Equinor has initiated preliminary work on the Bay du Nord oil project in the Canadian province of Newfoundland and Labrador, contracting BW Offshore and Altera Infrastructure for design studies.

This move comes despite the project's current hold status as the company assesses cost-effectiveness.

BW Offshore, based in Norway, has been tasked with a preliminary design study for a production and storage vessel for the Bay du Nord oilfield.

The company's news release states that this work aligns with Equinor's strategic objectives for the project.

Similarly, UK-based Altera Infrastructure has confirmed its involvement in a preliminary design contract related to a production and storage vessel. These contracts suggest progress in the project's planning phase, despite no final decision on its commencement.

The Bay du Nord development, sanctioned by the Canadian government in 2022, was put on hold for three years by Equinor in 2023 to enhance cost efficiency. The $16bn (Nkr179.88bn) project's future remains uncertain, but these preliminary contracts indicate ongoing interest.

Situated around 500km from St. John's, the Bay du Nord oilfield is said to be the first deep-water oil project offshore Newfoundland and Labrador.

The field, discovered in 2013, with subsequent finds up to 2020, lies in waters approximately 1,170m deep.

Equinor plans to utilise a floating production, storage and offloading (FPSO) unit for the Bay du Nord field. This FPSO unit is considered an optimal solution for connecting adjacent discoveries and future prospects.

The Bay du Nord project, once operational, is set to be one of the world's lowest-carbon projects per barrel of oil produced.