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ConocoPhillips Awards FEED Study Contract to Subsea7 Offshore Norway

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ConocoPhillips (COP - Free Report) , a leading global exploration and production company, has hired Subsea7 (SUBCY - Free Report) for conducting a front-end engineering and design (FEED) study offshore Norway. The new contract was awarded under a framework agreement between the two companies. ConocoPhillips Skandinavia has awarded the FEED study contract for the Previously Produced Fields (PPF) development project, and the work related to this project is slated to begin immediately.

The FEED study will enable COP to determine and finalize the technical specifications for the associated subsea project. Further, the details of the development project will be assessed to make a final investment decision (FID). If an FID is reached and the project obtains the necessary approvals from the authorities, COP can exercise option under its current framework agreement with Subsea7 for a major subsea contract.

By exercising the option, ConocoPhillips, the operator of this project, can proceed with the award of the subsea structures, umbilicals, risers, and flowlines (SURF) scope to Subsea7. The value of the contract is estimated to be between $300 million and $500 million. If an FID for the project is reached, then the offshore activities associated with the project will be slated for 2026-2029.  

The Previously Produced Fields are situated 290 kilometers to the southwest of Stavanger, Norway, in the Greater Ekofisk Area. The development will be tied back to the Ekofisk Complex. Subsea7 mentioned that it is excited to work with ConocoPhillips to deliver incremental value from the Greater Ekofisk Area and contribute to the final investment decision on the project.

Zacks Rank and Key Picks

COP currently carries a Zacks Rank #5 (Strong Sell), while SUBCY sports a Zacks Rank #1 (Strong Buy).

Some better-ranked stocks from the energy sector are Diversified Energy Company plc (DEC - Free Report) and Expand Energy Corporation (EXE - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Diversified Energy Company is an independent oil and natural gas producer in the United States. The company is primarily engaged in the production, transportation, and marketing of natural gas and natural gas liquids. The rising demand for natural gas as a cleaner-burning fuel, along with an uptick in the commodity’s prices, is expected to positively impact the company’s bottom line.

Expand Energy is a leading U.S.-based natural gas producer formed through the merger of Chesapeake Energy Corporation and Southwestern Energy Company. Natural gas is expected to play an increasingly important role in the energy transition journey. Expand Energy is poised to benefit from the rising demand for natural gas as a cleaner-burning fuel. The recent rise in natural gas prices is also anticipated to positively impact EXE’s profitability.

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