Skaugen: First gas shipments to small scale LNG project delayed

JULY 25, 2017 — Norway’s I.M. Skaugen SE says that transportation of first gas for a “proof of concept” Small Scale LNG project under development in Africa has been delayed.

With its fleet of six advanced Multigas LNG carriers of 10,000 and 12,000 cu.m, Skaugen says it can provide instant logistics solutions for LNG and that its Small Scale LNG (SSLNG) concept is an effective solution for making natural gas available to energy users not currently connected to pipeline networks.

Today, Skaugen reports that an SSLNG project in Africa announced on January 23 has made good progress in that that all site-specific equipment required has been shipped to its location and installed — or for some parts has already been manufactured and the modules are ready to be installed. All equipment is site specific and made for this SSLNG solution and paid for by the clients.

The power plant clients, with support of the IMS team of professionals, are getting ready with all these facilities to receive and consume LNG.

Complete gassing up and cooldown of the receiving and regas facilities with liquid nitrogen has been performed for the first power plant with no major deficiencies observed.

Here’s the “however” part of the story:

“In line with the project progression on site, the first gas was expected to be transported in July 2017 under the reconfirmed agreements of May 24, 2017 and June 1, 2017. Financial close under the agreements has been pending completion of the full package of project agreements, which in turn been reliant on finalization of all relevant government approvals. We are confident that our client is able to obtain these Government approvals. However, these transactions are located in Africa where such commercial deals are prone to prevarications and delays. In anticipation of these approvals the commissioning for ‘first gas’ has been deferred and we expect financial close to occur in August rather than in July and with the results that our ships will load first LNG for the client in August.”