WOOD has clinched an $84 million (£65m) contract to work on a Norwegian North Sea facility that will provide a boost amid challenging times in the oil and gas sector.

The Aberdeen-based group has been engaged by Equinor to help adapt the Grane platform so that it can handle output from a new field nearby.

Equinor plans to develop the Breidablikk field as a subsea tieback to Grane.

The award provides a vote of confidence in Wood, which completed preparatory engineering studies in connection with the development for Equinor.

It provides a sign that oil and gas firms still see long term potential in the North Sea in spite of the plunge in oil and gas prices triggered by the coronavirus.This has prompted some firms to slash spending on new developments with grim implications for the supply chain.

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Wood won the Grane modifications engineering studies contract in June last year.

Brent crude sold for more than $70 per barrel then. The price fell to an 18-year-low of less than $16/bbl in April. It rallied to above $45/bbl following the easing of some lockdown measures and moves agreed by major exporters to curb output to support the market.

Oil prices have been under pressure in recent days amid fears of a second wave of the coronavirus. Brent sold for $41.95/bbl yesterday afternoon.

Wood was hit hard by the slowdown in oil and gas basins such as the North Sea that followed the sharp fall in the oil price between 2014 and 2016. The company has diversified into other markets in recent years to reduce its reliance on oil and gas work.

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Grane came into production in 2003, 12 years after it was discovered. It was the first heavy oil field to start production on the Norwegian continental shelf.

Advances in technology have helped improve the economics of heavy oil developments.