- Karoon Energy’s (KAR) Bauna operations in Brazil will remain suspended until May
- Operations were halted at the end of March due to an incident associated with the high pressure flare on a floating production storage and offloading unit
- Karoon, together with system operator Altera&Ocyan, are undertaking essential and proactive works, focussing on a detailed inspection of the production systems
- If all goes well, KAR expects production operations to recommence in early May – albeit at lower production rates and higher costs than its current guidance
- KAR shares are down 5.2 per cent, trading at $2.27 at 3:45 pm AEDT
Karoon Energy’s (KAR) Bauna operations in Brazil will remain suspended until May.
The operations were shut in at the end of March due to the loss of containment incident associated with the high pressure flare on a floating production storage and offloading unit (FPSO).
While repair work was carried out, higher than expected flow rates from wells in the Patola field put pressure on the processing system. As such, the company decided to extend its shutdown to complete a full inspection and testing of its systems.
This work was expected to wrap up by mid-April. However, the company said work would now be extended into May as it’s now committed to “essential and proactive works,” which will be completed with FPSO operator Altera&Ocyan.
“These activities include the acceleration of some of the planned July shutdown work scope to ensure the future reliability of the FPSO,” Karoon’s statement to the ASX read.
If all goes well, by early May KAR expects production for the 2023 financial year to be at the low end of its current guidance range of between 7.5 and 9 million barrels of oil.
The impact on unit production costs for the 2023 financial year were still being assessed, but the company said were likely to be towards the upper end of the current guidance range of between US$13 to $17 a barrel.
KAR shares were down 5.2 per cent, trading at $2.27 at 3:45 pm AEDT.