PetroSA to shelve FLNG project

South Africa’s PetroSA has decided to shelve a floating LNG import terminal in Mossel Bay, Southern Cape, following extensive research into the feasibility of establishing such a project.

A study undertaken by Worley Parsons concerning Mossel Bay’s suitability for an LNG terminal has determined that the location is technically and commercially challenging. The study found that meteorological and oceanographic (metocean) conditions in Mossel Bay are severe and would inevitably increase the logistical and overall gas supply costs of the project.

LNG imports

Since 2008, PetroSA has been investigating the possibility of importing LNG to supplement dwindling gas reserves in Mossel Bay. PetroSA has proposed the importation of LNG into Mossel Bay through a floating LNG facility (FLNG). The proposed FLNG facility comprised a breakwater and berth structure allowing a permanently moored floating, storage and regasification unit (FSRU) to discharge vaporised LNG into a subsea and overland pipeline leading to the Mossel Bay Gas-to-Liquids (GTL) Refinery.

PetroSA Group CEO, Nosizwe Nokwe-Macamo, said in spite of the challenges of locating an FLNG terminal in Mossel Bay, the company would continue with efforts to finding sustainable feedstock solutions for the refinery.

Comments

Commenting on the decision, Nokwe-Macamo said: "We are committed to Mossel Bay and the Southern Cape for the long-haul. Our focus is to now go back to the drawing board, and evaluate other long term feedstock options.”

She added that the feasibility studies had been very useful, as the company was now better acquainted with the oceanic conditions prevalent around the Mossel Bay area.

"As a good corporate citizen we had to follow due-process. The results from this are telling us it is not technically feasible to locate the LNG facility in the area. The good thing about this exercise is that the results of these feasibility studies will be put to good use in other projects in the medium to long term."

Global FLNG terminals

Nokwe-Macamo said PetroSA had closely studied the 13 operational FLNG terminals around the world in countries including Argentina, Brazil and the UK.

"The main distinguishing factor between these FLNG terminals and the one that was proposed for Mossel Bay is the fact that all of them are located either in very well protected ports, very near the shore or are located on very calm rivers,” she added.

PetroSA has consequently decided to explore the suitability of locating an LNG import terminal at other sites. The company is currently evaluating various location options.

Adapted from press release by Katie Woodward

Read the article online at: https://www.lngindustry.com/floating-lng/27082014/petrosa-scraps-flng-plans-in-south-africa-1281/