LNG

Baker Hughes, the US liquefied natural gas equipment-maker and energy services and technology company, has won a major contract from Brazil’s Petrobras.

Sound Energy, the UK company with natural gas assets in Morocco and an LNG production proposal, has reported progress on several fronts, including sales, finance and engineering.

The company is planning to develop a micro-LNG plant for the Tendrara 5-Horst gas well in its Tendrara production concession in eastern Morocco, near the Algerian border.

The micro-LNG plant is part of a full field development plan centred around the construction of a 120-kilometre pipeline going north to link with the Maghreb-Europe pipeline.

Graham Lyon, Executive Chairman, said that there had been positive developments for the Tendrara concession, including on a commercial gas sales contracts and Phase 1 engineering of the micro-LNG plant.

A company called Afriquia Gaz SA has signed a conditional LNG sales agreement.

Afriquia Gaz  is Morocco-based and is currently engaged in the refining and marketing of liquefied petroleum gas (LPG).

“The agreement covers a 10-year, take-or-pay LNG sale and purchase at Tendrara,” said Lyon.

Sound Energy is also negotiating an $18 million loan from Afriquia Gaz.

The company added that there has also been activity covering the pipeline development discussions.

“A huge amount of work has been completed so far this year and much remains to be concluded during the remainder of 2021,” said Chairman Lyon.

“Having secured a long-term LNG sales agreement with Afriquia Gaz, we have established a route to market for our gas and following completion of the proposed $18M loan from Afriquia Gaz, the company will have financing for the Sound Energy share of the Phase 1 development,” he explained.

Afriquia Gaz has received £2.0 million ($2.8M) of share equity at 1.25 UK pence per share in connection with the LNG sales agreement, thus providing Sound Energy with more liquidity.

The LNG sales agreement with Afriquia Gaz commits the buyer to purchase not less than 100,000 cubic metres per annum produced and liquified from the Phase 1 development concession joint venture.

“With important catalysts to come in the near term, I look forward to updating shareholders further as we progress towards the development phase of the project and to becoming a revenue generating business,” he stated.

The company said the Tendrara Horst field would help provide domestic LNG to industrial users in Morocco, displacing presently imported fuels with a deeper carbon footprint.

Sound Energy was also able to successfully restructure its Luxembourg-listed €28.8M, 5-percent senior secured notes by engaging proactively with noteholders to agree a suitable restructuring without substantial equity dilution.

Predator Oil and Gas, the Jersey-based company listed on the London Stock Exchange and with operations in Trinidad, Morocco and Ireland, said it submitted a bid to supply and operate a floating LNG import terminal in Morocco after the North African kingdom’s Energy Ministry invited bids with a deadline of May 31.

French energy major Total has signed an agreement to renew its partnership in the field of liquefied natural gas with the North African state of Algeria as Italian energy company Eni also advances with projects.

The accord between Total and Algerian oil and gas company Sonatrach allows the extension of the existing supply contracts for three additional years.

This will provide 2 million tonnes per annum of Algerian LNG to the French market, primarily through the LNG import terminal at Fos Cavaou, located east of the Mediterranean port of Marseilles.

Total said that the agreement also included the sub-charter of one of its LNG carriers to Sonatrach.

“This agreement is part of the long history of cooperation between Total and Sonatrach,” said Laurent Vivier, President for gas at Total.

“Thanks to the quality of our relationship we were able to conclude it in an extremely volatile market environment,” added Vivier.

“This new contract further enhances the flexibility of Total's LNG portfolio and strengthens our position as a major partner of Sonatrach,” he stated.

Total noted it was a historic player in the energy sector in Algeria for almost 70 years.

The group is active in oil and gas exploration and production, participating interests in the TFT II and Timimoun gas fields and in the oil fields of the Berkine Basin in southeast Algeria.

In addition, Total and Sonatrach have launched engineering studies for a petrochemical project in Western Algeria.

Algerian LNG exports have been falling and in the most recent official annual figures dropped by over 18 percent to about 10 million tonnes compared with 12.34MT the previous year from its two liquefaction plants at Skikda and Arzew on the Mediterranean Coast.

Italian energy company Eni and Sonatrach have completed the construction of the natural gas pipeline connecting the Bir Rebaa Nord and Menzel Ledjmet Est fields in the Berkine Basin.

The completion comes as Algeria is making three-pronged marketing efforts to direct new gas finds into domestic industry, for export as pipeline gas to Europe and as LNG to mostly European markets amid low prices and high global volumes.

The new Berkine Basin pipeline is 185 kilometres in length and 16 inches in diameter and will transport capacity of 7 million standard cubic metres of gas per day to markets.


That project will allow for the export of the associated gas produced in Block 403 and the development of the gas fields of the blocks of North Berkine, where the drilling of the first four wells have already been completed and linked.

Sonatrach has been increasing the capacity of its export infrastructure like the Medgaz gas pipeline to Spain, and building a new LNG jetty at the Skikda liquefaction plant.