Equatorial Guinea sees Fortuna FLNG off-taker decision in August


Joseph Afam with Agency Report

06 June 2017, Cape Town — Equatorial Guinea has short-listed Royal Dutch Shell and oil traders Gunvor and Vitol for an off-take agreement at its Fortuna floating liquefied natural gas (FLNG) export terminal and expects to make a final decision by August, its oil minister said on Monday.

Fortuna FLNG will be Africa’s first deepwater floating liquefaction facility, with production capacity of 2.2 million tons per year and an estimated start-up in 2020.

“Our criteria for selection (of the preferred off-taker) is very simple – whoever gives more money. So, whoever provides the biggest cash and good terms and alternatives to the state,” Gabriel Obiang Lima, Minister of Mines and Hydrocarbons, said at a press conference on Monday in Cape Town

“Clearly the ball is with the off-takers. We have already had discussions with them,” he said.

British oil and gas explorer Ophir Energy said in May it plans to borrow $1.2 billion from Chinese banks to back the development of Fortuna.

Addressing delegates at an African oil and gas conference earlier, Obiang Lima said he saw scope for adding another two FLNG terminals by year-end, as demand for LNG grew particularly on the continent.

He said the latest OPEC member, who joined the oil producing cartel in May, has entered into a binding agreement with OneLNG SA to explore the liquefaction and commercialisation of natural gas in offshore Blocks O and I.

OneLNG is a joint venture between Golar LNG and Schlumberger to rapidly develop gas reserves into LNG.

“That combination will give us a lot of flexibility,” Obiang Lima said.

He also named the winners of the 2016 licensing round for onshore and offshore blocks, with Ophir Energy among seven companies that included firms from Israel, Ireland and South Africa, who were awarded seven blocks.

Earlier Equatorial Guinea, a former Spanish colony, and Sub-Saharan Africa’s third largest oil producer signed a production-sharing contract for offshore block EG-11 with U.S. oil major ExxonMobil, for one of the blocks on offer.

“Block EG-11 is the jewel among a group of already very prospective blocks that we are signing in 2017,” Obiang Lima said in a statement.

ExxonMobil already operates Zafiro field, the largest oil producing field in Equatorial Guinea, and Obiang Lima said the country intended raising oil output to 300,000 b/d by 2020.

*Wendell Roelf; Editing: Tiisetso Motsoeneng & David Evans – Reuters


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