The government of Cameroon has today signed a fully effective and binding gas convention with the country’s state-owned oil and gas company Société Nationale des Hydrocarbures (SNH), Perenco Cameroon, Golar Hilli Corporation and Golar Cameroon (both part of Golar LNG).
The signing is the “final milestone” in approvals for the development of a floating LNG export project, in which one of Golar’s GoFLNG vessels will be deployed in waters off Kribi, Cameroon.
Golar will provide the liquefaction facilities and services under a tolling agreement to SNH and Perenco, who will be responsible for marketing the project located near shore off the coast of Cameroon.
Golar and Perenco have already signed a binding tolling agreement, which is expected to be formally approved by SNH soon, Golar said. The agreement establishes the terms under which Golar shall provide liquefaction, storage, and off-loading services to SNH and Perenco, the upstream joint-venture partners.
Natural gas reserves from offshore Kribi will be exported from the FLNG facility, which is currently under construction at Keppel Shipyard in Singapore.
Having finalised the gas convention and tolling agreement terms, Golar will now be able to draw down up to $700m from its debt facility to fund the ongoing conversion cost of the Golar Hilli, which is being converted from a Moss-type LNG carrier into an FLNG unit at Keppel Shipyard, Singapore.
The export project is expected to produced 1.2m tonnes of LNG per annum, representing approximately 50% of the vessel’s nameplate production capacity, over an approximate eight-year period. Production is scheduled to commence in the second quarter 2017.
“The achievement of this very significant milestone in the delivery of Golar’s FLNG strategy is the result of many years of hard work and technical innovation by our employees and partners. We consider ourselves very fortunate to be developing our first FLNG project in a very professional partnership with Perenco and SNH who have provided a solid foundation to this groundbreaking project,” said Golar’s CEO Gary Smith in a statement.
“We genuinely believe the employment of this first speculatively ordered FLNG unit and the approval for development of the Kribi field sets a new standard for development of gas reserves.”