All articles in the Gas Monetization Section:


TOTAL to Help Rwanda with LPG, Renewable Energy Solutions

TOTAL Energies says it has signed a Memorandum of Understanding (MoU) with the Rwandan Government to develop collaboration on projects related to energies.

The collaboration will be with the Rwanda Development Board, a public institution responsible for accelerating Rwanda’s economic development.

The scope of the agreement covers in particular:

  • The energy products distribution (including LPG, and electric charging),
  • The supply of LPG as a substitute for burning biomass,
  • The renewable hydro-electricity generation,
  • The development of power storage solutions for the electrical network,
  • The development of Natural Based Solution for carbon storage,
  • The implementation of education and training programs on new energies and the energy transition.

TOTALEnergies also announced the incorporation of a local branch TOTALEnergies Marketing Rwanda Ltd, and the opening of a permanent representation office in Kigali.

“The collaboration with TOTALEnergies in the energy sector, particularly the investment they will make in clean energy storage, distribution, partnerships with our private sector companies in Rwanda and beyond, is timely for a country that puts the environment at the heart of its development strategies. Additionally, the skills transfer in critical areas such as renewable energies and energy transition will undoubtedly contribute to the development of local expertise in the energy sector.” said Clare Akamanzi, CEO of the Rwanda Development Board.

 


Commissioning Hitches at NNPC’s Oredo LPG Plant: Upsets the Nigerian Government

By Macson Obojemuinmoin

Officials at the Nigerian presidency are concerned that the state hydrocarbon company, NPDC, got President Muhammadu Buhari to commission an LPG plant that failed to deliver more than a fraction of the capacity to the market a full year after the President inaugurated it.

NPDC is a subsidiary of NNPC. The second phase of its Oredo Integrated Gas Handling Facility (IGHF-2) in Edo state, in midwestern Nigeria, was commissioned four days to Christmas 2020, and billed to deliver 240,000 metric tonnes of commercial grade liquefied petroleum gas and propane to the domestic market, according to the speech by President Buhari himself.

He said that the plant would “meet 20% of Nigeria’s LPG demand”.

Mele Kyari, NNPC’s Group Managing Director, had promised at the commissioning “a daily load out of 17 trucks of LPG and 22 trucks of propane”.

That has not happened.

Commissioning hitches have hampered the efficacy of the facility and ensured only minimal benefit to the market a full year after the high-powered, widely publicized commissioning. Over half of the 1.2Million tonnes of LPG consumed in Nigeria in 2021 was imported. The Oredo Plant was supposed to boost locally produced LPG, most of which is contributed by Nigeria Liquefied Natural Gas NLNG Ltd (which supplied 400,000Tonnes, or 33% of the entire 2021 consumption).

As demand/supply challenges forced up the prices of the product for most of 2021, the Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM) fingered “inconsistent availability” of the product as a causative factor and called for a policy that “would encourage full domestication of LPG” , a phrase that could be translated as ‘full scale local production’.

Presidency sources say there is a robust campaign to bolster local production of LPG, with a list of projects that is topped by the Oredo Plant, which has now proved disappointing. They are also looking to contributions from Seplat/NGC’S ANOH gas project, Platform Petroleum”s Egaboma Plant, Energia’s Ebendo field and Sterling Exploration’s Kwale Hydrocarbons.

Of the lot, Kwale Hydrocarbons has started supplying the market and it is the next major local supplier after NLNG, although it doesn’t disclose its delivery volumes. LPG distributors interviewed by Africa Oil+Gas Report, have been largely disappointed by the effectiveness of Platform Petroleum”s Egbaoma Plant and Energia’s Ebendo project. The ANOH project is still under heavy construction, and it’s expected to come on stream in late 2022.


NLNG Is Supplying All its Butane Production to Nigeria in January 2022

Nigeria Liquefied Natural Gas (NLNG) Limited supplied its entire Butane (LPG) output to Nigeria’s domestic market in January 2022.

It is also supplying 50% of its propane production to the country (although its propane output is a minuscule fraction of the Butane production).

It is the first time the company would not export a single tonne of Butane. NLNG Ltd says it will do the same thing for Propane by January 2023, that is: its entire production of Propane will be supplied to the domestic market.

