A roundup of the latest developments in FSRU-based LNG import terminals highlights new projects in south Asia, the Mediterranean and the Caribbean
According to the latest annual report from the International Group of LNG Importers, there were 28 floating storage and regasification units (FSRUs) offering storage capacity of 4.3M m3 in service at the end of 2017. The orderbook at the time comprised 12 FSRUs, five of which were scheduled for delivery in 2018.
The latest annual survey of the LNG industry available from the International Gas Union states that the LNG processing capacity of the global FSRU fleet stood at 83 mta as of January 2017.
South Asia FSRU hotbed
FSRU developments have continued apace over the first four months of 2018. For a start Excelerate Energy has put the 138,000 m3 FSRU Excellence on station in coastal waters off Moheshkhali Island in the Bay of Bengal in recent weeks in a move that will welcome Bangladesh to the LNG importers club as its 41st member.
Excellence, which has the capacity to process 3.7 mta of LNG, is using a submerged turret loading buoy anchored to the seabed as the means of sending regasified LNG ashore. Excelerate Energy, the operator of the vessel, has established the technique of ship-to-ship transfers of LNG from the delivery tanker to the FSRU while the latter is moored to the STL buoy at the Hadera project in Israel. This method will be utilised in the Bay of Bengal operations.
Excellence is linked to the Anwara district of Chittagong, the country’s main demand centre, by a 90 km gas pipeline. The vessel has been taken on charter for 15 years by Petrobangla, the country’s state oil and gas firm.
The second Bangladesh LNG import project is set to start up in October 2018. Summit LNG will lead the scheme, which is also based on the use of a 3.7 mta Excelerate Energy FSRU moored in the Bay of Bengal.
Petrobangla is purchasing the necessary LNG supplies. Earlier this month the company signed a 10-year sales and purchase agreement (SPA) covering the supply of 1 mta of LNG from Oman Trading International. This complements an earlier SPA with Qatargas of Qatar for 2.5 mta.
Oman will initially supply LNG at the rate of 0.5 mta, starting in July, but the volume will rise to the agreed 1 mta level when the Summit FSRU commences operations later this year.
Bangladesh’s neighbour India is preparing to launch its first FSRU, and fifth LNG import terminal, project. H-Energy welcomed the 145,000 m3 GDF Suez Cape Ann at the west coast port of Jaigarh in late April as part of procedures to inaugurate the marine facilities.
The receiving terminal arrangements are not quite ready. H-Energy has still to commission the jetty facilities at Jaigarh, including the marine loading arms, and the connecting pipeline to Dabhol needs a few additional few months of work. The company reports it is on target for an October 2018 start to operations with the Jaigarh FSRU.
Petronas of Malaysia concluded a deal earlier this year covering the supply of LNG to Jaigarh. H-Energy plans to start operations at a modest level and to build capacity as the market for its services develops.
Further west, in Pakistan, monthly LNG imports are currently running at around 0.5 mta following the start in November 2017 of the second FSRU, the 170,000 m3 BW Integrity, at Port Qasim. Pakistan now has the capacity to process up to 9 mta of LNG with its two FSRUs.
Two additional FSRU projects have been proposed for Port Qasim. The operator of the BW Integrity terminal, Pakistan GasPort is working with Trafigura on the development of a new facility as is a consortium comprising Engro, Shell and Fatima. The latter scheme would use an FSRU supplied by Excelerate Energy. Both projects are targeting a 2019 start.
Croatia LNG has had a rethink of its plans for an FSRU import terminal on Krk island and has set its sights lower. The project developer launched a new tender earlier this year to ascertain interest in the leasing of terminal capacity. The first round of tenders, which expired in April 2018, revealed little interest in the availability of an FSRU, with only one bid being submitted.
Croatia LNG is hoping for better results when the second round of the bidding process ends at the end of this month. Whatever the outcome, the original goal of having an FSRU in place by 2019 will not now be met.
In Cyprus the state-owned utility DEFA has awarded a contract to DLA Piper and Navigant Consulting to provide legal, commercial and financial consultancy services for a project to develop an FSRU-based LNG terminal in the port of Vasilikos.
The island EU member stare is seeking to commence LNG imports under the CyprusGas2EU project banner by 2020 to meet its EU clean environment obligations. It will receive EU funding for its efforts.
New Fortress Energy (NFE), the operator of Jamaica’s LNG import arrangements, is stepping up its commitment to the island nation. For the past 18 months it has used the 138,500 m3 Golar Arctic as a floating storage unit moored near Kingston and the 6,500 m3 coastal tanker Coral Anthelia to shuttle cargoes to Montego Bay for regasification and use by a power plant.
Now, NFE has agreed to charter an FSRU for 15 years from Golar LNG to replace Golar Arctic, starting in Q4 2018. Golar will provide either the 129,000 m3 Golar Spirit or the 126,000 m3 Golar Freeze for the contract.
Golar LNG reports that the deal, which includes a five-year extension option, is expected to generate annual operating income before depreciation and amortisation of US$18-22M.
The contract includes an option for the charterer to terminate the deal after three years and seek an alternative regasification solution, but only in the event that certain throughput targets have not been met. Golar has a matching right to provide such an alternative solution.
Panama is also poised to join the ranks of the world’s LNG importers through the use of an FSRU solution. BAM International and Iconsa are building an LNG jetty in Costa Norte, at the Caribbean entrance of the Panama Canal, following the award of a contract by AES.
Completion is set for later in 2018. The Costa Norte FSRU will have a regasification capacity of 1.5 mta and will be able to accommodate LNG delivery tankers ranging in size from 30,000 to 180,000 m3. AES and Inversiones Bahia each own 50% of the Panama project.
Further north in Central America El Salvador is working to have an FSRU-based receiving terminal in place in the Pacific Coast port of Acajutla by late 2020. Shell has agreed to provide the FSRU with LNG in a deal signed with Energía del Pacífico (EDP).
The gas will be used to fuel a power plant that EDP will build and operate in Acajutla. In the early stages of the FSRU project LNG imports are expected to run at about 0.5 mta, or about seven cargoes per annum. This is expected to increase along with the region’s demand for gas over the next decade.