Malampaya oil rim FPSO fixed

Published 31.07.2008 11:28:10 by John Bradbury

Oslo-listed Nexus Floating Production has secured a letter of intent to supply an FPSO for operations off the Philippines.

Singapore-based Nexus said it is to lease its Nexus 1 FPSO to Burgundy Global Exploration Corporation (BGEC) over a seven-year period for the Camago Malampaya Oil Leg project off the Philippines.

Nexus says its FPSO lease deal is worth US $800 m and first oil under the contract is scheduled for the first quarter 2010.

Field-specific modifications of the production unit will be subject to a separate financial arrangement, Nexus indicated.

The project involves tapping the oil rim on the deepwater Malampaya gas and condensate field in a water depth of 850 m (2,788 ft) and which has been the subject of discussions over several years including Mitra Energy which had been hoping to tap the oil rim – estimate to contain around 41 m bbl of oil - on the field starting late 2007, with US $225 m of pre-development funding, in partnership with the Philippines National Oil Company (PNOC).

Back in 2005, Shell Philippines Exploration, one of the partners in the Malampaya gas field development consortium formally relinquished its rights to the oil resources in the field.

Previously AustralAsian Energy Ltd. of Azerbaijan, US-based Argo Group, PetroEnergy Resources Corporation, South China Resources Inc. and Petroleum Geoservices Inc. of Norway had expressed interests in developing the oil field, according to the Philippines-based Manila Standard newspaper.

“We are pleased to sign a Letter of Intent with BGEC for the CMOL project, a challenging field development in deep water in an area subject to typhoon activity,” said Anders Holm, chief executive of Nexus. “This confirms our expectations for a stronger market in deep waters, and we are happy to be in a position to support such developments with our FPSOs.”

The Camago Malampaya oil project is owned 84.9 % by BGEC and 15.1 % by PNOC

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