DW: Prelude to a $60B FLNG Growth Story?

Posted by Michelle Howard
Monday, March 03, 2014
Photo: Shell

Following first steel cutting in late 2012, Shell’s Prelude Floating Liquefied Natural Gas (FLNG) unit continues to take shape in Samsung’s Geoje shipyard in Korea, Douglas Westwood (DW) said in its Monday report.

At 488 meters long by 74 meters wide and with an LNG processing output of 3.6 million metric tons per annum (mtpa), its specifications are impressive; but what DW said is perhaps more interesting is that the Prelude unit has the potential to be a gamechanger, indeed Shell’s boss at the time ranked Prelude as his most important strategic decision. Prelude, along with several other near-term projects, forms the vanguard of a global FLNG vessel market that could be worth more than $60 billion from 2014-2020 according to DW’s latest publication on the subject.

Shell’s interest in FLNG has been driven by both the strong LNG market fundamentals, and the challenges associated with construction of large onshore liquefaction schemes, especially where promising gas fields are located far from shore. Shell and its technology partners have taken an approach to the design which allows modules to be added and subtracted based on the expected fluid composition, DW reported. For example, Prelude is a rich gas field, meaning the liquids content is relatively high, necessitating processing and treatment modules to monetize these valuable associated products. With a leaner gas input, these modules could be replaced with additional liquefaction capacity allowing processing of 6 mtpa of LNG.

Of course, being “serial #1” contains a number of challenges, including the costly upfront engineering time and the contract interface risks associated with managing such a complex project. In addition, standardization arguments tend to be viewed with some skepticism within the industry, DW added. External factors also impact on FLNG projects including the potential loss of economic benefit to local communities linked to siting the LNG production offshore. Balanced against these downside issues, Shell and its peers have the ability to make this kind of mega-project work, as well as the obvious requirement to book new reserves in increasingly challenging conditions.

douglas-westwood.com

Maritime Reporter March 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Shipbuilding

First Supramax Vessel for Japan-Italy Venture

'DACC Tirreno' was delivered at the Oshima shipyard in Japan yesterday, the first of four Supramax bulk carriers for the dACC Maritime Limited fleet, the joint

Austal Graduates 48 4-Yr Apprentices

Austal USA combined two classes to graduate a total of 48 members of Austal’s cutting-edge four-year apprenticeship program yesterday at a formal ceremony held at the Arthur R.

BAE Systems to Expand San Diego Shipyard

BAE Systems announced it will invest approximately $100 million to expand drydocking capabilities at its San Diego shipyard.   The investment, which will include

Offshore

JV Wins $2bln Freeport LNG Contract in US

A joint venture (JV) between CB&I, Chiyoda International and Zachry Industrial has won a contract worth over $2bn from FLNG Liquefaction 3 for a liquefied natural

Feds Delay LNG’s Port Ambrose Application

The US Coast Guard and the US Maritime Administration (MARAD) have temporarily suspended their review of the proposed Port Ambrose deep-water LNG import terminal.

Nations Convene for Arctic Maritime Discussion

Citing an increasing need to ensure safety, security and stewardship of Arctic waters, member countries of the Arctic Council gathered at U.S. Coast Guard Headquarters

Energy

Feds Delay LNG’s Port Ambrose Application

The US Coast Guard and the US Maritime Administration (MARAD) have temporarily suspended their review of the proposed Port Ambrose deep-water LNG import terminal.

Austal Graduates 48 4-Yr Apprentices

Austal USA combined two classes to graduate a total of 48 members of Austal’s cutting-edge four-year apprenticeship program yesterday at a formal ceremony held at the Arthur R.

Mexico Unveils National Strategy ahead of Paris Climate Talks

Mexico on Friday said it will cap its greenhouse gas emissions by 2026, becoming one of the first countries to formally submit its national climate plan the

LNG

JV Wins $2bln Freeport LNG Contract in US

A joint venture (JV) between CB&I, Chiyoda International and Zachry Industrial has won a contract worth over $2bn from FLNG Liquefaction 3 for a liquefied natural

Feds Delay LNG’s Port Ambrose Application

The US Coast Guard and the US Maritime Administration (MARAD) have temporarily suspended their review of the proposed Port Ambrose deep-water LNG import terminal.

GAIL Seeks 7 LNG Cargoes

GAIL (India) will buy seven liquefied natural gas (LNG) cargoes for delivery from October 2015 until December 2016, according to the tender document obtained by Reuters.

Offshore Energy

Nations Convene for Arctic Maritime Discussion

Citing an increasing need to ensure safety, security and stewardship of Arctic waters, member countries of the Arctic Council gathered at U.S. Coast Guard Headquarters

Advanced Drillships a Burden for Owners as Business Slows

Not so long ago, advanced drillships costing more than half a billion dollars each and capable of operating in ever-deeper waters practically guaranteed big profits for oil-rig operators.

Russia May Allow More Firms to Offshore Oil

Russia may allow more oil companies to access its offshore projects, Energy Minister Alexander Novak said on Friday.   "In general, the access can be extended," Novak told reporters in Moscow.

 
 
Maritime Careers / Shipboard Positions Naval Architecture Navigation Offshore Oil Pipelines Pod Propulsion Port Authority Salvage Ship Electronics Ship Repair
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.2152 sec (5 req/sec)