Fortunately, the hydrocarbons did not ignite, all 112 people on the platform were safely evacuated in the space of 15 minutes, and efforts to shut down the well could be sustained.

Although some 9 500 tonnes of crude oil were spilt during its 7.5-day duration,[REMOVE]Fotnote: this incident caused no special harm to people or the environment. The oil deteriorated before reaching land.

But the Bravo blowout and the controversy over the Statfjord development had an impact on the solutions chosen for the Valhall development.

Amoco submitted a supplementary safety report on 11 July 1977, the AmocoNoco group had a meeting with the industry ministry on 29 July, and it met the NPD twice on 1-2 August.

In the sessions with the directorate, Amoco argued that a two-platform solution would be the most sensible. It wanted a staged development in order to use experience from the first production wells in order to achieve stable output.[REMOVE]Fotnote: Report no 92 to the Storting (1976–77), Ilandføring av petroleum fra feltene Valhall og Hod . Appendix 2.

Since developing Hod and the north and south flanks would take time, the overall maximum production rate would be lower than if all parts of the field came on stream simultaneously. Amoco took the view that a smaller processing facility would be sufficient.

The NPD disagreed. It maintained that Amoco should install full process capacity from the start, and dimension the facilities as if all parts of the field were developed almost simultaneously. They should be able to handle the maximum capacity.[REMOVE]Fotnote: Letter from the NPD to Amoco Norway Oil Company, 4 August 1977, NPD 9259/ASt/ES/RGA/AH.

That called for a much larger and more expensive process unit. In reality, Hod was developed in 1990 and the northern and southern flanks in 2002 and 2003 respectively. So the big production capacity was never required.[REMOVE]Fotnote: Asbjørn Tansø in conversation with Kristin Øye Gjerde, 16 June 2014.

The Storting approved this solution in August 1977.[REMOVE]Fotnote: Report no 92 to the Storting (1976–77), Ilandføring av petroleum fra feltene Valhall og Hod. Amoco issued a press release on 24 August that the field would be developed with platforms for drilling (DP), process and compression (PCP), and quarters (QP).

These structures were linked by bridges. A three-platform solution allowed the NPD to approve simultaneous drilling and production in accordance with specified conditions.

Production of oil and gas should start in 1981, it was announced. The original plans called for the field to stay on stream until 2001.

Positioning the platforms

Engineers John Evans Asbjørn Tansø were asked to present their recommendations for locating the platforms on Valhall and Hod to Amoco Europe in London.

They had studied this issue for six months and produced a solution for three installations on Valhall and one on the other field.[REMOVE]Fotnote: Valhall/Hod field study, Technical Volume 1, Hydrocarbon distribution . AmocoNoco group, October 1976.

Their recommendation for Valhall was to place the structures at the edge of the field because of indications that shallow gas was present and to avoid being affected by subsidence.

Evans had begun by hanging a big map of the two fields on the wall to illustrate his presentation. He got no further than the introduction when Steve Antuniack, Amoco’s European boss, interrupted.

“John, just wait,” he said, got up, went to the map, put his finger in the middle of Valhall and drew a circle round it. “That’s where the platforms’ gonna go,” he declared and left. Evans did not even get to present his proposed solution.[REMOVE]Fotnote: Asbjørn Tansø in conversation with Kristin Øye Gjerde, 4 June 2014.

A quick mark on a map swept aside the recommendations of the specialists. In retrospect, this proved unwise. The seabed where the first three Valhall platforms stand had subsided by 6.5 metres up to 2014, bringing the base of their topsides that much closer to the sea surface.

Much of this subsidence could have been avoided if the platforms were positioned as recommended in the study – with the Valhall process facilities a little out on the western flank where the reservoir is at its thinnest.

The other two structures to the north and south would then have stood where the chalk formation is less porous and stronger than in the centre of the field.

Some compression of the reservoir would nevertheless have occurred – actually a positive development, since this is the biggest driver for production from Valhall.

When pressure in the reservoir falls as oil and gas are extracted, the weight of the overlying rock is transferred to the porous chalk. This then collapses and squeezes out more hydrocarbons.

Such compression would have occurred even if the platforms had been positioned in line with the original recommendations from Evans and Tansø. The wells would then have been drilled into the middle of Valhall and produced from there.[REMOVE]Fotnote: Asbjørn Tansø in conversation with Kristin Øye Gjerde, 16 June 2014.

Organising the construction work

As soon as the development solution had been approved by the Storting, the Valhall Engineering Joint Venture (VEJV) was established as a project organisation.

Participants in this body were A/S Akers mek Verksted (41.7 per cent), Brownaker Offshore A/S (25 per cent), Fred Olsen & Co and Kværner Brug A/S (33.3 per cent).

Its head office was located at the Aker Engineering premises in Oslo, with the engineering design work done there as well as at Kvaerner Engineering in Billingstad outside the capital and at Brown & Root i London.

The VEJV’s job was to provide the necessary documentation in the form of calculations, drawings and specifications required by Amoco to secure government consents and as the basis for the operator’s own evaluations.

