Carri Lockhart, Karoon’s CEO and Managing Director, commented: “The electrical fault on SPS-92 is clearly very disappointing, especially given that this new ESP and cable system was in operation less than three months. Prior to the electrical fault, the well was performing in line with expectations, benefiting from increasing reservoir pressures following the resumption of water flood operations.
“Our key focus now is on planning the intervention and bringing SPS-92 back into full production to capture the deferred barrels, and maximising production from the other Baúna wells. In parallel, the company is actively pursuing avenues for equipment warranty and insurance recoveries. We will keep the market informed once we have more clarity on intervention timing.”
While the firm continues to investigate the root cause of the SPS-92 failure and assess the event against the applicable policy terms, based on its current understanding and preliminary nonbinding advice from its insurance advisers, it believes its insurance program may partially offset the resulting loss of production revenue and reimburse substantially all costs associated with the required intervention and repair, subject to applicable deductibles, policy terms, and final confirmation of coverage by insurers.
As a result of reduced SPS-92 output, Karoon has revised its 2026 full-year Baúna project production guidance from 6.0–6.7 million bbl to 5.4–5.7 million bbl, with the lower end reflecting a conversion to gas lift, if necessary. With Who Dat guidance unchanged, total production for 2026 is now expected to be 6.6–7.2 million boe.
