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Upstream wins NOGA contract extension for $45M

24 May 2022 3:53 PM | Stephanie Berlin (Administrator)

The Department of Industry, Science, Energy and Resources has given the GR Engineering subsidiary an extension to the contract by another four months. The contract now ends September 30. 

UPS will continue to provide maintenance, project, and transition services to the FPSO and associated infrastructure in preparation for a disconnection and removal of the vessel. 

The latter work will be undertaken by a separate company which won a tender six weeks ago.

"We are pleased to continue working with the DISER team and the relevant regulatory bodies to safely manage and maintain the FPSO, and preparing for transition to support a safe removal of the FPSO in the future," managing director Geoff Jones said. 

Petrofac won a contract for Phase 1 work from DISER April 1 worth $325 million, with the government saying then that the company would take over from UPS as part of a managed transition. 

The company won after the government called for expressions of interest in July last year. 

UPS was production manager aboard the vessel when it was shut down over safety concerns. 

The lack of production strangled cash flow and forced the owner Northern Oil and Gas Australia into liquidation, as it had no money to decommission the ageing vessel it had picked up from Woodside Petroleum in a cheap but legal sale in 2016. 

Resources minister Keith Pitt insisted tax payers not foot the bill and after consultation with industry that was reportedly difficult on both sides imposed trailing liabilities, which will affect future sales, and a 46c per barrel of oil equivalent tariff on industry until full costs are paid. 

Separately this week Petrofac took another decommissioning contract in Mauritania worth US$60 million while today GR Engineering announced a contract for services with a gold miner. 

Source: Energy News Bulletin

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