Sri Lanka is yet again trying to advance its liquefied natural gas import plans, with the Ceylon Electricity Board (CEB) inviting bids for a leased floating storage and regasification unit to be deployed at Kerawalapitiya.
CEB is in the market for an FRSU on a build-own-operate basis, while the associated mooring system — mooring, flowline and umbilical to the pipeline end manifold (PLEM) control system — is being sought on a build-own-operate-transfer basis.
The request for proposal (RFP) calls for a vessel with regasification capacity of 380 million cubic feet per day of gas and minimum storage capacity of 156,000 cubic metres at “100% filling level”.
Regasified volumes are intended for power plans in Kerawalapitiya and the vicinity of the capital Colombo.
The successful bidder would be required to design, finance, procure, construct, deliver, commission, operate and maintain the FSRU and mooring system, the latter being transferred to the CEB at the end of the 10-year contractual term.
This decade-long period can be extended by the CEB.
The contractor will also be tasked with securing all the necessary environmental clearances, governmental approvals and statutory licences for the proposed LNG import project.
The deadline for proposals is 18 June and bidders will have to provide a $2.5 million proposal security. The CEB intends to award the contract around year-end.
The project’s PLEM, subsea pipeline, onshore receiving facility with gas metering, pressure let down and other infrastructure, and onshore pipeline (including right of way) up to the power plants fence lines, will performed by Ceylon Petroleum Company.
Sri Lanka is now eyeing a transition to a gas-based power generation by tapping the liquefied natural gas market and any potential domestic gas production, which could be developed in the medium-term.
“The state-run Ceylon Electricity Board has decided to convert power plants that are run on furnace oil and diesel to natural gas and has recently floated a tender for the construction of a gas pipeline to distribute it to the plants,” said Sri Lanka’s Minister of Energy, Udaya Gammanpila.
The FSRU is expected to enter operation early in 2024 and supply volumes to CEB’s power plants until 2033.
Sri Lanka for some years now has flagged up its LNG ambitions but with little success.
The Ministry of Power, Energy & Business Development in 2018 launched its own Swiss Challenge tender for an FSRU-based import decision in response to South Korean contractor SK E&S submitting an unsolicited proposal to supply a converted FSRU.
However, this tender appears to have fallen by the wayside after the bid submission deadline was pushed back at least six times.
The initial terms of that tender were so onerous that it effectively precluded experienced FSRU players such as Excelerate Energy, Golar LNG and Hoegh LNG from even bidding.
CEB said that after considering several alternatives, including land-based and floating regasification systems in multiple locations around Sri Lanka, its steering committee — on the basis of data gathered and recommendations from advisors — concluded that an FSRU moored off Kerawalapitiya would meet the brief.
“This solution will overcome the challenge of securing suitable land for storage and [the] regasification facility,” read the bid documents.
“It was further established that a privately held special purpose vehicle, strategically sourced by means of a bidding process, would be the preferred structure to us to finalise the most optimum price to be paid for the services rendered.”
The CEB will purchase the LNG to be imported via the Kerawalapitiya FSRU.
A complete set of the RFP documentation for the latest FSRU tender can be obtained from the CEB until 4 June.