Romania’s top oil and gas group OMV Petrom [BSE:SNP] said that it has signed a contract worth an estimated 1.6 billion euro ($1.75 billion) with Italian multinational oilfield services company Saipem and its Romanian unit for the development of the infrastructure of the Neptun Deep offshore gas project.

Saipem will execute engineering, procurement, construction, installation and commissioning services, necessary for the development of the offshore gas fields Domino and Pelican Sud, OMV Petrom said in a press release on Thursday.

The infrastructure will consist of ten wells, three subsea production systems and associated flow lines pipelines, an offshore platform, the main natural gas pipeline to Tuzla and a natural gas metering station.

“With the signing of this contract, we are taking a major step in the development of the Neptun Deep project – practically, this marks the beginning of the execution phase,” said Christina Verchere, CEO of OMV Petrom.

Earlier this week, OMV Petrom announced that the Neptun Deep project entered its development phase after receiving regulatory approval.

Saipem is a major global oilfield services company with over 60 years of experience, headquartered in Italy. It employs over 32,000 people and has a presence in 50 countries.

The Neptun Deep block in the Black Sea has an area of 7,500 sq km and is located at about 160 km from the shore. Since 2008, seismic acquisition campaigns and exploration drilling programs have been carried out at the site. Once production will reach the plateau stage, Neptun Deep will output 8 billion cu m of gas for almost ten years.