KUALA LUMPUR (April 17): Bumi Armada’s unit has received a notice from Erin Petroleum Nigeria Ltd (EPNL) about an alleged “force majeure event” and a request for an orderly shutdown of the operations of Armada Perdana, a floating production storage and offloading (FPSO) unit belonging to the group.

The unit, Bumi Armada (Singapore) Pte Ltd (BASPL), has also received a notice of seizure of goods from a third party, stating that crude oil product to be produced and to be stored on Armada Perdana has been seized or attached by a writ of attachment issued by a court in Lagos, Nigeria.

This is in relation to legal proceedings of which the Bumi Armada group is not a party, Bumi Armada said in a filing to Bursa Malaysia.

“The company had sought clarifications from EPNL on such notice of seizure/attachment of goods but EPNL has not responded to the company despite numerous reminders,” added the group.  

Bumi Armada said it is of the view that the force majeure declaration by EPNL is wrongful under the operational and maintenance services contract and the group is reviewing its legal options, including commencement of legal proceedings, against EPNL.

It added that the estimated financial impact of credit risk recovery for the group to the results for the financial year ending December 31, 2018 is about RM30 million.

Bumi Armada also maintained that the suspension of provision of services under the bareboat charterparty contract and operational and maintenance services contract remains in place.

In addition, it said EPNL is not relieved from its obligation to make full payment of all payments due to BASPL under the contract.

Since last June, Bumi Armada has suspended operations on Armada Perdana due to delayed payments from EPNL.

Shares in Bumi Armada fell 1.5 sen or 1.63% to 90.5 sen today, for a market capitalisation of RM5.31 billion.