Montara FPSO Remains Shut Down Due to “Small Defect” Involving Two Tanks
The trouble-plagued FPSO Montara positioned off the coast of Australia remains offline with its operator Singapore’s Jadestone Energy warning that it is continuing to conduct tests. The operation was suspended two weeks ago in late July marking the second time in less than a year they have been forced to suspend production.
“The initial inspection has identified the location of a ‘small defect’ between tank 4S and oil cargo tank 5C,” the company said in an update issued on August 10. They said it was the result of an inspection that began two days earlier after tank 4S had been emptied and cleaned.
The operation reported a gas alarm on July 29 triggered within the ballast water that was a possible indication the company said of “communication with one of the adjacent tanks.” While there was no external leak, it still required a temporary suspension of production. The company reported it would have to empty and clean the tank so that the inspection could identify the cause of the alarm.
“While disappointing and frustrating to have to shut in Montara again, we will find and repair any additional defect while continuing with the overall planned program of inspection of the storage tanks of the FPSO,” Paul Blakeley, president and CEO of the company said on July 31.
In the next step, the company reports it will be offloading crude oil from tank 5C to allow for leaning and access to undertake an inspection. They will also have to re-enter tank 4S to finalize the inspection of the tank and carry out the necessary repair. There will need to be a final inspection in ballast water tank 4P as well before returning that tank to service as part of the overall ballast and stability plan requirements for the FPSO operation.
The company has not projected any timeline for the return to service of the Montara. They further wanted that their reserve-based lending facility banks have a requirement for borrowing base assets, such as the Montara, not to have production interrupted for a continuous period of 60 days or more. The company said it would be working with the banks to “assess how the shutdown might impact the clauses and covenant,” under the facility.
Another leak resulting in a small leak of oil from a crude oil tank in June 2022, trigger a series of events for the Montara. The vessel briefly resumed production before it was then suspended and regulators undertook a more extensive review and safety planning. Production did not resume till March 2023.
Jadestone acquired the Montara Project in September 2018. Production began in 2010 at the site which is approximately 400 miles west of Darwin in the Timor Sea with an estimated reserve of 24 million barrels. It is centered around the FPSO Montara which was converted from a 146,000 dwt tanker, Freeway, by Tanker Pacific in 2009 in Jurong Shipyard. At the time they said the conversion was designed to provide a minimum of 20 years without dry docking.