Teekay Offshore Partners has terminated an agreement with Alpha Petroleum Resources for the use of the Petrojarl Varg floating production storage and offloading (FPSO) unit on the Cheviot oil field on the UK continental shelf.
The effectiveness of the agreement remained subject to a number of conditions precedent being satisfied, including that Alpha Petroleum provide initial funding to cover life extension and upgrade costs. As a result of this condition precedent not having been satisfied by the prescribed contractual deadline, the agreement and all commitments related thereto have now been terminated.
Following the termination, Teekay immediately began pursuing a range of alternative deployment opportunities for Petrojarl Varg.
The next potential project for the FPSO could still include the Cheviot development albeit under a revised financing model, Teekay Offshore Production president Chris Brett said.