July 2016, Vol. 243, No. 7

In The News

World News

Petronas’ Floating LNG Facility Arrives in Malaysia

The first floating LNG facility for Malaysian state-run oil and gas company, Petronas, arrived in the Kanowit gas field, offshore Sarawak, making its historic 2,120- mile journey to Malaysia on May 14. At 365 meters in length and with a dry weight of 132,000 tons, the PFLNG SATU was towed from the Daewoo shipyard in South Korea for the offshore phase of the project.

Installation, hook-up and commissioning of the PFLNG SATU will begin once the floating facility is moored at the Kanowit gas field, 180 km offshore Sarawak. Designed for water depths between 70-200 meters and a processing capacity of 1.2 mtpa and 145-member crew, PFLNG SATU will support Petronas’ global LNG portfolio as an LNG supplier.

Separately, JX Nippon Oil & Energy will work with Petronas to tap the Southeast Asia market for LNG. The Japanese firm will invest $550 million for a 10% stake in a ninth liquefaction train to be added to a Petronas-operated plant in northern Borneo. The expansion, to start production in 2017, will have a 3.6 mtpa capacity.
Plans call for the LNG to be sold through a Petronas subsidiary to Malaysian power companies as well as to gas companies in Japan, South Korea and Taiwan.

Technip Awarded Natural Gas Field Development in Mediterranean  

Technip won a contract to develop the Bahr Essalam, Phase II development in the central Mediterranean Sea. Operated by Mellitah Oil & Gas B.V. Libyan Branch, a consortium between National Oil Corporation and ENI North Africa, the development will be tied back to the Sabratha platform, 110 km off the Libyan coast in a depth of 190 meters.

Technip will perform the overall design and engineering as well as deliver the project management, procurement, installation, tie-ins, pre-commissioning and commissioning. Offshore installation is scheduled for late 2017 through to the second half of 2018.

 GLNG Train 2 Begins LNG Production

Santos’ GLNG train 2 started producing LNG on Curtis Island, Queensland. This follows the first LNG production from train 1 in September and GLNG’s first LNG export cargo in October.

Santos Managing Director and CEO Kevin Gallagher said first LNG from train 2 was another milestone for GLNG and marked the successful delivery of the two-train project, which has already produced over 2 million tons of LNG and shipped 32 cargoes.

Santos is the operator and has a 30% interest in GLNG. Other co-venturers are Petronas (27.5%), Total (27.5%) and KOGAS (15%).

Ceremony Marks Construction Start of Trans Adriatic Pipeline

Construction began on the 878-km Trans Adriatic Pipeline (TAP) project, which will transport gas from the Shah Deniz II field in Azerbaijan to Europe. The 48-inch pipeline, which constitutes the European leg of the Southern Gas Corridor, will deliver 10 Bcma of Caspian gas to Europe beginning in 2020.

The pipeline will connect with the Trans Anatolian Pipeline (TANAP) at the Turkish-Greek border at Kipoi, cross Greece and Albania and the Adriatic Sea, before coming ashore in Southern Italy.

TAP’s routing can bring gas supply to several southeastern European countries, including Bulgaria, Albania, Bosnia and Herzegovina, Montenegro, Croatia and others. TAP’s landfall in Italy provides multiple opportunities for further transport of Caspian natural gas to some of the largest European markets such as Germany, France, the UK, Switzerland and Austria.

First gas sales to Georgia and Turkey are targeted for late 2018, and first deliveries to Europe will follow in early 2020. TAP’s shareholding is comprised of BP (20%), SOCAR (20%), Snam (20%), Fluxys (19%), Enagás (16%) and Axpo (5%).

Gazprom’s Reviews Progress of Nord Stream 2 Project

The Gazprom Management Committee recently reviewed the progress of the Nord Stream 2 project. It was emphasized that creation of the transmission system was important in light of the constantly rising demand for Russian gas in Europe.

Specifically, Gazprom’s supplies to the European market climbed by 8% in 2015 compared to 2014. The growth trend continues this year as well: the company’s gas exports have risen 9.5 Bcm in the first four months compared to the January-April period of 2015.

At the meeting, participants stressed that the new gas pipeline would dramatically increase the reliability of energy supplies to Europe and strengthen the liquidity of gas hubs, thus prompting the development of the European gas market. Moreover, Nord Stream 2 will help European countries achieve emission-reduction targets.

Geophysical surveys are complete for the subsea section of Nord Stream 2 with geotechnical investigations now underway. Detailed surveying is planned along the pipeline route. Design of the subsea section and the pipeline landfall in Russia is being developed.

In March, the pipe supply tendering for the Nord Stream 2 project was completed. The contracts were awarded to Europipe (40%), OMK (33%), and ChelPipe (27%). Gazprom signed pipe supply contracts with the above companies in April. In addition, the company called for tenders to lay the deepwater section of the pipeline, with the exception of coastal areas.

The meeting participants expressed confidence that the project would be delivered and the gas pipeline commissioned before late 2019. Last fall Gazprom, BASF, E.ON, ENGIE, OMV, and Shell signed the shareholders’ agreement to construct the Nord Stream 2 with the annual capacity of 55 Bcm from Russia to Germany, across the Baltic Sea.

Rosneft Delivers 1st LNG Shipment

Russia’s Rosneft Trading SA, a company of Rosneft Group, delivered its first LNG shipment as part of its contract with Egyptian Natural Gas Holding Company. The delivery of the cargo was made by the tanker Golar Ice to Egypt’s Ain Sukhna port. The delivered cargo of LNG is the first in Rosneft’s operational history.

Saipem Awarded $1.3 Billion Contract for Shah Deniz Stage 2

Saipem and consortium partners Bos Shelf and Star Gulf were awarded a contract under the Shah Deniz Stage 2 master agreement by BP on behalf of the Shah Deniz partnership. The $1.5 billion contact ($1.3 billion to Saipem), is for five years, plus a possible five-year extension.

The Shah Deniz field is located 90 km offshore of Azerbaijan, in depths from 75-750 meters. The work includes the transport and installation of subsea production systems and subsea structures, laying of fiber-optic cables and production umbilicals, laying of 90 km of pipelines, activation, crewing and operations management of the new-build Subsea Construction Vessel (SCV) Khankendi.

Bibby Offshore Awarded North Sea Contract

Bibby Offshore will provide subsea construction, ROV and diving services at the Forties Field in the North Sea for Apache North Sea. The contract, due to begin this month, will use Bibby Offshore’s multi-role diving support vessel Bibby Topaz, equipped with an inspection class ROV.

The project, which involves well tie-ins and spool change-out at the Aviat and Bacchus locations, along with associated pre-commissioning work, will tie back the subsea wells to the Forties Oil Field, 110 miles east of Aberdeen, Scotland.