LNG

Chart Industries, the US LNG equipment-maker and industrial gases company, has received a key order from the Cedar floating LNG project being developed in the Canadian Pacific province of British Columbia.

The US Delfin floating LNG export project proposed for offshore Louisiana has finalized a binding sale and purchase agreement with the US subsidiary of global commodities firm Vitol.

The deal was between Delfin Midstream Inc. and Vitol Inc. and also includes “strategic investment” by Vitol in the US export project.

Under the SPA, Delfin will supply 500,000 tonnes per annum of LNG on a free-on-board (FOB) basis for 15 years at the Delfin Deepwater Port to be established 40 nautical miles off the coast of Louisiana.

“The SPA is indexed to Henry Hub benchmark. The agreement is valued at approximately $3 billion in revenue over 15 years,” said a statement.

Dudley Poston, Chief Executive of Delfin, said that recent events had accelerated the need for a wider array of potential buyers to source reliable low-cost energy from the safety of the US at “compelling” prices.

“After evaluating multiple projects and running an extensive diligence process, Vitol’s decisions to invest demonstrates the strong trust they have in our ability to deliver a reliable source of LNG,” added Poston.

Delfin added that it had signed other accords and term sheets that are being finalized into fully termed supply agreements.

Modular project

The company declared that as modular project requiring between 2 MTPA and 2.5 MTPA of long-term contracts to begin construction, Delfin is on schedule to make final investment decision on the first FLNG vessel by the end of 2022.

“We are delighted to conclude this agreement with Delfin,” said Pablo Galante Escobar, Global Head of LNG and European Gas and Power at Vitol.

“Global LNG demand is experiencing tremendous growth and Vitol continues to strengthen its position to safely and reliably deliver cost effective, flexible solutions to our customers around the world,” added Escobar.

Vitol’s commitment and investment grade rating will help Delfin on its path to financial close of this exciting project,” he stated. 

Delfin has completed the engineering and design phase of the venture for the vessels being built at South Korea’s Samsung Heavy Industries shipyard and the liquefaction equipment and technology is being provided by Kansas-based company Black & Veatch.

UTOS pipeline

At the outset of the project planning Delfin had purchased the UTOS pipeline, the largest natural gas pipeline in the Gulf of Mexico, and submitted its deepwater port licence application way back in 2015.

The UTOS pipeline is the only 42-inch pipeline in the GoM and was formerly owned and operated by Enbridge Inc.

Delfin then proposed to activate the formerly abandoned offshore pipeline for the FLNG project and construct new connecting pipelines, a compressor station and associated facilities.

Wouter Pastoor, Chief Operating Officer of Delfin, explained that the company had completed permitting work with a positive record of decision from the Maritime Administration and had been granted its Department of Energy export licence.

“Delfin has completed front-end engineering and design with Samsung and Black & Veatch which puts us on pace to execute our project this year and to commence operations in 2026,” he stated.

Delfin LNG, the US floating liquefaction and export project proposed for offshore Louisiana, has filed with the Federal Energy Regulatory Commission for a third extension of permits to complete the venture.

June 4 (LNGJ) - Black and Veatch of the US, the Kansas-based supplier of LNG and energy equipment and solutions, has been selected to conduct a technical, engineering and commercial study for the Andes Energy Terminal project in the South American nation of Colombia. The gas-to-power venture would be centred on Buenaventura in Colombia’s Aguadulce Peninsula.

   “The study will build on commercial and technical work previously completed by the sponsors and focus on the development of an LNG regasification facility and 400 megawatts of natural gas-fired power generation for cities in central and southwestern Colombia,” said the company.

Golar LNG Ltd, the operator of conventional carriers, floating import and export terminals and a power affiliate backed by its fleet of 27 ships, reported business progress while posting a first-quarter loss amid increased operating revenues.

Golar reported a net loss of $104.24 million for the first quarter compared with $41.74M of losses in the same three months of 2019.

However, total operating revenues were higher at $122.55M versus 114.28M in the year-ago quarter.

“Golar is pleased to report Q1 operating revenues and adjusted EBITDA of $76.2M, that were driven by a solid performance in FLNG, with 100 percent commercial uptime on ‘Hilli Episeyo’ (Cameroon FLNG exports), and strong seasonal results in Shipping,” said Iain Ross, Chief Executive of Golar LNG.

At the Golar Power affiliate, the 1.5 gigawatts Sergipe power plant in northeast Brazil reached its Commercial Operation Date acceptance which triggered earnings under the 25-year Power Purchase Agreement (PPA) and the associated FSRU “Golar Nanook” charter.

Golar LNG said that the first three small-scale customers have also now been formally signed up and LNG distribution operations are expected to start in 2021.

“This short time to cash flow and the very strong project return confirms the attractiveness of our small-scale business,” said the company.

“To date, a further 200 potential customers have signed letters of intent to pursue various small-scale opportunities with Golar Power, demonstrating the robust consumer appetite to reduce both energy costs and environmental footprints,” it added.

Among other highlights, Golar LNG said the power unit entered into a partnership with Petrobras Distribuidora S.A. to facilitate a nationwide rollout of small-scale LNG supply to Brazil's transportation and industrial sectors.

Golar Power also signed an accord with the Brazilian state government of Pernambuco to develop an LNG import terminal in the Port of Suape.

“We also expect to finalize arrangements for locating a Floating Storage Unit (FSU) at Suape over the course of the year,” said Golar.

The affiliate is additionally working with BR Distribuidora S.A to overlay its geographical coverage of LNG distribution onto BR Distribuidora’s 7,600 Brazilian fuel stations.

“This will optimize the roll-out of the necessary infrastructure to convert current diesel, heavy fuel oil and coal consumers to cleaner and cheaper LNG through the provision of a stable and secure LNG supply,” it said.

The floating LNG production from the “Hilli Episeyo” hull deployed offshore Cameroon in West Africa is heading for its 40th export cargo with 100 percent commercial uptime maintained.

Golar also noted that regarding the “FLNG Gimi” being built for production offshore Mauritania and Senegal in West Africa, the company received a “force majeure” claim from UK major BP in relation to a delay in the order of 12 months to the target connection date.

“We are in advanced and positive discussions with our main building contractor, Keppel Shipyard Limited, and with engineering topsides subcontractor, Black and Veatch, on a revised cost and time schedule for the ‘FLNG Gimi ‘conversion that can be implemented as a contingency in response to the 12-month delay claimed by BP on its Tortue project,” Golar explained.

In the LNG Shipping segment, Golar said it expected second-quarter time charters to be at around $40,000 per day, with utilization of at least 80 percent of the fleet based on fixtures to date and the prevailing spot market.

“The current chartering strategy to de-risk the business by targeting more fixed and floating coverage has been successful and we intend to fix more portfolio term-based deals to further de-risk shipping exposure and to hedge expected volatility,” said Golar LNG.

“Except for the ‘Golar Tundra’, scheduled to dry-dock during June, no other dry-docks are planned this year,” it added.