The Republic of Equatorial Guinea, Ophir Holdings & Ventures, a subsidiary of Ophir Energy, OneLNG and La Compañía Nacional De Petróleos De Guinea Ecuatorial (GEPetrol) have signed a detailed Umbrella Agreement (UA), that establishes the full legal and fiscal framework for the Fortuna FLNG Project, Africa’s first deepwater FLNG project.
The Fortuna FLNG Project FID is on schedule for mid-2017, with first gas expected in mid-2020. The agreements reconfirms the participation rights of GEPetrol as partners for 20% of the upstream portion of the project, and for a future potential participation of up to 30% ownership of the midstream FLNG vessel by the Republic of Equatorial Guinea or a designated State company. These participations create alignment with the EG Government throughout the project value chain from upstream through to LNG marketing.
Project Update
The execution of the UA completes one of the four key milestones required for FID. The other three are: (i) the award of construction contracts for the upstream and midstream vessel, (ii) the completion of the project finance facility and (iii) a decision on the amount of gas to be termed at FID and signature of resulting LNG SPAs. With respect to these milestones:
- The impending award of construction contracts is well progressed and on schedule.
- Term sheets have been agreed with a consortium of China-based lenders. The counter-parties to the financing have now entered into final documentation stage.
- The Fortuna partners will decide in the coming weeks the amount of the expected 2.5MMTPA to put under contract at FID from the several offtake options available.
Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons for the Republic of Equatorial Guinea, commented: “This agreement is in line with the government’s objective to deliver important projects that monetizes our gas, promotes local content and brings world-class petroleum technology to Equatorial Guinea. It also has brought us one crucial step closer to realizing the historic Fortuna FLNG project.”
Jeff Goodrich, CEO of OneLNG commented: “Signing of the Umbrella Agreement represents an innovative way of doing business, brings alignment throughout the entire value chain to all of the Project Stakeholders, and provides clear line of sight to FID for the project. The Fortuna project remains on track to become Africa’s first deepwater FLNG project.”
The expected total capital expenditure for the integrated project is approximately $2 billion to reach first gas.
Nick Cooper, Chief Executive of Ophir, informed that the remaining stages of the construction contract awards, the finalisation of debt and the LNG offtake are due to date, as estimated, so the Fortuna FLNG Project remains on schedule for an FID by mid-year.
