Africa-focused oil and gas company VAALCO said Wednesday it had completed the installation of the Floating Storage and Offloading vessel ("FSO") installation and field reconfiguration at Etame field offshore Gabon.
VAALCO Energy in August last year signed an agreement with World Carrier Offshore Services Corp. for the provision and operation of a Floating Storage and Offloading (“FSO”) to be deployed at Etame, to replace the Petroleo Nautipa FPSO.
The contract, for the Cap Diamant vessel that has since been converted into an FSO and renamed Teli, is for up to eight years, with additional option periods available.
VAALCO said at the time that the FSO solution would decrease storage and offloading costs by almost 50%, compared to the FPSO solution, and lower total operating costs at Etame by approximately 17% to 20% through 2030.
Also, according to the oil company, the FSO solution increases effective capacity for storage by over 50%, allowing for greater operational and lifting flexibility and a material reduction in per barrel lifting costs.
The FSO is expected to lead to an extension of the economic field life, resulting in a corresponding increase in recovery and reserves at Etame, VAALCO said at the time.
In a press release announcing the completion of the FSO installation at Etame, VAALCO said it had completed all diving, subsea connections, subsea infrastructure and reconfigurations; all pipeline tie-ins and pressure testing; and all the new riser connections to the Teli FSO.
The company, which is set to merge with TransGlobe, disconnected all production lines from the Petroleo Nautipa FPSO and performed a lifting of export oil from the FPSO on September 26 of 300,510 barrels followed by a lifting from the FPSO on October 5 of 275,817 barrels;
The company said it had delivered the first oil from the Etame field to the Teli FSO on October 18 and completed the annual field-wide maintenance turnaround concurrently with the FSO and field reconfiguration.
George Maxwell, VAALCO's Chief Executive Officer, said, "We are very pleased to have successfully delivered this highly complex, full field reconfiguration, maintenance turnaround, and upgraded FSO installation, as planned and on time. This project was completed despite a difficult global supply chain environment and is a testament to the dedication of our workforce and partners who helped complete the project, underlining VAALCO's status as a quality Operator.
"The new FSO provides us with additional flexibility and has an effective capacity for storage that is 50% larger than our relinquished FPSO. It also reduces our expected storage and offloading costs by 50% which should lead to an extension of the economic field life, resulting in a corresponding increase in recovery and reserves at Etame.
"Additionally, we reported very strong VAALCO standalone third quarter 2022 production and sales volumes both above the midpoint of our guidance ranges. Production for the third quarter was approximately 9,150 net BOPD and sales volumes were approximately 7,952 net BOPD. Our team worked tirelessly to ensure that we maximized our production and sales in the third quarter.
"We were able to complete three liftings during the quarter plus an additional smaller one on October 5, shortly before the FPSO was decommissioned. The team successfully overlapped the maintenance turnaround with the field reconfiguration to minimize downtime and deliver operating efficiencies. We continue to execute on our strategy and remain focused on generating meaningful free cash flow to enhance shareholder value."