Afgas and Sonagas Sign LNG Deal

Gasol plc said Wednesday that African Gas Development Corporation (Afgas) and Sociedad Nacional de Gas, GE (Sonagas) have signed an exclusive joint venture agreement (JV) to monetize gas supplies from Nigeria, Cameroon and Equatorial Guinea through infrastructure and facilities in Equatorial Guinea. This marks a critical step in Gasol's ambitions to capitalize on growth in the Liquefied Natural Gas (LNG) sector through its investment in African LNG (AfLNG), a subsidiary of Afgas.

Exclusive Joint Venture between Sonagas and Afgas

Sonagas is the national gas company of the Republic of Equatorial Guinea. It has the exclusive responsibility for the State's interest in all existing and future gas related projects in the country.

Sonagas' existing gas projects include a 25% stake in the US$1.4 billion Equatorial Guinea Liquefied Natural Gas (EGLNG) plant.

The JV and its partners (including Afren PLC) will assemble the necessary regional gas supplies, primarily from Nigeria and Cameroon, to supplement existing gas sources from gas related projects in Equatorial Guinea.

The JV will be responsible for providing all required subsea pipelines, facilities and related infrastructure for the gas related projects, and Heads of Agreement for this purpose, have been entered into with Acergy and AMEC.

Relationship between Afgas, AfLNG and Gasol

  • Gasol announced the purchase of a 20% stake in AfLNG on 1 September 2006
  • AfLNG is a subsidiary of Afgas (the largest shareholder in Gasol) and was established to integrate and build on the group's gas and LNG strategy
  • AfLNG's strategic intention is to become the premier independent LNG company in the Gulf of Guinea

Impact on Gasol

  • The establishment of the Joint Venture allows AfLNG to fast track gas related projects and respond to the growing demand for LNG and other gas products from the Gulf of Guinea
  • Afgas's exclusive Joint Venture with Sonagas marks an important critical step for AfLNG to realize its goal to become the premier independent LNG company in the Gulf of Guinea
  • As announced on 1 September 2006, Gasol has an option to increase its shareholding in AfLNG to 100%

Haresh Kanabar, Chief Executive of Gasol plc, commented: "The Joint Venture with Sonagas marks the first critical step for African LNG to achieve its goal of becoming the premier independent LNG company in the Gulf of Guinea."

Exclusive Joint Venture between Sonagas and Afgas

Sonagas is the national gas company of the Republic of Equatorial Guinea which has the exclusive responsibility for the State's interest in all existing and future gas related projects in the country. Sonagas' existing gas projects include a 25% stake in the US$1.4 billion Equatorial Guinea Liquefied Natural Gas (EGLNG) plant, which will begin deliveries of LNG to international markets from mid-2007. Train 1 has a capacity of 3.8 million tonnes and negotiations are currently underway regarding Train 2 and possible Trains 3 and 4. The Joint Venture will assemble the necessary regional gas supplies, primarily from Nigeria and Cameroon to supplement existing Equatorial Guinea gas sources.

Other Sonagas projects include participation in the Bioko methanol plant which currently produces approximately 3,000 tonnes per day and the Punta Europa Liquefied Petroleum Gas plant, which currently produces approximately 25,000 barrels per day.

The Afgas / Sonagas Joint Venture will be responsible for providing all required subsea pipelines, facilities and related infrastructure for the gas related projects. Afgas has entered into Heads of Agreement with each of Acergy (formerly Stolt Offshore) and AMEC, for the design, procurement, building and operation of the infrastructure and facilities required in support of the JV's various gas monetization projects.

Relationship between Afgas, AfLNG and Gasol

Gasol announced the acquisition of a 20% stake in AfLNG on 1 September 2006. AfLNG is majority owned by Afgas and was established to integrate and build on the group's gas and LNG strategy. AfLNG's strategic intention is to become the premier independent LNG company in the Gulf of Guinea. The Joint Venture with Sonagas is the group's first critical step in realizing the independent LNG strategy.

Impact on Gasol

LNG is rapidly emerging as the swing gas supplier in an increasingly global market, particularly given depleting indigenous European and US gas supplies and concerns over the security of European gas supplies. Gasol's objective is to access opportunities to capitalize on the growth in LNG demand.

The Gulf of Guinea has approximately 200 TCF of gas reserves, with more than 80% of those reserves being situated in Nigeria; therefore Equatorial Guinea is ideally placed to be one of the leading regional gas processing centers in West Africa.

African LNG - in which Gasol holds a 20% shareholding, with the option to acquire the remaining 80% - is pursuing a cohesive strategy to develop LNG and gas related projects in West Africa. Afgas's exclusive Joint Venture with Sonagas, which already has a significant stake in an expanding LNG infrastructure, marks an important critical step for AfLNG to realize its goal to become the premier independent LNG company in the Gulf of Guinea.

For More Information on the Offshore Rig Fleet:
RigLogix can provide the information that you need about the offshore rig fleet, whether you need utilization and industry trends or detailed reports on future rig contracts. Subscribing to RigLogix will allow you to access dozens of prebuilt reports and build your own custom reports using hundreds of available data columns. For more information about a RigLogix subscription, visit www.riglogix.com.
Events  SUBSCRIBE TO OUR NEWSLETTER

Our Privacy Pledge
SUBSCRIBE


Most Popular Articles


From the Career Center
Jobs that may interest you
Truck Driver (Sand)
Expertise: Driller|Oil Terminal / Storage Management|Well Servicing & Testing
Location: Midland, TX
 
Technical O&M Advisor - LNG - Direct Contract or W2
Expertise: Process Engineer
Location: Houston, TX
 
Plant Operator
Expertise: Gas Plant Operations
Location: Odessa
 
search for more jobs

Brent Crude Oil : $50.64/BBL 0.62%
Light Crude Oil : $48.04/BBL 1.47%
Natural Gas : $3.01/MMBtu 2.58%
Updated in last 24 hours