MELBOURNE, Aug. 22 -- AED Oil Ltd. of Melbourne has entered into a time-charter agreement letter of intent with Modec Inc. for provision of the Modec Venture 1 floating production, storage, and offloading vessel. The FPSO will serve as a second vessel on AED's Puffin oil fields in the Timor Sea.
The vessel will be used to develop the Puffin South West segment of the field, which is expected on stream during first half 2008. AED expects production to exceed 25,000 b/d of oil.
Previously Modec Venture 1 was for 9 years at the Santos Ltd.-operated Elang-Kakatua oil fields in the Joint Petroleum Development Area between Australia and East Timor. Prior to that it was 5 years at the Skua field in the Timor Sea.
Elang-Kakatua field is being decommissioned and all the facilities used there, including mooring, umbilicals, and risers, will be redeployed and installed at Puffin South West. The FPSO will follow after some minor modifications and maintenance.
Modec Venture 1 has production capacity of 32,000 b/d and storage for 750,000 bbl.
The new agreement with AED is for 3 years with two 1-year options to renew at AED's choice.
Last month AED announced a 40 million bbl contingent resource for the Puffin South West region, which was first drilled by Arco with Puffin-2 in 1974. Puffin-9 drilled by AED in 2006 confirmed the quality, continuity, and extent of Puffin South West.
The company plans to drill a bilateral appraisal and development well (Puffin-10) in October.
Separately AED's first FPSO, Front Puffin, which will be stationed on the Puffin North East sector of the field, is undergoing final preparation in Singapore and is due to arrive at the field next month.