Øivin Iversen
Vice President
Höegh LNG
Floating LNG Production (FPSO)
The opening up of an untapped LNG supply source
2 / 28. juni 2010
Floating LNG Production (FPSO) –
The opening up of an untapped LNG supply source
• Key industry trends a...
3 / 28. juni 2010
Höegh Group
Family controlled since 1927…..
Other Activities
Asset Management
Real estate
Railways
Media...
4 / 28. juni 2010
Höegh LNG
Existing fleet
Delivered in
June 2010,
from Samsung
Heavy
Industries. The
vessel is
chartered ...
5 / 28. juni 2010
Höegh LNG
Strategic Projects
• Floating Production Storage and Offloading (FPSO)
•
• Front End Engineeri...
6 / 28. juni 2010
Business strategy
The complete Floating LNG value chain
Production &
Liquefaction
Transportation Storage...
7 / 28. juni 2010
Höegh LNG
The floating LNG chain – NOCs participation
Gas Asset
Gas Asset
Gas Asset Liquefaction
Company...
8 / 28. juni 2010
Key industry trends and their implications for NOCs
• More smaller off takers looking for Natural Gas
• ...
9 / 28. juni 2010
The market opportunities for LNG FPSOs
Will the NOCs participate?
Estimated Distribution of Offshore Gas...
10 / 28. juni 2010
LNG Process Capacity:
LNG: 0.85 - 3.00 MTPA
Gas Reserves: 1-4 TCF
Lifespan: 15 – 20 years
LNG FPSO Desi...
11 / 28. juni 2010
Risk and rewards for LNG FPSO Projects
• Risks
• A novel concept based on experience from Oil FPSOs and...
12 / 28. juni 2010
WHAT ARE THE CRITICAL ISSUES?
Risks and Rewards for LNG FPSO Projects
13 / 28. juni 2010
Critical issues for Floating LNG projects
1. Liquefaction technology
2. Cryogenics
3. Marine LNG experi...
14 / 28. juni 2010
Höegh LNG - Choosing the right team
HLNG FPSO
Topside Engineering
Shipyard
Finance
Citi/JPM
LNG shippin...
15 / 28. juni 2010
Höegh LNG FPSO
FPSO Development history
• Complete feasibility study for converting 129 000 m3
LNG carr...
16 / 28. juni 201016 / 28. juni 2010
• Technical:
• Comprehensive technical basis – developed to early Detail Engineering ...
17 / 28. juni 2010
Höegh LNG – LNG FPSO team
• Complete consortium
• World leaders in every segment
• Unmatched experience...
18 / 28. juni 2010
Typical field development timeline
3-5 yrs 6 mths 0.5 – 2 yrs 1 yrs 1 – 1.5 yrs 4 yrs
Exploration Appra...
19 / 28. juni 2010
Why choose Höegh LNG ?
Improved timeline
HLNG
Technical
Maturity
3-5 yrs 6 mths 0.5 – 2 yrs 1 yrs 1 – 1...
20 / 28. juni 2010
Project Execution – key to success
Select FEED Execution OperationAssess
Value (NPV)
Time
Good Project
...
21 / 28. juni 2010
Participation by NOCs in Höegh LNG FPSO development
• Höegh LNG offers NOCs joint owner-ship and operat...
22 / 28. juni 2010
Participation by NOCs in Höegh LNG FPSO development
LNG FPSO SPV
Höegh LNG
NOCs & Partner(s)
Gas Liquef...
23 / 28. juni 2010
Höegh LNG
Summary
• LNG FPSO allows for monetizing of smaller fields
• LNG FPSO allows for earlier star...
24 / 28. juni 2010
THE ONLY PARTNERSHIP OF THIS KIND IN THE MARKET
COMBINING LNG AND FPSO EXPERIENCE
LNG FPSO
Höegh LNG & ...
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Oivin inversen's presentation slides from the 2010 World National Oil Companies Congress

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Oivin inversen's presentation slides from the 2010 World National Oil Companies Congress that took place in June in London.

