Excelerate has committed to a shipbuilding contract with Hyundai Heavy Industries for a newbuild FSRU
Excelerate Energy has signed a binding shipbuilding contract with Hyundai Heavy Industries for a new floating regasification and storage unit (FSRU) to be delivered in June 2026.
The FSRU will have a storage capacity of 170,000 m3 and a maximum regasification capacity of one billion standard cubic feet per day (1,000 MMscf/d), according to Excelerate.
The state-of-the-art FSRU will be equipped with HHI’s proprietary LNG regasification system, dual-fuel engines, selective catalytic reduction system and a boil-off gas management system.
“This shipbuilding contract with HHI demonstrates our commitment to grow our FSRU fleet at a time when the world needs FSRUs and flexible LNG infrastructure the most,” Excelerate president and chief executive Steven Kobos said. “Recent geopolitical events, including the energy crisis in Europe, have highlighted the essential role FSRUs play in providing energy security and serving as a complementary backstop to balance the intermittency of renewable energy. Upon delivery, this newbuild FSRU will enhance the capabilities of our existing fleet and support the execution of our integrated growth projects.”
With this newbuild order, Excelerate will have 11 FSRUs in operation or under construction. Excelerate first announced it had signed an LoI for the vessel with HHI during a quarterly earnings call in August 2022. At the time, Excelerate said an option for a second vessel was under discussion, but the announcement of the shipbuilding agreement did not include mention of another FSRU.
"Just this week, we signed a letter of intent with Hyundai Heavy Industries for a new, 170,000-m3 FSRU to be delivered in 2026," Mr Kobos said at the time.
"This new FSRU, when delivered, will be a critical tool used to support the execution of our integrated projects," Mr Kobos said, noting the second quarter results showed ’continued strong momentum’ for the company.
"We are focused on strengthening our base business and expanding downstream into new and existing markets as we execute our strategy of deploying flexible LNG infrastructure," he said.
Asked whether the potential newbuild FSRU would come before contracts were secured for its work, Mr Kobos said the company was pleased to have a 2026 delivery option and that the timing of the delivery meant the newbuild would "in all likelihood, displace one of our existing vessels with a customer" and the company intends to further grow its fleet.
Regarding the company’s existing fleet and projects, Excelerate and Gasgrid Finland have a 10-year, time charter party agreement for Excelerate to provide LNG regasification services beginning Q4 2022. Gasgrid Finland has begun developing a new jetty in southern Finland, near the Balticconnector pipeline, where the FSRU Exemplar would moor.
Excelerate said it had also advanced its negotiations with the government of Bangladesh for the expansion of the Moheshkhali LNG terminal, the extension of its existing regasification agreement by five years to 2038, and a multi-year LNG supply agreement. The expansion project was approved in principle by the government of Bangladesh in Q2 2022.
Excelerate said it is also furthering commercial negotiations with Bangladesh for the Payra LNG project. The proposed scope of the Payra LNG project, which is located in the southwestern part of the country, involves the development of an offshore FSRU import terminal and an onshore pipeline to the city of Khulna. As part of the project, Excelerate is also negotiating a long-term LNG supply agreement with the country.
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