ONS: Ormen Lange´s captain

“Whither Ormen Lange?”, asked the Norwegian nineteenth-century poet laureate Bjørnstjerne Bjørnson in his poem on the Viking king Olav Trygvason (d. c. 1000) and his flagship, the Ormen Lange (Long Serpent). The same question can be put to Norsk Hydro’s project manager and sturdy skipper of the Ormen Lange development, Thor Andreas Tangen. “Our plans are to submit a development and operation plan, a PDO, in 2002,” says Tangen. “Within that period we will have a lot of hard work on our plate.”

Tangen is probably the most experienced project leader in Norsk Hydro’s ranks out at Kjørbo. He is considered the best to bring the Ormen Lange project safely into harbour for the company with the Viking ship in its logo. His experience stretches back to the beginning of the 1970s, when as a fledgling chartered engineer (sivilingeniør) he followed in his father’s footsteps and started work in Norsk Hydro. After three or four years he joined Statoil, but returned to Norsk Hydro in 1984, then as project manager for Oseberg B. Later he accepted responsibility for one of the most demanding projects Norsk Hydro had ever undertaken, the magnesium plant at Becancour in Quebec. Tangen has played a key role in the development of Njord and Troll.

When Norsk Hydro was assigned to develop the Norwegian shelf’s so far most demanding field, it was no coincidence that the job was given to Thor A. Tangen.

A “Trønder” in Porsgrunn

He was born in Orkanger in the Trøndelag, about 60 km west of Trondheim, in 1945. Like so many others, his father was looking for challenging work in the aftermath of the war; the choice was between Norsk Hydro at Herøya in Telemark, or Rio de Janeiro. The upshot was that the new family moved south, but no further than to Grønli in Porsgrunn, where young Thor grew up. “I count myself a Porsgrunn boy, but in my heart of hearts I’m a Trønder.”

It’s said that Trønders are quite impulsive, when they’ve first had a good think. This deliberation can be a good quality when the time comes to make a final choice of design and send the PDO to the Storting for final approval. After all, it will require investment in the order of NOK 25-30 billion to get the Ormen Lange gas up from the seabed and into the Europan markets.

Uncertain prices

“The economics of Ormen Lange are completely dependent on achieving a major gas sale. We must be more than reasonably certain of selling the gas when we submit a PDO”, emphasises Tangen. “We entrust our fate to the Gas Negotiation Committee, the GFU, which is responsible for selling the gas.”

Selling to Europe is an uncertain business right now. According to the Finnish energy company Fortum, the European gas market will double in the course of the next decade. Much of the uncertainty, however, is related to the price of electrical power, because this market is undergoing deregulation – the power market is currently rather chaotic. In consequence, there is much uncertainty about gas prices on the Continent. We will try to sell as much as possible of the gas resources to the United Kingdom. Production in the British sector is falling, and gas demand is set to rise. We have prepared the Heimdal platform to supply this market.

Prefer a subsea solution

Norsk Hydro is responsibility for the developing, but Shell for operating, Ormen Lange. This means that all production wells are to be planned and established by Shell, and Hydro’s 24-person team now working on project planning includes two seconded from Shell. In addition, weekly meetings are held between the two companies. “We have excellent cooperation. All jobs are done as soon as we agree.” This includes the other oil companies who are part of the project: BP Amoco, Esso/Mobil and Statoil.

All kinds of development solution are being considered, from giant production platforms to a seabed-based design with its production facilities on shore, as for Troll at Kollsnes. “We must find the solutions whose development is financially and technically sound. This is why qualification of the technology through the Demo 2000 programme is of great importance to us; it gives us results that may be decisive for the choice of technology and concepts for further operation. Our objective is a solution with landing of gas in Møre og Romsdal county, but it might well be that we end up with other solutions, although I would prefer not to be known for building the last dinosaur on the Norwegian shelf.

Gradual development

Tangen envisages a stepwise development: “We are planning to start production around 2006. We may not need a lot of advanced subsea equipment until 2010. This makes great demand of our ability to prognosticate, so that we can select the solution that will be most profitable for at least twenty years ahead. This equipment may not exist yet, but Tangen thinks that the developers have plenty of time to develop the components required. This presupposes that Norwegian suppliers are forward-looking and out there on the playing-field. “I am convinced that in concert with our capable engineering industry, we can achieve solutions that can be used and sold way beyond our own continental shelf”, concludes Thor A. Tangen, gazing over the mirror-calm Oslofjord.