MODEC to manage FPSO despite sale to Ghana Jubilee partners

Despite selling the Kwame Nkrumah Floating Production Storage Offloading (FPSO) to the Ghana Jubilee Partners, MODEC will still be working on the facility, according to Tulow Oil Plc.

Tullow, on behalf of the Jubilee Partners also made up of the Ghana National Petroleum Corporation (GNPC), Kosmos Energy, Sabre Oil and Anadarko acquired ownership of the FPSO from MODEC on December 29, 2011.

But the Japanese firm will still be providing services for the vessel – this time under a new contract, according to Jubilee operator Tullow.

“MODEC will continue to provide operations and maintenance services under a new contract,” said Tullow in a statement January 18, 2012.

However it did not give the value of the sale but according to a Reuters news report January 6, 2012, a source close to the deal put the value at $750 million.

Tullow explains that the acquisition was made following the excellent performance of the vessel in 2011 and “reflects the Partners’ belief that ownership of the vessel will maximise commercial value and operational flexibility.”

The World Bank’s Multilateral Investment Guarantee Agency (MIGA) was providing $225 million political risk insurance for the vessel per an agreement it had with MODEC. But in 2011 MODEC cancelled the insurnce, an official of MIGA told ghanabusinessnews.com in an email January 6, 2012.

By Ekow Quandzie