Ophir Energy & OneLNG: Execution of the Fortuna Umbrella Agreement
May 02 2017 - 2:01AM
The Republic of Equatorial Guinea, Ophir
Holdings & Ventures Ltd, a subsidiary of Ophir Energy
("Ophir"), OneLNGSA and La Compañía Nacional De Petróleos De
Guinea Ecuatorial ("GEPetrol") have signed a detailed Umbrella
Agreement ("UA") that establishes the full legal and fiscal
framework for the Fortuna FLNG Project, Africa's first deepwater
FLNG project.
The UA reconfirms the participation rights of
GEPetrol as partners for 20% of the upstream portion of the
project, and for a future potential participation of up to 30%
ownership of the midstream FLNG vessel by the Republic of
Equatorial Guinea or a designated State company. These
participations create alignment with the EG Government throughout
the project value chain from upstream through to LNG marketing.
Signing the UA was one of the key milestones to be delivered ahead
of Final Investment Decision ("FID"). The Fortuna FLNG Project FID
is on schedule for mid-2017 with first gas expected in
mid-2020.
Project Update
The execution of the UA completes one of the
four key milestones required for FID. The other three milestones
are: (i) the award of construction contracts for the upstream and
midstream vessel, (ii) the completion of the project finance
facility and (iii) a decision on the amount of gas to be termed at
FID and signature of resulting LNG SPAs. With respect to these
milestones:
(i)
The impending award of construction contracts is well progressed
and on schedule.
(ii)
Term sheets have been agreed with a consortium of China-based
lenders. The counter-parties to the financing have now entered into
final documentation stage.
(iii)
The Fortuna partners will decide in the coming weeks the amount of
the expected 2.5MMTPA to put under contract at FID from the several
offtake options available.
As previously announced the expected total
capital expenditure for the integrated project is approximately $2
billion to reach first gas. Approximately $1.2 billion is expected
to be debt financed, with full drawdown by the start of commercial
operations.
His Excellency, Gabriel Mbaga Obiang Lima,
Minister of Mines and Hydrocarbons for the Republic of Equatorial
Guinea, commented: "This agreement is in line with the government's
objective to deliver important projects that monetizes our gas,
promotes local content and brings world-class petroleum technology
to Equatorial Guinea. It also has brought us one crucial step
closer to realizing the historic Fortuna FLNG project. The
participation of Equatorial Guinea's national companies was
critical to Fortuna's success and to maximizing the project's value
at every level of the gas supply chain. The Fortuna Project targets
becoming the first choice supplier of LNG for the Gulf of Guinea
region."
Nick Cooper, Chief Executive of Ophir,
commented: "The Umbrella Agreement is the important foundation
agreement which formalises the value chain economics for the
Government of Equatorial Guinea and the project participants. We
welcome the introduction of Equatorial Guinea's national companies
as project partners and the alignment of interests that this
brings.
The remaining milestones of the construction
contract awards, the finalisation of debt and the LNG offtake are
as advanced as we had wanted them to be at this stage. The Fortuna
FLNG Project therefore remains firmly on schedule for an FID by
mid-year."
Jeff Goodrich, CEO of OneLNG commented: "Signing
of the Umbrella Agreement is a significant milestone. It
represents an innovative way of doing business, brings alignment
throughout the entire value chain to all of the Project
Stakeholders, and provides clear line of sight to FID for the
project. The Fortuna project remains on track to become Africa's
first deepwater FLNG project."
This announcement has been determined to contain inside
information.
For further enquiries please contact:
Ophir
Energy plc
+ 44 (0) 20 7811 2400
Nick Cooper, CEO
Tony Rouse, CFO
Geoff Callow, Head of IR and Corporate
Communications
OneLNG
+44 (0)20 7063 7900
Stuart Buchanan, Head of Investor Relations
Brunswick (PR Adviser to
Ophir)
+44 (0)20 7404
5959
Patrick Handley
Wendel
Verbeek
About the Umbrella Agreement:
As previously communicated, final State Approval
of the overall project, including the Umbrella Agreement, is the
final milestone at FID.
About OneLNG:
OneLNG is joint venture between Golar LNG
Limited and Schlumberger to rapidly develop low cost gas reserves
to LNG. The combination of Schlumberger reservoir knowledge,
wellbore technologies and production management capabilities, with
Golar's low cost FLNG solution offers gas resource owners a faster
and lower cost development solution that increases the net present
value of their asset.
About Ophir:
Ophir Energy is an independent Upstream oil and gas exploration
and production company focused on Africa and Asia. It is listed on
the London Stock Exchange.
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