Malaysian oil giant will supply €283 million floating LNG terminal

Updated on 15 April at 8:32am

Malaysian oil field services firm Bumi Armada has won contracts worth $300 million (€283 million) to provide a floating storage unit in Delimara, to ElectroGas Malta.

The contracts are for a period of 18 years and two months from 2016, Bumi Armada said in an announcement to the stock exchange.

In December 2013, Gasol plc had said that Azerbaijan state company SOCAR will provide the supply of liquefied natural gas and a floating storage vessel for the 200MW gas power plant.

Bumi Armada’s wholly owned subsidiaries Armada Floating Gas Storage Malta Ltd and Armada Floating Gas Services Malta Ltd on Monday entered into agreements with ElectroGas for the conversion, supply and operations and maintenance, respectively, of one floating storage unit.

AFG Storage is principally involved in the business of owning and chartering of ships and vessels among others whilst AFG Services is principally involved in the provision of marine support among others. AFG Storage has identified an LNG carrier which has been approved by ElectroGas, as the conversion vessel for this project. The acquisition of the LNG carrier is currently being finalised.

A 32-year-old LNG carrier under the control of a Japanese could be the most likely vessel to be selected for the job – the NYK-owned 125,568-cbm Echigo Maru – but Mitsui OSK Lines (MOL) could still be in the running with its candidate, the 125,000-cbm Wakaba Maru (built 1985), which the company began marketing for sale or scrap last year. Awilco LNG was also recently been engaged in talks for the job.

ElectroGas Malta comprises lead shareholder Gasol plc on 30%, Socar Trading with 20%, Siemens Projects Ventures on 20% and Maltese firm GEM Holdings with 30%. ElectroGas will be supplying LNG to Enemalta for the period of 18 years and also construct an LNG plant.

Under the plan for the import facility, the floating storage unit will cast anchor just off Delimara, backed up by an onshore regasification plant of 55 to 60 million cubic feet per day. The gas will supply the Delimara power station extension’s 149-MW plant, currently running on heavy fuel oil, while ElectroGas will provide a new 200MW LNG power plant to be completed by March 2016.

Greek company J&P Avax will construct a €125 million terminal for the FSU.

The effective date of the contracts is 13 April 2015.

Commenting on the signing of the contracts, Chan Chee Beng, executive director and the acting CEO of Bumi Armada said: “These contracts are a significant milestone for Bumi Armada’s new venture in the promising floating LNG business. The project is of national importance to Malta and we are proud of being entrusted to deliver a critical part of this project.”

Bumi Armada is a Malaysia-based international offshore oil and gas services provider with a presence in over 18 countries spread across five continents.

The plant was scheduled to be completed by March 2015, but has been postponed to March 2016.

Japan's Kobe Steel Ltd has also announced that it will supply two intermediate fluid LNG vaporisers (IFVs) to the Delimara LNG regasification terminal. The FSU will supply LNG to the land-based receiving terminal, where the regasification facility will vaporise the LNG into natural gas. Kobe Steel’s IFVs will be the main equipment installed at the LNG regasification facility.

To increase the power generation capacity of the new combined cycle power plant, cold energy derived from LNG regasification of Kobe Steel’s IFVs will be used in order to cool the air to the gas turbines.