Equinor’s Johan Castberg oil field in the Arctic Barents Sea won’t come onstream until the end of 2023, a year later than planned due to technical problems that have also hit its value, Norway’s oil and gas safety watchdog said June 1.

The Petroleum Safety Authority (PSA) said in a statement it had identified “serious breaches” of regulations in the construction of the hull for the oil field’s FPSO vessel.

“The project (is) now expected to come onstream in the fourth quarter of 2023, with a consequential reduction in present value as a result of delayed earnings,” the PSA said.

The Norwegian regulator launched its investigation last year after becoming aware of problems related to the hull’s welding at the Sembcorp Marine (SCM) yard in Singapore.

SCM was not immediately available for comment.

Equinor’s own investigation has shown “quality deviations” regarding both welding and welding inspection, and the company has promised to cross-check and repair welds.

The PSA said that it was not technically feasible to identify reliably all potential defects, and the FPSO vessel might require more maintenance and repairs in the future.

Equinor’s desire to maintain a lean project organization despite the complexity of the project had led to inadequate supervision, the regulator said.

Equinor denied the problems were caused by cost savings.

“This was not related to cost but the composition of the team,” a company spokeswoman said in an email.

“We did not foresee the extensive issue with welding and in hindsight we see that we did not have sufficient personnel with welding competence at site until 2019,” she said.

Equinor has previously said the project’s costs would rise by 6% from the original estimate to 53.4 billion crowns ($6.5 billion), due to delays and the impact of currency changes.

Equinor has a 50% stake in the project, its partner Vaar Energi, a subsidiary of Eni, holds 30% and Norway’s state-owned Petoro owns 20%.

Offshore