Oil exploration firm, Tullow Oil says repair works on the Jubilee FPSO would now end in 2019, according to details in its half year results and statement issued to investors on July 26.
The report released by Tullow Oil showed that Turret Remediation Project should be carried out in three phases.
The first phase of this work, involving the installation of a stern anchoring system, was completed in February 2017, after which the tugs maintaining the FPSO on heading control were removed.
The FPSO is now anchored to the seabed with the turret bearing locked and the vessel held on a constant heading. The JV Partners and the Government of Ghana have agreed on the need to stabilise the turret bearing.
A shutdown of between five and eight weeks is planned for late 2017 with work continuing to further reduce the length of this shutdown.
Planning for the rotation of the vessel to its optimum heading and the installation of a deep water offloading system is ongoing and it is anticipated that this work will be executed in two stages in 2018 and 2019.
The total shutdown duration for stabilisation, rotation and offloading system installation is not expected to exceed 12 weeks.
The capital costs associated with the remediation works, the lost revenue resulting from the shutdown periods, and the increased operating costs are expected to be covered by the JV Hull and Machinery insurance policy and Tullow’s corporate Business Interruption insurance policy.
Possible Impact on power generation
It is not clear for now whether this move would result in some shutdowns on the jubilee field running into next year and even 2019.
Tullow earlier announced that it would shut the jubilee field for almost three months beginning this September.
Previous shut downs had resulted in a cut in gas supplies from the Jubilee infrastructure to the Atuabu gas processing plants which has become the main source of fuel for some generating plants in the country.
Some analysts have argued that the country could be faced with some challenges with power generation. This is because the state is yet to reach an agreement with Tullow oil on the price it should for gas exported to the Atuabo Gas processing plant.
Deputy Minister of Energy, Dr. Mohamed Amin Adam, has however told JOYBUSINESS that government is working to reach an agreement with Tullow by next month on the gas export agreement.
This would aid the export of gas from Tweneboa, Enyenra, and Ntomme Oil (TEN) field to the Atubo processing plant. The minister also adds that government is working to import of enough crude oil to act as a backup during this shutdowns.
Developments on Tullow and Jubilee field
Tullow Oil puts gross production on the jubilee field average 84,200 bopd (net: 29,900 bopd) in the first half of 2017.
Business Interruption insurance reimbursed Tullow for around 5,000 bopd of net production-equivalent payments in the first half of 2017, increasing Tullow’s effective net production to 34,900 bopd.
Jubilee field regularly produced in excess of 100,000 bopd throughout the first half of 2017.
The TEN fields performed in line with expectations in the first half of 2017 and averaged 48,000 bopd (net: 22,500 bopd) with full year gross production guidance unchanged at 50,000 bopd (net: 23,600 bopd).
Production from the 11 wells drilled so far indicates reserves estimates for both Ntomme and Enyenra to be in line with previous guidance.
The TEN fields continue to be managed carefully because no new wells can be drilled after the restrictions imposed by the ITLOS provisional measures ruling are lifted.
Nevertheless, higher production levels in excess of 50,000 bopd have been achieved recently as Tullow continues to conduct trials to optimise production.
In June 2017, a final commissioning capacity test and facility blowdown was completed demonstrating that the FPSO can operate at its design capacity of 80,000 bopd and at higher rates as indicated by a recent 24-hour test conducted at 100,000 bopd.
The testing however identified an issue with the FPSO’s flaring system which has been addressed but required a 10-day shutdown of the facility.
Final commissioning is expected to be completed in the second half of 2017. The TEN gas manifold has also been installed and commissioned and a gas export trial to GNGC facilities was successfully completed.
The JV Partners are currently progressing a rig tender process that would see the resumption of drilling of the remaining wells around the end of the year, subject to the outcome of the ITLOS decision on the maritime boundary between Ghana and Côte
d’Ivoire. Completion of these wells should allow the TEN fields to increase daily production to the FPSO design capacity of 80,000 bopd.