Sendje Berge Limited, a subsidiary of BW Offshore Limited (BWO), has agreed terms of a contract extension for the FPSO Sendje Berge with Addax Petroleum.
BW Offshore said on Monday that the extension for the FPSO, working on the Okwori field offshore Nigeria, had been submitted to relevant Nigerian authorities for review and approval.
The company added that the contract extension was for a four-year fixed term with two additional one-year extension options, beginning on November 6.
The FPSO has been operating for Addax offshore Nigeria since March 2005 under a contract which was supposed to expire in 2018 or 2020 with extension options.
The revised and agreed commercial terms include a new day rate partially linked to oil production volumes and oil price.
To remind, Addax terminated the contract with BW Offshore for the FPSO Sendje Berge operating offshore Nigeria after losing a dispute related to payment of outstanding dayrates for the unit back in May.
The two companies were in dispute over unpaid dayrates for the FPSO since 2016. At the end of February 2017, Sendje Berge Limited received an arbitration award relating to its claim against Addax for the payment of all outstanding dayrates in respect of the hire of FPSO Sendje Berge.
The award was in SBL’s favor , and it required the claimed dayrates to be paid. The arbitration tribunal also declared that no deduction may be made by Addax from future hire payments.
Following the arbitration, BW Offshore received a termination notice for the Sendje Berge FPSO which was supposed to take effect on November 6. Furthermore, BW Offshore was also supposed to provide a demobilization plan for the FPSO.
Now that the contract has been extended, the termination notice for the FPSO has been withdrawn, and the arbitration was settled as part of the agreed terms.
Offshore Energy Today Staff