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Basic Equity Participation Agreement Made on FPSO Owning and Chartering Business for Oil and Gas Field, offshore Ghana

Four companies (hereinafter the “four partners”), namely, Kawasaki Kisen Kaisha, Ltd. (head office: Chiyoda-ku, Tokyo; President & CEO: Eizo Murakami; hereinafter “’K’ Line”), Sumitomo Corporation (head office: Chuo-ku, Tokyo; President & CEO: Kuniharu Nakamura), JGC Corporation (head office: Yokohama, Kanagawa Prefecture; Chairman & Representative Director: Masayuki Sato; hereinafter “JGC”), and Development Bank of Japan Inc. (head office: Chiyoda-ku, Tokyo; President & CEO: Masanori Yanagi; hereinafter “DBJ”) have agreed in principle to participate in the owning and chartering business for oil and gas floating production, storage and offloading (FPSO)1 (hereinafter the “project”) run by the Malaysian offshore production services provider, Yinson Holdings Berhad and its group of companies (hereinafter “Yinson”).

After commencement of the definitive agreement, the four partners will acquire, through a joint venture, 26% of the shares of Yinson Production (West Africa) Pte. Ltd. (hereinafter “YP (WA) PL”), a FPSO owning company operated by Yinson. YP (WA) PL has concluded a 15-year long-term FPSO chartering agreement with eni ghana exploration and production ltd., which is an affiliate of the major Italian oil company Eni SPA, and started oil production at Offshore Cape Three Point Block (“OCTP”), approximately 60 kilometers south west of Ghana, in May 2017. Barring any unforeseen circumstances, the domestic supply of natural gas from FPSO is expected to commence in Ghana by mid-2018.

FPSO is key infrastructure for deep-water oil and gas production, which are likely to increase steadily in the future; thus, demand for FPSO is expected to increase. In preparation for this demand, “K” Line, Sumitomo Corporation and JGC will acquire knowledge and expertise through the project as their first FPSO owning and chartering business. DBJ will supply risk money with the “Special Investment Operations” as the project will help improve vitality and develop sustainability of the Japanese economy. Through the project, the four partners will contribute to stable oil and natural gas supplies in Ghana, thus solving natural gas and electricity shortages in the country.

Source credit: http://www.klineurope.com/news/newsview.aspx?id=805

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