Karoon’s Brazilian oil assets to remain offline longer

(U) Australian independent Karoon Energy expects that production from its Bauna oilfield and the recently on stream Patola field offshore Brazil will remain suspended into May.

Karoon and the fields’ floating production, storage and offloading vessel operator Altera & Ocyan are undertaking both essential and proactive work with the focus on the ongoing detailed inspection of the Cidade de Itajai floater’s production system.

The inspection is expected to be completed soon, while the duo is also accelerating some of the work that was scheduled to be performed during the planned July shutdown to ensure the future reliability of the FPSO.

“The timing of when production will restart is dependent on completion of the inspections and the final scope of works undertaken,” Karoon said on Friday.

Karoon on 28 March shut down production at its Bauna and Patola oilfields following a loss of containment incident associated with the high pressure flare on the Cidade de Itajai FPSO.

Only one day before, the operator had brought on stream the second of two new production wells on the Patola field on its 100%-held Block BM-S-40, which had boosted Bauna’s total output to more than 40,000 barrels per day of oil.

The Cidade de Itajai FPSO has nameplate processing capacity of 80,000 bpd of fluids.

Based on a resumption of safe and reliable production operations in early May, Karoon’s 2023 financial year production is expected to be at the low end of the current guidance range of 7.5 million to 9 million barrels.

The operator added that the impact on the 2023 full-year unit production costs is still being assessed, but these are likely to be towards the upper end of the current guidance range of between US$13 and US$17 per barrel.

The Brazil-focused upstream independent will provide a further update on the timing of the restart of production and the 2023 full-year production and unit production cost guidance in its first quarter report, which is scheduled to be released on 27 April.

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