Page 5 - AfrOil Week 01 2021

AfrOil COMMENTARY AfrOil

The consortium has said it will use the FLNG also be deployed more rapidly and cheaply than
to process gas from Coral, the first section of existing FLNG solutions, the company added.
Area 4 that is slated for development. Eni and
its partners aim to start production at the Coral Vertical integration vs. LNG as a service
field in the second half of 2022. Assuming that These two projects are, of course, at very differ-
they reach this target, they will become the first ent stages of development. Coral South LNG
group to launch upstream development in the is gearing up to start commercial production
Rovuma basin. later this year and has already spent a significant
In the meantime, the consortium’s contractor amount of money. NFE, by contrast, has only
– TJS, a group formed by the companies Technip reached the point of signing an MoU and is not
Energies (France), JGC (Japan) and Samsung ready to make any formal commitments.
(South Korea) – will work to install the vessel It’s worth noting, though, that there is
at the operating site, which is located in approx- another significant difference between these
imately 2,000-metre-deep water. The group will projects. Coral South LNG is something of a
be responsible for carrying out mooring and vertically integrated endeavour, as the Eni-led
hook-up operations. consortium is directing and funding the effort
The vessel is about 432 metres long and 66 to monetise Area 4 from top to bottom – by The difference
metres wide. It weighs 220,000 tonnes and can extracting the gas, processing it into LNG and
accommodate up to 350 people. It will be able loading onto tankers for exports. between the
to turn out around 3.4mn tonnes per year (tpy) NFE, by contrast, is coming from a different
of LNG from its single production train, and angle. It is not looking to invest in upstream two projects is
BP (UK) has agreed to purchase all of its output exploration and development. Instead, it is mak- illustrative of a
within the framework of a long-term agreement. ing its technology and capabilities available to
firms that are working at existing gas deposits broader change
Mauritania energy hub and aims to give them an economical means of
Meanwhile, NFE is looking to develop an LNG turning their production into LNG, ammonia, in the LNG sector
plant offshore Mauritania as part of a planned electricity or (presumably) pipeline shipments
energy hub. to onshore customers.
In a press release dated December 21, The difference between these two approaches
the company reported that it had signed a is illustrative of a broader change in the LNG
non-binding memorandum of understanding sector. LNG was initially perceived as a rela-
(MoU) with Mauritania’s government on the tively inflexible and cumbersome commodity,
establishment of an offshore facility capable of best suited to long-term, large-scale contracts
using existing gas reserves as feedstock for the handled by major players with the widest pos-
production of LNG, blue ammonia and electric sible range of in-house capabilities. Over time,
power. It did not say whether it had identified a though, the market has become more open and
source of gas for the proposed energy hub, but it flexible, with room for smaller players, more
did note that the facility would be able to deliver varied types of contracts and more specialised
gas to two power-generating facilities in Mauri- service providers.
tania. One of these, the 180-MW Somoelec ther- Hence the difference between Coral South
mal power plant (TPP), is already in existence, LNG and NFE’s proposal for Mauritania. Eni
and the other, a new 120-MW combined-cycle and its partners are a bit closer to the older pat-
TPP, is slated for construction, it explained. tern, in which everything is handled by the con-
NFE further stated that the facility would sortium’s operator and its chosen contractors,
make use of its “Fast LNG” technology, which whereas NFE almost appears to be talking about
uses modular units to establish midsize gas liq- offering gas liquefaction as one possible type of
uefaction plants in conjunction with jack-up service. (LNG as a service, perhaps?) If current
rigs or other types of floating infrastructure. This trends persist, there may be more companies
method will allow the partners “to produce LNG that take a similar approach in the future, treat-
in the Atlantic coastal basin offshore Mauritania ing LNG as a more flexible (and smaller-scale)
for local gas and power markets as well as inter- commodity than Coral South LNG and other
national exports,” it said in its press release. It can large consortia have done. ™

Illustration of Fast LNG from slide shown at NFE’s Q1-2021 earnings call (Image: NFE)

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