The LNG industry’s second and third floating LNG production vessels, Hilli Episeyo and Prelude reinforce the emergence of a major new LNG supply option
The transfer of a cooldown cargo to the floating LNG production (FLNG) vessel Prelude and the dispatch of a second cargo from the FLNG Hilli Episeyo in June 2018 signals that the era of offshore LNG liquefaction has now taken hold.
The pair join the 180,000 m3 Petronas-operated PFLNG Satu, which loaded its first LNG cargo from the Kanowit field off the coast of Malaysia in March 2017, as the pioneering trio of FLNG vessels. Four more floating production projects are either under development or at a relatively advanced preparation stage while, beyond that, several further FLNG schemes have been tabled.
Floating LNG production obviates the need for undersea gas pipelines to a shore liquefaction plant when the commercialisation of remote gas fields is being considered. Because FLNG vessels are constructed at specialised facilities, the local labour costs and permitting issues associated with the construction of shore terminals can be avoided.
Despite the use of innovative technologies and the detailed preparation work associated with these inaugural floater projects, the FLNG approach usually translates into shorter lead times and less capital expenditure than is required for traditional shore-based liquefaction plants. The time and cost disparities are only likely to grow as the LNG industry builds on its ground-breaking FLNG design work with these initial projects and further refines its floater technologies.
The Golar LNG-operated Hilli Episeyo is positioned in nearshore waters off the coast of Cameroon near Kribi. When the FLNG vessel despatched its inaugural cargo, on 17 May 2018 onboard the 2004-built, 138,000 m3 Galicia Spirit, it marked the start-up of not only the second floating LNG export project but also the first employing a converted FLNG vessel.
Hilli Episeyo started out life as the conventional 1975-built, 125,000 m3 LNG carrier Hilli. Following four decades of employment shuttling LNG cargoes, Golar sent the Moss spherical tank vessel to the Keppel yard in Singapore in 2015 for conversion to its new role.
It was prepared for its new lease of life through the installation of Black & Veatch (B&V) liquefaction technology and arrangements for connection to a client-specified mooring system. The B&V PRICO liquefaction process uses a single mixed refrigerant (SMR) technology which has a small enough footprint to enable mounting on a spherical tank vessel, albeit a modified one with side sponsons added.
The vessel has put Cameroon into the industry record books as the world’s 20th LNG exporting country. The FLNG is helping the West African nation monetise the resources of two otherwise ‘stranded’ offshore gas fields near Kribi.
It is moored 14 km off the coast in benign waters by means of an external frame turret arrangement which allows it to weathervane. Cargo transfers to loading LNGCs are being carried out with the two vessels positioned side-by-side (SBS).
Hilli Episeyo is chartered by Perenco and the state-owned Société Nationale des Hydrocarbures, the developers of the Cameroon FLNG project. Golar LNG received a notification on 4 June from the two companies, acknowledging commercial acceptance of the FLNG’s performance. The vessel is contracted to produce 1.2M tonnes per annum (mta) of LNG for export.
Veterans put to work
Golar LNG has a pair of veteran Moss LNGCs similar to Hilli lined up for transformations to FLNG vessels for further offshore West Africa export projects. Once the developers of the Fortuna LNG venture in Equatorial Guinea and the Greater Tortue initiative in offshore waters shared by Senegal and Mauritania make financial investment decisions (FIDs) on their schemes, Gandria and Gimi, respectively, will undergo similar conversions at the Keppel yard.
Green lights for both projects had originally been expected later this year, but Ophir Energy, one of the participants in the Fortuna LNG initiative, has encountered difficulties in finalising the necessary financing arrangements. This prompted Schlumberger to drop out and slow proceedings even further. Schlumberger had been a joint venture partner with Golar in OneLNG, another of the Fortuna LNG project participants.
While Ophir and Golar are still confident of a go-ahead for their FLNG plan for Equatorial Guinea, the approval is unlikely to come before 2019. In contrast, a BP proposal to utilise the converted Golar FLNG vessel Gimi to develop the Tortue/Ahmeyim field in an area that straddles the territorial waters of Senegal and Mauretania is moving ahead rapidly, only 16 months after the discovery of the gas deposit.
The Greater Tortue scheme calls for the FLNG vessel to be positioned at a jetty location close to shore near the Senegal-Mauritania border, where a breakwater would afford protection against ocean swells. A project FID is expected by the end of this year, a timetable which would enable the FLNG vessel to begin producing cargoes for export by the end of 2021.
Shell’s 488 m Prelude FLNG vessel displaces 600,000 tonnes and is the largest floating offshore facility in the world. Utilising 260,000 tonnes of steel in its fabrication and boasting a GTT Mark III containment system with space for 220,000 m3 of LNG, Prelude was completed by Samsung Heavy Industries (SHI) in June 2017. Some 5,000 workers were involved with the Prelude FLNG vessel and its systems at the height of construction.
The FLNG vessel is now positioned on the Prelude gas field, in 250 m of water in open seas 475 km northwest of Broome in Australia. Moored using the largest bow turret system ever constructed, Prelude is now undergoing an elaborate set of hook-up and commissioning procedures to enable the vessel to commence commercial operations later this year.
The delivery of LNG to Prelude, on 8 June, by the 137,000 m3, 2002-built, spherical tank Shell LNG carrier Gallina, is part of the commissioning series of operations. The availability of the LNG is enabling not only cooldown of the storage tanks, but also the switchover of the FLNG’s utilities from diesel to gas fuel.
Visiting LNG carriers align with Prelude in the SBS configuration and cargo transfers are carried out using a special set of loading arms developed by FMC. Besides the variations in the movements of the two vessels, these arms accommodate the difference in main deck levels between the large FLNG vessel and the much smaller LNGC.
Prelude, which will remain on station for 25 years, is able to produce 3.6 mta of LNG, 0.4 mta of LPG and 1.3 mta of condensate from the field’s natural gas. Shell has a 67.5% stake in the venture while Japan’s Inpex holds 17.5%, Kogas of South Korea 10% and CPC of Taiwan 5%.
Projects in the pipeline
The second FLNG vessel delivered in 2017, after Prelude, was Exmar’s 16,100 m3 Caribbean FLNG. Caribbean FLNG was completed by the Wison yard in China last July and has the capacity to produce 0.5 mta of LNG.
The Exmar FLNG was originally built for a location off Colombia’s Caribbean coast, but that project fell through. Exmar is still negotiating employment opportunities for the vessel, including possible deployment on Iran’s Pars field.
Two further FLNG projects have cleared the FID hurdle – Eni’s Coral project in Mozambique and the second Petronas FLNG scheme (PFLNG2) planned for offshore Malaysia – and the pair are proceeding according to plan. SHI is building the 3.4 mta Coral FLNG vessel and is working towards a June 2022 completion date for the US$7Bn project.
As was the case for Prelude, Technip is responsible for supplying the vessel’s topsides. BP intends to purchase the entire output of the Coral FLNG’s design production volume under a 25-year sales and purchase agreement (SPA).
SHI has also secured the contract to build the 177,000 m3 PFLNG2 vessel for Petronas. The 1.5 mta PFLNG2 project is being undertaken in collaboration with Murphy Oil and will be utilised, via an external turret mooring arrangement, to exploit the reserves of the Rotan field 130 km offshore Sabah.
In 2016, Petronas decided, in view of the market conditions then pertaining, to delay the delivery of PFLNG2 by two years, to 2020.