Major growth of orders for Wärtsilä in the oil & gas industry

Wartsila Corporation
  • Trade press release
14 November 2007 at 2:01 AM E. Europe Standard Time

Wärtsilä Corporation, Trade and Technical Press Release, 14 November 2007

The high prices for oil and gas and the estimation that world gas consumption will double by year 2030, are encouraging significant new investments in the global oil and gas industry both for new exploration, production, transportation and refining infrastructures. There are also major efforts by the United Nations and the World Bank to reduce the flaring of associated gases from oil production within the next five years. These developments mean that there is and will be a growing demand for decentralized power plants in the oil and gas sector. This in turn has resulted in several new contracts for Wärtsilä during 2007 to supply power plants based on reciprocating engines developed for various petroleum industry applications.

“This successful string of new orders is a result of Wärtsilä’s efforts during many years to develop the fuel flexibility of our heavy-duty gas and diesel engines. The engines can today meet the specific demands of the oil and gas industry by being able to burn crude oils, associated gases and high viscosity fuels, such as process bottom oils from refineries,” says Mr Harry Lindroos, Director of Oil and Gas of Wärtsilä Power Plants.

Odessa oil refinery, Ukraine

As an example, Wärtsilä was awarded a contract by Lukoil Energy & Gas Ukraine Ltd in August 2007 to supply an 18 MWe diesel power plant for the Odessa oil refinery in Ukraine. Due for delivery in spring 2008, the plant will burn very high viscosity residual  oils from the refinery. The plant will be equipped with two Wärtsilä 20V32 diesel generating sets, together with other equipment from Wärtsilä.

Crude oil fuelled power plant for the Russian ESPO-pipeline

In August 2007 Wärtsilä also received  a contract to deliver power plant equipment including a powerhouse for the new Russian main oil pipeline ESPO running from Eastern Siberia to the Pacific Ocean and exporting oil to the Far East.

This power plant consists of five Wärtsilä 16V32 crude oil-fired engines with a total power of 35 MWe and it will be located near the town of Olekminsk in the Sakha Republic of the Russian Federation. The plant will produce both electricity and heat using crude oil from the pipeline as fuel and feeding electricity to a pumping station located nearby on the ESPO-pipeline.

The plant equipment will be delivered in summer 2008 from the Vaasa factory by rail to Eastern Siberia and then by river vessels to its final destination. The plant will be designed for independent operation in demanding arctic temperature conditions.

Hungarian strategic gas storage project

In July 2007 Wärtsilä won a major contract to deliver gas engine mechanical drives and auxiliaries for a compressor plant from MOL Hungarian Oil & Gas Plc for underground gas storage at Szöreg, in the Csongrád region of south Hungary.

Due to be completed by the end of 2009, the plant will be equipped with five Wärtsilä 9L34SG gas engines driving gas reciprocal compressors delivered by Cameron from US. The five engine-driven compressors and two electric motor-driven compressors will compress natural gas into underground storage caverns.

The plant will thus be employed to pump gas into storage during periods of lower demand, mainly in the summer, to make it available for times of high demand, as in the winter.

Gas-fired power plant for a Western Siberian crude oil pipeline pumping station

In Western Siberia, Wärtsilä was awarded a contract in early 2007 for a 42.7 MWe gas-fired power plant for a Rosneft oil company crude oil pumping station on the Vankor-Gubkinskoje oil export pipe in Russia. The plant is due for completion at the beginning of 2009.

The Vankor pumping station will be equipped with six generating sets powered by Wärtsilä 34SG gas engines using associated gas as the fuel. Four sets will have 20-cylinder engines and two will have nine-cylinder engines. The combined electrical output will be 42,696 kW.

52 MWe CHP plant in the Tarasovskoye oil field, Western Siberia

In October 2007, Wärtsilä began delivery of equipment for a 52 MWe gas-fired combined heat and power (CHP) plant for the Tarasovskoye oil field central processing facility  in the Yamalo-Nenets Autonomous District of the Tyumen region in Western Siberia. The contract marks Wärtsilä’s first CHP project of more than 50 MWe in Russia and it was the first-ever power plant for the Russian state oil company Rosneft.

The plant is being equipped with six Wärtsilä 20V34SG gas engines with heat recovery system. The CHP plant will run on flare gases from the oil wells. In addition, Wärtsilä will deliver the power plant building.

The contract was signed in November 2006 with OOO “Energotech”, Russia, a turn-key contractor to Rosneft-Purneftegaz, a 100%-owned subsidiary of Rosneft, one of the top ten oil producers in the world. The plant is due to be fully operational in summer 2008 supplying heat and power to the oil field’s processing facilities.

Rosneft selected a Wärtsilä gas engine-based power plant over a gas turbine arrangement because of its flexible characteristics of handling load variations and operational requirements. The gas engines are also tolerant against fuel quality variations and are thus well suited for oil field power generation.

Other advantages the Wärtsilä CHP plant will bring to the customer are high efficiency, low emissions and being able to reduce flaring as the associated gas will be used for the generation of power and heat instead. As the Tarasovskoye field is located in Western Siberia, Wärtsilä’s extensive experience in Arctic areas also played an important part in the customer’s decision.

Wärtsilä in brief:

Wärtsilä enhances the business of its customers by providing them with complete lifecycle power solutions. When creating better and environmentally compatible technologies, Wärtsilä focuses on the marine and energy markets with products and solutions as well as services. Through innovative products and services, Wärtsilä sets out to be the most valued business partner of all its customers. This is achieved by the dedication of more than 15,000 professionals manning 130 Wärtsilä locations in close to 70 countries around the world.

For further information, please contact:
Maria Nystrand
Public Relations Manager, Power Plants
Wärtsilä Corporation
Direct tel: +358 10 709 1456
Direct fax: +358 10 709 1425