Petrojarl Knarr FPSO awarded contract extension by Norske Shell

Altera Infrastructure subsidiary Teekay Knarr has entered into a contract amendment with Norske Shell, as operator for and on behalf of the Knarr field licence partners, that extends the contract for the lease and operation of the Petrojarl Knarr floating production storage and offloading (FPSO) vessel until at least March 2022.

The vessel has been operating on the Knarr field since 2015 under a firm duration until March 2021, which included a further fee payable by the operator if the contract was not extended through to 2025 and with additional extension options thereafter. The contract amendment includes a reduction in day rate from March 2021 to March 2022 and the removal of the fee payable by the operator if the contract was not extended, in return for the introduction of an additional production volume and oil price related tariff.

The amendment also terminates the operator’s purchase option for the vessel and provides for a mutual right to terminate the contract on six months’ notice without payment of penalty, such termination not to be effective before March 2022.

Altera Infrastructure, previously Teekay Offshore, owns and has been operating the FPSO since it achieved first oil on March 16, 2015.