A Chevron affiliate has canceled a newbuild order for a $1.8 billion floating production and storage offloading (FPSO).
According to Zacks Equity Research, Chevron North Sea Ltd. has cancelled an order placed with Hyundai Heavy Industries for a newbuild FPSO.
The order was placed in April 2013 and the unit was initially slated for delivery at the end of November 2016.
According to Zacks, Chevron North Sea cited low oil prices as the reason behind the order termination.
The FPSO was going to be used at the Rosebank field in the UK North Sea.
Chevron told Energy Voice that the termination is effectively immediate.
A spokesperson with Hyundai Heavy Industries told the Maritime Executive that Hyundai will “not suffer any losses” from the cancellation because construction on the unit had not begun due to delays in Chevron’s final investment decision.
The FPSO would have had a capacity of up to 100,000 barrels of oil per day and 80 million cubic feet per day of natural gas.
The Rosebank field is located in Blocks 213/26 and 213/27 off the coast of the Shetland Islands and was discovered in 2004.
A Chevron spokesperson told Offshore Engineer that the Rosebank project is currently “continuing through” front end engineering design (FEED) work.
The company added that it is working closely with its joint venture partners in Rosebank “to further improve project value and decrease execution risk as we progress through FEED.”
Chevron North Sea operates the project with a 40 percent stake.
Suncor holds a 30 percent stake, OMV holds a 20 percent stake and DONG E&P holds a 10 percent stake.