Rick Wilkinson
OGJ Correspondent
MELBOURNE, Jan. 7 -- Nexus Energy Ltd., Melbourne, has secured a tanker to be converted into a floating production, storage, and offloading vessel and a $50 million (Aus.) bank loan to kick-start its proposed Crux liquids project in the Browse basin off Western Australia.
Vanguard Oil & Gas International is purchasing the MV Ishwari to convert into an FPSO for use at Crux, Nexus said. This follows a July 2007 memorandum of understanding among Nexus, Vanguard, and Viking Shipping that established an engineering design and equipment procurement program leading to the expected sanction of the Crux project during third-quarter 2008 with a production start-up of mid-2010.
Design work includes a gas processing plant to be incorporated onto the topsides of the vessel and a weather-vaning turret and mooring system.
The vessel is described as a high quality, well-maintained Suezmax class oil tanker with a double hull that was built in South Korea in 1991.
Thome Offshore Management, Singapore, will manage the Ishwari during trading prior to conversion and will serve as subcontractor to Vanguard for the vessel's life extension, conversion, operation, and maintenance in the field.
The Early Stage Project Finance Development Facility is being provided by the Bank of Scotland International (Australia). The funds will be applied to drilling costs for the current Crux-3 and Crux-4 wells.
Nexus says the Crux-3 well has intersected 150 m of high quality net pay over a 300 m gross vertical gas column that includes a fourth reservoir zone not previously confirmed in the field.
Pressure data in this and previous wells indicate the gas sands in each formation (Montara formation, Plover formation and Nome formation A & B sands) are in pressure communication across the field and form part of a single accumulation. This is expected to simplify the development plan.
Nexus has an 85% stake in AC/P23, which contains Crux, with Osaka Gas holding 15%. Nexus also holds a 50% interest in adjoining AC/P41, with Shell holding the other 50%, which contains similar exploration prospects.