In 2021, the company increased its LPG supply commitment from 350,000 metric tonnes (or 28Million 12.5kg cylinders) to actual delivery of  400,000 metric tonnes (or 32Million 12.5kg cylinders) thereby directing most of its production into the domestic market. “But this was not enough for NLNG, hence this commitment to do all that we possibly can and supply 100% of our LPG production to the domestic market,” says Phillip Mshelbila, NLNG’s Chief Executive Officer.

The quantity of Butane supplied to the Nigerian market in 2021 was 378,000Tonnes. Propane volume was 21,000Tonnes. “Actual production of LPG depends on the volume and composition of feedgas we get from our gas suppliers”, says Andy Odeh, NLNG Ltd’s General Manager, External Relations and Sustainable Development. With this commitment it is expected that NLNGLtd will supply about 600,000Tonnes of both Butane and Propane into the Nigerian market in 2022. The volume of LPG consumed in Nigeria in 2021 was around 1.2Million Tonnes, according to government data.

 

 


Coral Sul FLNG Arrives Mozambican Waters

The Coral Sul Floating Liquefied Natural Gas (FLNG) Vessel has entered Mozambican waters, 45 days after it set sail from the Samsung Heavy Industries shipyard in Geoje, South Korea.

It will be moored at its operating site in the Rovuma basin offshore Mozambique. The FLNG will receive feedstock from the Coral gas field in the Area 4 of the deepwater Rovuma Basin in the Indian Ocean. Italian major ENI discovered Coral back in May 2012. The field holds about 16 Trillion cubic feet (Tcf) of gas in place.

Following the mooring, hook-up operations will begin at a water depth of around 2,000 metres.

Production startup, scheduled for the second half of 2022, may now be earlier. Coral Sul FLNG will contribute to increase gas availability in a tight market, with a gas liquefaction capacity of 3.4Million tons per year (MTPA) of gas. BP will buy all of the LNG produced at the unit as part of a long-term deal.

The 432 metre long and 66-metre-wide unit was constructed by the TJS consortium, consisting of Technip Energies, JGC Corp, and Samsung. It is the first floating LNG facility ever to be deployed in Africa’s deep waters, but it is the second FLNG on the continent, coming after the Hilli Episeyo, the 2.4MMTPA floater in shallow waters off Cameroon’s Kribi coast.

Italian major ENI operates the Coral Sul (South) project on behalf of the Area 4 partners.

These include Mozambique Rovuma Venture, a firm owned by Eni, ExxonMobil and China´s CNPC, Galp, Kogas and (the state hydrocarbon firm) Empresa Nacional de Hidrocarbonetos (ENH).

The Coral South Project achieved Final Investment Decision in 2017, only 36 months after the last appraisal well. “FLNG fabrication and construction activities started in 2018 and were completed on cost and on time, despite the pandemic”, ENI has always maintained.


TOTAL Reopens Office in Gas Rich Cabo Delgado

TOTALEnergies has opened an information office in the city of Pemba, in the gas-rich Cabo Delgado Province in Mozambique.

With this move, the company is gradually effecting a return, nine months after suspending its activities in the Afungi Peninsula, after an Islamist militant attack in the nearby town of Palma in March 2021, in which dozens of people were killed.

Afungi Peninsula is the site of TOTALEnergies’ proposed 13Million Tonnes Per Annum Liquefied Natural Gas LNG plant. 

The new information office in Pemba is 125 kilometres south of the Palma district.

A multinational force comprising troops from Rwanda and soldiers from countries in the Southern African Development Commission (SADEC) region has repelled the insurgents from many of their bases in the province, but the rebels have spread out and now conduct guerilla-style attacks. 

The office is expected to ease communication between interested parties in the LNG project.


LNG Supply: Turkey Pivots from Nigeria to Egypt

Seven Egyptian Liquefied Natural Gas cargoes have been shipped to Turkey since October 2021, the same month that the latter country ended its contract with Nigerian LNG.

There are no indications that Botas, the Turkish state hydrocarbon company with which NLNG signed the expired contract, has a contract with Egypt.

Turkey and Egypt re-established formal diplomatic relations in early 2021, almost eight years after they were broken off following the military coup that ousted Egypt’s first Islamist president Mohamed Morsi.

