FPSO operator BW Offshore has found a partner for its BW Catcher FPSO, currently under a lease contract with Premier Oil on the Catcher field located in the UK sector of the North Sea.
According to its statement on Tuesday, BW Offshore has closed an agreement with a nominee of the Chinese financial leasing firm, ICBC Financial Leasing (ICBCL), whereby such nominee becomes an equity partner in BW Catcher Limited, which owns the BW Catcher FPSO.
The equity investment in the BW Catcher FPSO is the first transaction under the cooperation agreement signed between BWO and ICBCL in April this year. BW Catcher Limited has issued preference shares with a preferential dividend right to ICBCL, for an aggregate subscription price of $275 million.
The company plans to redeem the preference shares in full over an estimated term of 12 years. The aggregate redemption and dividend payments on the preference shares are estimated to reflect approximately 25-30% of the estimated free cash flow after debt servicing in the Catcher contract over a similar term.
The net proceeds from the issue of the preference shares will be used for general corporate purposes, BW Offshore said.
“We are very pleased to secure this equity participation for the BW Catcher FPSO in cooperation with our strategic partner, ICBCL, and in line with our stated ambition to seek new ways of enabling further growth for the company,” said Carl K. Arnet, the CEO of BW Offshore.
“ICBCL is a world-leading financial institution and a strong partner. Together we can deliver cost effective solutions to our clients in the oil and gas sector.”
The BW Catcher FPSO, built by Keppel Shipyard, arrived at the North Sea field in October. The vessel is currently undergoing commissioning activities.
The FPSO is 241 meters long, 50 meters wide and 27 meters deep and it will be able to process up to 60,000 barrels of oil a day.
The Catcher development, made up of several fields discovered between 2010 and 2013, is located 170 kilometers south-east of Aberdeen. The development entails 22 subsea wells, 14 producers and 8 water injectors, on the Catcher, Varadero and Burgman fields which will be tied back to the BW Catcher FPSO. First oil from the field is expected by the end of the year.