Layang FPSO’s novation contract completed

PETALING JAYA: The novation contract for the Layang production storage and offloading (FPSO) facility entered between TH Heavy Engineering Bhd, Yinson Holdings Bhd’s associate Yinson Energy Sdn Bhd (YESB) and JX Nippon Oil & Gas Exploration (Malaysia) Ltd was completed on June 1.

TH Heavy Engineering Bhd said this came after the full payment of the novation consideration pursuant to the terms of the executed agreements.

Meanwhile, Yinson said the novation agreement has been rendered unconditional and the novation already took effect from June 1.

Pursuant to the novation contract, YESB will assume THHE’s right and obligations under the charter contract.

It is a firm charter period of eight years with 10 extension periods of one year each. The estimated aggregate value of the charter contract, assuming all extension options are exercised, is US$860 million (RM3.37 billion).

The FPSO is expected to commence operations at the Layang field in 2019.