Ann: Quarterly Activities/Appendix 5B Cash Flow Report, page-7

Extract from the report

These include an opportunity to optimise the production rate allowing the joint venture to reduce
CAPEX and phase the timing of wells. Subject to ongoing engineering work, a revised capacity
between 60,000 to 100,000 bopd could result in only a portion of the wells being required prior
to first oil. Any remaining wells would be drilled during production allowing them to be selffunded through project cash flows. Right-sizing the project and deferring wells after production
startup will reduce both the up-front capital outlay and the time to first oil, hence improving
project value and returns.

This looks like a smart move. I have been wondering why initial oil flows have reduced from 75-100k to 60-100k bpd. A staged CAPEX of wells funded by existing well cash flow means lower initial well CAPEX however this is likely to be small as the expensive FPSO etc is the big up front cost. However it looks like the lower cost of the FPSO will have lower capacity implying a longer time to recover all oil.

Am I right here? Comments welcomed.