Italian oil and gas company Eni said it expects to reach a Final Investment Decision (FID) for its Coral Floating Liquefied Natural Gas (FLNG) development in the second half of 2015.
The Coral project, located offshore Mozambique, comprises construction of a Floating LNG (FLNG) unit fed by subsea wells.
The development plan for the gas discovery located in Mozambique’s Rovuma basin was formally submitted to the local authorities at the end of 2014.
An FLNG unit is able to process and convert natural gas to liquefied natural gas (LNG) on site and ready for export. This method of LNG production is cheaper as there is no need for construction of subsea pipelines and onshore processing plants. Another in favour of FLNG versus onshore plants is that FLNG it can be remobilised if necessary. The FLNG option is useful when natural gas field are far away from coast, and in ultra-deep waters where pipe laying is pricy and difficult.
In its report, Eni said: “In Mozambique, where Eni has made the greatest discovery in its exploration history with a mineral potential of about 2,500 billion cubic meters of gas in place, we plan to finalize gas contracts and obtain the necessary production licences, in order to make a final investment decision for the project Coral floating LNG in the second half of 2015.”
The company said that the award of the relevant engineering, procurement, construction, installation and commissioning (EPCIC) contracts for the construction, installation and commissioning of the floating unit is expected by the end of 2015.
According to a press release issued by KBR last year, three consortia will be competing for the contract to build the Coral FLNG. Production start-up is expected for the end of 2019.
Douglas-Westwood (DW), an energy intelligence group, in its “World FLNG Market Forecast 2014-2020″ said it expected total expenditure of $64.4bn from 2014-2020 in the FLNG market. Two-thirds of this spend are attributed to liquefaction infrastructure, while the remaining is from import and regasification facilities.
Asia will be the first continent to have an operational FLNG unit, with Petronas’ PFLNG1 unit expected to start production later this year, off the coast of Sarawak, Malaysia. The PFLNG1 is currently under construction in South Korea; scheduled for completion for the end of 2015.