Swan selects Teekay Shipping for FSRU joint venture

Vol 16, PW 15 (21 Feb 13) Midstream & Downstream

Swan Energy has chosen Canadian company Teekay Shipping as its partner to set up a Floating LNG Storage and Regasification Unit (FSRU) off Pipavav Port in Gujarat.

"Environment ministry clearance is expected next month (March)," reports a Swan source. Mumbai-based Swan, he adds, is likely to sign a formal joint venture agreement with Teekay around the same time after which tenders will be issued to select contractors to construct the jetty and a 1.2-km breakwater for the planned FSRU.

Swan wants to award contracts for the estimated Rs1000cr ($200m) jetty and breakwater by end-April so construction can begin before this year’s monsoon season, from June to September. Swan has identified a ready-made FSRU with a 170,000 cubic metre capacity.

“We looked at smaller sizes too," our company source adds. "But they’re not economically viable in the long run.

The FSRU we have identified will cost $280m and can handle 4m t/y of LNG.” Swan is targeting to anchor the FSRU off Pipavav by May 2015 and is talking to a LNG supplier for long term supplies over 15 to 20 years.

“I can’t even tell you where this LNG will come from because that will make it easy for you to identify the seller,” adds our Swan source. “We have signed a term sheet with the seller and the GSPA is likely to be signed by July.

” Swan says it wants to bring in smaller quantities of LNG this year at either Dabhol or Kochi and larger quantities from 2015 when the FSRU is in place.

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