Shell has started awarding contracts for the construction of the Goldeneye
gas-condensate project in the Outer Moray Firth about 60 miles north east
of St Fergus, near Peterhead, Scotland.

Foster Wheeler wins St Fergus Gas Plant

Foster Wheeler has gained the £60 million contract for the construction
of the gas-condensate receipt and separation module to be built at the
Shell/Esso St. Fergus Gas Plant.

The St Fergus gas site will create around 300 construction jobs during its
2 year build programme and is scheduled to be completed by 2004.

Platform to be built in Norway

Meanwhile Aker Verdal AS, part of the Kvaerner Group has secured the
£10 million contract for the construction of a jacket and piles for the platform.
The work will take place at the Verdal yard in Norway.

Speaking about the award, Sverre Skogen, CEO of Aker Kvaerner said:
“This award demonstrates that our long experience and specialisation in
jacket construction has paid off – and suggests that our yards can be
competitive in the international market.”

Fabrication at the Verdal yard will commence in October.  At its base, the
jacket measures 35 sq metres, with a height of 140 metres, and weighs
3,000 tons.

At its peak, the contract is expected to employ about 150 people. Once
delivered in June 2003, the Goldeneye Jacket will be the 28th such
structure that Aker Verdal has undertaken in a row. Aker Verdal is one of
the few yards in Europe specialising in jacket construction for the upstream
oil and gas industry – with three jackets currently under construction –
Kvitebjørn for Statoil, Valhall for BPAmoco, and Grane for Norsk Hydro.

Goldeneye product to be processed onshore rather than offshore.

Shell announced the £300 Goldeneye project last month. Goldeneye is
unusual in that the processing module will be onshore at St Fergus rather
than offshore. The offshore facilities will consist of a smaller, unmanned
platform.

The field was discovered in 1996. Despite having more than 500 billion
standard cubic feet of gas reserves and some 17 million barrels of
condensate it was regarded as being uneconomic to develop due to its
long distance from existing infrastructure.

To solve this problem Shell decided to transport the product directly to
shore by pipeline for processing. At 105 km the Full Wellstream Transfer
pipeline will be the longest tieback in the UK continental shelf and will
transfer gas and condensate under reservoir pressure from the unmanned
platform on the field to the onshore processing facility at St Fergus. Gas
will be delivered to the National Transmission System at Transco in St
Fergus while NGLs and condensate will go to the Fife Natural Gas Liquids
Plant in Mossmorran through an existing pipeline.  After further processing
various products, including condensate, Propane and Butane will be
produced

Three times depth of Southern North Sea

Goldeneye has also created another technological first for the UK industry
with the use of jack-up drilling in 120 metres of water as an alternative to
sub sea completions.

This will also be the greatest water depth in which a jack-up rig has been
used for production drilling in the UK.   At 120 metres/400 feet the water
depth at the platform is three times the depth of the Southern North Sea.

The field is expected to be in production from 2004 for between 7 and
10 years.

For more information on the Goldeneye project visit the Goldeneye
Website at www.goldeneye-venture.com

Goldeneye is a joint venture between Shell U.K. – 52.5 % Esso Exploration and Production U.K., an ExxonMobil
company – 39% Lasmo (TNS) a wholly owned subsidiary of Eni S.p.A – 4.5% Paladin Expro Ltd – 3%
Veba Oil & Gas UK – 1%