Delfin Midstream and Golar LNG Ltd have signed a Joint Development Agreement to develop the Delfin LNG project, off the coast of Cameron Parish, Louisiana using Golar's FLNG technology. The joint development agreement will facilitate the financing, marketing, construction, development and operation of Delfin LNG.
Delfin LNG is the only permitted floating LNG export project in the US. It is a brownfield Deepwater Port requiring minimal additional infrastructure investment to support up to four FLNG vessels producing up to 13 million tpy of LNG. Delfin purchased the UTOS pipeline, the largest natural gas pipeline in the Gulf of Mexico, in 2014 and submitted its Deepwater Port license application in 2015. Delfin LNG received a positive record of decision from MARAD in March 2017. In June 2017, Delfin received approval from the Department of Energy for long-term exports of LNG to countries that do not have a Free Trade Agreement with the US.
Golar has successfully designed, financed, contracted, and built its first FLNG vessel, the FLNG Hilli Episeyo, which is scheduled to sail away from Keppel shipyard in 3Q17. A second vessel of the same FLNG design, the FLNG Gandria, is soon to be converted subject to a Final Investment Decision (FID) by the Fortuna project partners. Golar is currently developing the Mark II next-generation floating liquefaction solution that is based on its industry leading Hilli and Gandria designs. The Mark II solution, as used at the Delfin LNG project, will have >3.0 million tpy of liquefaction capacity and will be the lowest cost liquefaction solution in North America.
It is expected that FID on the Delfin project will take place in 2018 with first LNG to be delivered in 2021/22. Delfin LNG is uniquely positioned in the North American LNG market as a proven low cost solution, modular, scalable, requiring limited additional investments in fixed infrastructure, and having already completed its environmental permitting and received Non-FTA export authorisations.
Oscar Spieler, Chief Executive of Golar, commented: "Golar's proven execution model will allow Delfin to deliver the lowest cost liquefaction solution in the North American market with a construction time of less than 3 years. Golar's low cost modular floating technology will allow Delfin to make Final Investment Decisions in 3.0 million tpy increments at a lower unit cost than large land-based projects."
Frederick Jones, CEO and Chairman of Delfin, commented: "We look forward to working with Golar to deliver the first floating liquefaction project in North America and lead the second wave of US LNG projects. Golar's flexible, floating liquefaction model has proven to be the world's lowest cost liquefaction solution allowing Delfin to offer innovative commercial solutions with reduced credit requirements, mid-term offtake contracts (approximately 10 years) and FOB and DES LNG pricing based on fixed price, S curves or tied to a variety of energy indexes."
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