The development, named the Western Isles project, will see Subsea build two 2.5 kilometre (1.6 miles) pipeline bundles and an 11km (6.8 miles) gas export pipeline.
The work will be undertaken by staff at Oslo-listed Subsea 7's Aberdeen office, with offshore activities due to start in 2014.
Steph McNeill, Subsea 7's vice president for the UK and Canada, said "The award of this prestigious contract from Dana is an endorsement of our unique bundle technology.
"We are grateful to Dana for choosing us to provide them with a cost effective solution and look forward to helping them deliver this strategically important development."
Last month Dana, which is owned by the Korean National Oil Corporation, was given the go-ahead by the Government to develop the Harris and Barra oil fields in the Northern North Sea, 160km (99 miles) east of the Shetlands.
Drilling at the $1.6 billion development is expected to begin later this year with first oil in 2015.
Production is expected to amount to around 40,000 barrles of oil equivalent a day.
Subsea 7, which is listed on the Oslo Stock Exchange and headed by chief executive Jean Cahuzac, also has offices in Aberdeen which employ hundreds of people.
The company operates across Africa, Asia Pacific, Brazil, North America and Europe.
It was established in 2010 when offshore services provider Acergy acquired Subsea 7 in an all-share deal.
Dana, founded by oil entrepreneur Tom Cross, was acquired for £1.9bn by KNOC in 2010.
Dana has a 77% stake in the Western Isles development project with the rest owned by Cieco, the exploration arm of Japanese conglomerate Itochu.