LNG

The Central Asian republic of Kazakhstan with some of the world’s largest oil and gas fields on its territory and part of an infrastructure network with Russia to supply natural gas to China in competition to LNG, is boosting its own domestic gas output as well as its role as a gas transit nation.

Algeria is preparing for more pipeline natural gas deliveries to the European Union as well as more LNG exports as new gas fields are developed amid more discoveries in the prolific gas basins of the North African nation.

The Algerian state oil and gas company Sonatrach has just appointed a new Chief Executive in Rachid Hachichi and he has just held talks with Claudio Descalzi, the CEO of Italian major Eni, the company with the most widespread interests in Algeria.

The talks between Descalzi and Hachichi in Algiers on October 12 were also attended by the Algerian Minister of Energy and Mines Mohamed Arkab.

“Eni and Sonatrach shared the joint programs for the development of Eni’s operated gas production as well as gas and LNG exports to Europe,” said Eni.

Descalzi also updated Minister Arkab on the progress of the accord signed by Eni and Sonatrach in January 2022 on upstream decarbonization, includingdetection of fugitive gas emissions in pipelines and plants and the identification of flaring-down opportunities in Sonatrach’s fields.

Eni currently has equity production of about 130,000 barrels of oil equivalent per day and is the key international energy company in terms of Algerian oil and gas operations.

Ten discoveries

Sonatrach also revealed that Algeria had made 10 new hydrocarbon discoveries in the nine months to the end of September 2023, adding to the 16 other discoveries made in 2022.

Arkab met the Eni CEO after also attending the 25th ministerial meeting of the Gas Exporting Countries Forum (GECF) held on October 10 in Malabo, the capital of  Equatorial Guinea, an LNG producer and exporter from its Punta Europa plant on Bioko Island.

The GECF ministers issued a statement declaring that it was “ill advised” to call for any halt in natural gas investments.

“Halting gas investment would curb supplies, lead to an excessive rise in prices and a potential return to coal, as happened in 2022, undermining emissions reduction targets,” said the GECF final communiqué.

Arkab noted that participants at the Malabo meeting highlighted the need for “unrestricted investment” while “strengthening transcontinental financial cooperation in this matter”.

The GECF also advocated more “equitable access” to all technologies related to the exploration, extraction and exploitation of natural gas.

Turkey, an LNG importer and with plans to increase domestic production from Black Sea fields and the main route to Europe for natural gas from Azerbaijan, has raised the prices of natural gas and power by 20 percent for industrial users amid energy secuirty concerns in the South Caucasus region bordering Eastern Europe.

Sept 15 (LNGJ) - Turkey said it would construct a physical hub in the country’s western region of Thrace to connect all existing gas pipelines. “Turkey can also receive LNG from different countries like the US, Algeria and Qatar,” said Energy and Natural Resources Minister Alparslan Bayraktar in describing the plan

   “We also take pipeline gas from Iran, Azerbaijan and Russia,” said the minister. “What we are trying to do in Thrace is build a physical hub that will connect to all respective pipelines and to our underground gas storage at Silivri as well as to LNG import terminals,” Bayraktar added.

Swan Energy Ltd, part of the Indian conglomerate the Swan Group with interests in oil and gas, textiles and infrastructure has given details of its lease-out deal to Turkey’s state-owned Petroleum Pipeline Corp. (BOTAS) of a floating storage and regasification unit.

The charter for the “Vasant 1” floating storage and regasification unit (FSRU), which is controlled by Japan’s Mitsui OSK Lines, is held by Swan Energy subsidiary Triumph Offshore Private Limited (TOPL) and has now moved to Saros Bay offshore northern Turkey.

The FSRU “Vasant 1” has capacity of 180,000 cubic metres and was completed by Hyundai Heavy Industries of South Korea at the end of 2020 for Swan‘s planned LNG import terminal at Jafrabad in India’s Gujarat state.

Swan was the lead promoter of the delayed Jafrabad LNG import terminal with a 63 percent equity stake.

The other shareholders are the Government of Gujarat with a 26 percent interest and the remaining 11 percent is owned by FSRU Venture India One Ltd, the Indian subsidiary of Japanese shipping line Mitsui OSK Lines.

MOL acted as technical partner for the Jafrabad project by supervising the construction of the FSRU.

Charter rates

“The lease arrangement is generating daily rental of $250,000, or about 2 crore Indian rupees (as per the present exchange rate), for Swan Energy,” said the Indian firm of the BOTAS deal.

