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Kvaerner Slides as Rival Hyundai Heavy Wins Billion Dollar Rig Order

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January 21, 2013

kvaerner asa logoJan. 21 (Bloomberg) — Kvaerner ASA, a Norwegian builder of oil platforms, dropped the most in almost a month in Oslo after it lost out on a $1.1 billion topside contract for the Aasta Hansteen natural gas project to Hyundai Heavy Industries Co.

The shares fell as much as 4.2 percent, the most since Dec. 28, and traded 3.6 percent lower at 16.20 kroner as of 10:21 a.m. in the Norwegian capital. More than 987,000 shares have traded today, compared with an average three-month daily volume of about 823,000. Statoil ASA, Norway’s largest oil and gas producer, signed an exclusive deal with Hyundai Heavy to build the top of the platform, the South Korean company said in a Jan. 20 statement.

The contract “was the main topside target for Kvaerner in this awards season,” Pareto Securities AS said in an e-mailed note today. With market rumors suggesting the company will also be unsuccessful in its bids for the Ivar Aasen and Dagny deals, “it seems that Kvaerner will be left without a North Sea topside contract” this season, the Oslo-based broker said.

Aasta Hansteen, which includes the Haklang and Snefrid South discoveries, holds recoverable volumes estimated at 47 billion standard cubic meters of gas. Statoil and partners OMV AG and ConocoPhillips are investing 32 billion kroner ($5.7 billion) in the field development, according to the Norwegian energy company.

The field will be developed at a depth of 1,300 meters (4,250 feet) and operated by the world’s biggest Spar platform, which is supported by a single vertical cylinder, Statoil has said. Production is scheduled to start in third quarter of 2017 and reach a plateau of 130,000 barrels of oil equivalent a day.

Kvaerner, based at Fornebu near Oslo, was spun off from Aker Solutions ASA in July 2011. The company is up 23 percent since then, giving it a market value of 4.4 billion kroner.

– Alastair Reed, Copyright 2013 Bloomberg.

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