Bumi Armada Seeks Compensation for FPSO Termination
Malaysia’s Bumi Armada Bhd intends to fully enforce its rights, including initiating legal proceedings against Woodside Energy Julimar Pty Ltd for purportedly terminating its charter contract of the Armada Claire Floating Production Storage and Offloading (FPSO) unit.
Bumi Armada Berhad has earlier announced that its wholly-owned subsidiary, Armada Balnaves, has received notice from Woodside Energy Julimar terminating the contract for FPSO Armada Claire, currently operating in the Balnaves Field off north-western Australia.
The company claimed that the purported notice of termination was not valid, and instead it was tantamount to a cancellation for convenience or alternatively, was a repudiation of the contract by Woodside, pursuant to which the company was entitled to a compensation.
“Bumi Armada’s position is that the purported notice of termination is not valid, and in fact tantamount to a cancellation for convenience or alternatively, is a repudiation of the contract by Woodside, pursuant to which Bumi Armada is entitled to compensation from Woodside,” it said.
The 240 meters long FPSO Armada Claire, built in 1993 and refurbished in 2014, has an oil production capacity of 80,000 bpd and a storage capacity of 805,035 bbls. The FPSO has been designed with a disconnectable riser turret mooring system for cyclonic weather in 135m water depth.
Bumi Armada, whose major shareholders include the Employees Provident Fund Board (8.74%) and Amanah Saham Bumiputera Scheme (7.64%), said the contract’s termination was expected to impact the full year 2016 financial results of the group.