Ophir, OneLNG to form Fortuna FLNG joint operating company

Ophir Energy and OneLNG, a joint venture between Golar LNG and Schlumberger, signed a shareholders agreement to establish a joint operating company to develop the Fortuna FLNG project off Equatorial Guinea. 

Under the agreement OneLNG will have 66.2 percent ownership in the JOC with Ophir holding the remaining 33.8 percent.

The joint operating company will facilitate the financing, construction, development and operation of the integrated Fortuna project and, from final investment decision, will own Ophir’s share of the Block R licence and the Gandria FLNG vessel, the statement issued on Thursday reads.

Golar LNG added that this structure “aligns investment across the value chain and provides a framework to promptly deliver a fully financed project.” 

Following the approval by shareholders of Ophir Energy and the government of Equatorial Guinea, the final investment decision is expected to take place in the first half of 2017 with the first gas anticipated for the first half of 2020.

Initial offtake is expected to be 2.2-2.5 mtpa for a duration of between 15 and 20 years which will monetise around 2.6 Tcf of the discovered resource.

The expected total capital expenditure for the integrated project is approximately US$2 billion to reach first gas.

According to Golar LNG’s statement, approximately $1.2 billion is expected to be debt financed, with full drawdown by the start of commercial operations.

The shareholders will take a decision on the final offtake pricing mechanism prior to the final investment decision, and shortlisted proposals from potential offtakers will be evaluated on the basis of value maximisation.

JOC is expected to generate aproximately $560 million in cash flow annually at an assumed FOB gas price of $6/mmBtu, the statement reads.

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