Analysts at Douglas Westwood say despite a current pause in commitments to new projects, the capital expenditure (capex) for Floating LNG (FLNG) vessels is expected to amount to US$35.5 billion over 2015-2021.
Spending on floating, storage, and regasification units (FSRU) will total $22.8 billion over the same period, taking the combined expenditure for the FLNG market to $58.3 billion.
"There is a huge interest in the pioneering projects that will drive market spend over the coming years. Future commitments by operators to the FLNG market hinges on the success of these pioneering projects," Douglas Westwood says.
The delivery of Petronas’ PFLNG 1, also known as the PFLNG SATU, will be the world’s first FLNG vessel to start operations on its completion by the end of 2016. This will be followed by Shell’s Prelude FLNG vessel, a significantly larger project and one that is likely to shape future FLNG developments. Construction of the 488m-long facility started in 2012 (the unit is being built by Samsung in Korea) and is expected to start up by 2017.
Following these projects is a second wave of new projects that are yet to be sanctioned but are expected to drive a growth in expenditure from 2019 onwards. This includes major projects in frontier regions such as East Africa.
Douglas Westwood anticipates more floating regasification units are to be sanctioned, with Asia and Latin America being the dominant regions. Upcoming projects are visible in Indonesia, China, Pakistan, India, Vietnam, Bangladesh and Sri Lanka, mostly led by national oil companies. Latin America will see deployments of floating regas units in Chile and Puerto Rico.