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Ophir, OneLNG and GEPetrol sign umbrella agreement for Fortuna FLNG

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Ophir Holdings & Ventures Ltd has announced that it has signed a detailed umbrella agreement (UA) with OneLNG SA and La Compañía Nacional De Petróleos De Guinea Ecuatorial (GEPetrol), establishing the full legal and fiscal framework for the Fortuna floating LNG (FLNG) project.

The UA reconfirms GEPetrol’s participation rights as partners for 20% of the upstream portion of the project. It also reconfirms a future potential participation of up to 30% ownership of the midstream FLNG unit by the Republic of Equatorial Guinea or a designated state company. The participations create alignment with the Equatorial Guinea Government throughout the project value chain from upstream through to LNG marketing. Ophir claims that the signing the agreement was a key milestone ahead of a final investment decision (FID).

The project is on schedule for mid-2017, with first gas expected in mid-2020. The total CAPEX for the integrated project is approximately US$2 billion to reach first gas. Approximately US$1.2 billion is expected to be debt financed, with full drawdown by the start of commercial operations.

The execution of this latest agreement is one of four key milestones for FID. The other three are: the award of construction contracts for the upstream and midstream vessel; the completion of the project finance facility; and a decision on the amount of gas to be termed at FID and signature of resulting LNG sale and purchase agreements (SPAs). Regarding these milestones, Ophir claims that:

  • The impending award of construction contracts is on schedule.
  • Term sheets have been agreed with a consortium of China-based lenders. The counter-parties to the financing have now entered into final documentation stage.
  • The Fortuna partners will decide within the coming weeks on the amount of the expected 2.5 million tpy to put under contract at FID from the several offtake options available.

Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons for the Republic of Equatorial Guinea, commented: “This agreement is in line with the government’s objective to deliver important projects that monetises our gas, promotes local content and brings world-class petroleum technology to Equatorial Guinea. It also has brought us one crucial step closer to realising the historic Fortuna FLNG project. The participation of Equatorial Guinea’s national companies was critical to Fortuna’s success and to maximising the project’s value at every level of the gas supply chain. The Fortuna project targets becoming the first choice supplier of LNG for the Gulf of Guinea region.”

Nick Cooper, Chief Executive of Ophir, commented: “The Umbrella Agreement is the important foundation agreement which formalises the value chain economics for the Government of Equatorial Guinea and the project participants. We welcome the introduction of Equatorial Guinea’s national companies as project partners and the alignment of interests that this brings.

“The remaining milestones of the construction contract awards, the finalisation of debt and the LNG offtake are as advanced as we had wanted them to be at this stage. The Fortuna FLNG Project therefore remains firmly on schedule for an FID by mid-year.”

Jeff Goodrich, CEO of OneLNG, added: “Signing of the Umbrella Agreement is a significant milestone. It represents an innovative way of doing business, brings alignment throughout the entire value chain to all of the Project Stakeholders, and provides clear line of sight to FID for the project. The Fortuna project remains on track to become the Africa’s first deepwater FLNG project.”

Read the article online at: https://www.lngindustry.com/floating-lng/02052017/ophir-onelng-and-gepetrol-sign-umbrella-agreement-for-fortuna-flng/


 

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