LNG

Golar LNG Ltd, the shipping company now specialising in a small but growing fleet of floating liquefied natural gas production and import project vessels, said the “Hilli Episeyo” had seen its 100th cargo lifted from offshore Cameroon in West Africa.

Indian liquefied natural gas imports continued their 2022 decline as rising cargo costs stemmed demand in West Asia and the Indian economy showed signs of slowing as natural gas demand was flat in industrial sectors.

The Emerging Africa Infrastructure Fund (EAIF) said it had agreed a loan deal with a project company in West Africa, adding the last block in a financing arrangement for a floating LNG terminal at the port of Tema in Ghana, which has almost been completed.

BP of the UK and one of India’s largest conglomerates, Reliance Industries, are on track for first gas from mid-2020 from projects developed to open up new Indian production when the nation is also increasing its LNG imports.

The RIL-BP joint venture has committed an additional $5 billion of investments towards monetizing about 3 trillion cubic feet equivalent of natural gas, or 500 million barrels of oil equivalent, from reserves in three projects.

The projects are named, R cluster, Satellite cluster and the MJ fields.

“These projects will utilize the existing gas production infrastructure. Further, this infrastructure can act as a hub for development of any discovery from contiguous areas,” said the BP-RIL partnership.

BP and Reliance sanctioned the projects in natural gas fields in the Krishna Godavari Dhirubhai offshore the East Coast of India.

India's Krishna-Godavari Basin covers more than 19,000 square miles offshore the state of Andhra Pradesh in the Bay of Bengal.

The KG-D6 block was Reliance’s first offshore gas field development and its first underwater discovery. It was also India's largest deposit of natural gas when first found in 2002.

“The first-gas from these fields is expected in mid-2020,” they stated.

“The peak production from these three fields is expected to reach 1 BCFe per day which is about 15 percent of envisaged Indian demand,” they explained.

The RIL-BP joint venture also confirmed that it had completed the safe cessation of production in a planned manner, from the D1 D3 field in Block KG D6, also off the East Coast.

India consumes more than 5 billion cubic feet a day of natural gas and aspires to double gas consumption after 2022.

The offshore gas supplies will be in addition to LNG imports which in December 2019 surged for a ninth month in the current fiscal year as more volumes were imported at a lower cost from countries such as Qatar, the US, Australia and West African nations.

LNG imports for December jumped by 22.7 percent to 2.08 million tonnes compared with the 1.70MT received in December 2018.

The main operating terminals on India’s West Coast are at Dahej, Hazira and Dabhol, near Mumbai. The newest terminal at Mundra is also now operational.

There is also the Kochi facility in the southwest state of Kerala and one East Coast terminal at Kamarajar, 25 kilometres north of Chennai Port in Tamil Nadu. 

India imports about 250 cargoes a year, mainly from Qatar, the US, Russia Australia and Africa.

The import figures also showed that December LNG imports cost India around $800M during the month, less than the $900M spent in December 2018.

The cost of the fuel from April to December 2019 was about $7.1Bln versus $8.0 Bln in the year-ago period.

India's current monthly LNG requirements for the regasification network is around 30 shipments.

The BP-RIL ventures will come on stream as the nation's domestic production of natural gas has been falling. For the month of December 2019, the output was 2.64 billion cubic metres compared with 2.86 Bcm in December 2018, down 7.9 percent.

French energy major Total plans to develop liquefied natural gas imports in the tiny West African nation of Benin, whose neighbour Nigeria is the world’s fifth-largest LNG exporter.

Total said it signed a Gas Supply Agreement and the Host Government Agreement for the development of a floating LNG import facility to supply 500,000 tonnes per annum to Benin for 15 years, starting in 2021.

Total will develop and operate the floating storage and regasification unit (FSRU) and its associated infrastructure.

“It will include an offshore pipeline connection to the existing and planned power plants in Maria Gléta,” said Total.

The Benin government has signed a contract for a second power plant with financial backing from Denmark and to be located at Maria Gléta in the outskirts of the country’s largest city, Cotonou.

Total said its FLNG import project was in line with its strategy to develop new gas markets by unlocking access to LNG for fast-growing economies.

“We are very pleased to have been entrusted by the Benin authorities to develop LNG imports and support a broad adoption of natural gas in the country,” said Laurent Vivier, Senior Vice President Gas at Total.

“Access to LNG will help Benin to meet growing domestic energy demand and add more natural gas to the country’s current energy mix, hence reducing its carbon intensity,” added Vivier.

West African nations have mixed fortunes on the energy front with countries like Benin and Ghana seeking pipeline gas supplies or access to LNG while others such as Nigeria, Cameroon, Senegal and Mauritania have adequate reserves to have current or developing LNG export projects.

Nigeria, which borders Benin, exported 19.68 million of LNG last year from its onshore plant at Bonny Island in the Niger Delta, making it the fifth-largest exporter in the world behind Qatar, Australia, Malaysia and the US and just ahead of Russia and Indonesia.

The Minister of Energy of Benin, Dona Jean-Claude Houssou, thanked Total for helping to build energy supplies for the power connections.

“I congratulate the Total Group on its willingness to support the revitalization of the energy sector, which is at the heart of the Government's Action Plan as evidenced by the signing of the gas import contract,” explained Houssou.

“I would like to highlight the Government's efforts to restore Benin's energy independence, which is the foundation of the country's ambitious economic and social development,” he added.

Benin has been putting in place a legislative framework to welcome participation of private capital in the energy sector with independent thermal, solar and hydroelectric power generation projects.

“The gas import project will supply plants in Benin, such as the new 127 MW power station at Maria Gléta, with imported LNG on preferential terms and will position Benin, capital of the WAPP (West African Power Pool), as the crossroads for gas and electricity in the subregion,” said Minister Houssou.

The southwest African nation of Angola, a liquefied natural gas exporter to nations such as India and China, has signed an accord with an American company to set up LNG import facilities as part of a gas-to-power project.