Denmark’s DONG Energy announced Tuesday that it has decided to terminate the EPC contract for the Hejre project after it claimed the supplier consortium failed to meet its contractual commitments.
The Danish energy firm, and its partner Bayerngas, said it no longer has confidence in the supplier consortium’s ability to deliver a planned platform.
DONG said it holds the consortium, consisting of Technip France and Daewoo Shipbuilding & Marine Engineering, has not been able to meet its contractual commitments under the EPC contract on Hjere.
It said: “This has, among other things, resulted in significant delays in the completion of the Hejre project.”
As a result, the platform will not be completed and the Hejre project in its current form will be stopped.
DONG will now assess alternative methods for the development of the Hejre field. As such, no first oil production date for the Hejre field can be provided at present, the company said.
Executive vice president David Cook said: “DONG Energy and Bayerngas have today decided to terminate the contract for the Hejre platform due to the supplier consortium’s material breach in meeting its contractual obligations under the EPC contract for the design and construction of the Hejre platform.
“We’ll now take a step back to jointly evaluate the best way forward for the Hejre field.”
DONG said the decision was not expected to result in additional impairment losses (including provisions) relating to the Hejre project and does not change its previous financial guidance for the 2016 financial year.
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