Malaysian energy giant, Petronas, will be the world’s first company to export liquefied natural gas (LNG) produced from a floating production unit. This will set Petronas in a position to beat rivals like Royal Dutch Shell in a race that has reportedly cost developers billions of dollars.
The PFLNG Satu (Petronas Floating LNG Satu) is situated near the coastal town of Bintulu on Borneo Island in Malaysia. It is also reported that the PFLNG Satu has been loading LNG into the 144,000 cubic metre of capacity Seri Camellia tanker.
Petronas officials have said that PFLNG Satu is advancing in its offshore phase of commissioning and would most likely achieve its phase of commercial operations by the beginning of 2017. The company also announced that all updates on PFLNG SATU would be announced in due course.
Based on Eikon data, it is reported that the LNG tanker arrived on March 25 and started with loading the LNG cargo. Traders who have knowledge of the matter have said that PFLNG Satu’s first export cargo would be heading for South Korea.
The Satu facility is estimated to have cost around US$10 billion having arrived in the waters last year. The other producers who are currently developing floating LNG production facilities include Royal Dutch Shell with around US$12 billion Prelude FLNG which is building the world’s biggest maritime vessel for use in Australia. Meanwhile, Japan-based Inpex is building its FLNG unit at around US$37 billion Ichthys export project, which is also for use in Australia.
Petronas is set to become the first company to produce LNG from a floating unit, as the other projects have been featured with delays. As the LNG industry is poised for changes with new supplies entering the market, it is reported that the volumes are coming mainly from the United States and Australia. The oversupply has reportedly resulted in over 70% fall in the Asian spot LNG process LNG-AS from their previous 2014 peak to nearly US$5.50 per million British thermal units (mmBtu).
These developments have marked an entry of Petronas into a super-elite club of global players having FLNG capability.