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Transcript of "Oivin inversen's presentation slides from the 2010 World National Oil Companies Congress"

  1. 1. Øivin Iversen Vice President Höegh LNG Floating LNG Production (FPSO) The opening up of an untapped LNG supply source
  2. 2. 2 / 28. juni 2010 Floating LNG Production (FPSO) – The opening up of an untapped LNG supply source • Key industry trends and their implications for NOCs • The market opportunities for LNG FPSOs-will the NOCs participate? • Risks and Rewards for LNG FPSO Projects • Project schedule, cost and the competitive advantage of LNG FPSO
  3. 3. 3 / 28. juni 2010 Höegh Group Family controlled since 1927….. Other Activities Asset Management Real estate Railways Media Other assets Höegh AutolinersHöegh LNG World’s 4th largest autoliner company with 50+ vessels 37 years of LNG experience and innovation Shipping Activities Höegh LNG Höegh Autoliners CETech
  4. 4. 4 / 28. juni 2010 Höegh LNG Existing fleet Delivered in June 2010, from Samsung Heavy Industries. The vessel is chartered to GDF Suez LNG Trading SA on a 20 year Time Charter for the Neptune project offshore Boston, US. Delivered in June 2010, from Hanjin Heavy Industries. The vessel will be on TC to Repsol for 33 months plus options. Ship management and Operation Agreement Delivered in 2009, from Samsung Heavy Industries. The vessel is chartered to GDF Suez LNG Trading SA on a 20 year Time Charter for the Neptune project offshore Boston, US. Delivered in 2006, from Mitsubishi Heavy Industries. The vessel is dedicated to the Snøhvit project, and is chartered by Statoil ASA. Delivered in 2006, from Mitsubishi Heavy Industries. The vessel is chartered on a 20 year TC for Total on the Snøhvit project. Delivered in 1979, from Newport News. Tractable LNG Trading owns the liquefied natural gas carrier Matthew. The vessel is operated by Höegh LNG. Delivered in 1973, from Rosenberg shipyard in Norway. Prototype of the Moss spherical cargo containment system. STX Frontier Suez Matthew GDF Suez Cape Ann GDF Suez Neptune Arctic Princess Arctic Lady Norman Lady
  5. 5. 5 / 28. juni 2010 Höegh LNG Strategic Projects • Floating Production Storage and Offloading (FPSO) • • Front End Engineering and Design (FEED) completed 2009 • Most advanced floating production project to date • Adaptable to wide variety of gas and associated gas fields • Operations agreement with Prosafe 2010 • FEED fully funded by Höegh LNG • Port Dolphin • Deepwater port offshore western Florida • Approved by US authorities • Offshore terminal for shuttle re-gasification vessels (SRVs) • Premium gas market • Fully funded by Höegh LNG • Port Meridian • Deepwater port offshore western England • Approved by UK authorities • Offshore terminal for floating storage and re-gasification vessel (FSRU) • Fully funded by Höegh LNG • Triton • Stationary FSRU offshore terminal in the Adriatic • Permitting process in progress • Joint development agreement with GDFSuez • GDF Suez and Höegh LNG to operate, tendering managed by HLNG • CETech • Compressed Natural Gas for moderate distance / moderate volume natural gas transportation. • competitive advantage is its unique composite tank technology • Wholly owned subsidiary.
  6. 6. 6 / 28. juni 2010 Business strategy The complete Floating LNG value chain Production & Liquefaction Transportation Storage Re-gasificationExploration End user FPSO Existing LNGC’s Neptune SRV’s Neptune SRV’s / DWP Port Dolphin / DWP Port Meridian / Triton
  7. 7. 7 / 28. juni 2010 Höegh LNG The floating LNG chain – NOCs participation Gas Asset Gas Asset Gas Asset Liquefaction Company LNG Offtaker Power plants Industrial Retail FPSO Transport Regas FPSO Lease Agreement Time Charter Agreement Regas Capacity Gas Purchase LNG Sales & Purchase Agreement UpstreamUpstream MidstreamMidstream DownstreamDownstream MarketMarket Scope: • Complete & Produce wells • Tie in from oil field to LNG FPSO • Maintain and ensure flow Participants: • NOCs • E&P companies Scope: • Aggregate gas resources • Own gas molecules in liquefaction facility • Finalize LNG sales and Purchase agreement • Lease FPSO Participants: • E&P companies • NOCs • Utility companies • Investors Scope: • Purchase LNG • Provide shipping for LNG • Provide regas capacity • Market and sell gas Participants: • Utility companies • NOCs • LNG Portfolio players Scope: • Industrial and retail consumption of gas Participants: • Utility companies • Industry Consumers
