Malaysia’s Yinson Holdings Berhad has secured a long-term e x t e n s i o n f o r i t s Floating Production, Storage and Offloading (FPSO) unit Adoon off Nigeria from Addax Petroleum Development stationed at the Antan field off Nigeria.
Yinson’s 100 percent owned Knock Adoon has a capacity to process 60,000 barrels of oil per day
with a storage capacity of 1.7 million barrels.
“The Board of Directors of Yinson’s is pleased to announce thaton 17 June 2019, Addax has entered into an addendum with Addon Pte.Ltd. to further extended the Contractfor an additional duration of four (4) years with retrospective effectfrom 17 October 2018 to 16 October 2022,” Yinson said in a statement on its website.
The value of the contract as of 17 June this year until the end of then extension period is around $137.5 million.
Yinson noted that there are no material changes to the terms of the Contract that will have material adverse effect to the company.
“The Contract will not have any effect on the share capital and shareholding structure of the Company. The Contract, however, is expected to contribute positively to the earnings and net assets of Yinson and its group of companies (“Group”) for the financial years ending 31 January 2020 onwards until the expiry or termination of the Contract,” Yinson said.
The Adoon was originally contracted in October 2006 for a firm eight-year period, with options to renew for a further eight years. Yinson noted that the risks associated with the Contract are normal operational risks which can be mitigated through the Group’s system of project management and internal business controls.
“None of the directors and/or major shareholders of the Company and/or persons connected to them have any interest, direct or indirect, in the Contract,” Yinson said.
The 1985-built vessel, moored at the Antan field offshore Nigeria, won its first contract with Addax in October 2006. After the original contract expired on October 16, 2014, it was extended for another year. After that, the contract was extended for another three years to October 16, 2018. Upon the October 2018 expiration, Addax extended the charter until January 2019, and then until April 16.
The two companies have been in talks over a potential longer-term contract, with information on Yinson’s website showing Addax has options to extend the contract until 2022. The FPSO has a storage capacity of 1.7 million barrels.
Addax, a subsidiary of Sinopec Group is engaged in the exploration, development and production of oil and gas resources in Africa, the Middle East and Europe. In Nigeria, Addax’s producing assets include 11 field complexes with around 60 production wells in concession OML123, two fields with 20 producing wells in concession OML 124, and two fields with 14 production wells in concession OML126. Yinson Holdings, an investment holding company, operates as a floating, production, storage, and offloading (FPSO) service provider.
The company operates through Offshore & Marine and Other Operations segments. It provides vessels and marine related services. The company engages in the ownership and operation of ships; trading, leasing, and sub-leasing of vessels on bareboat and time charter basis; provision of consulting services relating to ship management; provision of FPSO vessels for chartering and service activities incidental to oil and gas extraction; and shipping and vessel chartering activities.
