LNG

Thailand’s state energy operator PTT Public Company Limited (PTT) has secured long-term liquefied natural gas volumes by signing a firm supply deal with the largest US exporter Cheniere Energy.

The PTT subsidiary, PTT Global LNG Company Ltd (PTTGL), signed the sale and purchase agreement with Cheniere to book cargoes from the Corpus Christi export plant in Texas.

Under the SPA, PTTGL has agreed to purchase 1 million tonnes per annum of LNG from Corpus Christi Liquefaction for 20 years beginning in 2026.

The agreement is for a combination of both free-on-board (FOB) shipments and delivered ex-ship (DES) cargoes.

“This customized structure represents a further evolution in Cheniere’s commercial offerings tailored to the specific needs of LNG customers around the world,” said the Houston, Texas-based company.

The purchase price for LNG under the SPA is indexed to the US benchmark Henry Hub natural gas price, plus a fixed liquefaction fee.

Auttapol Rerkpiboon, PTT’s President and Chief Executive, said that by year-end PTT’s LNG receiving capacity will increase with a new terminal in commercial operation.

New terminal

Thailand’s new Nong Fab LNG facility in Rayong province, the nation’s second onshore import terminal, has received first volumes of LNG for commissioning and is on track for full commercial start-up at the end of 2022.

PTT is expanding regasification capacity and LNG imports after completing several expansions at the single existing Thai import terminal at Map Ta Phut, which can now handle 11.5 MTPA.

The Nong Fab terminal is adjacent to the Map Ta Phut industrial area in Rayong and will have total regasification capacity of 7.5 MTPA.

“LNG as is a major transition fuel which supports both energy security and sustainability,” said PTT CEO Auttapol.

“Our ambition is to move forward with the future energy while ensuring energy security. We actively engage in the LNG business and target to be a global LNG player by managing an LNG portfolio of 9 MTPA by 2030,” he stated.

Jack Fusco, Cheniere’s President and Chief Executive, said he was pleased to enter into this 20-year SPA with a subsidiary of PTT.

“This is the first direct LNG contract from a US LNG producer for PTTGL, and this agreement not only reflects the critical need for long-term, reliable LNG supply across the globe, but also the important role LNG has to play in powering growing economies for decades to come,” Fusco declared. 

Thailand’s new Nong Fab LNG regasification terminal in Rayong province, the nation’s second import facility, has received first volumes of LNG for commissioning and is on track for full commercial start-up in 2022.

PTT Group, the national energy company of Thailand, is behind the Nong Fab project.

PTT is expanding regasification capacity and LNG imports after completing several expansions at the single existing Thai import terminal at Map Ta Phut, which can now handle 11.5 million tonnes per annum.

The Nong Fab terminal is adjacent to the Map Ta Phut industrial area in Rayong and will have total regasification capacity of 7.5 MTPA.

Thailand has opted for the more permanent onshore LNG terminals rather that a floating storage and regasification unit (FSRU), seen mainly as a fast-track energy solution.

The new terminal is currently being completed by Italian energy engineering firm, Saipem, and Taiwan-based CTCI Corp.

Saipem and CTCI were awarded the engineering, procurement and construction contract for the facility four years ago and with an estimated cost of around $900 million.

Experienced

It was Milan-based Saipem who announced the first volumes of LNG being introduced into the Nong Fab facility. The company is one of the world's most experienced LNG engineering firms with expertise in subsea, liquefaction and regasification projects.

“Saipem is pleased to inform that on 18 June the Nong Fab LNG regasification terminal, located in the Mueang Rayong district in Thailand and executed by Saipem in a joint venture with its partner CTCI, began offloading the first LNG from a carrier moored at the terminal jetty,” said the Saipem statement.

Saipem added that the scope of the work for the project, which began in July 2018, included two 250,000 cubic metres capacity LNG storage tanks, the regasification and pipeline eqipment and a six-kilometre trestle unloading facility as well as an administrative building.

“It is a particularly significant project which is marked by its tank capacity (the largest ever executed in Thailand) and by the world’s largest trestle in the LNG sector,” explained Saipem.

“The offloading of the first LNG was achieved thanks to the expertise, quality and efforts of Saipem’s team in Thailand as well as the strong support of the client, PTT LNG,” the company added.

Saipem stated that full commissioning and start-up were expected before year-end and would provide the country with a stable and reliable energy supply in response to increasing power demand in Thailand.

“The project, confirms Saipem’s role in the LNG and regasification sectors, thanks to its long-standing expertise in complex projects, which are always executed applying the highest safety standards,” Saipem declared.

One of the oldest registered companies in Thailand is making progress on developing its liquefied natural gas business with more imports while expanding its power business domestically and in Southeast Asia and elsewhere as earnings were hit by the rising natural gas price.

Thailand’s state-owned energy company said the Yadana natural gas project in neighbouring Myanmar was key to the energy security of both Southeast Asian nations and the Thais will take over the operatorship after the withdrawal of France’s TotalEnergies over human rights issues.