Page 14 - Euroil Week 21 2020

EurOil POLICY EurOil
Ukraine inks deal to buy US LNG
UKRAINE
Ukraine wants to take US LNG arriving at the Swinoujscie LNG terminal in Poland.
UKRAINE’S government has approved a mem- orandum with a US firm called Louisiana Natu- ral Gas Exports on the potential delivery of 5.5bn cubic metres (bcm) of US LNG, it said on May 27.
The amount would cover more than half of Ukraine’s annual gas imports, which reached 10.6 bcm in 2019.
Ukraine is striving to become independent in gas, having awarded dozens of contracts to investors over the past year to develop its domes- tic resources. For the time being though, it sup- plements domestic supply with imports from its EU neighbours Hungary, Poland and Slovakia. It stopped buying gas from its former main sup- plier Russia in 2015, after relations between the two neighbours broke down.
In the past year Ukraine has reached out to US gas suppliers, buying gas imported at the Swinoujscie LNG regasification terminal in northern Poland.
“The memorandum provides for the study of the possibility of diversification of natural gas supply sources by ensuring the long-term supply of LNG and the development of cross-border gas infrastructure,” Ukrainian Energy Minister Olga
Buslavets said in a message on the government’s website.
The Swinoujscie terminal is undergoing an EU-funded expansion that will raise its import capacity by 50% by 2024. Poland wants to posi- tion itself as a hub for regional gas trade, with several other import projects also underway, including new pipelines from Norway and Lith- uania and potentially a second LNG terminal in Gdansk.
This infrastructure will allow Poland to achieve its stated aim of ending reliance on Russian gas after its long-term contract with Gazprom expires after 2022. But if all these projects are realised it should also have some supplies spare for Ukraine. The two coun- tries aim to finish a new gas link to increase cross-border flows.
Ukrainian officials say that under the mem- orandum, the price that Ukraine pays for US LNG would be pegged to prices at Louisiana’s Henry Hub. Louisiana Natural Gas Exports does not have a website, but is registered with the US Security and Exchange Commission and incor- porated in the state of Delaware, according to US records. ™
PROJECTS & COMPANIES
Pair of North Sea fields cleared for decommissioning
UK
The decision was taken before the oil price crash.
AUTHORITIES in the UK have cleared plans for the decommissioning of infrastructure at the Banff and Kyle fields in the North Sea, operated by Canadian Natural Resources Ltd (CNRL).
In the plans it submitted, CNRL said that production rates from both fields continued to decline, and that they would become uneco- nomical in 2020. It looked at options for extend- ing the lives of the fields but none were viable, it said, leading it to decide on decommissioning.
One option the operator considered was a near-field tie-back, de-bottlenecking of the Kyle field and development drilling.
Notably, CNRL filed for permission to cease production before the oil price crash in March, which has rendered many planned North Sea investments unfeasible until conditions recover. Permission was granted by the UK Oil and Gas Authority (OGA) on March 2.
The Banff and Kyle fields lie 200 km east of Aberdeen in waters 95 metres deep. Their decommissioning will involve the removal of
floating storage facilities, subsea installations and riser sections during three phases over the course of five years.
The first phase calls for the removal of the Petrojarl Banff floating production storage and offloading (FPSO) vessel at Kyle and the accom- panying Apollo Spirit floating storage unit (FSO). Petrojarl Banff has been flowing oil since 1999, with a capacity of 90,000 barrels per day (bpd). The Apollo Spirit receives oil processed from Petrojarl Banff via a flexible riser. Oil is stored in the vessel’s cargo tanks and offloaded periodically.
Work on this phase will begin this summer, and will involve the flushing and cleaning of the subsea production system, the FPSO and FSO. Together with the vessels, buoyant flexible pipe- lines and vessel mooring infrastructure will also be removed.
The second and third phases cover the decom- missioning of subsea installations and pipelines, and well plugging and abandonment.™
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w w w . N E W S B A S E . c o m Week 21 28•May•2020