Jadestone confirms restart of production at Montara

The AIM-traded firm said production operations restarted at the Montara facilities on 11 January, with production volumes set to be ramped up while final checks were concluded.

It said the entire facility would be restarted, including both the oil production system and the gas system, which enabled gas-lift and gas re-injection so as to optimise production operations as rapidly as possible.

The conclusion of that maintenance and inspection activity would result in improved facility reliability and uptime going forwards, resulting in no major planned shutdowns until at least the second half of 2020, Jadestone said.

PTTEP Australasia (Ashmore Cartier), as seller of the Montara assets, agreed to provide $22m to Jadestone in relation to the recent shutdown of the facilities, including associated costs, of which approximately $4m was directly attributable to shutdown work scope.

Jadestone and PTTEP were continuing to manage the asset under the terms of the operator and transitional services agreement, whereby PTTEP - as the duty holder under the currently in-force safety case - continued to operate the Montara assets, with all critical operations leadership positions now filled with Jadestone personnel who had been formally seconded into the PTTEP organisation.

In the meantime, the regulator was reviewing Jadestone's recently-submitted Montara safety case and environment plan.

Upon approval, the regulator would permit the transfer of operatorship to Jadestone.

“I'm delighted to see production operations safely resume at the Montara asset and pleased that the work we have completed alleviates the need for any further major planned outages until at least late 2020,” said Jadestone president and chief executive officer Paul Blakeley.

“Catching up on Montara's overdue inspection and maintenance tasks and resolving the regulatory non-compliance notices was a prudent step early in Jadestone's experience with Montara, and serves to enhance the asset's value.”