NZ High Court rules Tui field FPSO must stay

The floating production, storage, and offtake vessel Umuroa must stay connected to Tui oil field in the offshore Taranaki basin, the High Court of New Zealand has ruled.

The ruling comes after an Environmental Protection Authority plea to prevent the vessel contractor BW Offshore from removing the vessel from the field infrastructure and sailing it away.

BW Offshore had been contracted by Malaysian-owned field operator Tamarind Resources Pte Ltd’s New Zealand subsidiary Tamarind Taranaki to supply the FPSO for production from Tui field. Umuroa had been on station for several years.

The problem arose when Tamarind Taranaki went into liquidation in December 2019 owing hundreds of millions of dollars to contractors and creditors.

BW Offshore responded in March by saying it would demobilise the FPSO from New Zealand at a cost around NZ$20 million.

The company said at the time that Umuroa is a versatile turret-moored FPSO and an attractive redeployment candidate for field developments.

When BW Offshore began the demobilization process in March, the NZ EPA served the company six abatement notices, ordering the company to stop because the demobilisation would leave oil pipelines and Tui subsea infrastructure on the seabed.

The notices have been upheld by the High Court with the Honourable Justice Robin Cooke stating that “Parties engaged in significant oil mining activities need to ensure that those activities are appropriately brought to an end from an environmental point of view before departing the scene. That is saying no more than people must tidy up an activity before they leave,” he added.

The decommissioning of Tui oil field with Tamarind Taranaki in liquidation presents a number of legal, contractual, and constitutional challenges. With Tamarind Taranaki insolvent, the responsibility of Tui decommissioning activities is yet to be determined.

Source: Oil & Gas Journal