Golar LNG announced that FLNG Hilli Episeyo has been accepted under its “Liquefaction Tolling Agreement” signed with Perenco and Cameroon’s Societe Nationale Des Hydrocarbures and “is now in full commercial operation”.
The commissioning tests included the requirement to produce a set quantity of LNG in a period of 16 days of continuous production from minimum 2 trains at a level of 7500-CM/D of LNG on average, Golar LNG said in its announcement.
“The commercial tolling rate commencing will immediately add approximately $164 million in EBITDA* of base tolling income per year plus an additional $45 million operating cash flow per year based on the oil price linked element of the contract (assuming that Brent remains at an average of $75/bbl).”
FLNG Hilli Episeyo is the world's first FLNG vessel that has been developed as a conversion project, which has been implemented by Keppel Shipyard, from an LNG carrier.
The FLNG had started producing LNG in March and since then has shipped two cargoes of LNG, Golar said, revealing that minor issues occurred after the start-up, interrupting the commissioning of additional trains and the ramp up of production.
Backgrounds:

On 12 Mar. 2018, Golar LNG announced that first production of LNG has successfully commenced from Hilli Episeyo offshore Cameroon. Hilli Episeyo FLNG vessel arrived in Cameroon in late November 2017. Customs clearance, positioning, mooring hook-up and connection to the riser and umbilicals followed shortly thereafter, Golar said, adding that a ship-to-ship transfer of cool down LNG with the Golar Bear was completed in mid-December 2017, followed by the introduction of feed gas from the onshore processing plant.
Earlier, the Norwegian operator had reported that full commissioning of the gas treatment systems is substantially complete “and they are running satisfactorily. Commissioning of the refrigerant trains continued through to February 2018 and now first LNG production commenced.
“Although Golar reiterates the importance of taking the time it needs to safely commission the vessel, at this time final commissioning, followed by acceptance testing, remains on track for mid-April 2018. Vessel acceptance will trigger the final drawdown against the $960 million CSSCL facility.”
Golar will provide the liquefaction facilities and services for Cameroon’s Kribi floating LNG project under a tolling agreement signed with the project’s owners and upstream developers, SNH and Perenco. It is anticipated that the allocated reserves will be produced at the rate of some 1.2 MMT/Y of LNG over an approximate eight year period.
On 2 Jul. 2014, Keppel announced that Keppel Shipyard has signed a contract with Golar to perform the world's first-of-its-type conversion of an existing Moss LNG carrier, the 126,220-CM Golar Hilli (built in 1975), into a Floating Liquefaction Vessel (FLNGV). The contract is worth approximately $735 million.
In carrying out the FLNGV conversion, Keppel Shipyard shall be responsible for the provision of the design, detailed engineering and procurement of the marine systems and all of the conversion-related construction services. Keppel Shipyard's scope also includes engaging Black & Veatch to provide design, procurement and commissioning support services for the topsides and liquefaction process.
Black & Veatch's PRICO technology has been selected for the liquefaction process because of its long-established record in the marketplace. This contract, which includes options for another 2 similar units, follows the completion of a year-long Front-End Engineering and Design (FEED) study by Keppel Shipyard and Black & Veatch. The FEED study was conducted as part of the terms of a term sheet agreement with Golar to convert up to 3 LNG carriers into FLNG vessels.
The FLNGV will take about 31 months to convert and is expected to be completed in the first quarter of 2017. Detailed design and engineering activities will commence shortly, and the Hilli will be delivered to Keppel Shipyard within 2014 to initiate renewal of key marine systems onboard the vessel while the manufacturing of topsides commences.
On 24 Dec. 2014, Golar LNG announced the signing of a Heads of Agreement (HOA) with Cameroon’ Societe Nationale de Hydrocarbures (SNH) and Perenco Cameroon (Perenco) for the development of a floating LNG export project located 20-km off the coast of Cameroon and utilizing Golar's floating liquefaction technology (GoFLNG).
The HOA is premised on the allocation of 500 BCF of natural gas reserves from offshore Kribi fields, which will be exported to global markets via the GoFLNG facility Golar Hilli, now under construction at the Keppel Shipyard in Singapore.
“Golar will provide the liquefaction facilities and services under a tolling agreement to SNH and Perenco as owners of the upstream joint venture who also intend to produce LPG's for the local market in association with the Project. It is anticipated that the allocated reserves will be produced at the rate of some 1.2 MMT/Y of LNG over an approximate eight year period.”
According to Golar’s statement, “it is expected that during the first half of 2015 definitive commercial agreements will be executed and necessary licenses and approvals secured for the production, liquefaction, and export of the reserves, and that production will commence in the first half of 2017.”
The project will be the first floating LNG export project in Africa and will see Cameroon joining the small number of LNG exporting nations, Golar added.