Independent Oil and Gas (IOG) has signed a letter of intent (LoI) with Offshore Design Engineering (ODE) to perform multiple works for its Blythe Hub and Vulcan Satellites Hub development in the North Sea.
Project works will start with the necessary technical and operational support to the projects ahead of the final investment decision (FID).
IOG interim chairman and CEO Mark Routh said: “ODE has a wealth of relevant experience and manages several fields for other operators in the southern gas basin of the UK North Sea, so we will benefit from synergies with their existing operations.
“In line with our commercial model, the cost deferrals also tangibly improve IOG’s funding position both before and after FID.
“This LoI reflects the team’s continued strong progress with the IOG gas portfolio. We look forward to finalising the contract with ODE and agreeing similar terms with other key contractors to continue delivering our gas hub strategy.”
Under the LoI, ODE will be the operations and maintenance service provider and it will offer technical and operational support to IOG in both pre and post-FID stages to deliver the gas project into production.
It will also be responsible for the operational management of the Thames Pipeline and network of in-field pipelines, with IOG continuing to be a 100% licence owner and operator for all assets in the project.
Pre-FID technical and operational support work is scheduled to begin immediately after the finalisation of the ontract terms.
All pre-FID costs associated with the projects will be fully deferred while pre-first gas costs would be 50% deferred, significantly reducing IOG’s funding requirements.