Licence committee for unitisationNPC – a Norwegian option

Brown & Root lands offshore job

person by Trude Meland, Norwegian Petroleum Museum
Brown & Root was a multinational contractor owned by Halliburton Company, with its head office in Houston and branches in many parts of the world. In addition to a number of contracting subsidiaries, it owned companies whose only job was to secure cheap labour for hire.
— Statfjord A on the field. Photo: Odd Noreger/Norwegian Petroleum Museum
© Norsk Oljemuseum

The group had established a presence in Norway in early 1970 to participate in the development of Ekofisk, and was eventually represented by several companies – Brown & Root NV (Netherlands Antilles), Brown & Root Norge and finally Brownaker.[REMOVE]Fotnote: Ryggvik, H., Smith-Solbakken, M., Gullvåg, E., & Norsk petroleumsforening. (1997). Blod, svette og olje (Vol. 3). Oslo: Ad notam Gyldendal.: 111.

Brown & Root’s first contract in connection with the Statfjord A development covered engineering design and management of the loading buoy, flare and flowlines. This was awarded in September 1975.[REMOVE]Fotnote: Moe, J. (1980). Kostnadsanalysen norsk kontinentalsokkel : Rapport fra styringsgruppen oppnevnt ved kongelig resolusjon av 16. mars 1979 : Rapporten avgitt til Olje- og energidepartementet 29. april 1980 : 2 : Utbyggingsprosjektene på norsk sokkel (Vol. 2). Oslo: [Olje- og energidepartementet]. : 182.

Three months later, it also took over planning, management and execution (engineering design and project management) for the offshore hook-up work from Matthew Hall Engineering, which had done an inadequate job on the topside outfitting and thereby lost its contract.[REMOVE]Fotnote: Moe, J. (1980). Kostnadsanalysen norsk kontinentalsokkel : Rapport fra styringsgruppen oppnevnt ved kongelig resolusjon av 16. mars 1979 : Rapporten avgitt til Olje- og energidepartementet 29. april 1980 : 2 : Utbyggingsprosjektene på norsk sokkel (Vol. 2). Oslo: [Olje- og energidepartementet]:156.

Operator Mobil regarded Brown & Root as the best qualified company, and transferred the latter contract without competitive tendering. Brown & Root had been offered the assignment earlier, but had turned it down because its order book was full. The company now had spare capacity after completing work on the UK continental shelf.[REMOVE]Fotnote: Moe, J. (1980). Kostnadsanalysen norsk kontinentalsokkel : Rapport fra styringsgruppen oppnevnt ved kongelig resolusjon av 16. mars 1979 : Rapporten avgitt til Olje- og energidepartementet 29. april 1980 : 2 : Utbyggingsprosjektene på norsk sokkel (Vol. 2). Oslo: [Olje- og energidepartementet]:183.

On Mobil’s behalf, Brown & Root administered a number of sub-contractors – including its own subsidiaries. This meant that it was both the main contractor with responsibility for selecting and checking sub-contractors, and a sub-contractor through its own subsidiaries.

A contract was namely awarded to Brown & Root NV on 26 April 1976 covering the hire of labour and equipment for the offshore work. This “personnel resource” assignment was also placed without competitive tendering, but Brown & Root guaranteed its subsidiary’s performance.

Brown & Root’s possession of two big contracts came in for criticism from various quarters, including several licensees who took the view that the US group had become responsible for planning and construction as well as checking and approving its own work, estimates and costs.[REMOVE]Fotnote: Hanisch, T., Nerheim, G., & Norsk petroleumsforening. (1992). Fra vantro til overmot? (Vol. 1). Oslo: Leseselskapet. A number of critics maintained that this was a case of setting a fox to keep the geese.

To learn more, see the article: Brown & Root + Aker = Brownaker

Licence committee for unitisationNPC – a Norwegian option
Published December 4, 2019   •   Updated December 11, 2019
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