Global FSRU demand ramps up

April 27, 2015

This year, Pakistan, Egypt, Jordan and Uruguay plan to begin importing natural gas via floating storage and regasification unit (FSRU) vessels. The vessels are a solution to the challenge of importing liquefied natural gas (LNG) into areas that lack sufficient transfer and regasification terminals onshore. These vessels provide solutions for small-market gas demand regions and as temporary solutions for where future onshore regasification facilities are planned.

The PGN FSRU Lampung. From Hoegh LNG.

The FSRU vessels are capable of transporting and storing LNG, and then regasifying LNG onboard to deliver volumes into offshore terminals or onshore receiving terminals. Offshore facilities typically include a buoy and connecting undersea pipelines to transport regasified LNG to shore. Onshore receiving terminals typically include large deepwater docks and takeaway pipeline infrastructure. Both types of facilities might also include gas processing equipment and natural gas liquids (NGLs) storage facilities.

According to the US Energy Information Administration, a total of 16 FSRUs serve the global market as transportation and regasification vessels. An additional five vessels, which have been converted into FSRUs from conventional LNG vessels, are permanently moored.

London-based Golar LNG owns four currently operational FSRUs, all based on conversions of LNG carriers. These are the Golar Spirit (operating in Brazil), Golar Winter (Brazil), Golar Freeze (Dubai) and Nusantara (Indonesia). Its newbuilds include the Golar Eskimo (Jordan), Golar Igloo (Kuwait) and Golar Tundra (for Marshall Islands in November 2015).

Antwerp-based Exmar owns the FRSU Toscana (Italy) and is building its to-be-named floating regasification barge for Liberia work.

Texas-based Excelerate Energy operates the largest fleet of FSRUs in the industry. Its vessels are purpose-built LNG tankers that can vaporization LNG and discharge natural gas as a liquid at a conventional LNG receiving terminal, or as gas through the FSRU’s connection with a subsea buoy in the hull of the ship, or as gas through a high-pressure gas manifold from the vessel’s LNG loading arms. Excelerate’s fleet include its Excalibur Class, Excelsior Class, Explorer Class, Experience Class, all built by Daewoo Shipbuilding & Marine Engineering.

Already the world’s largest LNG carrier operator, Mitsui O.S.K. Lines (MOL) plans to build, own and operate an FSRU with a storage capacity of 263,000 cu m of LNG—making it the world’s largest. The vessel will be built by Daewoo Shipbuilding & Marine Engineering Co. for delivery by September 2016.

The Gdf Suez Cape Ann. From Hoegh LNG.

Norway-based Hoegh owns the PGN FSRU Lampung at a purpose-built mooring system in the Lampung Province at the southeast coast of Sumatra, Indonesia. The company also owns the GdF Suez Cape Ann that is employed as China’s first FSRU in Tianjin, China. Hoegh’s Hoegh Gallant is working as an LNG import terminal (FSRU) in Ain Sokhna, Egypt, and its Independence is working as an LNG import terminal in Klaipeda, Lithuania.

On 27 March, Pakistan received its first FSRU-sourced LNG shipment into its newly developed receiving infrastructure near Port Qasim, Karachi via Excelerate Energy’s FSRU, the Exquisite. The shipment of 147,000 cu ft of LNG from Qatar docked at Engro Corp.’s Elengy Terminal Pakistan Limited. After regasification, the gas was injected into the Sui Southern Gas pipeline for further transportation and final sale to power generators in Punjab. Later shipments will be used as compressed natural gas and as feedstock for fertilizer companies.

Meanwhile, Egypt recently suspended gas exports and seeks gas imports to feed its growing consumption demand. The country began developing plans for an offshore regasification terminal in 2012, and received its first LNG cargo in early April.

Jordan is struggling to meet its own demand after Egypt suspended pipeline exports to the country, and has since secured an FSRU vessel to be moved to offshore Aqaba, accompanied by a 500 MMcf/d regasification terminal that is scheduled to come online in May 2015.

Uruguay is building infrastructure for an offshore 400 MMcf/d regasification terminal near Montevideo, which is expected to be completed in 2016. The facility will supply its domestic market and could provide exports to Argentina. Originally planned to come online in mid-2015, the regasification terminal has been delayed until 2016.

Elsewhere, four other floating regasification terminals are planned in the next few years for Colombia, the Dominican Republic, India, and the Philippines.

However, in Colombia, Pacific Rubiales delayed its acceptance of the delivery of an Exmar FSRU, and agreed to sell approximately 43% of its interests in Pacific Midstream (which owns the ODL and Bicentenario pipelines, the Petroelectrica power transmission line, and the future LNG project), to the International Finance Corp. and a consortium of investors in December 2014. The company received $240 million in cash in December 2014 and the remaining $80 million is expected to be received sometime in 2015 upon completion of certain condition precedents and the completion and transfer of the LNG project.

Floating regasification was first deployed in the US Gulf of Mexico in 2005 and has since been employed in Argentina, Brazil, China, Indonesia, Israel, Italy, Kuwait, Lithuania, and the United Arab Emirates.

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