Brazil/North Sea/China16 Sep 2018 19:22
Over there in Brazil, there is the Tubarao Martelo (TBMT) heavy oil field, operated by Dommo Energia SA (formerly OGX and OGPAR). Since first oil in 2013, the estimated size of recoverable BOE reserves has shrunk to around one third of the original estimate and probably now stand at 20 million bbls remaining proven oil after 5 years of production. It is not a giant field as some on twitter are saying and the wells seem to taper off sharply. The 4 current production wells are producing a total of 7,000 bopd
In March 2018, Dommo was contemplating a redevelopment scenario for TBMT using the OSX 3 FPSO as follows. The capex would have been for new wells.
“TBMT Redevelopment Scenario:
US$ 46 million capital expenditure (to be invested between June 2018 and March 2019). Funds to be raised from the Market. Production extended until March 2021. Asset value: NPV10 US$ 28 million. Daily charter rate: US$ 35,000/day for FPSO OSX3 (US$ 12 million per year)”
That scenario would seem to be off the agenda now. The OSX 3 is clearly up for sale and there are multiple sources of public evidence for that. It will leave behind a marginal field which can be redeveloped with a different facility more suited in capacity and cost. That might be the MFDEVCO plan.
Meanwhile in the North Sea, Mr Paul Warwick at Whalsay Energy is looking to make an imminent development concept decision about the Bentley heavy oil field, which actually is the size originally estimated for TMBT.
https://www.energyvoice.com/oilandgas/north-sea/173242/whalsay-chief-to-pick-development-concept-for-bentley-in-q3/
He says a new platform or floating production, storage and offloading (FPSO) vessel were both possibilities. Whalsay would have preferred the cheaper option of tying Bentley back to existing infrastructure but conceded that such an outcome looks unlikely. Whalsay hopes to reach selection of concept in the latter part of summer – in the third quarter 2018, probably.
The owner of the OSX 3 FPSO (OSX 3 Leasing BV) can trigger a redelivery of the vessel, as too can the Nordic Trustee bondholders who own the vessel mortgage, if they have a better use for it. 240 days’ notice is required to disconnect from the TBMT field. This might suit Whalsay perfectly in size, water depth and timetable. The Nordic Trustee bondholders are all Norwegian private placements, as were the Bentley bondholders who now own Whalsay. Coincidence or what?
Meanwhile back in Brazil, as a creditor in the judicial reconstruction of OGX, OSX 3 Leasing BV has the call option to acquire and/or assign the TBMT field concession. That means it can, but does not have to. The option fee is $1 plus some minor capex recovery. So if a new home is found for the FPSO in the North Sea, the owner can assign TBMT to someone who has a more suitable facility from somewhere like China. MFDEVCO might have such a facility available.
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