Exmar NV and Pacific Exploration and Production (PEP) have decided to terminate a Liquefaction and Storage Agreement, originally executed in March 2012 for a term of 15 years from delivery of the Caribbean FLNG (CFLNG) in Colombia. CFLNG has a liquefaction capacity of approximately 0.5 million tpy of LNG and a storage volume of 16 100 m3.
Since the original agreement was executed, the liquefaction of LNG in Colombia is no longer economic for PEP, due to substantial changes to the domestic natural gas market in the country and the international LNG market.
The Settlement Agreement stipulates a termination fee payable by PEP to Exmar in monthly installments from March 2016 until June 2017.
By virtue of the Settlement Agreement, any and all obligations in connection with the tolling agreement have been terminated, except for customary survival clauses (e.g. confidentiality and dispute resolution).
Exmar confirmed that it is actively negotiating new employment of the CFLNG with several counterparts. The company expects the CFLNG to be delivered in the 2Q16 from the Wison shipyard in Nantong (China).
Edited from press release by Callum O'Reilly
Read the article online at: https://www.lngindustry.com/floating-lng/09032016/exmar-and-pep-end-cflng-deal-2098/