Tullow Oil says its hull and machinery insurance cover has been confirmed for the floating production, storage and offloading unit Kwame Nkrumah by its reinsurers, following the failure of the turret bearing earlier this year.
Tullow first experienced issues at the FPSO, which produces the Jubilee field, offshore Ghana, in mid-February.
A technical investigation during found the vessel's bearing was no longer able to rotate as originally designed, leading to new offloading procedures being implemented.
Tullow says hull and machinery policy covers relevant operating and capital costs associated with both current operating procedures at the FPSO and the long-term solution.
As operator of the Jubilee field, Tullow will now work closely with the loss adjusters and reinsurers to establish an efficient payments schedule as remedial work continues. Tullow also continues to work with its business interruption reinsurers on confirming cover for loss of production and revenue caused by the turret bearing failure.
The Kwame Nkrumah FPSO vessel, which started production from the field, 60km offshore Ghana, in 2010, is a converted tanker with 120,000 b/d capacity.
The 3 billion bbl Jubilee field was discovered in 2007 by Kosmos Energy by the Mahogany-1 (M-1) and Hyedua-1 (H-1) exploration wells. It was one of the largest oil finds that year. Average production in 2014 was 102,000 b/d.