Galoc’s first oil set back to August due to typhoon damage

The first oil from the Galoc field in offshore Northwest Palawan has been delayed anew and is now expected to be drawn in August.

The startup was originally slated for the first quarter of the year.

Joanne Williams, deputy managing director of 22.28% shareholder Nido Petroleum Ltd, said that due to typhoon “Frank” (international codename: Fengshen), which hit the country last June, the floating production storage and offloading (FPSO) facility was removed from the site to prevent damage.

It was later discovered, however, that the retrieval line linked to the FPSO was damaged irreparably, she said.

This facility would be used to extract 17,500 barrels of oil per day from the field.

Williams said current operations involved efforts to attach a new retrieval line to the mooring system.

“Once the new retrieval line is installed, the mooring and riser system will be raised to surface and connected to the FPSO. This will be followed by a full systems safety and integrity check prior to first oil production,” she added.

However, Alex Parks, chief executive of the 18.28% shareholder, Otto Energy Ltd, said the damage was found in one section of the riser and this had to be replaced. The replacement will come from Singapore and is expected to arrive within the week.

“In the meantime, the FPSO will remain in the field and function testing of the umbilical and wellhead valves will be undertaken as part of the integrity and systems safety check required prior to flowing oil,” he told the Australian Stock Exchange.

“Otto will provide an update as to the anticipated timing for first oil once additional information is provided by (service contract operator Galoc Production Co and FPSO owner and operator) Rubicon. However, initial indications show it will now probably be in August,” he added.

He said that while the delays to first oil were very “frustrating” for Otto, the project fundamentals-including the reserves, well “deliverability” and high oil prices-were still commercially robust.

Independent appraiser Gaffney, Cline and Associates had estimated the production rate at the Galoc field to reach 23,000 barrels a day, on the average, on the first year of production.

 

Category: ResourceAsia