Ophir Energy of UK has to shortlist buyers for Equatorial Guinea FNG

Tuesday, 17 November 2015

"Ophir has a shortlisted group of counterparties, all of which are globally established LNG buyers," the company stated.

The offtake contracts offer flexibility to competitively deliver the gas into either the Atlantic or Pacific Basin and have been met with strong interest from LNG buyers.

Accords

"The total requested demand under the Heads of Agreements (HoAs) has substantially exceeded the available offtake from the project," Ohpir said. The venture is expected to produce around 2 million tonnes per annum of LNG.

The FLNG project would provide Equatorial Guinea with its second production plant.

The nation has had an onshore liquefaction plant on Bioko Island since 2007 with a single Train producing 3.4 million tonnes per annum of LNG.

The plant is operated by Marathon Oil and the volumes are marketed by BG Group of the UK.

The Fortuna FLNG project remains on schedule for a final investment decision in mid-2016 and first gas in mid-2019.

"Each of the LNG buyers has completed due diligence on the Fortuna FLNG prior to agreeing terms," Ophir said.

"Ophir expects that all of the HoAs will have been signed by the end of November. There will then follow a further shortlisting process to select one or two of these LNG buyers with whom to sign full Sales and Purchase Agreements (SPAs) in Q1 2016. This timing is in line with the planned project Final Investment Decision in mid-2016," the UK company stated.

Norwegian LNG carrier owner and specialist floating project company, Golar LNG , has already signed an agreement to provide the former LNG carrier "Gimi" as a liquefaction hull to be placed over the Fortuna gas field offshore.

The Norwegian firm with its partners Keppel Shipyard of Singapore and Kansas-based US liquefaction process equipment company Black & Veatch decided on the "Gimi" FLNG conversion in December 2014.

Ophir also announced an increase in forecast feed-gas reserves. Gross contingent resources on Block R are estimated at 2.6 trillion cubic feet to 3.0 Tcf.

"An additional 0.8 Tcf of low risk gross prospective resource is also available and included in the base case planning for Fortuna FLNG," Ophir added.

"In addition to these certified resources, management includes a further 0.3 Tcf of contingent resources in the base case that is associated with the implementation of compression later in field life," it said.

Nick Cooper, Chief Executive of Ophir, commented: "The fact that the Fortuna FLNG Project delivers economically attractive returns in the current price environment and is attracting quality downstream partners is testimony to the relative cost competitiveness of the project.

"The finalisation and signing of Heads of Agreement for the offtake with leading LNG players, is another major step in derisking the project on the run to FID."