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A Malaysian research analyst working for a local investment bank had the following to say in his Bumi Armada report:
"Although purely an analyst’ guess and not to be construed as an immediate share price threat, we think some FPSOs long term DCF may eventually be discounted if they are not technologically modifiable to meet emission standard. There may also be an actual contractual impact from this ESG perspective, ie Kraken less likely to be extended beyond the firm expiry of mid-25, unless contract amendments ensue."
Is there any truth whatsoever that the Kraken FPSO lease may not be extended beyond 2025 due to this issue?
Also, isn't Bressay supposed to be tied back?
Is this why we are not hearing about new drilling at Kraken field?
I thought Kraken was supposed to be operational for 25 years....we may not even go beyond 8 years if what the analyst is saying has any truth to it!
What is happening at Kraken? They're projecting gross production to come in at 22k - 26k, which is a far cry from what it used to pump out just a few short years back. And there is no active drilling going on. The field was supposed to be viable for 20-25 years, what's happening there?
The Group generated revenue of RM545.7 million for the quarter ended 30 September 2021 (“Q3 2021”), a
decrease of RM69.9 million compared to the quarter ended 30 June 2021 (“Q2 2021”). The decrease from the
FPO segment was mainly due to lower vessel availability arising from an unplanned shutdown of one of the two
trains at Armada Kraken FPSO, while the decrease in revenue from the OMS segment was mainly due to lesser
operating vessels as a result of disposal of OSVs.
Back when the Kraken FPSO vessel was having issues in 2018-2019, Enquest managed to sign a supplementary agreement with Bumi Armada, which among others reduced the bare boat charter rate.
Is there a provision in that supplementary agreement for the charter rate to increase (up to its original amount) if the vessel performs well in the future period?
Basically, is Enquest at risk of paying slightly higher charter rates, closer to what was actually originally agreed upon?
Hi folks,
The Armada Kraken FPSO is contracted for a firm period of 8 years, with 17 annually renewable options thereafter.
Given the way things have been over the past 4 years since first oil was achieved by the FPSO, how are things looking for the future? How long is the Kraken field expected to be producing? How about the newer assets, Bressay and Bentley, are these a positive for the long term viability of the field?
Also, why did Enquest contract the FPSO in such a manner (8 years firm and 17 years options)? Usually, FPSOs are chartered with a longer firm and shorter option period. Would Enquest stand to lose from this?
Hi folks,
Since this board has been very educational with regards to the happenings with the Kraken FPSO, I’d like to share that in the Bumi Armada AGM that just concluded, the CEO said that Bressey is a tieback target for the FPSO. Discussions ongoing with Enquest on how to make this happen. The Bentley acquisition was also mentioned, but the CEO was not sure on the direction on development and till now there was no discussion on tieback with Enquest. Also there were two unplanned outages in Q1 2021, relating to gas sensors shutting down the vessel in a storm and a human error where someone hit the wrong button. Both were relatively short, didn’t say how long it took to get back operational.
Discounting the Bentley and Bressey development potential, how is the Kraken field doing at this stage of its life? Is the production plateau within expectations? Will anymore wells be drilled, or is this it? How many years can the production hold profitably? What are the risks to/from the FPSO operator, Bumi Armada?
Hi everyone, what are the future plans looking for, for the Armada Kraken FPSO?
How many more years of life does the Kraken field have?
How about the development of adjacent fields using the FPSO for tieback, is that part of the plans and economically feasible?
Is the FPSO now stable and operating at the desired specs?
Thanks!
Based on latest ops update, production in Nov/Dec 2020 was LOWER than in the previous 10 months, despite the maintenance shutdown in September. Why is the output lower, when the production efficiency actually increased in the latest two months? (87% full year efficiency, vs 86% till October 2020).
Does this mean Kraken field is dying? Are they not going to drill new wells? They also say guidance for 2021 is at 30 to 35k bopd. Sounds so little!
Someone please educate me on the performance and viability and life of the Kraken field.