BW Still Mulling Namibia Gas Project

BW Offshore, which charters out floating production ships (FPSOs) mainly to oil field operators, has no update on its Kudu gas development project offshore Namibia in its latest results November 24.

UK independent Tullow, Japan's Itochu, Russian giant Gazprom, and even earlier the US major Chevron – which discovered the field in 1974 – have in the past evaluated Kudu's development, but in the end walked away. 

A slide in BW's 3Q presentation showed 'Kudu final investment decision' still on the company's ‘to do’ list in 2H 2017, along with first oil from the UK North Sea Catcher field, operated by UK Premier Oil.

In February 2017, Oslo-listed BW surprised many by farming into the Kudu gasfield offshore Namibia as its majority stakeholder, taking a 56% stake from state Namcor, leaving Namcor with 44%; for almost three years now it has held 100%. BW said it would pay for past costs upon transfer of the field interest, and said FID was planned for 4Q 2017.

BW also said in February the Kudu gas-to-power project calls for gas to be produced by a floating production unit – which if it took FID, BW would provide – before being exported by pipeline to a new 885-MW power plant onshore.

In the UK North Sea, BW said its BW Catcher FPSO arrived at the Catcher field in the UK on October 18, with commissioning activities now begun. The Catcher project is expected to produce first oil towards end-2017, it added. Premier has 50%; its partners are Cairn, Hungary’s MOL, and Dyas (part of Dutch firm SHV). BW charters the FPSO but has no equity.

BW Offshore made a net 3Q profit of $3.9mn, an improvement from its $11.2mn loss in 3Q2016 but down from a profit of $5.2mn in 2Q2017. Pre-tax earnings (Ebitda) of $82.1mn this 3Q were up slightly on the year-ago level of $76.9mn.