An S&P Platts Global report declares that Botas has held a number of tenders for spot LNG cargoes in recent months, and is believed to have secured some supplies although exact volumes and delivery dates are not clear.

“Turkey is set for record high gas demand in 2021 — of as much as 2 Trillion Cubic Feet — on the back of strong consumption in the power sector, and”, the S&P Platts report adds…” …it is facing the prospect of more of its long-term import contracts expiring in the near future …with one long-term LNG contract in place — with Algeria’s state-owned Sonatrach — that is due to run until 2024, but otherwise has been taking cargoes mostly from the US and Qatar”.


Egypt’s LNG Exports in Full Throttle

By Toyin Akinosho

Egypt is capitalizing on the surge in natural gas prices overseas by exporting the equivalent of around 1.6Billion cubic feet per day (1.6Bcf/d), from its two LNG Terminals. 

“Egyptian gas has played a role in securing Europe’s energy needs … The liquefaction units are now operating at full capacity as we try to maximize our natural gas exports in light of the rise in international gas prices,” Tarik El Molla, the country’s Minister of Petroleum, said on the sidelines of the East Mediterranean Gas Forum ministerial meeting in Cairo.

At least 75 LNG shipments have been shipped so far in 2021 — a huge jump after having only shipped 24 during the whole of last year. As of the second week of November, more than eight gas shipments had departed from Egypt in 4TH Quarter 2021., data from S&P Global Platts indicate.

Egypt’s gas production fortunes slumped in the early to mid-2010s while domestic consumption rose, forcing the country to halt LNG export.

But in late 2015, ENI discovered Zohr, the giant gas field (> 22Tcf), in the deepwaters of the Mediterranean and gradually reclaimed its role as a net exporter of LNG. The country’s total natural gas output currently ranges between 6.5 and 7Bcf/d, Mr. Molla told the EMGF ministerial meeting.


Golar & Partners to increase Cameroon’s LNG Production to 1.4MMTPA

GNL Golar and its partners Perenco and the National Hydrocarbons corporation SNH plan to increase floating LNG plant Hilli Episeyo’s yearly production capacity from 1.2Million to 1.4 Million tons in 2022. 

The plant monetizes gas from the Sanaga Sud field, in MLHP-4 Block in the offshore area of the central Douala Basin. 

Commissioned in 2018, FLNG Hilli Episeyo has 2.4Million tonnes of liquefaction capacity. 

Golar says that the plant has delivered 100 percent commercial uptime since first gas in 2018.

According to the agreement binding the parties, Perenco and SNH have the option to increase the production capacity by an additional 200,000 tons yearly from January 2023 to 2026, which marks the end of the current contract. 

Should the parties decide to go this route, they will confirm it in Q3-2022.

Perenco and SNH intend to assess the potential of two to three additional gas wells and start drilling them this year in a bid to increase the upstream capacity in 2022 in preparation for the production.


N-Gas’ Profit Jumps by >50%, Despite No Increase in WAGP Export

By Toyin Akinosho

NNPC’s 62.35% owned gas delivery subsidiary N-Gas recorded a leap in profit from $6.217Million in 2019 to $9.532Million in 2020.

Most of the profit came, not from gas delivery, but from difference in Finance cost between 2019 and 2020, according to 2020 Annual report by N-GAS, one of the 21 NNPC subsidiaries whose audited reports were published in September 2021.

Finance cost was higher in 2019: $5.13Million, than in 2020: $1.88Million. This made all the difference in terms of profit after tax in 2020.

In terms of gas delivery itself, 2020 volumes were slightly lower than 2019 supplies, but that reflected extensive pigging operations in the pipeline in the first few months of the year.

N-Gas is jointly owned with NNPC by Chevron and Shell and its work is to purchase and deliver Nigerian gas to customers in Benin Republic, Togo and Ghana, through the West African pipeline.

This means that it pays upstream suppliers like NDWestern and NPDC for taking their gas and pays the pipeline owners for ferrying the gas through the line.

The bulk of the revenue should be from the delivery charges on sale of gas to Volta River Authority (VRA) and Communaute Electrique du Benin- Lome/ Cotonou (CEB) under their respective gas sales agreements, but that’s not what happened.

