Ophir Energy announced it is making good progress with its floating liquefied natural gas (FLNG) project in Equatorial Guinea and should be able to reach a Final Investment Decision (FID) before the end of 2016.
The company said in its half-yearly results that the upstream part of the Fortuna FLNG project Africa’s first deep water independent FLNG project, is “technically ready” for an FID.
“The value chain and our understanding of costs along this value chain, are sufficiently mature that we estimate that Fortuna is the lowest cost greenfield LNG project in the market today,” the company stated.
Floating LNG Project Ready for FID
According to Ophir, discussions are “progressing well and both parties are working towards an FID being made before the end of 2016”.
Additionally, despite the current low price environment, the project “continues to offer compelling returns”, Ophir explained.
“We are constructing a value chain that offers potentially the most cost-effective greenfield LNG supply available today,” the company stated further.
Fortuna LNG is expected to achieve first gas in mid-2020, while the various commercial and technical work streams ahead of the FID should be concluded by the fourth quarter of this year.
The project operated by Ophir involves the use of a Moss LNG carrier operated and maintained by Golar LNG, which is expected to bring cost reductions as well as the ability to quickly bring gas onstream.
Ophir Shortlists LNG Off-takers
Overall, Ophir Energy said it has managed to reduce upstream costs from approximately US$1 billion (£755 million) to US$450 million (£339.8 million).
Regarding its downstream activities, the company said the off-take part is ready for a final group decision between the competing off-take offers.
“We have shortlisted four high quality, high credit-rated gas off-takers, all of whom are significant players in the LNG market,” the company stated.
In the midstream side, Ophir and Golar LNG will continue to explore ways to collaborate to monetise the Fortuna field, the company informed further.
Shell Prelude Floating LNG
Royal Dutch Shell has been leading the way in the engineering of floating LNG facilities, with its giant Prelude FLNG, located offshore Western Australia, scheduled to reach first production in 2017.