Bumi Armada suspends FPSO operations of Armada Perdana


Bumi Armada Bhd has suspended operations on its floating, production, storage and offloading (FPSO) vessel Armada Perdana due to long-standing delays in the bare-boat charter (BBC) payments owed by Erin Petroleum Nigeria Ltd.

The offshore energy facilities and services provider said its wholly owned subsidiaries, Armada Oyo Ltd (AOL) and Bumi Armada (Singapore) Pte Ltd (BASPL), are suspending the BBC, and operations and maintenance (O&M) contracts respectively on the FPSO Armada Perdana to Erin.

“The suspension of operations is due to longstanding delays in the BBC payments due to Bumi Armada, as well as irregular payments on the O&M contract,” it said in a statement yesterday.

Bumi Armada ED and CEO Leon Harland said the suspension of operations was brought about by Erin’s refusal to provide the company with a clear structure of how Erin intends to comply with the contractual agreements and repay the amounts owing to Bumi Armada, despite Bumi Armada’s “repeated attempts to resolve the situation amicably”.

“This situation has gone on long enough and Bumi Armada has taken the decision to enforce its rights under the contracts and to be paid in accordance with the contractual terms,” he said, adding that the group is willing to work with its clients to reach mutually agreeable solutions.

“However, such solutions must be sufficient and reasonable, as a resolution to the outstanding amounts that Erin owes to Bumi Armada,” Harland said.

Erin is a unit of Erin Energy Corp, a US-based company primarily involved in the exploration, development and production of oil and gas.