Did you know that the first floating liquefied natural gas (FLNG) facility being built in Nigeria by UTM Offshore Limited, which will be completed in 2026 will produce 300,000 tons of liquefied petroleum gas (LPG) annually and create 7,000 direct jobs?

A floating liquefied natural gas (FLNG) technology is one that makes the production, liquefaction and storage of natural gas possible at sea. This makes for the direct transfer of liquefied natural gas (LNG) from the floating facility to specific carriers, for convenient shipping to countries around the world.

On its operations, natural gas is produced from underwater fields, then processed and chilled to -162° Celsius (-260° Fahrenheit) which shrinks its volume by 600 times to create LNG. The advanced design of an FLNG facility packs a typical land-based LNG plant into a fraction of its normal size.

As Nigeria is set to build its first ever FLNG, here are some facts to know about the floating facility which was conceived to serve the global energy market:

FACT 1: Nigeria’s first floating liquefied natural gas (FLNG) facility is to be built by UTM Offshore Limited, a gas firm in Nigeria, which signed a front-end engineering design (FEED) contract on November 11, 2022, with three technical partners: Kellogg Brown and Root (KBR) UK, Japan Gas Corporation (JGC) and Technip Energies Limited. The timeline for this phase of the FLNG project is 10 months.

FACT 2: The FEED contract signing is a follow-up to the successful execution of the pre-FEED agreement between UTM Offshore Limited and JGC, a leading International engineering design, procurement and construction firm. The pre-FEED scope was completed within four months from the commencement date. KBR provided due diligence on the JGC scope by conducting a third-party review of all deliverables from JGC during the pre-FEED. UTM Offshore Limited entered into the pre-FEED agreement with JGC and KBR in May 2021.

FACT 3: The planned FLNG will have a capacity to process 176 MMscf/d (million standard cubic feet per day) of natural gas and condensate and will be located 60km from the shore of Akwa Ibom State at the Yoho Field in offshore Block OML 204, operated by Exxon Mobil, in partnership with LNG Investment Management Services, a subsidiary of the Nigeria National Petroleum Company Limited (NNPCL).

FACT 4: The vessel facility is expected to be completed by Quarter 1 in 2026, and will feature a turret mooring system, gas pre-treatment modules, LNG production modules, living quarters, self-contained power generation and utilities, along with storage and offloading. When completed, the floating LNG shall have an LNG production capacity of 1.52 million tonnes per annum (Mtpa).

FACT 5: According to the CEO and chairman of UTM Offshore, Julius Dediare Rone, the company opted for FLNG facility to help bring gas to the global market from small offshore fields and near-shore terminals in areas lacking infrastructure—especially pipelines, as the LNG market is stuck with traditional models that do not address the world’s demand for low-cost, flexible LNG to become a preferred fuel-of-choice over coal and liquids.

FACT 6: The FLNG project when completed will help the Nigeria government to monetize more than 209 Tcf (trillion cubic feet) of proven gas resources with a potential upside of 600 Tcf, as market research analysts indicate that the FLNG market is estimated to increase at a compound annual growth rate of 27.14%, reaching $88.99 billion by 2024.

FACT 7: Earlier this year in Abuja, the company (UTM), in partnership with African Export-Import Bank (Afreximbank), signed a memorandum of understanding (MoU) to raise an initial sum of $2 billion for the first phase of the development, with a commitment for $3 billion in the second phase, bringing it to $5 billion.

FACT 8: The 1.52 Mtpa FLNG facility will have a storage capacity of 200,000 cubic meters, would also target the processing of associated gas currently flared to cut carbon emissions and monetize additional reserves for domestic and global markets.

FACT 9: UTM Offshore finalised an important deal in late 2023 that saw the government of Delta State joining state-owned NNPC in acquiring a significant stake in its Yoho FLNG project. A final investment decision of the 1.5-million-tonne-per-annum FLNG vessel is due to be made in early 2024. The project equity has NNPC, UTM Offshore and the Delta State Government holding 20 percent, 72 percent and 8 percent stakes, respectively.

Sources: Businessday | Offshore Magazine | Image credit: Splash247

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