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Hurricane Energy PLC on Friday announced that it has extended its Bareboat Charter contract with Netherlands-based Bluewater BV.
The contract was originally set to expire on June 4. It has now been extended to cover the remaining economic life of the Lancaster field, the Surrey, England-based oil producer added.
Under the new contract, both parties can terminate the charter within a six months' notice period.
The existing day rate and tariff for Bluewater's Aoka Mizu vessel remains at $75,000 per day and 8% of revenue respectively. Aoka Mizu is a floating production storage and offloading installation.
Hurricane agreed to establish a secured deposit account of up to $18.7 million for the benefit of Bluewater, covering the costs associated with the day rate for the six-month notice period and decommissioning in respect of the vessel.
Furthermore, Hurricane has negotiated a facility with BP Oil International that will allow for cash to be advanced ahead of a lifting.
‘This provides the ability to create more frequent cash receipts and assist with the company's working capital. The facility incurs a financing fee that is only payable if the company uses it,’ Hurricane explained.
‘With production continuing in line with our projections, good uptime performance on the FPSO and assuming oil prices are in the range $90-110 per barrel of oil, we believe that post clearing our bond debt and after funding the Bluewater secured deposit account, Hurricane will have between $50 million to $80 million of net free cash at the end of July 2022,’ Chief Executive Officer Antony Maris commented.
As of January 31, the company had net free cash of $85 million.
Hurricane Energy shares were 20% higher at 11.70 pence each in London on Friday afternoon.
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