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Chevron-led Angola LNG project gets okay Chevron, BP, Total, Eni and Sonangol agree to start construction on plant to liquefy a billion cubic feet of gas daily for U.S. Allen Baker For Petroleum News
Chevron Corp. and its partners are ready to move into the construction phase of a giant liquefaction plant to serve offshore gas production in Angola, after approval from that country’s government.
The plant, in planning since the 1990s, will be near Soyo in the extreme northern coastal region of the African country. Much of the plant’s supply will come from gas associated with oil production. As in Nigeria, much of that has been flared in the past.
Chevron’s Dec. 10 announcement didn’t provide a cost estimate for the project, but the capacity of 5.2 million tonnes annually puts it firmly in the $5 billion neighborhood, well up from original estimates in the $2 billion range. The plant will also process natural gas liquids and send out up to 125 million cubic feet of gas daily for the domestic market.
Chevron, long active in Angola, is the lead partner with 36.4 percent of the project. Sonangol, the national oil company, has 22.8 percent after selling a 13.6 percent share to Eni of Italy, while BP and Total each holds a 13.6 percent share.
The plant is expected to be the largest single investment ever made in Angola.
“Chevron has worked and been in partnership with Angola for the past 50 years, and we appreciate the government of Angola’s strong support for the project and are proud to partner with Sonangol and the other shareholders to move this project forward,” said Alan Kleier, managing director of Chevron’s Southern Africa operations. “The benefits of Angola LNG are broad — the project is expected to commercialize the country’s natural gas resources, facilitate more oil development and natural gas exploration and provide natural gas for domestic use to stimulate further economic development.”
Angola, which recently joined the Organization of Petroleum Exporting Countries, produces about 1.8 million barrels of crude daily.
Bound for Mississippi The plant is expected to start shipping LNG in 2012, with the cargoes to be delivered to the U.S. market through the Gulf LNG Clean Energy terminal to be built near Pascagoula, Miss.
El Paso Corp. bought a half-interest in the Gulf LNG terminal in November from Crest Group, a Houston investment concern, paying $294 million. A subsidiary of Sonangol holds 30 percent of the $1.2 billion project, with Crest retaining 20 percent.
The port has a 20-year supply deal with Sonangol. Site work has already begun for the terminal, and a construction contract is expected early next year. Chevron has approval for an LNG terminal of its own in the Pascagoula port, where it operates a major refinery.
El Paso operates an existing LNG terminal near Savannah, Ga.
Exxon off New Jersey Exxon Mobil Corp. has proposed a $1 billion liquefied natural gas terminal off the coast of New Jersey, that company said Dec. 11. The floating terminal would be anchored 20 miles from the New Jersey shore and about 30 miles from Long Island in New York.
Jeff Tittel, executive director of the New Jersey chapter of the Sierra Club, said his organization was not opposed to liquefied natural gas “because we think it’s a lot cleaner than coal” and produces fewer greenhouse gases.
Tittel said the offshore location was an advantage because a terminal on land would be more vulnerable to terrorism.
ExxonMobil said the terminal would be moored in 150 feet of water and wouldn’t be visible from the New Jersey shore. The project is at the beginning of what the company called “a lengthy and rigorous permitting process.”
—Material for this story was provided by the Associated Press.
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