Golar and Delfin sign agreement to jointly develop Delfin LNG project

The agreement will facilitate the financing, marketing, construction, development and operation of the Delfin LNG project – the first and only permitted FLNG export project in the US. The project is a brownfield deepwater port, requiring minimal additional infrastructure investment to support up to four FLNG vessels, producing up to 13 million tpy of LNG.

The UTOS pipeline – the largest natural gas pipeline in the Gulf of Mexico – was purchased by Delfin in 2014. The following year, Delfin submitted its Deepwater Port licence application. Delfin LNG received a positive record of decision from MARAD on 13 March 2017. On 1 June 2017, Delfin was granted approval from the Department of Energy (DOE) for long-term LNG exports to countries that do not have a free trade agreement (FTA) with the US.

Golar has successfully designed, financed, contracted and constructed its first FLNG vessel – FLNG Hili Episeyo. This vessel is scheduled to sail away from the Keppel shipyard in 3Q17, whilst a second vessel of the same FLNG design – the FLNG Gandria – will soon be converted, subject to a final investment decision (FID) by the Fortuna project partners. The company is currently developing the Mark II next-generation floating liquefaction solution, which is based on the designs of its Hili and Gandria vessels. The solution, as used at the Delfin LNG project, will be capable of producing 3 million tpy of LNG.

FID on the Delfin project is expected to occur in 2018, with first LNG to be delivered in 2021/2022.

The Chief Executive of Golar, Oscar Spieler, said: “Golar's proven execution model will allow Delfin to deliver the lowest cost liquefaction solution in the North American market with a construction time of less than three years. Golar's low cost modular floating technology will allow Delfin to make Final Investment Decisions in 3.0 million tpy increments at a lower unit cost than large land-based projects."

The CEO and Chairman of Delfin, Frederick Jones, added: “We look forward to working with Golar to deliver the first floating liquefaction project in North America and lead the second wave of US LNG projects. Golar's flexible, floating liquefaction model has proven to be the world's lowest cost liquefaction solution allowing Delfin to offer innovative commercial solutions with reduced credit requirements, mid-term offtake contracts (approximately 10 years) and FOB and DES LNG pricing based on fixed price, S curves or tied to a variety of energy indexes."