8th Apr 2016 06:23
LONDON (Alliance News) - Tullow Oil PLC on Friday said it plans to revise its full-year production guidance after confirming operations are having to be restrained due to the turret bearing on its floating production, storage and offloading vessel at the Jubilee field offshore Ghana being damaged.
Although operations are being hampered by the ongoing issue, Tullow stressed it has insurance that covers the costs related to the damage and the loss of revenue that may come from it.
The company said in February that it had implemented extra operational procedures on the FPSO after identifying an potential issue in the turret area.
A typical feature of an FPSO is the turret mooring system, which is usually fitted inside and integrated into the FPSO's hull. The turret is moored to the seabed with chains, wires and anchors and has bearings allowing free and unrestricted 360-degree rotation of the FPSO around the turret.
On Friday, the company said the bearing has been damaged and is no longer able to rotate as originally designed.
"Oil production and gas export can continue but under revised operating and off-take procedures," said the company. "The FPSO Kwame Nkrumah has now been placed on 'heading control' through the use of tugs which minimise vessel movement around the bearing."
The company said a project team is continuing to investigate what the root cause of the issue is, but Tullow has implemented new operating procedures in the meantime. That includes the use of a shuttle tanker with a capacity of 250,000 barrels of oil and a storage tanker with a capacity of 1.0 million barrels of oil being installed to allow safe operations to continue.
"Although all necessary equipment for the new operating procedures, including the two tankers, are in place, it is important that additional time and due care is taken to implement new procedures and receive required approvals," said Tullow.
"Tullow currently estimates that production from the FPSO will re-start in approximately two weeks time and will also take time to ramp-up. Tullow's production guidance will be re-issued once the new operating arrangements have stabilised," the company added.
Tullow stressed that it has a "comprehensive package" of insurances under its belt, including a package that covers the operating and capital costs related to the damage to the bearing and insurance that covers loss of revenue.
By Joshua Warner; [email protected]; @JoshAlliance
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