Seplat boosts operations with US$ 15M
By Yemie Adeoye
IN furtherance of moves aimed at boosting its operations and ensuring the prompt evacuation of its hydrocarbon Seplat Petroleum Development Company has concluded plans to invest the sum of 15 million dollars in its operations on OML’s 4, 38 and 41.
This is coming on the heels of revelations that the 36,500 barrels production capacity of the 3 wells is expected to grow to 50,000 bpd by year end 2012.
In view of this Seplat has signed an agreement with Shebah exploration and Production Ltd and Allenne British Virgin Islands Ltd for the possible leasing or acquisition of the “Trinity Spirit” floating oil production, storage and offloading unit (FPSO). Seplat paid Allenne British Virgin Islands Limited a US$15 million refundable deposit.
This deposit is repayable by Allene to Seplat on demand if Seplat decides not to buy the FPSO or decides not to lease the FPSO or should it decide afterwards not to use the FPSO in transporting, processing or delivering its oil production.
The lease or acquisition of the Trinity Spirit FPSO would therefore provide support of the Trinity Spirit FPSO would therefore provide Seplat with an alternative means of transporting its hydrocarbons to the SPDC Nigeria pipeline.
The vessel, which can handle 22,000 bpd and store 2 million barrels of oil, is currently located at Shebah’s Ukpokiti field in OML 108.”
A representative of Seplat in Nigeria who spoke with Sweetcrude on the condition of anonymity noted that the 15 million dollars deposit made by Seplat to Allenne British virgin Islands Limited is repayable by Allenne to Seplat on demand if Seplat decides not to buy the FPSO, Seplat decides not to lease the FPSO or Seplat decides not to use the FPSO in transporting, processing or delivering its oil production.
The leasing or acquisition of the Trinity Spirit FPSO would therefore provide Seplat with an alternative means of transporting its hydrocarbons to the SPCC Nigeria pipeline.
Seplat had entered into an initial agreement with Shell Petroleum Development Company (SPDC) for the purpose of crude carrying from the aforementioned oil wells even as there indications of a Shell possible disengagement from the agreement following stipulations that from January 1, 2013 it will only accept crude that has maximum water content of 0.5 percent.
Seplat’s foreign partners Maurice and Prom however placed stipulations in a positive light when it said in a prospectus that water separation facilities on its assets will not be ready by that deadline so Shell will have the right to terminate the agreement if it so desires.
This, according to some industry sources must have necessitated the MOU signed some few weeks ago by with Shebah which covers an alternative export route via the Trinity Spirit FPSO.
However, the Seplat’s representative who spoke with Sweetcrude made it clear “In Nigeria the group, through Seplat, has only one major relationship which is with Shell trading.
GivenShell’s credit rating, the Company considers there is no customer risk. Apart from this contract and others signed in the course of its normal activities, the Company has not entered into any significant agreements” he enthused.