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UPDATE 1-Woodside to suspend Australia's Vincent oil output for one year from May

Published 05/03/2018, 08:23 pm
Updated 05/03/2018, 08:30 pm
© Reuters.  UPDATE 1-Woodside to suspend Australia's Vincent oil output for one year from May
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* Ngujima-FPSO leaving station for modifications in May

* Last Vincent cargo to be exported in May - trader

* Impact of production suspension limited - traders

* Vincent oil production drops in Q4 from Q3 (Adds details)

By Jessica Jaganathan and Florence Tan

SINGAPORE, March 5 (Reuters) - Woodside Petroleum APL.AX will suspend production of its Vincent crude oil for a yearstarting from May as the floating, production, storage andoffloading (FPSO) unit for the field undergoes maintenance, twotraders that participate in the market said on Monday.

The Ngujima-Yin FPSO will be leaving station from theVincent field, located offshore of the state of WesternAustralia, from May for "modifications ahead of forecast GreaterEnfield production" from the middle of 2019, a spokeswoman frommajority stakeholder and operator Woodside told Reuters in anemail.

The spokeswoman did not comment directly on the field'soutput during the maintenance period.

The last cargo from the field before the suspension will beexported in May, one of the traders said.

The Vincent project is 60 percent owned by Woodside and 40percent by Mitsui E&P Australia. Production at the field fell to17,350 barrels-per-day (bpd) at maximum capacity in the fourthquarter of 2017, compared with 18,644 bpd in the third quarter,the spokeswoman said.

The suspension of Vincent production will likely tighten thesupply of high-density, low-sulphur, or so-called heavy-sweet,crude from Australia, though the impact on the Asia-Pacificmarket may be limited since it has a small pool of buyers, thetraders said.

About one 550,000-barrel cargo a month of Vincent isexported and the usual buyers are in Malaysia, the United Statesand India.

"Vincent crude has always been the hardest to sell among allthe heavy (crude) grades as there are limited outlets for it asit's far too heavy," said a Singapore-based crude oil trader.

"I don't see a massive impact but there will be some."

The Ngujima-Yin FPSO is being refitted as part of Woodsideand Mitsui's $1.9 billion Greater Enfield project that willstart producing from three fields near Vincent by the middle of2019.

Greater Enfield is expected to initially produce more than40,000 bpd of oil at 100 percent capacity, the Woodsidespokeswoman added.

This oil will be processed and stored aboard the Ngujima-YinFPSO.

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