Ophir Energy to make Block R FID in 2015. FLNG deal looming

Ophir Energy is pressing ahead with FLNG development of its natural gas field in Equatorial Guinea.

The company today revealed that it expects to make the Final Investment Decision for the development of its Block R, offshore E. Guinea, in 2015.

Ophir has an 80% operated interest in Block R to the west of Bioko Island in water depths of up to 1,950m.  Gross 2C recoverable resources now stand at 2.6 TCF with remaining prospective resource estimated at c.7 TCF, of which c.2 TCF is considered low-risk.

“We have considered a number of options to monetise our gas resource including supplying the existing LNG train as production from the Alba field declines or building a second LNG train at Punta Europa sharing facilities with the existing plant. However, we are progressing Floating LNG as the preferred development solution. This option is aided by the quality of the gas which needs minimal processing and the benign sea conditions in the Gulf of Guinea,” Ophir said in a statement.

Ophir also said that the process to select the preferred vessel provider is nearing conclusion. According to internet reports, a joint venture between Singapore’s Keppel , Malaysia’s Bumi Armada and Japan’s IHI, is racing with Excelerate and Samsung Heavy Industries JV to secure the FLNG vessel deal, reportedly worth around $2 billion.

An FLNG is able to process and convert natural gas to liquefied natural gas (LNG) on site and ready for export. This is an economical and environmentally efficient method of LNG production as it requires no pipelines to be built as well as no onshore processing facilities. Furthermore, as it is a vessel type unit, it can be re-mobilised if necessary. It is especially useful when natural gas deposits are very far from shoreand also in ultra-deep waters where pipe laying is expensive and challenging.

Worth noting, the Ophir FLNG will be the fourth FLNG project in the world so far. Shell’s Prelude FLNG being the first, and the second and third being PETRONAS’s PFLNG 1 and PFLNG 2. Elsewhere in Australia, Woodside is also preparing an FLNG FID, also expected next year.

On completion of further drilling in the area this year, Ophir will look to bring in upstream partners to progress the development with FID expected in 2015 and first gas likely in 2018.