Italian engineering, procurement, and construction (EPC) contracting giant Saipem, in a joint venture with America’s McDermott International and Japan-headquartered Chiyoda Corporation, has reached an agreement with Area 1 Concessionaires – a wholly owned subsidiary of Anadarko Petroleum Corporation for the development of Mozambique Area 1 Liquefied Natural Gas (LNG).
The joint venture project scope include construction, procurement and engineering for all components of the onshore LNG development, this include two LNG trains with a total nameplate capacity of 12.88 million tonnes per annum (MTPA) plus associated infrastructure and utilities.
“LNG is shaping an entirely new era of energy solutions and McDermott is playing a crucial role in this global shift. The project will be built based on McDermott’s industry-leading experience and ability to deliver EPC solutions globally,” said McDermott’s Senior Vice President for Europe, Africa, Russia and Caspian Mr Tareq Kawash.
Earlier the JV provided front-end engineering design (FEED) services for the LNG development. McDermott’s initial portion of the EPC contract award is about US $2bn. Saipem and McDermott have established a new office in Milan, Italy to lead in Engineering, procurement and project management. This will aid in sharing on-site construction management responsibilities, the new plan will also see McDermott perform engineering from both India, Gurgaon and London. On the other side Chiyoda will provide advisory services for the JV.
Construction works are expected to start when Anadarko issues a Notice to Proceed after it takes a Final Investment Decision (FID). In addition as the operator of Offshore Area 1, Anadarko is the main project sponsor while other sponsors include Beas Rovuma Energy Mozambique Limited, ENH Rovuma Área Um, BPRL Ventures Mozambique B.V., S.A, PTTEP Mozambique Area 1 Limited, ONGC Videsh Ltd and Mitsui E&P Mozambique Area 1 Ltd.
Italian oil and gas firm, Saipem, has been awarded a US$6 billion contract to engineer and construct an onshore Liquid Natural Gas (LNG) project in Mozambique.
Saipem, in joint venture with McDermott International and Chiyoda Corporation, reached an agreement with Area 1 concessionaires on an Engineering, procurement, and construction (EPC) contract.
The contract has been executed by Anadarko Moçambique Area 1, Lda., a wholly owned subsidiary of Anadarko Petroleum Corporation, which operates Offshore Area 1 and acts as front-runner of a Venture including other leaders in the energy sector, such as ENH Rovuma Área Um, S.A, Mitsui E&P Mozambique Area1 Ltd., ONGC Videsh Ltd., Beas Rovuma Energy MozambiqueLimited, BPRL Ventures Mozambique B.V. and PTTEP Mozambique Area 1 Limited.
The LNG Project consists of the construction of two Natural Gas Liquefaction (LNG) trains, with a total nameplate capacity of 12.88 million tonnes per annum (MTPA), as well as all necessary associated infrastructure, storage tanks and export jetty facilities.
“We are very happy to announce that we have reached full agreement for the contract after many years of dedication to this project,” commented Stefano Cao, CEO, Saipem.
While congratulating Anadarko and its co-ventures for the achievement, Stefano expressed his gratitude for the confidence demonstrated toward CCS JV. He confirmed that CCS JV teams will be mobilized to site after Anadarko issues notice to proceed following the final investment decision (FID).
The EPC Contract is subject to a full Notice to Proceed which is expected to be issued after FID.
Confirming Saipem’s role among the leaders in the LNG market for the energy transition, Stefano said that SAIPEM will strengthen it’s presence in East Africa with the project.
His statement comes just a few months after oil and Gas stakeholders from the East African Community partner states held a high-level forum to discuss oil and gas investment opportunities in the region.