Mega Floating Gas Platforms Way Forward for Africa

Jan 7 2019

Gas producers are embracing a technology that allows them to bring to market gas deposits that would otherwise be left where they are

Floating gas platforms are the latest technology being embraced by energy-hungry African countries, an advancement that could unlock previously uneconomical resource deposits up and down the continental coastline.

Traditionally gas has been at the bottom of the list of African resources, either ignored or even flared off as an inconvenient by-product of oil. The cost of extracting, storing and transporting it were seen as too high. Besides, Africa was proving rich in oil, a far easier commodity to monetise.

This has now changed, in part due to the way in which gas itself is being packaged. Usually, undersea gas is sourced from a well, then transported via undersea pipelines to a storage facility on the coast. South Africa’s largest offshore gas deposit the Ibhubesi field, for instance, lies more than 100 kilometres offshore.

Development of Ibhubesi has been delayed in part because of the cost, which had been estimated at around $4 billion. Now, the economics of offshore gas projects like this are rapidly changing.

“Offshore floating natural gas [FLNG] is becoming increasingly attractive compared to building an onshore plant,” says Suba Sivandran, capability and strategy director for critical infrastructure at BMT, a UK engineering company that is one of the pioneers of the technology.

“Some key advantages are lower cost, earlier production, overcoming development issues and vessel leasing options.”

Mr Sivandran says global capital expenditure on floating gas platforms is projected to exceed $50bn over the coming half decade. About $42bn of this amount is earmarked for gas liquefaction ships. Gas will be harvested from the ocean, processed on board and then transferred to transport ships. The ships could be supplied by pipelines from the mainland. But with these mega-ships, offshore LNG can be processed on site.

“This investment will lead to the installation of 15 floating gas vessels globally, many of which are planned for the African continent.”

The world’s first completed FLNG production facility is the FLNG Satu located in Kanowit gasfield off the shore of Sarawak in Malaysia, which started operations in 2016 and and is owned by Petronas. Shell started building the world’s second floating LNG facility in 2013. FLNG Prelude weighs in at 600,000 tonnes, which is six times the weight of the world’s largest aircraft carrier. Prelude, a “floating liquefied natural gas facility” is 1,600 feet long and 243 feet wide. That makes it the biggest ship in the world, according to the BBC.

As a floating natural gas facility, it is anchored off the coast of Western Australia for 25 years, acting more like a platform than a mobile vessel. The ship is anchored to the sea floor with a 93-metre-tall turret while it processes 175 Olympic swimming pools’ worth of liquid natural gas year-round.

On December 25 last year, Shell announced that the wells had been opened at the Prelude.

“Prelude now enters start-up, ramp-up, which is the initial phase of production where gas and condensate is produced and is moved through the facility. Once this has concluded the facility will be stabilised for reliable production of LPG and LNG,” Shell said.

Using such ships, potential gas projects in Africa will no longer be constrained by having to carry the cost and risk of getting the commodity to the shore. Instead, a floating platform will be used to pump it out, and directly into a waiting ship, from where it can be transported anywhere in the world.

In September this year Rome-based ENI announced construction had begun on a FLNG vessel that will be used to service its Coral field, off the coast of Mozambique. The Coral field, discovered in May 2012, contains approximately 16 trillion cubic feet of gas.

“The decision to use an FLNG vessel to develop the Coral field is based on the properties and location of the field itself,” an ENI spokesman tells The National.

The Coral field lies in water depths ranging between 1,500m and 2,300m, approximately 55km offshore. The combination of depth and distance make conventional pipelines costly to install and maintain, the spokesman says.

“FLNG technology is suitable when transporting gas to land is problematic because of the distance from the coast or the nature of the sea bed. At the same time, it requires deposits that can ensure a continuous supply for 25-30 years, as the Coral deposits will.”

The floating vessel itself will be equipped for receiving, processing and liquefaction of the produced gas.

Meanwhile, Bermuda based Golar LNG operates a fleet of gas-transport vessels. Last year Golar moored the Hilli Episeyo off the coast of Cameroon, where it is producing gas, after dispatching its first shipment to China in May.