BAKU, Azerbaijan, Dec.3
By Leman Zeynalova – Trend:
FLNG solutions could become more common in regions with large reserves of untapped natural gas, Trend reports with reference to Fitch Solutions.
“Continued FLNG innovation is needed to remain competitive against onshore projects that can utilize scale to achieve lower break-even prices. The use of additional FLNG vessels at some soon-to- be operating export projects in Area 4 in Mozambique and the Greater Tortue Ahmeyim could reduce costs for additional capacity growth and prove an effective method to increase overall profitability,” said the company.
At the recent November naming ceremony in Korea for ENI’s Coral-Sul FLNG, Mozambique’s President Filipe Jacinto Nyusi hinted at the potential for the addition of another FLNG vessel to capitalize on the vast offshore reserves found in Area 4.
“The development of an expanded FLNG fleet for Mozambique clearly has advantages over the onshore mega-projects, which are currently mired in uncertainty given the unstable security situation onshore in Cabo Delgado. ENI has consistently reported that offshore operations have had no impact from the insurgency attacks, increasing the credibility of FLNG’s limited onshore presence and relative ease of construction. Meanwhile, BP’s Greater Tortue Ahmeyim Phase 2 project FID has been delayed to late 2022 or early 2023, as the project is reassessed,” the company says.
The report released by Fitch Solutions says that Phase 2 would leverage the infrastructure from Phase 1 with the addition of another FLNG vessel.
“The partnership is focusing on optimizing the design and commercial terms of Phase 2. High volatility demonstrated by LNG spot prices over the last two years has illustrated the continued need for FLNG projects to demonstrate low development costs in order to weather bouts of low natural gas prices. By nature, most FLNG projects can leverage their fast-track potential as well as other inherit advantages over onshore developments, including smaller environmental footprints, offsite fabrication, ease of decommissioning and the ability to demobilise to a new location. Should LNG demand substantially outstrip supply in the coming years FLNG solutions could become more common in regions with large reserves of untapped natural gas,” said the report.
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