Wednesday, June 12, 2024
BusinessSingaporean company in talks with Poly-GCL for supply of offshore natural gas...

Singaporean company in talks with Poly-GCL for supply of offshore natural gas terminal

The Singaporean ship builder, Sembcorp Marine, is in talks with Poly-GCL, the Chinese company which recently discovered oil and gas finds in Ethiopia, for the provision of an offshore natural gas processing terminal to be moored at the Port of Djibouti and connected to the natural gas transportation pipeline extending from the Calub and Hilala gas fields in the Ogaden basin of the Ethio-Somali Regional State.

The offshore platform will be serving an integrated purpose of liquefying, storing and loading into carrier vessel of the natural gas which will be extracted and transported to the Port of Djibouti for processing and loading for shipment to the destination market.

 The planned natural gas terminal is based on the offshore natural gas technology called Floating Liquefied Natural Gas (FLNG). The FLNG refers to water-based liquefied natural gas (LNG) operations employing technologies designed to enable the development of offshore natural gas resources. Although the original intent was to facilitate an offshore natural gas exploration in deep waters, with Sembcorp’s propriety Gravitfloat concept the technology is said to be applicable to shallow waters of not more than 20 meters in depth.

According to the Rigs and Floaters engineering team at Sembcorp Gravifloat platforms are re-deployable, modularized LNG and LPG terminals, designed for installation in shallow waters of 8 to 20 meters.

“The Gravifloat structure is fixed to the seabed of 8-20 meters water depth, allowing full port capabilities. It can be designed for LNG export, where raw gas from the wellhead or gas pipeline can be routed to the Gas Treatment module, followed by the Liquefaction module of the Gravifloat structure,” reads information on the company website.

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Poly-GCL, which has recently dominated the news headlines for crude oil discovery in the Ogaden basin, is primarily concerned with extraction, production and exporting of natural gas from the 70-year-old natural gas concessions in Ogaden. In addition to its original discovery of 3TCF natural reserve, Poly-GCL has announced recently that it has discovered more reserves of the same amount in its concession area pushing up the overall natural gas deposit of Ethiopia to eight TCF. Apparently, the company has been considering various ship engineering companies including Sembcorp and another shipyard in South Korea which is known to have built and supplied FLNG technology before.

Meanwhile, according to reports the Gravitfloat, the concept of Sembcorp and its potential to LNG export, floating in shallow waters might have made it a frontrunner to get selected for the project. On the other hand, if selected, the new-build project will be one of the first FLNG structure based on the Gravitflaot concept to ever been constructed.

Ang Hsien Loong, assistant manager of Rigs and Floaters with Sembcorp, told The Reporter that if it is a go, the structure will be fully constructed and transported to the Port of Djibouti; and the construction is estimated to take close to three years and cost around one billion dollars.

According to AsianOne, Singaporean digital news publication, Poly-GCL has been making preparation for the eventual extraction of natural gas from Calub and Hilala gas fields for years. In this regard, the report indicated that company has already purchased a used LNG transporting vessel, LNG Libra, form USD 20 million to complement the floating structure as Floating Storage Unit (FSU) after refurbished by ship builder for the purpose.

Coming under China’s One Belt One Road initiative, the natural gas export from Ethiopia may have various financing options, according to the same report. Last September, the Singapore Business Federation and the Industrial and Commercial Bank of China (ICBC) announced a tie-up of 50 billion yuan (USD 10.37 billion) in funding for OBOR projects.

So far, it is estimated that as high as 70 per cent of initial natural gas extract from Ogaden fields are destined for export markets in China while the remaining is mean for the international market.

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