Floating liquefied natural gas (FLNG) specialist Golar LNG and UK energy major BP, as operator of the Greater Tortue-Ahmeyim LNG project, have executed agreements to implement a commercial reset for FLNG Gimi.
The commercial reset agreement simplifies contractual cash flows and settles previous disputes related to payment mechanisms for pre-commercial operations date contractual cash flows.
Golar and BP have agreed to an updated schedule of daily payments until the commercial operations date (COD) which have step-up mechanisms based on project milestones up to the COD and are secured by long stop dates.
Golar will also be entitled to certain lump sum bonus payments subject to the achievement of certain project milestones. These pre-COD cash flows are expected to be deferred on the balance sheet and amortized over the 20-year contract term from the commercial operations date. The commercial reset settles all ongoing disputes including the current arbitration process.
To shorten the time to COD the parties further agreed to start the commissioning of the FLNG unit with an LNG cargo before the availability of gas from the FPSO which arrived on location in early June.
The FPSO is expected to process over 500m standard cubic feet of gas daily. It will remove water, condensate, and impurities from the gas before transferring it via pipeline to the Gimi.
At the FLNG vessel, the gas will be cryogenically cooled, liquefied, and stored before being transferred to LNG carriers for export. Some of the LNG will be allocated to help meet growing demand in the two host countries – Mauritania and Senegal.
As for the FLNG, it is owned and operated by Golar LNG and it arrived on site in February this year after a voyage of around 9,000 nautical miles. FLNG Gimi can store up to 125,000 cu m of LNG.
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