Annual Report 2010 - SBM Offshore

SBM Offshore
employees on board
an FPSO
Offshore Production Unit with storage (MOPUstor) for
the Yme development was installed offshore Norway
in September 2008. The installation of the tank allowed
the client, Talisman Energy Norge AS, to complete drilling
activities along with installation of the associated
dry tree wellheads.
The complexity of the project and compliance with
Norwegian regulations caused significant delay and
substantial cost overruns. The magnitude of the capex
cost overruns in 2009 were such that the Company had
to incur an impairment charge to maintain a return on
investment equal to the weighted average cost of capital
during the lease period. In 2010 further costs led to
an additional impairment charge.
Report of the Board of Management
Construction of the MOPUstor TM was completed in
Abu Dhabi mid-August 2010 and the MOPU was then
shipped to Stavanger in Norway on a Heavy Lift Vessel
where it arrived mid-September 2010.
The unit is currently ready for offshore installation with
production targeted for the summer of 2011; actual
start-up date is dependent on the occurrence of a
suitable weather window to enable the safe installation
of the MOPU offshore in the Yme field. The initial
lease contract is a bareboat charter for a five-year
period and excludes the operating activities. The
MOPUstor concept is a patented design of SBM
Offshore.
SBM Offshore – Annual Report 2010 59