Audit FPSO, ACEP demands to resolve frequent breakdowns

Energy policy think-tank, Africa Centre for Energy Policy (ACEP) has called on government and Jubilee partners to quickly undertake

a comprehensive technical audit of Floating Production Storage and Offloading vessel (FPSO) Kwame Nkrumah.

The findings of such an audit will help resolve the irregular frequent breakdowns.

“Contract independent auditors; let them audit the FPSO to make sure that we identify the defects and put in place measures before they occur,” Dr Ishmael Ackah, Head of Policy Unit at ACEP, told The Finder in an interview.

The call comes in the wake of several frequent irregular breakdowns of FPSO Kwame Nkrumah, which has serious challenges for power generation.

Various challenges have hindered the delivery of a potential 120 million standard cubic feet of gas a day from the FPSO Kwame Nkrumah to the processing plant at Atuabo.

Since gas production commenced, Tullow Ghana has undertaken several unplanned shutdowns of the FPSO Kwame Nkrumah as a result of faulty compressor.

Dr Ackah explained that the irregular breakdowns have negative consequences for the power sector as the thermal power plants at Aboadze depend on gas from the Atuabo gas processing plant.

“When it is down, we lose revenue because we are not able to produce, and even if we do, the cost of production using Light Crude Oil (LCO) is high because we have to pay cost of maintenance and other things we need to do to bring it back to work.

“ACEP is advocating a total audit of the FPSO Kwame Nkrumah. Total production maintenance,” he added.

Next time, Dr Ackah said, government and Jubilee partners should use competitive bidding to procure goods and services such as the FPSO.

Tullow identified a potential issue on the FPSO turret bearing in mid February.

On March 20, 2016, Tullow Oil, the lead operator of Jubilee field, shut down FPSO Kwame Nkrumah for planned maintenance.

Even before the planned shutdown, a turret bearing problem of the FPSO forced Tullow to reduce daily average production from 100,000 barrels to a little over 30,000 barrels from March 9, 2016 till the FPSO was shut down on March 20, 2016.

Following an inspection of the turret area of FPSO Kwame Nkrumah by Sofec, the original turret manufacturer, it was confirmed that the bearing has been damaged and is no longer able to rotate as originally designed.

Tullow said a root-cause analysis is ongoing and a project team is assessing which long-term remediation option is most appropriate.

Initial feasibility studies by the team have confirmed that the bearing issue can be fully resolved.

According to Tullow, Sofec will now undertake further offshore examinations and Tullow will work with Sofec to determine what further measures will be required.

The Jubilee field was discovered in 2007 and production started in late 2010.

Tullow is the operator of the field with 35.48% interest.

Ghana joined the league of oil-exporting countries in December 2010 when the country began production of crude oil in commercial quantities.

So far, total lifting proceeds and other income allocated from inception to the end of December 2015 amounted to US$3.198 billion.

Annual Budget Funding Amount (ABFA) received a total of US$1.375 billion, representing 43% of the total revenue, while the Ghana National Petroleum Corporation (GNPC) received a total amount of US$968.81 million, equivalent to 30% of total revenue.

The Ghana Stabilisation Fund (GSF) and the Ghana Heritage Fund (GHF) received an amount of US$604.36 million (19%) and US$249.92 million (8%) respectively.

Tullow’s partners are Kosmos and Anadarko, each with 24.08% interest, and GNPC and Petro SA with 13.64% and 2.73% interest respectively.

FPSO Kwame Nkrumah has 17 modules weighing more than 12,500 tonnes installed on the vessel, including a water treatment plant, crude separation plant, chemical injection plant, gas processing and injection plant, the turret, electricity generation plant, as well as a 120-room accommodation, among others.

FPSO Kwame Nkrumah MV21 is installed in approximately 1,100 meters water depth on the Jubilee field, which is one of the largest oilfields discovered offshore West Africa in the past 10 years.