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SBM Offshore has been issued with a letter of interim award (LOIA) for Shell’s Fram floating production, storage and offloading vessel (FPSO) in the U.K. North Sea for an undisclosed amount.
The award has been issued as part of the framework agreement SBM and the operator signed in March this year, and will see the contractor carry out the supply, lease and operation of the floating production system. The LOIA allows SBM to start engineering and procurement of long lead items to ensure timely completion of the planned Fram FPSO project, which is subject to a final investment decision.
Shell and SBM signed an enterprise framework agreement (EFA) in March covering a five-year period, with an option to extend for another five years, to supply small and medium sized FPSOs globally on a lease and operate basis. The Fram FPSO will be the first project to be developed under the terms of the EFA.
The hull of the FPSO will be based on a converted Aframax tanker and will incorporate an internal turret permanent mooring system. The crude will be offloaded to shuttle tankers and the gas exported via the existing Fulmar field pipeline.
Bruno Chabas, chief executive officer of SBM Offshore, said, “We are delighted by the letter of interim award for this FPSO lease and operate project in the North Sea for Shell. This award reaffirms our strategy to focus on FPSOs as we develop SBM Offshore’s position as the world’s leading FPSO provider. The agreement signed earlier in the year is a commitment to work with Shell on a long term basis to develop offshore floating solutions. We look forward to developing many more FPSO projects with Shell around the world in the future.”