  8. 8. 8 / 28. juni 2010 Key industry trends and their implications for NOCs • More smaller off takers looking for Natural Gas • The smaller off takers also want to diversify the supply sources • Flaring of associated gas no more allowed • Need to handle the gas to sustain oil production • Changing the view on associated gas from “a cost” to “a revenue” • Extensive technical development on Floating LNG the last 10 years • Smaller sized projects 1-3 MMTPA open up for Independent Service Providers • NOCs can work with the Independent Services Providers in a similar manner as for Oil FPSOs Production Transportation Regasification Market Access
  9. 9. 9 / 28. juni 2010 The market opportunities for LNG FPSOs Will the NOCs participate? Estimated Distribution of Offshore Gas Fields (Logarithmic scale) Source: Pareto Securities 3922 1043 719 347 337 73 4 1 10 100 1000 10000 <0.1 tcf 0.1-0.25 tcf 0.25-0.5 tcf 0.5-1 tcf 1-5 tcf 5-50 tcf 50-100 tcf Future Technology Large scale onshore Facilities, potentially with a LNG FPSO as early production LNG FPSO or smaller onshore facilities Future technology Borderline economics Future technology Borderline economics
  10. 10. 10 / 28. juni 2010 LNG Process Capacity: LNG: 0.85 - 3.00 MTPA Gas Reserves: 1-4 TCF Lifespan: 15 – 20 years LNG FPSO Design Envelope – Medium Size Example 1 LNG 1.70 MTPA LPG 0.46 MTPA Condensate 0.22 MTPA Example 2 LNG 1.00 MTPA Condensate 0.10 MTPA Example 3 LNG 2.60 MTPA
  11. 11. 11 / 28. juni 2010 Risk and rewards for LNG FPSO Projects • Risks • A novel concept based on experience from Oil FPSOs and LNG industry • Rewards • LNG production of stranded reserves means revenue • Economics in smaller gas reserves • Larger fields can be developed with a 2 MTPA LNG FPSO to achieve early revenue and continue with baseload onshore development • Project construction at specialized construction site (Shipyard) to reduce risk
  12. 12. 12 / 28. juni 2010 WHAT ARE THE CRITICAL ISSUES? Risks and Rewards for LNG FPSO Projects
  13. 13. 13 / 28. juni 2010 Critical issues for Floating LNG projects 1. Liquefaction technology 2. Cryogenics 3. Marine LNG experience 4. Offloading 5. Interfaces 6. Offshore design & operations 7. Process plant integrity 8. EPC capabilities 9. Permitting 10. Cost & Finance Your team need to have excellent competence in all these areas
  14. 14. 14 / 28. juni 2010 Höegh LNG - Choosing the right team HLNG FPSO Topside Engineering Shipyard Finance Citi/JPM LNG shipping/regas FPSO Operations
  15. 15. 15 / 28. juni 2010 Höegh LNG FPSO FPSO Development history • Complete feasibility study for converting 129 000 m3 LNG carrier to FPSO (Moss Maritime) • Screening of suitable liquefaction technologies for FLNG applications (HLNG / Moss Maritime) 2006 2007 • Initiated Pre-FEED study for new-build LNG FPSO (Topside – CB&I Lummus, Hull/Marine - Aker Yards, Turret-Bluewater, Tandem Offloading – Framo) 2008 • Completed Pre-FEED study • 3rd party review of topside (Energy & Power Ltd.) • 3rd party verification of the Niche LNG technology performance (Sintef Research Institute) • Initiated extensive FEED (Topside - CB&I Lummus, Hull/CCS/Marine/Integration – DSME, Turret - APL) 2009 • Completed FEED - including 3rd party reviews and project risk assessments. Approval in Principle by DNV • Established Contract structure, Operations and Maintenance philosophies, Commissioning and Start-up procedures • Optimization Studies for further improvement of performance, efficiency and economics • 10+ Client/Field specific studies for clients • MOU with Prosafe Production for operation • MOU with KBR for Topside Engineering 2010
