Skanska secures SEK 1 billion assignment for Ormen Lange gas project in Norway

Skanska has secured the contract for the construction and civil engineering work for the on-shore terminal for the new Ormen Lange gas field in Western Norway.

Skanska has secured the contract for the construction and civil engineering work for the on-shore terminal for the new Ormen Lange gas field in Western Norway. The contract is valued at SEK 1,085 M, or NOK 1 billion, and is included in order bookings for the first quarter of 2004. The customer is Norsk Hydro.

Skanska's assignment includes construction and civil engineering work above and below ground at the site of the future processing plant at Nyhamna in Western Norway. It includes two seawater tunnels with a total length of 2.4 kilometers and a chamber for the storage of condensed gas. On shore, a number of temporary and permanent infrastructure facilities are being constructed, such as loading and service bays, a sewage treatment plant as well as temporary residential and office premises. The contract also includes an option to supply concrete.

"Securing this major assignment is again evidence of confidence in our ability to manage large, complicated projects," says Petter Eiken, President of Skanska Norway.

Work at the site will commence in April and is scheduled for completion in December 2006.

The Ormen Lange gas field is one of the largest construction projects in Northern Europe. The total development costs are expected to amount to NOK 66 billion. The gas field is located at a depth of 800-1,100 meters under the Norwegian Sea, about 100 km from the coast. The facility will not be visible above the surface of the sea -- but gas extraction will occur through automatic subsea installations, combined with an on-shore processing plant at Nyhamna near Kristiansund. Ormen Lange will be placed in operation in 2007.

The expansion has been approved by the Norwegian Government and the issue will be addressed in the Storting (Parliament) in the near future. Norsk Hydro is the operator of Ormen Lange for the build-out phase of the gas field, the processing plant and pipelines. Shell is the operator for the gas production phase and Gassco for the operation of the export pipeline.

Skanska Norway is currently also constructing the first public-private partnering highway in Norway. The construction assignment is valued at SEK 1.6 billion and Skanska BOT is involved in the ownership consortium. Skanska Norway's larger on-going projects also include the Tyin power plant and the new highway bridge in Drammen.

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