Apache Northwest Pty Ltd, a subsidiary of Apache Corporation (NYSE, Nasdaq: APA), said today it has completed an initial assessment of damage at its Varanus Island processing hub and a timetable for restoring production.
“Our estimated timetable is to restore gross production at a rate of 180 million cubic feet (MMcf) of natural gas per day (200 Tj per day) through the East Spar Joint Venture processing facilities by Aug. 15, ramping up to 315 MMcf (350 Tj) per day in December as the Harriet Joint Venture facilities are returned to production,” said Tim Wall, managing director of Apache Northwest Pty Ltd.
“We are making every effort to meet or beat this timetable,” Wall said. “We have 146 people on Varanus Island conducting clean-up and reconstruction efforts. Since the incident occurred on June 3, Apache engineering teams have been canvassing the world for replacement equipment in an effort to minimize repair time.”
The East Spar J.V. facilities are located the greatest distance from the rupture and sustained less damage. Export pipelines and associated valves, two compressors, instrumentation and control facilities are being repaired to meet the timetable of restoring production by mid-August.
The Harriet J. V. processing facilities are located adjacent to the rupture and will require significant repairs to meet the goal of restoring production in December. Damage occurred at three sales gas compressors, the hot oil system, control system and flare stacks. In addition, evaluation of damage to several processing vessels is continuing.
“Apache understands the hardship that this disruption has caused, not just for our customers but also for many others in Western Australia,” said G. Steven Farris, Apache Corporation president and chief executive officer. “We are committed to restoring production as soon as possible.
“Apache has been a major supplier of natural gas to Western Australia for the last 15 years,” Farris said. “We have four new oil and gas projects under development that will contribute to the expanding Western Australia economy. Our Reindeer project, which includes construction of a 68-mile (110 km) offshore pipeline and an onshore gas processing facility at Devil Creek, will provide an entirely new source of gas for the domestic market in mid-2010.”
Prior to the June 3 incident, total production through Varanus Island, which is located approximately 60 miles (100 km) from Karratha on Australia’s Northwest Shelf, was 315 MMcf (350 Tj) per day. Apache has a 68.5-percent interest in the Harriet J.V. and a 55-percent interest in the East Spar J.V.
Apache continues to assist the Department of Industry and Resources (DoIR) and the National Offshore Petroleum Safety Authority (NOPSA) with their inquiries.
Apache Corporation is a large independent oil and gas exploration and production company with operations in the United States, Canada, the United Kingdom North Sea, Egypt, Australia and Argentina.
(Apache Press Release)