Golar-Nor Offshore is a floating production contractor that has provided turnkey production services in the UK and Norwegian Sectors of the North Sea since 1986, with the production vessel PETROJARL I, and its dedicated shuttle tankers, PETROSKALD and PETROTROLL. They are currently engaged in early production for Amerada Hess (UK) in the Hudson Field, and shall be commencing a full field depletion contract for Arco (UK) in the Blenheim Field in early 1995, for a period of 3-5 years.
The paper will examine the applicability of contractor-based production services for extended well testing, early production and full field depletion, addressing the economic limitations and considerations, both of Company and Contractor, for these three market segments.
The paper will further examine the applicability of variable reimbursement schemes to such contracts, based on the risk-sharing scenario currently practiced by GNO, and discuss how such models can be further developed to optimize risk-sharing between Contractor and Company, in the context of development of smaller fields with uncertain reserves.
This paper summarizes the contractual experience so far gained on the PETROJARL I and the associated shuttling services, and attempts to draw some lines into the future with respect to development of the business format and the evolution of the relationship between the Floating Production Contractor and the various oil companies in question.