KBR Awarded Front End Engineering Design Contract for Equinor Bay du Nord FPSO Project

Rhea-AI Summary

KBR announced that KBR Industrial Canada Co. has received a Letter of Intent from Equinor Canada for the front-end engineering design (FEED) of topside facilities for the Bay Du Nord floating production, storage, and offloading facility (FPSO) located offshore Newfoundland, Canada. This agreement includes an option for ongoing design and procurement management. KBR's work will contribute to one of the world's lowest carbon-emitting FPSOs, utilizing advanced technology to minimize emissions. This contract builds on KBR's previous work in pre-FEED engineering conducted in 2022, with production expected to commence in the late 2020s.

Positive

• Received Letter of Intent for FEED of Bay Du Nord FPSO from Equinor Canada.
• Contract includes option for detailed design and procurement management.
• Focus on developing one of the lowest carbon-emitting FPSOs in the world.
• Builds upon KBR's previous engineering work, creating continuity and expertise.

Negative

• Production timeline extends to the late 2020s, which may delay revenue generation.

HOUSTON, April 3, 2023 /PRNewswire/ -- KBR (NYSE: KBR) announced today that its Canadian entity, KBR Industrial Canada Co., has received a Letter of Intent (LOI) from Equinor Canada for the front-end engineering design (FEED) of the topside facilities of the new Bay Du Nord floating production, storage, and offloading facility (FPSO) to be located offshore Newfoundland, Canada. 

The agreement also includes an option for continuation of detailed design and procurement management services through to final completion of the FPSO. The FEED scope comes on the back of the pre-FEED engineering carried out by KBR in 2022 and will further mature the engineering and execution planning, working towards a final investment decision with first production expected to be in the late 2020s. 

During the FEED engineering, KBR will continue to help Equinor develop one of the lowest carbon emitting FPSO's in the world, using an onboard combined cycle power system and the latest technology to minimize the number of crew onboard and maximize digital solutions. All these elements will produce energy safely and securely while minimizing carbon emissions.

KBR will execute the work scope jointly with Canadian sub-contractor Hatch Ltd., an employee-owned multidisciplinary engineering, project management, and professional services firm with a local office in St. John's, Canada, and will provide Equinor with an integrated team across Canada and London.

The Bay du Nord FPSO is a deep-water facility utilizing industry leading technology and digital solutions to ensure safe and reliable production. This award builds upon KBR's unrivalled knowledge and expertise in this arena.

"We are excited to be a part of this significant project with Equinor," said Jay Ibrahim, president of KBR's Sustainable Technology Solutions business. "This win is indicative of KBR's strategic commitment to work with clients not only to secure energy supply for the world but to do it in a safe, responsible, and sustainable way. KBR adds maximum value to clients such as Equinor, by drawing on our extensive global engineering expertise and applying the latest technology and processes to deliver extraordinary outcomes."

About KBR

We deliver science, technology and engineering solutions to governments and companies around the world. KBR employs approximately 30,000 people performing diverse, complex and mission-critical roles in 34 countries.

KBR is proud to work with its customers across the globe to provide technology, value-added services, and long-term operations and maintenance services to ensure consistent delivery with predictable results. At KBR, We Deliver.

Visit www.kbr.com

About Equinor's Bay Du Nord Project

The Bay du Nord project (BdN) consists of several oil discoveries in the Flemish Pass basin, some 500 km northeast of St. John's in Newfoundland and Labrador, Canada. The first discovery was made by Equinor in 2013, followed by additional discoveries in 2014, 2016 and 2020. Confirmed discoveries in 2020 in adjacent exploration license EL1156 (Cappahayden and Cambriol) are potential tie-ins in a joint project development. The Bay du Nord discovery is at a water depth of approximately 1170 meters whilst the new discoveries are at approx. 650 water depth.

The optimization of the Bay du Nord development project is ongoing to make it more robust for the future market and evaluation to include confirmed new discoveries in adjacent license EL1156 (Cappahayden and Cambriol). Equinor is working Together with their partner in the discoveries BP, towards a final investment decision with first oil expected to be produced in the late 2020's.

About Hatch

Hatch is a Canadian, employee-owned, multidisciplinary engineering, project management, and professional services firm, which has a strong presence in Canada with multiple offices spread across the country. In addition to the St. John's offices, Hatch has a wider resource pool in Canada of more than 3,000 people, who can be called upon should additional local support be required. The Canadian team is supported by a global network of 10,000 professionals with experience that spans more than 150 countries around the world in the metals, energy, and infrastructure sectors.

Learn more at www.hatch.com

Forward Looking Statements

The statements in this press release that are not historical statements, including statements regarding the company's work on the Bay Du Nord FPSO facility and the expected production timeline, are forward-looking statements within the meaning of the federal securities laws. These statements are subject to numerous risks, uncertainties and assumptions, many of which are beyond the company's control, that could cause actual results to differ materially from the results expressed or implied by the statements. These risks, uncertainties and assumptions include, but are not limited to, those set forth in the company's most recently filed Annual Report on Form 10-K, any subsequent Form 10-Qs and 8-Ks and other U.S. Securities and Exchange Commission filings, which discuss some of the important risks, uncertainties and assumptions that the company has identified that may affect its business, results of operations and financial condition. Due to such risks, uncertainties and assumptions, you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. Except as required by law, the company undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

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SOURCE KBR, Inc.

FAQ

What is the Letter of Intent KBR received from Equinor Canada about?

KBR received a Letter of Intent for the front-end engineering design of the Bay Du Nord FPSO from Equinor Canada.

When is first production expected for the Bay Du Nord project?

First production from the Bay Du Nord project is expected in the late 2020s.

What technology will KBR use for the Bay Du Nord FPSO project?

KBR will utilize advanced technology to minimize emissions and enhance safety in the Bay Du Nord FPSO project.

What is the significance of KBR's contract with Equinor Canada?

The contract solidifies KBR's role in a sustainable energy project, focusing on low carbon emissions and leveraging their engineering expertise.

How does the Bay Du Nord project impact KBR's business timeline?

While the project represents a significant opportunity, the extended timeline until late 2020s may delay revenue recognition for KBR.