A subsidiary of German oil and gas producer Wintershall said it awarded a contract to Halliburton for work in the Norwegian Sea, describing it as a market booster.
Wintershall Norge awarded a four-year service contract to a regional component of Halliburton for work in the Maria development in the Norwegian Sea. It's the first major contract for Halliburton since it ended a bid to merge with industry counterpart Baker Hughes.
Wintershall said work would begin immediately on laying the groundwork for a drilling plan for the Maria development. By next year, Halliburton will support efforts to drill six development wells in the Norwegian Sea.
"At an uncertain time for the industry, this contract provides a timely boost for the supplier market while laying the groundwork for efficient construction of our operated development and exploration wells over the rest of the decade," Wintershall Norge Managing Director Bernd Schrimpf said in a statement.
The Norwegian government in September approved Wintershall's development plans for the Maria oil field, with the company earmarking as much as $1.8 billion for drilling operations. Wintershall described Maria as an important landmark project for Norway. Recoverable resources are estimated at 180 million barrels of oil, of which the majority is oil.
Wintershall provided no terms for the contract and no comment was offered by Halliburton, which last month ended its efforts to merge with rival Baker Hughes amid competition concerns from U.S. and European regulators.
Lower crude oil prices, down about 25 percent from this time last year, mean companies have less capital to invest in exploration and production, the side of the energy sector serviced by companies like Halliburton.
Halliburton in its first quarter earnings report said the pressure from lower crude oil prices was widespread. The company reported income of $64 million, compared with fourth quarter income from continuing operations of $270 million.
Maria is expected to begin production by 2018.
