Oil majors BP, Royal Dutch Shell and OMV Group have awarded new three-year contracts of affreightment (CoA) for shuttle tankers owned by Teekay Offshore Partners (TOP). The financial terms of the deal were not disclosed.
The tankers will carry oil produced from the new Glen Lyon floating production, storage and offloading (FPSO) unit, which is part of the Quad204 development, located west of Shetland in the North Sea.
The CoAs are expected to commence in the first half of 2017 and will require approximately two shuttle tankers from TOP’s existing fleet of 28 vessels.
“These contracts further enhance our CoA contract portfolio and are expected to add future cash flow through higher shuttle tanker fleet utilization without the need for incremental capital expenditure,” Peter Evensen, Teekay Offshore’s CEO, said in a release.
“Looking ahead, the shuttle tanker market in the North Sea is expected to remain tight supported by a combination of more lifting points from new fields coming on-line and limited fleet growth with no uncommitted shuttle tanker newbuildings on order.”