Contractors chosen for Russian LNG project

September 30, 2013

Rosneft and ExxonMobil have selected CB&I UK and Foster Wheeler Energy as the initial phase front end engineering and design (FEED) contractors for the two oil giants’ Russia Far East liquefied natural gas (LNG) project. The contractor selection process began back in August.

“We look forward to working with Rosneft and our initial FEED contractors on further evaluation of specific technical and commercial aspects of a potential LNG project,” said Glenn Waller, president of ExxonMobil Russia. ”Special attention will be given during the design phase to reduce the environmental impact on the unique ecosystem of the area and to developing local infrastructure.”

In 2013, around two years after Exxon and Rosneft signed the 2011 strategic cooperation agreement, the two companies completed several major milestones in the agreement, including: the formation of joint ventures framework for Kara Sea and Black Sea projects; agreements on seven Arctic license areas; established foundation for joint venture to implement Western Siberia tight oil project; and advanced the Russian Far East LNG plant to the next stage.

The planned LNG plant off Sakhalin is expected to have a capacity of 5MPTA, and is scheduled to come onstream in 2018. It will receive natural gas from Rosneft’s reserves in the Far East and other Sakhalin gas reserves.

Both CB&I UK and Foster Wheeler Energy will be awarded separate contracts for FEED. The scope of work features a conceptual project, including finalizing details for an LNG plant site; gas liquefaction technology; and construction method. Once submissions are received from the companies reflecting their respective concepts and designs, Rosneft and ExxonMobil will evaluate and award the contract for the second phase of FEED.
The project design phase is planned to be finalized by the end of 2014.

“We are pleased with the technical progress of our joint team of experts from Rosneft and ExxonMobil,” said Rosneft President Igor Sechin. “With our initial FEED contractors on board, now we will see the project begin to take shape in a matter of months. We are taking a determined approach with this project to help monetize the gas resources of Russia.”

For a video on Rosneft and ExxonMobile's Strategic Cooperation Agreement, please click here.

Pictured are Sechin, left and Waller at the signing of the Strategic Cooperation Agreement. Photo: Rosneft



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