“The duration of the lease agreement is for 12 months and is extendable on this basis of mutual agreement,” Swan added.

Based on the bare boat charter, TOPL has leased out only the bare FSRU vessel to BOTAS and BOTAS will manage the operational expenses including fuel, crew, insurance, maintenance, and repair.

“As a result, TOPL does not incur any operational expenses during the lease tenure,” Swan said.

BOTAS also runs the Marmara Eregesli LNG import terminal and cargoes have been received there since 1994, first from Algeria and later from countries like Qatar and Nigeria and then over the last five years from the US as well.

Commenting on the lease arrangement with BOTAS, Rishi Chopra, an executive of Swan, said the lease agreement based on bare-boat charter would enhance the rental earning capabilities of the FSRU.

“The net revenue from the annual rental will strengthen the profitability position of the company,” explained Chopra.

“By renting out the FSRU to BOTAS, we aim to play an enabling role to boost the LNG initiatives of the Turkish government to build clean energy preparedness amid a growing demand for FSRUs in that market,” he added.

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.

The US Department of Energy published its latest LNG monthly export data with European nations such as France, Spain, the Netherlands and Italy being joined by Japan in the list of leading destinations while Sempra’s Cameron LNG plant in Louisiana shipped the most expensive cargoes for a second month.

Turkey, one of the largest LNG importers in the European region, has awarded a European-US consortium a significant contract for the subsea development of the nation’s largest-ever natural gas discovery, the Sakarya gas field in the Black Sea.

State energy company, Türkiye Petrolleri Anonim Ortaklığı (TPAO), has chosen the consortium of Houston-based Schlumberger and Europe’s Subsea 7 for the engineering, procurement, construction and installation (EPCI) at the Sakarya field.

The integrated project scope will cover subsurface solutions to onshore production, including well completions, subsea production systems (SPS), subsea umbilicals, risers, flowlines (SURF) and an early production facility.

Turkey has discovered between 400 billion cubic metres and 530 Bcm of natural gas in the Black Sea Sakarya field in assorted wells.

The project contract includes the provision and installation of infield flowlines, control umbilicals, tie-in connections, associated subsea equipment, 170 kilometres (105 miles) of gas export pipeline and an monoethylene glycol injection pipeline.

The government aims to get Black Sea gas flowing into the national grid in 2023, the centennial of the founding of modern Turkey, with sustained plateau production starting in 2027 or 2028.

Turkey plans to cover up to a quarter of its consumption from the discovery by 2027.

Natural Resources Minister Fatih Dönmez has said the country may be able to start with an initial annual production capacity of 3.5 Bcm in 2023.

Increases

The eventual aim would be to lift the Sakarya field capacity to around 15 Bcm per annum within four years of initial production.

Turkey itself currently consumes between 45 Bcm and 50 Bcm of natural gas each year.

Turkish LNG import terminals in 2020 handled 10.72 million tonnes of LNG with its four largest suppliers being Algeria with 3.96MT, Qatar with 2.26MT, the US supplying 2.22MT and a further 1.32MT coming from Nigeria.

The scope of work on the Sakarya field for Subsea 7-Schlumberger comprises the whole EPCI of the subsea pipelines and associated equipment to connect the gas wells at a depth of around 2,000 metres to the shore and gas grid. Turkey has already initiated the production of the pipes for this process.

Subsea 7 said it its statement on the contract that it defines a major contract as being one where its share of revenue is more than $750 million.

Schlumberger will deliver the well completions scope and the design, construction and commissioning of the early production facility capable of handling up to 350 million standard cubic feet per day of gas.

The SPS and SURF scope will be delivered by OneSubsea, the subsea technologies, production, and processing systems division of Schlumberger and Subsea 7.

“Subsea 7 looks forward to building a long-term relationship with Turkish Petroleum and to making a significant contribution to the development and growth of the Turkish energy industry,” said John Evans, Subsea 7 Chief Executive.

“Subsea 7 has a long track record of providing optimised solutions for deepwater developments and we are pleased to be working on this important project,” added Evans.

Southern LNG Company, the operator of the Elba Island LNG export plant near Savannah in Georgia and a subsidiary of pipeline giant Kinder Morgan, is to host a full inspection of the facility by regulators just after the first anniversary of a fire at the new plant that delayed completion.

Italian energy company Eni and Sonatrach, the Algerian state-run company and LNG producer, have completed the construction of the natural gas pipeline connecting the Bir Rebaa Nord and Menzel Ledjmet Est fields in the Berkine Basin in southeast Algeria.