 

N-Gas Limited was incorporated in 2004 as a private limited liability Company. The Company is jointly owned by the Nigerian National Petroleum Corporation (62.35%), Chevron N-Gas Limited (20.00%) and Shell Overseas Holdings Limited (17.65%). The Company’s main activity is to buy and sell natural gas shipped through the Escravos-Lagos Pipeline System (ELPS – NGC) and the West African Gas Pipeline (WAGP) to its customers in the countries of Ghana, Togo and Benin.

N-Gas has executed agreements with upstream producers in Nigeria (Chevron Nigeria Limited Joint Venture (CNL-JV) and Nigerian Petroleum Development Company/ND Western Joint Venture (NPDC/NDW-JV)) and with gas transportation companies (Nigerian Gas Company Limited (NGC) and West African Petroleum Company (WAPCo) ) for the supply and transportation of gas to its customers. The agreement with NPDC/NDW-JV was previously with Shell, ie SPDC-JV but subsequently novated to NPDC/NDW-JV following the divestment of Shell Petroleum Development Company Joint Venture (SPDC-JV) from the asset that is the source of its upstream gas supplies to N-Gas. The Novation agreement which transferred the rights and obligations of the NNPC/SPDC JV parties to NPDC/NDW JV parties in the NNPC/SPDC GPAs, was finally concluded in December 2014 following the execution of the novated Trust Accounts and Security Deeds (TASDs),

The dividend paid to shareholders in 2020 was $6Million, same as in 2019. In both years, NNPC received $3.741Million as dividend; Chevron received $1.2Million and Shell received $1.059Million.

Originally published in the September 2021 edition of Africa Oil+Gas Report and distributed to paying subscribers.


Coral-Sul FLNG Begins Sail Away from South Korea to Mozambique

Italian operator ENI has held the naming and sail away ceremony of the Coral-Sul floating LNG (FLNG) at Samsung Heavy Industries shipyard in Geoje, South Korea.

The FLNG, which is part of the Coral South Project, will be now towed and moored at its operating site in the Rovuma basin offshore Mozambique. Production startup is expected in the second half of 2022, and it will contribute to increasing gas availability in a tight market.

FLNG treatment and liquefaction installation has a gas liquefaction capacity of 3.4Million tons per year (MTPA) and will put in production 450Billion cubic metres of gas from the giant Coral reservoir, located in the offshore Rovuma Basin.

Partners, with ENI, on the project, include ExxonMobil, CNPC, GALP, KOGAS, and ENH. The event took place, in the presence of the Mozambican President, Filipe Jacinto Nyusi, and Moon Jae-in, President of the Republic of Korea.

The Coral South Project achieved Final Investment Decision in 2017, only 36 months after the last appraisal well. “FLNG fabrication and construction activities started in 2018 and were completed on cost and on time, despite the pandemic”, ENI says in a statement. While performing the construction activities in Korea, several significant activities were undertaken in Mozambique, with full support from the Mozambican Authorities, including the ultra-deepwater (2000 metres water depth) drilling and completion campaign that involved the highest technological and operational skills and equipment.

“The Coral South Project will generate significant Government takes for the Country while creating more than 800 new jobs during the operation period.

“The Coral Sul FLNG is 432 metres long and 66 metres wide, weighs around 220,000 tons, and has the capacity to accommodate up to 350 people in its eight-story Living Quarter module. Once the FLNG facility will be in place, the installation campaign will begin, including mooring and hook-up operations at a water depth of around 2,000 metres by means of 20 mooring lines that totally weigh 9,000 tons.

About Area 4

Area 4 is operated by Mozambique Rovuma Venture S.p.A. (MRV), an incorporated joint venture owned by Eni, Exxon Mobil, and CNPC, which holds a 70 percent interest in the Area 4 exploration and production concession contract. In addition to MRV, Galp, KOGAS, and Empresa Nacional de Hidrocarbonetos E.P. each hold a 10 percent interest in Area 4. ENI is the offshore Delegated Operator and is leading the construction and operation of the floating liquefied natural gas facility on behalf of MRV.

© 2021 Festac News Press Ltd..