BP Exploration Operating Company Ltd v Kvaerner Oilfield Products Ltd & Anor, Court of Appeal - Commercial Court, May 06, 2004, [2004] EWHC 999 (Comm)
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BP Exploration Operating Company Ltd v Kvaerner Oilfield Products Ltd & Anor, Court of Appeal - Commercial Court, May 06, 2004, [2004] EWHC 999 (Comm)
Draft 9 May 2004 11:13 Page 2
Case No: 2002 Folio 550 IN THE HIGH COURT OF JUSTICEQUEENS BENCH DIVISIONCOMMERCIAL COURTNEUTRAL CITATION NO. [2004] EWHC 999 (Comm)Royal Courts of JusticeStrand, London, WC2A 2LLDate: 6 May 2004Before :THE HONOURABLE MR JUSTICE COLMAN- - - - - - - - - - - - - - - - - - - - -Between :- - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - -Mr Peter McMaster (instructed by Clyde & Co) for the ClaimantMr Stuart Catchpole QC (instructed by Masons) for the 1st DefendantMr Stephen Cogley (instructed by Tarlo Lyons) for the Part 20 DefendantHearing dates : --28-29 January 2004 and 3 March 2004------- - - - - - - - - - - - - - - - - - - - -JudgmentMr Justice Colman: Introduction1. This is a trial of preliminary issues which arises out of a claim by BP that certain equipment supplied to it as part of the facilities for recovering oil from the Schiehallion and Loyal fields, west of the Shetland Islands, was defective. The equipment supplied consisted of subsea control modules (SCM) and directional control valves. Hydraulic control equipment ultimately controls the flow of production and other fluids into and out of the oil wells by means of the SCM and the directional control valves mounted on the Xmas tree which is located on the sea bed on top of the well head. The electrical equipment forms part of an umbilical system consisting of sub sea cables carrying electrical signals out of the units in which those cables terminate. This equipment is tied back to a Floating Production Storage and Offloading facility which consists of a large vessel with a substantial processing and storage capacity. The product is carried ashore by tankers.2. Kvaerner supplied the SCM and directional control valves under a series of contracts with BP as Operator on behalf of itself and so-called Co-Venturers, numbered 101259 dated 5th February 1997.3. The Xmas tree was supplied by Cooper Cameron (UK) Ltd. (``CCL'') to BP under a series of contracts numbered 101260 dated 30th October 1996.4. Both the Kvaerner contract and the CCL contract consisted of three separate but inter-related contracts. There were the main contracts numbered 101259 (Kvaerner) and 101260 (CCL) and in relation to each there was a Front Engineering Design (FEED) Contract, numbered 101259A (Kvaerner) and 101260A (CCL) and a Development Contract numbered 101259B (Kvaerner) and 101260A (CCL). I usually refer to these contracts by their numbers in this judgment. In both cases the FEED contract, as its name suggests, was to apply to the earlier phase of the relationship between the supplier and BP, namely the design, engineering and procurement services necessary for the provision of the equipment, development in conjunction with BP and the necessary statutory bodies of the safety case for the equipment and certification of the CSM. Its application was to be followed in point of time by the Development Contract and that provided for provision of the Development Services which included administration, management and control services as required to manage the execution and timely completion of the Development Services, provision of specialist engineering support to the oil field management team in Aberdeen, the provision of all direct and indirect labour or subcontractual services inclusive of tools and all necessary consumables and the provision of all resources, materials and equipment necessary to undertake the Development Services. For ...See the full content of this document
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