Under the contract, the JV will undertake fabrication of three pre-assembled unit complex process modules for the Arctic LNG 2 Project, which is being developed in northern Siberia


Image: QMW has bagged a contract for the for Arctic LNG 2 Project. Photo: courtesy of rawpixel/Pixabay.

McDermott International’s joint venture (JV) in China has bagged a contract to deliver three complex modules for Novatek’s $21.3bn (£17.28bn) Arctic LNG 2 project in Russia.

The joint venture – Qingdao McDermott Wuchuan Offshore Engineering (QMW) will be responsible for the fabrication of three pre-assembled unit complex process modules for the Russian LNG project. Based in Qingdao, QMW is McDermott’s joint venture with the Chinese state-owned China Shipbuilding Industry Corporation (CSIC).

McDermott did not reveal the exact contract value but indicated that its share is in the range of $50m-$250m (£40.15m- £200.73m).

Under the scope of the contract, the joint venture will carry out fabrication engineering, partial procurement, construction and pre-commissioning scope.

McDermott expects the fabrication work for the modules to begin at the year-end with completion slated for mid-2022.

QMW provides integrated engineering, procurement, construction and commissioning solutions for the floating production storage and offloading (FPSO), onshore and offshore modules market, and also fabrication capabilities. The joint venture’s operations are carried out at a fabrication yard in the Huangdao District in Qingdao.

McDermott Asia Pacific senior vice president Ian Prescott said: “This award recognizes QMW’s experience and excellent performance in the Arctic on an earlier Yamal LNG project. It is further evidence that QMW is a tier one module fabricator in the LNG market.

“Fabrication will be completed in QMW’s mega module workshop which provides increased certainty for safety, schedule and successful project delivery.”

FID taken on Arctic LNG 2 project in September 2019

Earlier this month, Novatek and its partners sanctioned the final investment decision (FID) for the Arctic LNG 2 project to be developed in northern Siberia. The Russian LNG project will feature three liquefaction plants, which will have a combined production capacity of 19.8 million tons per annum (mtpa).

The first of the trains is slated to be brought online in 2023, while the second and third trains are scheduled to be commissioned in 2024 and 2026, respectively.

The Arctic LNG 2 project will see a natural gas liquefaction plant constructed on the Gydan Peninsula in the Russian Arctic region, along with the development of the Utrenneye field, which will provide the feedstock.