Total will develop a shallow-water field off Nigeria to provide its portion of gas to feed the Nigeria LNG (NLNG) Train 7 liquefied natural gas expansion project, which is nearing sanction.
The French supermajor plans to develop its operated Ima field with just four wells, using a “cost-effective well-to-shore concept”, Total president of exploration & production Arnaud Breuillac said at the company’s strategy update mid-week.
“Total’s contribution to the additional gas supply to the plant will come from the nearby Ima field, which is located in shallow waters about 20 kilometres south-east of the LNG facilities,” he said, adding that the field has estimated resources of 1.4 trillion cubic feet of gas “in an excellent reservoir”.
Ima straddles OMLs 112 and 117 in the south-east portion of the Niger Delta.
The NLNG partners – Total, Italy’s Eni, Anglo-Dutch supermajor Shell and state player Nigerian National Petroleum Corporation – earlier this month handed a consortium of Saipem, Chiyoda and Daewoo E&C the engineering, procurement and construction deal for Train 7.
The project involves a single train of 4 million tonnes per annum and an additional liquefaction unit to debottleneck existing trains, bringing an additional 3.2 MMtpa for a total of 7.2 MMtpa. The expansion will raise capacity at NLNG from a current 22 MMtpa to close to 30 MMtpa.
A final investment decision is expected before the end of the year – most likely in late October – with start-up seen in 2023.
The production cost from Train 7 will be about $700 per tonne of LNG, which Breuillac said is very low. The cost of LNG delivered from the expansion to Asia will be less than $3.5 per thousand British thermal unit.
Train 7 is part of Total’s plan to have 30 MMtpa in equity LNG production by 2025, coming from 38 trains in 15 plants. This would represent one third of global LNG production.
Another significant contributor to the total will be Mozambique LNG, which was sanctioned recently by Anadarko Petroleum right before it was acquired by Occidental Petroleum. Before that deal closed, Total had agreed with Occidental that it would acquire Anadarko’s Africa assets for $8.8 billion, meaning it will become operator of the Area 1 project once its deal closes.
The takeover of the Anadarko Africa assets is happening in stages, with the Mozambique element set to be the first to close.
“We are on the verge of closing Mozambique,” Total chief executive Patrick Pouyanne, speaking alongside Breuillac, said this week.
“I will fly to Mozambique at the end of the week and we should be able to close, if not this week, then the beginning of next week.”
The first phase of development at Mozambique LNG involves two 6.44 MMtpa trains, with a cost of $850 per tonne. Phase one will develop 16 Tcf of the Area 1 resource, with feed gas coming from the deep-water Golfinho-Atum field. Area 1 gas resources are pegged at more than 60 Tcf, according to Total. Anadarko has previously given a figure for Area 1 of 75 Tcf of recoverable gas.
Long-term offtake agreements for 90% of the gas for the first phase of development have already been secured.
Breuillac said “studies for trains 3 and 4 have already started”, with the two-train second phase set to exploit about the same amount of the resource.
Following this, Total will close the deals for Anadarko’s Algeria assets before sealing the deal for the Ghana assets, possibly by year-end or early next year
In Papua New Guinea, Total is planning to sanction its Papua LNG development in 2021. It will be a two-train scheme, with each train at 2.27 MMtpa. Another 2.7 MMtpa train will also be incorporated from the nearby PNG LNG development.
Front-end engineering and design studies for Papua LNG are about to be launched, Breuillac said.