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aftenposten.no: Hydro admits overrun: Hydro’s development at Ormen Lange will be nearly twice as expensive as expected.

Construction at Ormen Lange

Construction at Ormen Lange. PHOTO: CORNELIUS POPPE – SCANPIX (ARKIV)
 
Hydro’s gas landing facility at Ormen Lange will cost NOK 17 billion (USD 2.86 billion) more than planned, financial daily Dagens Næringsliv reports.

This is the cost for phase two of the development, which has risen in cost from NOK 20 billion to 37 billion. When parliament approved the extension in 2003 the construction budget was NOK 16 billion, calculated as NOK 20 billion in 2007 currency.

Phase one of the project is currently being completed, on schedule and on budget.

Project director Tom Røtjer believes it is wrong to focus on the estimates for phase two as many aspects of the final facility remain unclear. Also, costs from the supplier industry have doubled in recent years.

The announcement came after pressure from partners, including Shell and Statoil.

The overrun first became known via a leak at a Statoil presentation in connection with their first quarter results. This leak caused considerable irritation at Hydro, and also put Statoil’s overrun at their Snøhvit facility in a better light.

http://www.aftenposten.no/english/business/article1859023.ece

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