Exmar team eyes first FLRSU

July 1, 2012

Wison Offshore & Marine, Exmar and longtime LNG consulting and engineering firm Black & Veatch have teamed up on what the companies promise will be the first floating LNG liquefaction, regasification and storage unit (FLRSU), to be installed 3km offshore Colombia. Russell McCulley reports from Shanghai, where executives from the three companies gathered to discuss the project.

Executives met in Shanghai in early June to sign the engineering, procurement, construction, installation and commissioning contract Exmar awarded to Wison's offshore & marine division, culminating more than a year of negotiations and planning. "We are on the verge of a very fast-growing market," says Exmar CEO and managing director Nicolas Saverys, a scion of the family that founded the Belgian company in 1829.

The vessel a barge measuring 140m by 32m wide and 18m deep will be built at Wison's Nantong, China, fabrication yard and equipped with Black & Veatch's Prico LNG processing technology. Exmar will operate the installation on behalf of Colombia's Pacific Rubiales Energy, 100% owner of the currently producing onshore La Creciente field, in Colombia's Lower Magdalene Valley Basin, where the gas for the project will originate.

flrsuThe FLRSU will be permanently moored to both a jetty and a floating storage unit. The FLRSU will convert gas provided from the onshore La Creciente field into LNG and transfer the LNG to the storage unit, from which it will be offloaded to LNG tankers for distribution. Inset (from left): Breaux, Saverys and Kerns.

The FLRSU will be capable of converting 69.5 million scf/d of natural gas to LNG, which will be temporarily stored in onboard tanks with a total capacity of 14,000m3 and either offloaded to a moored floating storage unit or shuttle tankers. The processing unit will be moored to a jetty in 15m water depths off Colombia's Caribbean coast. Topsides equipment will weigh roughly 5000t.

Onboard regasification equipment will be used to supply the domestic Colombian market, Saverys says. La Creciente is currently producing around 60mmscf/d and could more than double that amount with the planned addition of several wells, which would supply far more gas than the local market can absorb. Plans call for the new facility to export some 75mmscf/d.

Saverys says the floating option makes sense in this case for a number of reasons, not least the need to minimize what he calls the project's eco-footprint.

If you put an installation a couple of miles at sea, you have no visible pollution, you have no NIMBY factor, he says, a reference to the not in my back yard opposition to large-scale projects. And you can even take it away after the end of the industrial necessity of it, he continues. Next to that, I think there are also cost factors. The FLRSU, including installation, is expected to cost around $300 million.

fabrication yardWison's fabrication yard in Nantong, China.

Most of these remote places are in very nice little places of our planet, Saverys says. Maybe 20 or 30 years ago, we were looking less at this (ecological) aspect. But I think today people want energy, but not at the cost of the environment.

The facility is designed to serve La Creciente for 15 years, although Exmar expects that the field will continue producing to the FLRSU beyond that time. Pacific Rubiales plans to bring the FLRSU into service in late 2014.

Gas production with less than 1% CO2 and the unit's sheltered location minimized the modifications needed to replicate a land-based liquefaction plant offshore, says Wison Offshore & Marine executive VP Dwayne Breaux.

It is a very benign environment, very sheltered, with [more] limited exposure than you would normally see in an offshore project, Breaux says. Wison was able to leverage our deepwater offshore experience with Black & Veatch's technology. We understand, in working with Black & Veatch, that the marinization of that package has been accounted for. This plant sitting on a barge 3km offshore is not significantly more harsh than a plant sitting on the beach in a similar environment.

Taking the facilities offshore was a very simple process, says David Kerns, executive VP and director strategic planning & risk management for B&V Energy, a division of Black & Veatch Corp. Probably the most complex thing on [the barge] is the cargo handling system, and for that we are working with a proven provider: Germany's TGE Gas Engineering. Fabrication of the cargo handling systems will take place in China, headquarters of China International Marine Container, a major stakeholder in TGE. Marine engines and other equipment will be sourced globally, Kerns says, including a nominal amount from China.

The bulk of the 28-member marine crew needed to operate the facility will be Colombian citizens, in keeping with local content rules.

The complexity, or the challenge, is primarily associated with the dry tow from the shipyard to the project site, Kerns continues. We will do some additional design work to understand the conditions that the barge and the related topside fabrication component will experience during this dry tow to make sure that when it arrives in Colombia it is in the same shape it was in when it left the shipyard.

The partners are currently negotiating with Colombian authorities to secure approvals for the offshore pipeline and mooring, a process that could take up to 12 months.

Saverys defends the relatively modest size of the installation.

We have had a lot of criticism because our project is so small, he says. But I think that small is beautiful in this case. Our joint risks are limited, it is affordable, and we are going to prove certain things and bring this industry to more transparency.

Exmar is also confident, he says, that its main contractors would be able to pull off the first FLRSU. Wison Offshore & Marine ‘may be the new kid on the block in the EPCIC arena but showed strong interest, he says. Wison's Nantong shipyard also showed great eagerness for the project during early discussions, when many other yards were working at capacity, Saverys says.

Breaux agrees: Wison is young in the offshore marine side, but in fact in the onshore downstream domestic market, Wison has done more than 100 projects here in China. We are young as a shipyard, but our goal is to be a major offshore marine supplier.

The first FLRSU will almost certainly not be the last for Exmar, Saverys says.

There is enough stranded gas worldwide, which very often is being stupidly flared, and where the technology is not there to bring this gas to markets, he says. We think that there are plenty of opportunities in the world.OE



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