Swan forging ahead with Pipavav FSRU project

Vol 15, PW 12 (15 Dec 11) Midstream & Downstream

Mumbai-based Swan Energy believes it can set up India’s first Floating Storage and Regasification Unit (FSRU) off Pipavav in Gujarat by the first quarter of 2014.

PETROWATCH learns Swan has scheduled a public hearing for the project on December 28, a crucial first step towards securing environment ministry clearance. Local villagers and government officials are expected to attend the hearing at the site of the under-construction 2100-MW gas-fired Pipavav power station, promoted by Swan, GSPC and Gujarat Power Corporation.

Swan received a positive Environmental Impact Assessment (EIA) report in August on its FSRU plans from Indian consultants Indomer Coastal Hydraulics and BMT Consultants India. Unconfirmed reports say Swan is likely to hire a 70,000-tonne LNG tanker from Canada-based and NYSE-listed Teekay Shipping Corporation, which last year reported revenues of over $1.8bn.

Swan wants Teekay to convert the LNG tanker into a 3m t/y capacity FSRU which can receive LNG cargoes off Pipavav. “Constructing a FSRU could cost as much as $500m,” reports a source.

“Teekay is partnering Swan for the entire project.” Teekay is also expected to construct a jetty and ‘breakwater’ at Pipavav Port for the FSRU.

Once the FSRU is commissioned, it will be designed to receive LNG from berthing tankers through flexible ‘cryogenic hoses.’ Alternatively, Swan might opt for the FSRU to have three LNG unloading arms with a ‘swivel joint.

’ With such a system, LNG can be unloaded quickly at up to 12,050-cubic metres/hour. “An entire LNG cargo could be unloaded this way in up to 24 hours,” we hear.

When contacted, Swan confirms it is “actively looking” for long-term LNG for the proposed FSRU and is hoping for a ‘landed price’ of $9/mmbtu. “We are talking to four US-based LNG suppliers,” he says, without disclosing more.