Jadestone working to rectify Montara defects

(Sharecast News) - Asia-Pacific oil and gas producer Jadestone Energy updated the market on the Montara Venture floating production, storage and offloading (FPSO) vessel, offshore Australia, on Wednesday. The AIM-traded firm said production had been temporarily halted due to a small defect discovered between ballast water tank 4S and oil cargo tank 5C.

Following its initial announcement on 10 August, the company said it had been steadily making preparations to rectify the identified defect.

It said it had completed inspections in ballast water tank 4P, with two minor repair jobs identified and set to be undertaken in the coming days.

Upon completion, tank 4P was projected to resume service.

The company said it had also successfully offloaded the oil contained in tank 5C into a shuttle tanker.

It said the subsequent cleaning process for the tank was currently well underway, with a brief inspection also planned for later in the week.

The successful removal of oil from tank 5C had also enabled the firm to proceed with inspections of tank 4S, which were now in progress.

Jadestone clarified that the identified defects posed no safety or structural threats, nor carried any risk of hydrocarbon leaks into the sea.

In line with regulatory guidelines and transparency commitments, Jadestone said it was continuing its active dialogue with the National Offshore Petroleum Safety and Environmental Management Authority.

"With regard to the disclosures in the 10 August announcement on the company's reserve-based loan, Jadestone currently does not expect production at Montara to be shut in for more than 60 days, subject to ongoing inspections, identifying the cause of the 4S/5C defect and implementing preventative measures," the board explained in its statement.

"A further update on the progress of Montara activities will be provided during the week commencing 28 August."

At 1126 BST, shares in Jadestone Energy were up 28.96% at 28.5p.

Reporting by Josh White for Sharecast.com.