LNG

Turkey’s state-owned Petroleum Pipeline Corp. (BOTAS) has become the seventh company to sign a long-term supply agreement with Oman LNG in the Arabian Peninsula.

Oman LNG, the expanding producer on the Arabian Peninsula, has signed two more supply agreements with TotalEnergies and Thailand’s oil and gas firm PTT for a combined 1.6 million tonnes per annum of cargoes after also signing similar deals recently with three Japanese companies and Shell.

The company said it signed separate deals to supply the Thais and TotalEnergies each with 800,000 tonnes of LNG from 2025.

A statement said the binding term-sheet deals were signed by the Chief Executive of Oman LNG, Hamed Al-Naamany, with the Managing Director of PTT Global LNG, Ratchada Lertwanichwatanam, and with the TotalEnergies Senior Vice President of LNG Thomas Maurisse.

“The signing of the term-sheet agreements with PTT Global LNG and TotalEnergies enhance our efforts to further grow and strengthen our market positions including new business opportunities,” said Oman LNG’s Al-Naamany.

“Such a step complements our mission to add value to the local economy through increasing capacity, and strengthening collaborations with international firms,” he added.

The 10-year supply deal with TotalEnergies is scheduled to begin in 2025, while Thailand’s shipments begin a year later in 2026.

Japan deals

Oman LNG last month signed similar deals with top Japanese electricity generator JERA, and trading houses Mitsui & Co and Itochu Corp, to supply a combined 2.35 million tonnes per year, starting in 2025, for up to 10 years.

JERA confirmed its deal on December 27 and it was in the form of a preliminary term sheet that could lead to a Sales and Purchase Agreement.

The deal for JERA is for up to 12 cargoes per year from 2025. JERA noted that LNG procurement competition had been intensifying and stable procurement of fuel in a timely manner was necessary to secure a stable supply of energy in Japan.

The Japanese deals were on a free-on-board (FOB) basis, using their own ships, which they would regard as more flexible.

Oman LNG signed a similar deal - making six in total in the past two months - with Shell International Trading for 800,000 tonnes per annum for 10 years from 2025. 

Oman, the LNG producer and exporter, has signed an exploration and production sharing agreement with UK major Shell and French company TotalEnergies to explore, appraise and develop natural gas resources at Block 11 onshore the Sultanate on the Arabian Peninsula.

McDermott, the US energy and LNG project engineering company, has outlined part of the scope of the planned Fujairah LNG production facility being developed in the fifth-largest emirate by area of the seven United Arab Emirates.

McDermott was awarded the contract by Abu Dhabi National Oil Co. (Adnoc) to provide front-end engineering and design for the plant.

The Fujairah project will be centred around a liquefaction plant with a total capacity of 9.6 million tonnes per annum.

Fujairah is located outside the Arabian Gulf on the Gulf of Oman. The shores of Fujairah extend for 70 kilometres along the coast from the city of Fujairah.

The emirate shares its boundaries with the emirates of Sharjah and Ras Al Khaimah to the west and the south respectively.

In the north, Fujairah shares its international border with the Sultanate of Oman, an established LNG producer supplying customers in Asia.

Electric drives

“The plant will be designed with electric drives for the liquefaction compressors and will incorporate several features that significantly reduce greenhouse-gas emissions, capitalizing on the experience McDermott,” said the Houston, Texas-based company.

McDermott said the Fujairah plant would benefit from the “robust capabilities and experience” of the US company in FEED performance.

Our biggest differentiator is our ability to execute this FEED on a fast-track basis incorporating all of the characteristics required to support the award of EPC contracts which are expected in 2023,” said Tareq Kawash, Senior Vice President for Onshore at McDermott.

McDermott was involved in initial phases of Adnoc’s LNG development in the late 1980s that resulted in the Das Island plant in Abu Dhabi, the second-largest emirate after Dubai.

The US company constructed the storage facilities for both LNG and liquified petroleum gas (LPG) on an EPC basis on Das Island.

“We are proud to continue our long history with Adnoc by playing an important role in helping to define the next phase of LNG development in the UAE,” added Kawash.

McDermott noted that it was one of the most experienced engineering and construction firms serving the LNG market and has delivered more than 30 LNG Pre-FEED and FEED projects over the past 10 years.

The Fujairah LNG facilities FEED will be performed by teams in McDermott's offices in London and the UAE.

The Oman LNG bunkering project for the Port of Sohar has advanced with the signing of a series of agreements for an Omani onshore gas field known as Block 10 and involving French major TotalEnergies, the Oman National Oil Company and Shell.

Oman, the Arabian Peninsula country and oil producer and long-standing LNG exporter, has been hit by a cyclone, causing major disruption with power cuts and flooding.

The Oil Ministry issued a statement saying that loadings and operations may be temporarily affected as “Cyclone Shaheen” moved along the Sea of Oman.

However, the Ministry said oil fields are far from the path of the cyclone and that there was unlikely to be interruptions to the production of oil nor of feed gas for LNG.

The main Omani LNG export facilities are at the port of Sur on the Gulf of Oman. The plant comprises the three amalgamated liquefaction Trains of two former separate companies, Oman LNG and Qalhat LNG.

Oman exports around 11 million tonnes per annum and its customers include South Korea with around 3.9MT of annual supplies, Japan with about 3MT as well as other leading importers like China and India.

Oman's National Multi Hazard Early Warning System said “Cyclone Shaheen” was accompanied by wind speeds of up to 116 kilometres per hour (72 mph) when it hit the country on October 3, with the cyclone causing heavy rainfall and high waves.

According to the authorities the areas affected by “Cyclone Shaheen” were in the wilayats of Musannah in South Al Batinah Governorate and Saham in North Al Batinah Governorate.

