LNG

Brazil’s state oil company Petrobras is in negotiations with Singapore-based shipbuilder Seatrium on ways to liquefy and export gas produced in Brazil’s giant deepwater Atlantic pre-salt fields, catering to rising demand from gas-fired power generators across Asia in a tight market.

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

QatarEnergy, the leading LNG exporter, is moving forward with another overseas oil and natural gas joint venture in the prolific pre-salt Santos Basin offshore Brazil.

Petróleo Brasileiro S.A., the Brazilian major known as Petrobras and the first national oil company to import LNG to chartered floating storage and regasification units (FSRUs) back in 2009 while never developing LNG production itself, posted an almost 35 percent drop in first-quarter profits as global energy prices eased.

TechnipFMC, the US oil and gas services company, reported increased profit and revenues as well as a rising backlog of contracts covering areas such as South America, the Gulf of Mexico and Europe.

Challenger Energy, the Americas-focused and London-listed exploration and production company, has formally signed the Area 3 licence offshore Uruguay where field resources include around 9 trillion cubic feet of gas.

The Area 3 licence was awarded under the Open Uruguay Round process and, following final regulatory approvals being granted, was signed in Montevideo on March 7.

“Accordingly, the Area 3 first exploration period will commence on 7th June 2024 and will run for four years, until 6th June 2028,” said Challenger.

Depth and range

The Area 3 licence covers an area of 13,252 square kilometres located in relatively shallow water depths (from 20 metres to 1,000 metres) around 100 kms (62 miles) off the Uruguayan coast.

“The block has substantial existing 2D and 3D seismic coverage, with two previously identified material prospects possessing currently estimated gross resource potential of up to 2 billion barrels of oil and up to 9 Tcf of natural gas,” said Challenger.

Uruguay’s state-owned oil and gas company ANCAP awarded Challenger with the Area 1 block licence in May 2020 and the company confirmed a farm-out process for the block three years later.

“Thanks to the farm-out agreement with Chevron Corp., the company is in the process of divesting a 60 percent interest in the Area 1 block,” explained Challenger.

During the initial exploration period, the Company's minimum work obligations on the Area 3 block are relatively modest, comprising licensing and reprocessing of 1,000km of legacy 2D seismic data and undertaking two geotechnical studies.

“The company intends to follow a similar strategy to that successfully adopted for the Area 1 licence (the farm-out of which to Chevron was announced on 6th March 2024), specifically to accelerate its technical work programme including additional discretionary work,” Challenger added.

Strong position

Eytan Uliel, Chief Executive of Challenger, said that the signing of the Area 3 licence cements the company’s position as a significant industry participant in Uruguay's offshore.

“It represents a successful expansion of the company's business in Uruguay, a country that has fast become one of the world's frontier exploration hotspots,” explained Uliel.

“We believe that Area 3 has strong technical merit and offers an exciting value-creation opportunity,” the CEO stated.

Challenger noted that to the east is the Brazilian maritime border, an area that was subject to considerable licensing in December 2023, with 13 nearby Brazilian blocks licenced variously to Chevron, Shell, China National Offshore Oil Corp. and Brazil’s Petrobras.

To the south, the block is adjacent to two deepwater Uruguayan blocks, Area 6, held by Houston, Texas-based APA Corp. and Area 7, which is held by Shell.

TotalEnergies, the leading European oil and gas major, has joined with Shell, Brazilian state company Petrobras as well as two Chinese majors to start production from a second development phase of the Mero field offshore Brazil.

Dec 29 (LNGJ) - Engie Brasil, formerly known as Tractebel Energia and a Brazilian subsidiary of France-based European utility group Engie, has reached an agreement to sell a 15 percent stake in natural gas pipeline firm Transportadora Associada de Gas (TAG) to the Canadian pension fund, Caisse de dépôt et placement du Québec (CDPQ) for 3.1 billion Brazilian reais (US$640 million). TAG owns and operates a large part of Brazil's natural gas pipeline network with some 4,500 kilometres (2,800 miles) across 10 Brazilian states.

   The transaction when completed will increase CDPQ’s stake in TAG to 50 percent. Engie Brasil will own 17.5 percent and its French parent company will hold the rest, giving Engie units a 50 percent shareholding. Engie and CDPQ jointly acquired a 90 percent stake in TAG in 2019 from Brazil’s state-run energy company Petrobras for about $8.6Bln and afterwards bought the remaining 10 percent still held by Petrobras.

New Fortress Energy, the New York-based developer of liquefied natural gas import and export projects, has entered into a definitive agreement to charter the “Energos Winter”, a floating storage and regasification unit (FSRU), from Brazilian state company Petróleo Brasileiro (Petrobras) and with the FSRU being deployed in the south of the country.

NFE said that the “Energos Winter” charter from Petrobras would start in December and the FSRU would “immediately” be deployed to the Terminal Gas Sul (TGS), NFE’s newest LNG import facility in the state of Santa Catarina.

The US company said that the TGS terminal project would thus begin commercial operations ahead of schedule in January 2024.

NFE is currently completing two terminals projects in Brazil, one at Santa Catarina and a second at Barcarena in the state of Pará in the far northeast of Brazil.

Growth opportunity

“We are extremely pleased to reach this agreement with Petrobras and begin operations at the TGS terminal in Santa Catarina, Brazil ahead of schedule in January 2024,” said NFE Managing Director Andrew Dete.

“The TGS terminal is a unique, high-growth opportunity for NFE, as connection to the pipeline system in south Brazil offers a diverse and near-term set of opportunities across power and gas supply,” Dete explained.

The “Energos Winter” will be sub-chartered by NFE through the remaining term of the Petrobras charter with Energos Infrastructure and then direct-chartered by NFE on a long-term basis with Energos.

“This will enable NFE to commence commercial operations at TGS in January 2024 and continue uninterrupted service on a long-term basis,” said NFE.

Energos Infrastructure, the owner of the “Energos Winter” FSRU, is owned 80 percent by funds managed by New York equity firm Apollo and 20 percent owned by NFE.

LNG production

NFE is on course to start LNG production and export operations by early 2024 at Mexico’s first production facility with capacity of 1.4 million tonnes per annum.

NFE’s “Fast LNG” project comprises modular, midsize liquefaction technology with jack-up rigs to enable lower costs

The US company and Mexico's state-owned power utility, the Comisión Federal de Electricidad (CFE), have set up the LNG hub in Altamira in the Gulf of Mexico to convert Mexican natural gas into LNG for export.

Each of NFE’s three parts of the first “Fast LNG” project were completed at the Kiewit Offshore Services yard in Ingleside in Texas.

The company said that the first “FLNG 1” liquefaction operating facility is being deployed in Mexican waters at a cost of just $1.3 billion, far below the cost of other proposed projects.

Excelerate Energy, the leading US provider of floating storage and regasification units (FSRUs) with increased demand from Europe and South America, has signed a contract to charter an FSRU to Brazil’s state-owned energy company Petróleo Brasileiro (Petrobras) for 10 years.