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Gazprom eyes LNG bunkering market
PROJECTS & COMPANIES
RUSSIA’S Gazprom is set to join the burgeoning market for LNG bunkering, with plans to break ground next year on an LNG refuelling facility in the Far East.
The 1.5mn tonne per year (tpy) LNG plant will be built in Vladivostok at a cost of around $2bn, according to a Russian energy ministry presentation on September 24. It will fuel Russia’s growing fleet of LNG-powered vessels carrying oil and gas from the Arctic to the Asia-Pacific region.
Gas supplies for the facility will be delivered from Gazprom’s fields off the coast of Sakhalin Island using the Sakhalin-Khabarovsk-Vladiv- ostok (SKV) pipeline. The 1,800-km conduit, opened in 2011, is capable of flowing up to 5.5bn cubic metres per year of gas, but it has been underutilised because of limited local demand.
Gazprom has lagged behind its domestic rival Novatek in developing LNG, with its only pro- ject a 11mn tpy plant on Sakhalin Island that was launched in 2011. The company ditched plans to develop a larger a 5mn tpy export terminal in Vladivostok in favour of the smaller-sized refu- elling facility.
The global LNG bunkering market is growing
rapidly, in large part as a result of tougher UN emissions limits for shipping set to be intro- duced next year. Russia is meanwhile expanding marine-based exports of oil and gas from the Arctic, with the bulk of these supplies heading to Asia. This is the rationale behind Gazprom’s choice of Vladivostok as a location for a refuel- ling hub.
Gazprom will need to ramp up production in the Far East to provide gas for the facility. In June, it awarded an engineering, procurement and construction (EPC) contract to privately owned RusGazDobycha to complete development of the Kirinskoye gas field off Sakhalin. The project will bring its annual output to 5.5 bcm per year, from 700mn cubic metres at present.
Gazprom has also been discussing plans for over a decade to build a pipeline from Vladivostok to supply 20 bcm per year of gas to North and South Korea. The scheme stalled amid heightened tensions over Pyongyang’s nuclear missile programme. But Gazprom continues to hold talks on the project with Korean partners. Early this year Gazprom hired RusGazDobyca to expand SKV’s capac- ity at a cost of more than $500mn.™
AMERICAS
Magnolia draft supplemental environmental impact statement
Liquefied Natural Gas Ltd (LNGL) is pleased to advise that the United States Federal Energy Regulatory Commission (FERC) issued the Draft Supplemental Environmental Impact Statement (DEIS) for the production capacity amendment to the Company’s Magnolia LNG project on September 27, 2019. Magnolia LNG’s production capacity amendment, filed with FERC on 19 November 2018, would increase the total authorized production capacity of Magnolia from the currently authorised 8 million tonnes per annum (mtpa) to 8.8 mtpa.
In the supplemental DEIS, FERC concluded: “The modifications associated with the Production Capacity Amendment,
NEWS IN BRIEF
with the additional mitigation measures recommended in the supplemental EIS, would continue to avoid or reduce impacts to less than significant levels.
FERC also concluded: “There would be no substantive change in construction noise or air emissions from that previously analysed
in the Commission’s EIS for the Magnolia LNG Project and modelling demonstrates there would be no exceedances of the National Ambient Air Quality Standards.”
The supplemental DEIS is a critical milestone for the proposed Magnolia LNG project capacity upgrade, incorporating comments from FERC and other co-operating federal agencies. In completing the work necessary to issue the supplemental DEIS, FERC analysed publicly available data and data provided by Magnolia LNG associated with the construction and operation of the Magnolia LNG project.
FERC set 18 November 2019 as the deadline for receipt of public comments on the supplemental DEIS. Based on the Notice of Schedule for Environmental Review, previously issued by FERC on June 26, 2019,
the supplemental final environmental impact statement (FEIS) is expected to be issued by FERC on or before January 24, 2020. LIQUEFIED NATURAL GAS LTD, September 30, 2019
Annova LNG solidifies tax
agreement with Cameron
County
Annova LNG agreed to a 10-year tax abatement with Cameron County today. During construction, Annova LNG will make direct payments to the county of $5.5mn for community projects, in addition to property taxes. During operations, Annova LNG will pay $500,000 annually in a payment in lieu
of taxes (PILOT) for a total of $5mn over 10 years.
Annova LNG included a regional resident employment commitment to meet a minimum 35 percent of full-time employees and an assurance to staff the facility with
a minimum of 100 full-time employees to
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Week 39 03•October•2019