Floating Liquefied Natural Gas (FLNG) Market 2015-2025 - SAMPLE

Floating Liquefied Natural Gas (FLNG) Market
2015-2025: CAPEX Prospects for LNG FPSOs &

FSRUs in a Lower Oil Price Climate
5.5.6 African FLNG Projects
Table 5.11 Planned African FSRU Projects (Owner (Main Sponsor), MMTPA, Earliest
Operation, Location, Vessel Name, Estimated Cost ($m))
Main
Constructor
MMTPA
Golar
SHI
2.0
Excelerate
TBA
Gasol (Socar)
Lease sought
Sponsor(s)
Earliest
Location
Vessel Name
Est. Cost
2015
Ghana
Golar Tundra
100
3.8
Q4 2016
Ghana, Aboadze
500
1.5
2016
Benin, Cotonou
Op.
Harbour
Source: Visiongain 2015
Table 5.12 Planned African LNG FPSO Projects (Sponsor, Constructor, MMTPA,
Status, Earliest Operation, Location, Estimated Cost ($bn))
Main Sponsor(s)
Ophir Energy Plc,
Construct
or
TBD
MMTPA
Status
Earliest Op.
Location
FID 2016
2019
Equatorial
Excelerate
Golar (with SNH, EDF,
Cost
2.5
Guinea
Keppel
1.2
Perenco Cameroon
ENI Partners
Est.
Under
Q1 2017
construction
-
2.5
FID 2015-2016,
Cameroon,
.735
Kribi
2020
Mozambique
FEED by Daewoo
Ophir Energy Plc/BG
TBD
2.5
Concept
2020
Tanzania
2.5
TBD
TBD
Concept
TBD
Tanzania
TBD
Group
Shell
www.visiongain.com
Page 163

The US demand market for natural gas has been substantially and substantively altered by the
shale gas revolution. The need for imported natural gas is now non-existent at the national level,
and 2014 will mark the first year the country will be a net exporter of natural gas. The now unused
onshore import terminals, meanwhile, are almost universally the subject of export application
proposals to the US Department of Energy (DOE) to convert the import terminals into export
terminals. Applications to export to countries the US has a Free Trade Agreement (FTA) with have
historically been quicker than those destined to places without and FTA. Visiongain expects the US
will move away from isolationist policies regarding energy export, as there is a concerted effort by
the Unconventional Energy and US National Security Task Force to support energy exports to nonFTA regions. While onshore LNG facilities will surely be employed, visiongain predicts that
exporting US LNG will largely rely on non-conventional floating liquefaction vessels (see below for
a distinction between conventional liquefaction vessels). As such, floating liquefaction vessels will
form the basis of spending for the entire North American region for the forecast period.
5.11.1.2.1 US LNG FPSO Project Analysis

Two 4 mmtpa trademarked FLSO (Floating Liquefaction Storage and Offloading) vessels are
proposed by Excelerate Energy for the Port of Port Lavaca, a town around one hundred miles
south of Houston, Texas. The project has received export approval for countries with which the US
has a FTA, and will be operational by 2019. The Port of Port Lavaca FLNG facilities are
spearheaded by Excelerate Liquefaction Solutions, a subsidiary of Excelerate Energy, who has
extensive experience in the FLNG market with FSRUs. The relatively low CAPEX of $4bn (total) is
achieved by using pre-processed natural gas from the US grid and the pre-existing LNG import
terminal infrastructure at Lavaca Bay. It is not, strictly speaking, an LNG FPSO, as it does not
produce liquefied natural gas from an offshore field.
Another project boasting two floating liquefaction vessels with 4 mmtpa has recently applied to the
DOE for export approval. This project, is sponsored by the Delfin LNG, a joint venture company by
Fairwood Group and Peninsula Group. It has recently been approved to export US LNG to areas
with a FTA, and will be located 30 miles offshore Louisiana, costing around $2bn total. As of
February 2015 Delfin announced publically a non-binding Joint Development Agreement with
Hoegh LNG to construct their liquefaction vessels. This is not anticipated to actually take place.
This project, like many other onshore ones, is late to the development stage and is unlikely to
actually materialize given the advanced stage of other US LNG projects that will beat them to
market. The finances of this operation, in the wake of the oil crisis, are also weak.
Several similar but less certain projects have been submitted to the DOE for approval, though
exact details and the outcomes of their export license applications are, at time of publication,
www.visiongain.com
Page 225

