Montara oil production halted following offshore leak

SINGAPORE — Jadestone Energy has shut in production from the Montara area offshore northwest Australia following an oil leak.

On June 17, crude oil was being transferred between two tanks on the Montara Venture FPSO in a routine operation. During the transfer, oil appeared on the sea surface adjacent to the vessel.

Transfer operations were halted immediately, and production from the Montara fields was shut in as a precaution.

The release of oil to the sea stopped following pumping of water into the tank, and an ROV inspection confirmed a 30-mm diameter hole in the bottom of the tank.

Jadestone plans a temporary repair to remove the remaining oil from the tank, which will then undergo cleaning to complete an inspection and permanent repair program.

Since assuming operatorship of the Montara area, the company has applied the same approach to all the other main crude oil storage tanks on the FPSO, as part of a five-yearly inspection and repair process.

Jadestone added that the estimated volume of released oil, at 3 to 5 cu. m, had fully dispersed by yesterday morning. It has notified Australia’s National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) and will initiate an onsite inspection of the Montara facilities on June 21.

It should take about four weeks to complete the tank inspection and conclude repairs before production can restart, with appropriate isolation of the crude oil tank. Securing the leak site and the subsequent permanent repair of the crude oil tank should cost $2 million to $3 million.

Earlier this year, production was impacted by an unplanned compressor core change-out. Jadestone has been assessing the feasibility of adding a second reinjection compressor to increase production and reduce flaring.