HOUSTON, May 23 -- Sydney-based Australian Worldwide Exploration Ltd. negotiated a 14.5-year extension on its charter for the FPSO Umuroa for its Tui oil field in the offshore Taranaki basin of New Zealand.
The company says the extension will allow at least 5 million bbl of additional oil to be recovered from the reservoirs.
The contract extension with vessel operator Prosafe Production will be in stages. The fixed term charter was extended by 3.4 years to December 2015. After that date, the Tui JV will have seven 1-year options to extend, which could see the charter running until December 2022.
AWE says the field's four production wells are performing well, and total production remains about 45,000 b/d despite rising water production. Studies are underway to increase water-handling capacity on the vessel to 150,000 b/d. Since coming on stream at the end of July last year Tui has produced 12.6 million bbl.
Full operating cost of the charter for the next financial year (ending June 2009) is expected to be $61 million. This rate will then reduce annually with the expected field production profile.
Tui is operated by AWE with 42.5% interest. Mitsui E & P New Zealand has 35%; New Zealand Oil and Gas 12.5%; and Pan Pacific Petroleum 10%.