7. Expert Opinion
7.1 Matthew Blycha, HFW LLP Interview
Mr. Blycha is a Lawyer who attended the University of Newcastle, Australia. He took a secondment
at Woodside Energy, and is now a partner at Holman Fenwick Willan, a global law firm that
specializes in marine and shipping law. Its headquarters is in London, and Mr. Blycha is based in
Western Australia. He works on regulation and legislation that relate to the LNG and FLNG industry
in Australia, and has spoken publically on the topic at conferences internationally.
7.1.1 About HFW LLP

Visiongain: Thank you Matthew for speaking with me today. Can you give me an
introduction to the services HFW LLP provide, particularly in relation to the FLNG industry?
HFW LLP: HFW is an international law firm with fourteen offices around the globe. We work on all
legal aspects involved in LNG and FLNG. In Australia in particular, weve done a lot of work on the
regulatory side. That is, how a FLNG unit will be treated under various pieces of legislation.
Generally legislation is not drafted with FLNG units in mind, so the question of how FLNG units will
be treated under various pre-existing legislation needs to be considered by operators and
contractors. I am involved in the construction and development side of FLNG project - how you
would structure the ownership of an FLNG unit, and dealing with all issues through to the design,
construction and operation of FLNG.
Visiongain: Do you mostly advise in Australia, or are you engaged in some of the projects
such as those headed to Columbia or developing in south east Asia?
HFW LLP: We advise on projects globally and work on projects across offices. Our London office
has been recently been involved in a project thats based in the gulf of Mexico, and another in
Africa. Lawyers in other offices, including me, have been involved as needed. Saying that, many
of the projects our Australian offices have been involved in have focused on local projects offshore
of Australia, where many FLNG projects are planned to occur.
7.1.2 Impact of Oil and LNG Price Fall

Visiongain: Planned to occur is exactly what Id like to ask you about- its been quite a
tumultuous year for the oil industry and LNG industry. What do you think the impacts of the
www.visiongain.com
Page 235

8.1.3 Hegh LNG
Table 8.12 Hegh LNG Overview (FSRU CAPEX, $m (new orders 2015), Global FSRU
CAPEX Share % (2015), Total Revenue (2013), Headquarters, Ticker, IR Contact,
Website)
FSRU CAPEX, $m (new orders
2015)
Global FSRU CAPEX Share %
(2015)
Total Revenue (2013)
$216.67m
(Order Value Divided Over Duration of EPC)
9.7%
Headquarters
Ticker
$178m
Hegh LNG, Drammensveien 134
0277 Oslo, Norway
HLNG:OL
Arild Jger,
IR Contact
aj@hoeghlng.com
http://www.hoeghlng.com
Website
Hegh LNG is part of Hegh LNG Holding Ltd, and originates with the common holding company,
Leif Hegh & Co. It is listed on the Oslo Stock Exchange. The company has been involved in the
LNG business for over 40 years and currently operates four FSRUs and five LNG carriers. Ship
management is handled at their office in Norway. The company is also invested in FEED studies
for LNG FPSOs with partners such as DSME and KBR. It refers to its FSRUs as Shuttle and
Regasification Vessels (SRVs).
8.1.3.1 Hegh Products and Services

Table 8.13 Hegh Products and Services (Product/Service, Notes)
Product/Service
LNG Transportation Services
Notes
Currently have two LNG carriers in operation.
Floating Regasification
Currently owns four regasification vessels.
Floating LNG Production
Actively involved in five LNG FPSO projects.
www.visiongain.com
Page 254

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2015-2025: CAPEX Prospects for LNG FPSOs &