FPSO : Why the frequent breakdown

THE frequent irregular breakdowns of the Floating Production Storage and Offloading (FPSO) Kwame Nkrumah vessel have dire implications on the country, energy think-tank Africa Centre for Energy Policy (ACEP) has said.

According to Dr Ishmael Ackah, Head of Policy Unit at ACEP, as a result of the breakdowns, there is a production shortfall because the country loses about 230MW from the AMERI which uses natural gas from the Atuabo which also gets its supply from the FPSO.

The AMERI Plant uses natural gas from the FPSO and since it is not designed as a dual fuel plant, it has to be shut down when the FPSO is down.

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

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.

“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,” Dr Ackah said.

Additionally, the Head of Policy at ACEP maintained that the frequent breakdowns increasedthe cost of production of power. He said if there is no gas for the FPSO, the country would have to buy light crude oil for TAPCO and Takoradi International Company (TICO).

“Since they are quite expensive, what it means is that cost of production of power would go up.Some have estimated that if FPSO Nkrumah is not running, for Cenit, T1, Tapco and Tico, VRA would need about $30 million a month to buy fuel to run these plants and that is a major problem,” Dr Ackah lamented.

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

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.

Tullow is the operator of the Jubilee field with 35.48% interest. 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 metres water depth on the Jubilee field, which is one of the largest oilfields discovered offshore West Africa in the past 10 years.

Going forward, the energy policy think-tankurged government and the Jubilee partners to undertakea comprehensive technical audit of the FPSO Kwame Nkrumah to 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, said.

ACEP is advocating a total audit of the FPSO Kwame Nkrumah and total production maintenance of the vessel.

He urged government and the Jubilee partners to, next time,use competitive bidding to procure goods and services such as the FPSO.

Already the Tema Thermal Power Plant (TT1) has been shut down due to inadequate Light Crude Oil (LCO) in the Tema power enclave.

There are indications that the limited crude oil available was being used to operate the 110-megawatt Cenit Power Plant.

This situation, coupled with limited gas from Nigeria – which is being used by Sunon Asogli Thermal Power Plant to generate some 90MW out of its 200MW capacity – and the lack of lean gas from Ghana Gas due to the shutdown of FPSO Kwame Nkrumah, has resulted in overdrafting of hydro dams to close the deficit in power generation.

According to Dr Ishmael Ackah government as a result has compelled the Volta River Authority (VRA) to run all six turbines of the Akosombo Dam during peak hours in the past three weeks to avoid severe power cuts (Dumsor).

Because of the low level of water in the lake, each unit of Akosombo generates 125 megawatts, translating into 750MW during peak hours.

During off peak, Akosombo operates five turbines, which is still above the two or three turbines engineers have recommended.

He condemned the action since it is in total disregard for advice of VRA engineers, who said the dam should be operating only two turbines at current water level, which was at 237.92 feet last Friday, April 22, 2016.

The minimum operating water level for the Akosombo Dam is pegged at 240 feet, but VRA engineers advised that running two turbines at current water level of 237 feet would not cause any harm since it once operated the dam with two turbines at a water level of 235 feet.

Kpone Hydro Generating Station and Bui Hydro Dam are also said to be overdrafted during peak hours. Each unit of Bui generates 100MW, translating into 400MW during peak hours.

Overdrafting of a Hydro Dam results in faster depletion of water levels, which could force total shutdown of the dam.

Consequently, Dr Ackah called on the government to immediately stop overdrafting the hydro dams.

The overdrafting of waters of the Akosombo Dam and other hydro sources such as for power generation has been necessitated by the power challenges brought on by the shortage of gas from fields in Nigeria, as well as no gas from the Atuabo gas plant operated by the Ghana National Gas Company.

As of Thursday, April 21, 2016, peak production was 1,980MW while demand was 2,011MW.

“What it means is that we are having marginal shortfall, which is not good because looking at the fact that we have been in this load shedding for about four years, we believe by now we should be having excess capacity of about 10-25%”, he added.

According to Dr Ackah, the short-term solution is to clear arrears owed Nigeria Gas, as well as buy crude oil until the FPSO Kwame Nkrumah resumes operations.