PTTEP, Partners Award Mozambique LNG FEED Contracts

PTTEP AI (a subsidiary of PTTEP) and its joint venture partners have awarded Front End Engineering Design (FEED) contracts for both onshore LNG (liquefied natural gas) construction and offshore installation for its newly acquired block “Rovuma Offshore Area 1” in Mozambique which contains the vast natural gas resources discovered currently estimated to hold between 35 and 65 plus trillion cubic feet of recoverable natural gas.

The competitive Onshore LNG FEEDs will be performed by 3 consortiums comprised of:

1. a joint venture comprised of JGC Corporation and Fluor Transworld Services, Inc.,
2. a joint venture between an affiliated company of CB&I and Chiyoda Corporation, and
3. International Bechtel Co. LTD. which will deliver of a full engineering, procurement and construction plan, and a lump sum turnkey price for an initial LNG development that will include two liquefaction trains for the Rovuma Offshore Area 1 joint venture with capacity of 5 million tons of LNG per annum (MMTPA) per train, as well as associated common facilities. The FEEDs will also develop an overall LNG Park plan allowing the capability to produce approximately 50 MMTPA in the future years.

The competitive Offshore Installation FEEDs will be performed by another 3 consortiums comprised of Technip USA, Inc.,

1. a joint venture comprised of Subsea 7 (US) LLC and Saipem SA, and
2. a joint venture comprised of McDermott, Inc. and Allseas USA Inc. will deliver of a full engineering, procurement, installation and commissioning plan for subsea production systems.

Once all of the above designs and estimated costs are submitted, a LNG contractor and an offshore contractor will be selected and awarded for Engineering, Procurement, Construction, Installation and Commissioning (EPCIC) contracts to continue advancing the project toward expected first LNG cargo in 2018.

Moreover, Anadarko, as the operator of Mozambique Offshore Area 1, reached Heads of Agreement (HOA) with Eni, as the operator of Mozambique Offshore Area 4, establishing foundational principle for the coordinated development of the common natural gas reservoirs spanning both areas. The HOA is designed to facilitate a work program whereby the two operators will conduct separate, yet coordinated offshore development activities, while jointly planning and constructing common onshore liquefaction facilities in the form of an LNG (liquefied natural gas) park at Cape Afungi, in Cabo Delgado Province of northern Mozambique.

Mr. Tevin added that “Awarding of multiple FEED contracts and reaching an HOA with Eni is a significant step that moves forward the monetization of the discovered natural gas resources in addition to the on – going efforts on securing LNG customers. All joint venture partners are grateful for the support of ENH and the government of Mozambique and look forward to continue moving this transformational project toward first production”.

The joint venture partners for Rovuma Offshore Area 1 are PTTEP AI with 8.5%, Anadarko Mozambique Area 1 Ltd as the operator with a 36.5% interest, Mitsui E&P Mozambique Area 1 Ltd with 20%, BPRL Ventures Mozambique B.V. with 10%, Videocon Mozambique Rovuma 1 Ltd with 10% and Empresa Nacional de Hidrocarbonetos, ep’s (ENH), Mozambique National Oil Company, 15% interest is carried through the exploration phase.

In August 2012, PTTEP successfully acquired the entire shares of Cove Energy Plc and became the partner in Rovuma Offshore Area 1 and other petroleum blocks in Mozambique and Kenya with other joint venture partners. This success marks PTTEP’s significant step into the highly prolific East Africa hydrocarbon region which will be a vital LNG production base in the future in order to support the increasing demand of Asian region including Thailand.

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LNG World News Staff, December 21, 2012; Image: Anadarko