Rescues

There were no clear details of casualties, though dozens of people have been rescued by the Civil Defence and Ambulance Department (CDAA) in different areas.

Oman Air rescheduled 10 flights to an earlier departure time before the cyclone hit.

New gas fields have boosted feed-gas availability for LNG exports in the last few years from the onshore Block 61 comprising the ‎Khazzan field, which began production in 2017, and the Ghazeer field, onstream since October 2020.

Block 61 covers around 3,950 square kilometres in central Oman, and contains the largest tight-gas ‎development in the Middle East.

Gas from the Block is also sent for domestic consumption ‎into Oman’s national gas grid.

Oman is also making progress with developing the Sohar Port and Freezone that is also the future site of an LNG bunkering project on the Arabian Sea coast and near the entry to the Gulf by the Strait of Hormuz.

Oman’s Sohar Port is one of the fastest-growing in the world because of its strategic location.

JGC Corp. of Japan has been awarded an engineering contract in the Sultanate of Oman by French major Total for what will be the world’s first liquefied natural gas production plant built specially to supply the shipping fuel market on the Arabian Peninsula.

KBR, the US energy and LNG engineering company, said it was awarded a front-end engineering and design contract by Oman LNG for the debottlenecking of liquefaction facilities at the port of Sur on the Arabian Peninsula.

“This project builds on KBR's extensive track record of developing and implementing LNG projects and providing solutions to complex developments around the world,” said Jay Ibrahim, KBR President for Energy Solution Services.

The Omani facilities export to Japan, South Korea and the spot market and comprise the amalgamated three liquefaction Trains of Oman LNG and Qalhat LNG, now producing more than 10 million tonnes per annum.

The Sultanate has revitalised its LNG production after the Khazzan natural gas discovery by BP and the plants near the port of Sur have been at near nameplate capacity since 2017.

The three Trains had previously suffered from a lack of feed-gas as supplies were diverted to fill domestic gas shortages.

The Omani government allocates Oman LNG feed-gas supplies from various gas fields and the Khazzan field production has ended all resource concerns for the near future.

Houston, Texas-based KBR explained that it would act as an extension to Oman LNG's project team and help manage the overall execution of the debottlenecking efforts, whereby better output can be achieved by fixing inefficiencies, both technical and operational.

“The contract underpins Oman LNG's robust commitment towards knowledge-sharing and boosting staff competency in dealing with such complex projects,” said KBR.

KBR’s Ibrahim said the company was excited to be a part of this important project and to continue to grow and maintain its presence in Oman.

French energy major Total and Oman recently signed an accord for the development of an onshore natural gas block that will provide feed-gas for separate LNG production reserved for LNG fuel for shipping in the Arabian Peninsula.

The deal was signed between Ministry of Oil and Gas of Oman and Total and is linked to the award of exploration licence for onshore Block 12 where there are “significant prospective” gas resources.

Total said it would use its equity gas entitlement as feedstock to develop in Oman a regional hub for LNG bunkering services.

Oman is a major anchorage and stop-over point for tankers and other vessels on trade routes between the Middle East, Asia and Europe.

Total has previously outlined plans for its LNG hub project involving a small-scale modular liquefaction plant to be built near the deepwater port of Sohar in the north on the Gulf of Oman.

French energy major Total and the Sultanate of Oman have signed an accord for the development of an onshore natural gas block that will provide feed-gas for liquefied natural gas production reserved for LNG fuel for shipping in the Arabian Peninsula.

Abu Dhabi National Oil Company (Adnoc) in the United Arab Emirates has awarded LNG producer Inpex Corp. of Japan an exploration licence for the onshore Block 4 area as the Japanese company also advanced with LNG bunkering plans for the UAE.

The onshore Block 4 is located in a coastal area in the central part of the emirate of Abu Dhabi that includes Abu Dhabi City, and covers a surface area of around 6,116 square kilometres.

“Inpex looks forward to working in close cooperation with Adnoc to help it unlock value from Abu Dhabi’s substantial hydrocarbon resources while further expanding and strengthening our own business portfolio,” said Takayuki Ueda, President and Chief Executive Inpex.

The Japanese company recently became an LNG producer from the Ichthys liquefaction and export venture in the North Territory of Australia.

Inpex also has a stake in the Royal Dutch Shell Prelude floating LNG venture offshore northwest Australia.

The UAE is the oldest LNG producer in the Middle East from its Das Island plant offshore Abu Dhabi consisting of three Trains with nominal capacity of 5.5 million tonnes of LNG per annum.

The Japanese company added that it was working to finalize a joint venture with Adnoc on LNG bunkering in the UAE and Southeast Asia.

The logistics and services unit of Adnoc has signed the framework agreement with Inpex on developing the bunkering activities.

“We had already signed a memorandum of understanding with Adnoc about LNG bunkering, so I think there might be a lot of potential,” said Ueda.

“We would like to quickly establish a joint venture with Adnoc in this area where there is demand,” added the Inpex CEO.

The UAE is strategically located to become a major bunkering hub in the Gulf and the Arabian Peninsula.

Inpex is a long-term investor in Abu Dhabi's hydrocarbons industry, which accounts for 4.2 percent of the world's crude production.

Inpex’s subsidiary Jodco Exploration will hold and manage its interest in the onshore Block 4 as part of a 35-year concession deal.

The Japanese company will hold a 100 per cent stake during the exploration phase for the concession, which straddles Abu Dhabi’s border with Dubai.

There are two existing undeveloped oil and gas fields in the new concession area, Ramhan and Hudairiat, which both will be appraised by Inpex.

“The block’s proximity to the onshore oil producing fields of Al Dabb’iya and Rumaitha as well as the offshore field of Umm Al Dalkh, suggests it has very promising potential,” said the companies.