Talisman Energy has signed a deal with SBM Offshore to scrap the YME MOPUstor project in Norwegian sector of the North Sea.
Talisman will also scrap the existing above-surface structure and end all joint activity for an agreed cost.
As per the deal, the Netherlands-based contractor SBM Offshore will make an upfront payment of $470m, while Talisman will complete the work to remove the Mobile Offshore Production Unit (MOPU), from the Yme oil field.
SBM will carry out the transportation and final scrapping of the facility.
Calgary Herald reported that SBM announced that it has accounted for $200m of the amount in December, and will charge the remainder to its first-half 2013 results.
Under the agreement, the ownership of the in situ subsea structure will be transferred from SBM Offshore to the Yme license holders.
Talisman Europe-Atlantic executive vice-president Paul Warwick said the deal as a good settlement for the company, the Yme partners and Norway.
"This arrangement should allow the partners to move forward to examine options for the Yme field, without incurring significant additional costs related to the existing topsides," Warwick added.