NLNG Expansions.

NLNG exports from five trains, with a capacity of 18m t/y. Train 6 in early 2008 brought this to 22m t/y of LNG and 5m t/y of NGLs. But Train 6 remains suspended. Since October there have been question marks about the proposed Trains 7&8 to raise NLNG's capacity to 37m t/y by 2012/13, with the actual export potential to exceed 40m t/y. Its Trains 1&2 went on stream in June and October 1999. The partners in NLNG are NNPC (49%), Shell (the technical leader, 25.6%), Total (15%) and ENI (10.4% - see background in GMT7NigrGasExpAug15-05).

The NLNG trains are on Bonny Island in Rivers State in southern Nigeria. Train 7 could come online by end-2012 - provided that Abuja's moratorium on additional gas supplies has ended before 2010. The complex is supplied from dedicated non-associated gas fields. But it is anticipated that, within a few years, half of the feedstock will consist of associated gas from existing oilfields.

The first LNG cargo from Train 4 went to the US in early 2006. The train had begun production in November 2005. The first cargo was loaded on Jan. 7, 2006, for delivery to the Lake Charles, Louisiana, terminal. NLNG Managing Director Chris Haynes then said production at Train 5 had also started, which was the last leg of its $2.1 bn expansion aimed at raising earnings from LNG exports to $4 bn per annum. As Train 6 came on stream in early 2008, NLNG had a plan to export 14m t/y to Europe and the remaining 8m t/y to the US.

Cheniere Energy Inc. in March 2008 announced that its Celestine River LNG vessel had departed from the NLNG terminal fully laden with her first cargo of liquefied methane. By then Sabine Pass LNG had become the largest receiving terminal in North America by regasification capacity at 4 BCF/d and 16.8 BCF of LNG storage capacity, with two berths capable of handling the largest LNG tankers. The Celestine River was a new, 145,000 CM-capacity LNG vessel owned and operated by K-Line LNG shipping and chartered by Cheniere.

NLNG in late 2007 began to increase its LPG supplies to the domestic market, when it diverted 2,100 tons for local use. Until then, NLNG used to export all of its LPG. Under a government decree, NLNG is selling 150,000 t/y of its LPG to the domestic market. The government is working on increasing national LPG consumption to well over 1m t/y by end-2010. The NLNG produces LPG from trains 3, 4 and 5.

BG Group on Feb. 13, 2007, said it had signed a sale and purchase agreement (SPA) to buy 2.5m t/y of LNG from NLNG. BG Group will take the LNG for 20 years from NLNG's Train 7. Cargoes will be delivered to BG's North American marketing business at Lake Charles. BG Executive Vice President Martin Houston then said: "This agreementadds to our existing supply arrangements through Trains 4 and 5, which came into effect last year. It enhances the profitable long-term growth of BG's LNG supply portfolio and reflects the strength of BG's competitive position in the Atlantic Basin". A spokesman for NLNG said: "we are excited about the agreement. It is a continuation of our long-standing business relationship with BG".

ENI on Feb. 12, 2007, signed a 20-year SPA with NLNG for acquisition of 1.375m t/y (about 2 BCM/y) of LNG. This will be part of the volume which would be produced from Train 7, then scheduled to be on stream in 2012. The LNG should be delivered by NLNG to the terminal of Cameron, Louisiana, where ENI holds a re-gasification capacity of some 6 BCM/year, and should be sold to the US market.

It was then said that the volumes of LNG delivered to ENI through this SPA was to represent some 17% of the whole production of Train 7. This SPA was to make a further sizeable contribution to ENI supplies' portfolio, enabling the company to strengthen its brand LNG activities in the US and its role as leading player in the global LNG market.

Total on Feb. 13, 2007, said its wholly owned trading and marketing unit Total Gas & Power (TGPL) and NLNG had signed a 20-year SPA for 1.375m t/y of LNG to be produced by Train 7. The LNG should be delivered to the US and Mexico, in particular to Total's regasification capacity at the Sabine Pass and Altamira LNG terminals.

Then TGPL President Yves-Louis Darricarrere said: "With this LNG purchase, Total is delighted to further expand the scope of its co-operation with Nigeria, which is an important part of Total's portfolio and a key producer in the LNG industry". With the signing of this SPA, it was then said, long-term purchases of LNG contracted by Total were expected to grow to over 10m t/y.

A trail-blazer in the LNG business since 1964, Total has interests in six of the world's largest LNG plants which account for around 40% of world LNG production capacity. About 30% of the gas produced by Total in 2006 was dedicated to the LNG industry. Total is strengthening its position across the LNG chain, as illustrated by its August 2006 signatures to acquire a stake in Brass LNG in Nigeria, in the Ichthys LNG project in Australia and in the Qatargas-2 project in Qatar. After entry into the South Hook terminal in the UK, Total holds interests in five regasification terminal projects to ensure additional markets for its brand LNG business from the Middle East, the Gulf of Guinea and, in the near future, Northern Europe.

The Italian power utility Enel, part of the ENI group, in early 2009 received final clearance from the authorities for its LNG terminal in Sicily. Enel owns 90% of the project, which should have a capacity of 8 BCM/year. Enel will use gas it already has in its portfolio from Nigeria through Agip. The ENI group was then looking to close contracts with LNG sources such as Algeria, Egypt, Qatar and Abu Dhabi.

Print Get the Mag Weekly Updates