  16. 16. 16 / 28. juni 201016 / 28. juni 2010 • Technical: • Comprehensive technical basis – developed to early Detail Engineering in some areas • All key interfaces between Hull and Topsides closed-out during FEED • 300 000 engineering man-hours spent to date • 1 500 technical documents developed (from PFD’s to Mechanical Datasheets) • Project Execution (EPC): • Project Execution Plan • Project Team • Contracting Strategy / Basis for EPC Contracts • Commissioning and Start-Up Strategy • Operation and Maintenance Partner (Prosafe) • Project Risk Analysis performed • Capex based MTO’s and quotes from potential suppliers Höegh LNG FPSO Project Development
  17. 17. 17 / 28. juni 2010 Höegh LNG – LNG FPSO team • Complete consortium • World leaders in every segment • Unmatched experience • Combines Marine LNG experience with FPSO experience • Sufficient and adequate engineering capacity and competence within the same company Our Uniqueness 1. Liquefaction technology √ 2. Cryogenics √ 3. Marine LNG experience √ 4. Offloading √ 5. Interfaces √ 6. Offshore design & operations √ 7. Process plant integrity √ 8. EPC capabilities √ 9. Permitting √ 10. Cost & Finance √
  18. 18. 18 / 28. juni 2010 Typical field development timeline 3-5 yrs 6 mths 0.5 – 2 yrs 1 yrs 1 – 1.5 yrs 4 yrs Exploration Appraisal Assess Concepts Specific engineering Development Discovery FID Commitment wells completed Concept Selection E&P Company development phases: Conventional timeline • Typical schedule from FID to first LNG: 4 years • Schedule driven by topside engineering, long lead items and topside installation
  19. 19. 19 / 28. juni 2010 Why choose Höegh LNG ? Improved timeline HLNG Technical Maturity 3-5 yrs 6 mths 0.5 – 2 yrs 1 yrs 1 – 1.5 yrs 4 yrs Timeline improvements: Exploration Appraisal Assess Concepts Specific engineering Development Discovery FID Commitment wells completed Concept Selection E&P Company development phases: 3-5 yrs 6 mths 0.5 – 2 yrs 0.5 yrs 0.5 - 1 yrs 4 yrs Conventional timeline Total timeline improvements: 12-18 months
  20. 20. 20 / 28. juni 2010 Project Execution – key to success Select FEED Execution OperationAssess Value (NPV) Time Good Project Definition Poor Project Definition Good Execution Poor Execution Poor Execution 4 years of technical development already performed to support a Good Project Definition
  21. 21. 21 / 28. juni 2010 Participation by NOCs in Höegh LNG FPSO development • Höegh LNG offers NOCs joint owner-ship and operator-ship of the LNG FPSO • Through partnership, the NOCs can get access to all work done and experience gained from 4 years of extensive development • Höegh LNG has a proven track record of financing large and complex LNG projects • Höegh LNG has long standing relationships with all major shipyards with LNG ships and large new-built FPSO’s competence and capacity • Höegh LNG offers the shortest possible schedule to 1st LNG at a competitive price
  22. 22. 22 / 28. juni 2010 Participation by NOCs in Höegh LNG FPSO development LNG FPSO SPV Höegh LNG NOCs & Partner(s) Gas Liquefaction Company SPV Partner(s), NOCs and/or Asset owners Gas Field(s) Asset Owner(s) NOCs LNG Buyer Partner(s) LNG Shipping Co Payment flows Contractual commitments Lease agreement Gas Purchase Agreement FOB LNG sale Purchase Agreement LNG T/C Entities owning the gas in the various phases Gas processing service provider. Shipping service provider.
  23. 23. 23 / 28. juni 2010 Höegh LNG Summary • LNG FPSO allows for monetizing of smaller fields • LNG FPSO allows for earlier start up and earlier cash flow • LNG FPSO offers to turn cost of flaring and re-injection to revenue • Through a partnership with Höegh LNG the NOCs can benefit from 4 years of development work to shorten field development schedule • Through a partnership with Höegh LNG the NOCs can get access to world-leading companies in development of the LNG FPSO: KBR, DSME and Prosafe Production
  24. 24. 24 / 28. juni 2010 THE ONLY PARTNERSHIP OF THIS KIND IN THE MARKET COMBINING LNG AND FPSO EXPERIENCE LNG FPSO Höegh LNG & NOC LNG Shipping/Regas Topside Engineering ShipyardFPSO Operations Finance Citi/JPM Thank you for your attention! Øivin Iversen oivin.iversen@hoegh.com
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