Tender packages were to be put on offer as the basis for fixed-price contracts covering equipment to be installed as well as construction and installation of the platforms.

When the VEJV had assessed the bids, it would handle procurement and reception of the equipment as Amoco’s agent and act as consultant during the construction phase.[REMOVE]Fotnote: Kostnadsanalysen norsk kontinentalsokkel, bind II, 270.

Quarters platform QP

The QP was built in 1979-80 and taken into use in July 1981 to accommodate everyone working on Valhall. Stord Verft south of Bergen constructed the steel jacket, a joint venture between France’s UIE and Sterkoder mek Verksted in Kristiansund fabricated the topside, and Vigor in Orkanger near Trondheim built and hooked up the modules.[REMOVE]Fotnote: Kostnadsanalysen norsk kontinentalsokkel, bind II, 275-276.

In this phase, the platform was designed for 160 berths. However, that proved inadequate even before installation. A temporary additional storey with 48 berths was accordingly added offshore in 1982 immediately beneath the helideck.

All the cabins were double to begin with, but developments in computer technology during the 2000s meant that more jobs could be transferred to land. Most of the cabins were then converted to single occupancy.   These were not the most popular cabins because of the helicopter noise, but the shortage of accommodation meant they were never removed.[REMOVE]Fotnote: Asbjørn Tansø in conversation with Kristin Øye Gjerde, 4 June 2014.

The topside rests on a jacket, a simple steel framework in 68 metres of water. In addition to cabins, it housed the canteen, lounge, offices, sick bay and helideck with hangar.

Following the 2006 decision to extend the field’s producing life and supply power from shore, Valhall QP was replaced in 2012 with a new combined quarters and production platform. But it was still in use in 2014, and will probably continue to be occupied for a couple of years more. (Read more in the article on Valhall QP.)

Drilling platform DP

The DP stands in the centre of the field complex, and was built by Aker Verdal north of Trondheim as main contractor. This yard also constructed the jacket. The job of fabricating the topside and the bridge to the QP was sub-contracted to Kværner Brug in Egersund south of Stavanger.

Four of the topside modules came from Stord Verft, while the drilling package was supplied by Kristiansand mek Verksted near Norway’s southern tip.

The platform became operational on 17 December 1981 with the first enclosed derrick in the North Sea.[REMOVE]Fotnote: The North Sea Platform Guide, 1985, 688. Kostnadsanalysen norsk kontinentalsokkel bind II, 275-276. Myklebust, Alf Terje: 75 år på Kjøtteinen: 1919-1994: jubileumsbok for Aker Stord , 1994, 209. It originally had 24 well slots, but another six were added between the original set in 1989-90.

Age, wear and tear on equipment, and corrosion which would be very expensive to repair prompted a decision to remove the derrick and its base in 2009. New wells on the field were drilled from the southern and northern flank platforms.

Process and compression platform PCP

The PCP was designed to produce 168 000 barrels of oil and 10 million standard cubic metres of gas per day. Its topside sits on a steel jacket standing in 68 metres of water.

As indicated above, the support structure had a rather special history in that it was originally purchased from Hamilton Brothers in the UK for use on South-East Tor.

It was built by McDermott in Morgan City, Louisiana, and sold to AmocoNoco when Hamilton Brothers halted its project. The same fate befell South-East Tor because a development would not be profitable after Norway boosted offshore taxes in 1975.

AmocoNoco then decided to use the jacket on Valhall at the insistence of Noco, although Amoco was prepared to sell it after the South-East Tor project had been cancelled.

However, the structure had to be strengthened for use on the NCS. That additional cost meant it was probably as expensive as a new facility would have been.[REMOVE]Fotnote: Asbjørn Tansø in conversation with Kristin Øye Gjerde, 16 June 2014. The jacket was towed from the USA to Stord during August-September 1980, and installed on Valhall a year later.

McDermott was main contractor for the whole platform, and responsible for negotiations with the sub-contractors, including Brussels-based Oceanic (a subsidiary of McDermott Hudson Inc).

This company was main contractor for the module support frame (MSF) and modules, and contracted out fabrication of these units to Stord Verft (MSF), Vigor (generator module) and Kværner Egersund (three compressor modules).

It looked for a while as if UIE would get the MSF contract for the PCP, but a certain amount of pressure was applied to the developer to select Norwegian suppliers.

The companies were called into the Ministry of Petroleum and Energy, where minister Bjartmar Gjerde explained how difficult the employment position was at Stord.

No direct order was given about where the MSF contract was to be placed, but it ended up going to Stord Verft – to great jubilation at the company, which thereby avoided redundancies.[REMOVE]Fotnote: Aftenposten , 16 November 1979, “500 mill. i Valhall-oppdrag”, and Bergens Tidende , 16 November 1979, “Stord verft sikret arbeid i hele 1980”.

The MSF and the modules were installed in November and December 1981, with Oceanic doing this job and the subsequent hook-up work.

Discovery of Hod and ValhallValhall orders for crisis-hit yards
Published 15. July 2019   •   Updated 10. August 2020
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