Jadestone Energy Share News (JSE)

(Sharecast News) - Asia-Pacific focussed oil and gas production company Jadestone Energy updated the market on its Montara asset inspection and maintenance shutdown on Tuesday, reporting that the operating team had made "excellent" progress in efficiently and safely completing more than 8,000 hours of work offshore.The AIM-traded firm had announced its decision to shut in the Montara asset in November, in order to correct an "extensive" backlog of inspection and maintenance routines.It said work had progressed to a detailed plan, which included dealing with a "small number" of improvement notices issued by NOPSEMA, the offshore regulator, as well as inspections throughout all parts of the facilities.As a result, no further integrity concerns, or safety-critical exceptions, had been identified.All activities associated with the oil system were now fully complete, and the facility was ready for the restart of oil production, subject to an independent audit currently under way, and regulator support.The company said it expected production to restart later in December, with a further announcement to be made at that time.Work on the gas system was said to be progressing, independent of the oil system, and was now around 85% complete and expected to be finished in the near future.In addition, the maintenance management system (MMS), which was identified as inadequate to reliably guide the asset's ongoing maintenance regimen, nad been partially re-built, tested and audited internally for compliance.The company said the safety management system was also reviewed, with "extensive updates" to the assurance plan, and all maintenance routines and inspection records now correctly incorporated into the two systems.Jadestone added that it also completed the secondment of a number of key operational leaders, both onshore and offshore, and was now well-positioned to advance a "seamless transition" over the next few months while the Jadestone safety case and environment plan were under review, prior to acceptance by NOPSEMA.After that, the board said all inspection and maintenance work would be complete, with the exception of one activity - the long-planned replacement of the subsea control umbilical - which was now due to be delivered early in the new year, and installed shortly thereafter.The company said it anticipated that the facility would be able to operate reliably and without the need for a planned major maintenance shutdown until at least the second half of 2020."Whilst we were aware, through the due diligence process, of the opportunity to improve operating performance at the Montara asset, and had factored this into our analysis, integrity flaws in the incumbent operator's MMS made it impossible to identify the full extent of the inspection backlog, and couldn't provide clear information on inspection status, or the ability to plan future maintenance tasks," said Jadestone president and chief executive officer Paul Blakeley."In the course of working with the operator during the transition phase, since closing the acquisition at the end of September, this became more fully apparent, and led to the identification of a number of incidents of non-compliance with the approved safety case."Having opted to shut down the facility and remedy the broad maintenance and inspection backlog, we have also corrected the MMS itself."Blakeley said that while that work scope had resulted in a protracted shutdown timeline, it was a "prudent" operational decision, and one that he claimed would significantly reduce ongoing work effort, uncertainty and inefficiency.The asset was now up to date with regards to inspection and major maintenance, he confirmed."The extensive scope of inspection work we have undertaken has confirmed our view that the Montara facility is in excellent condition."After having completed over 800 assurance tasks, we see nothing that changes our view of the exceptional value we have attributed to the Montara asset."The shutdown would more rapidly embed Jadestone's proven operating philosophy and safety culture, Blakeley added, and when Jadestone assumed operatorship, it would now inherit a "high reliability facility" that it could operate safely and with confidence."Whilst unplanned outages can always occur, the work undertaken in this shutdown is expected to materially improve uptime performance in the years ahead."