Floating LNG Business A breakthrough in offshore gas monetization

LNG Malaysia Forum 2013 19-21 March, Kuala Lumpur

Allan Magee, Ph.D.

R&D Manager, Offshore Product Line and Technologies, Technip Geoproduction Malaysia

Technip Chair in Deepwater and Subsea Technology, Universiti Teknologi Petronas (UTP)

Table of Contents

1. The Gas and LNG Market

2. Natural Gas Technology and Track Record

3. FLNG Challenges

4. Technip Leadership in the FLNG

2

1.The Gas and LNG Market

A Strong Increase in Gas Demand

World Energy Demand (1980-2035)

“The use of natural gas could rise by more than 50 per cent by

2035 from last year” IEA, 2011

World Energy Outlook, Special Report « Are we entering a golden age of gas? »© OECD/IEA, 2011

Source: Cédigaz, April 2011

% of world gas demand

3%

% of world gas reserves including proven

unconventional gas

Geographical Mismatch Between Proven Gas Reserves and Demand

5

3%

26%

6%

4% 4%

3% 8%

18%

31% 20%

4% 15%

39% 11%

5%

Increasing Long Term Demand in LNG

6 Source: Wood Mackenzie / Deutsche Bank , Jan 2010

Pacific Basin Supply

Atlantic Basin Supply

Middle East Basin Supply

LNG Global Demand

Mtp

a

How Is the LNG Market Evolving?

Onshore LNG

Small-sized LNG

Floating LNG (FLNG)

LNG Supply Chain

8

Upstream Treatment, Liquefaction & Export

Transportation Regasification Terminal

Distribution

Pipelines

FLNG Supply Chain

9

Upstream + Treatment, Liquefaction & Export

Transportation Regasification Terminal

Distribution

FLNG: New Opportunities for Oil and Gas Producers

Cost optimization in areas with high construction

costs

Deeper and further offshore reserves

Pipeline too complicated or too long

Insufficient reserves for dedicated onshore LNG plant

Monetize associated gas rather than re-injection or

flaring

Environment

Potential redeployment

10

Floating LNG mainly driven by economics

Economics

Other

2. LNG Technology and Technip’s Track Record

From Wells to LNG, a Complex Process

Sulphur

Recovery

Liquefaction

Field

Facilities

Methane

rich gas

LNG Storage

Loading

Fractionation LPG

Condensates

Dehydration Mercury

Removal NGL

Recovery

Refrigeration

Loop

Refrigerant

LNG

Pipeline

Reception

Acid Gas

Removal Fuel gas

(8-12% of feedstock)

LNG

Train

Methane

Utility Production for the Plant -Power Plant

-Cooling water

-Fire Fighting Systems

- Nitrogen Generation

- Flare

- Water Treatment

20°C, 50 bars

-162°C, 1 bar

Condensates (C4+)

Ethane, Propane, Butane, Pentane…

12

Sulphur

N2 Rejection

Technip: a Leading LNG Contractor for 45 Years

3. FLNG Challenges

Onshore to Offshore: Volume Optimization

15

From onshore to offshore plant: a space management

challenge to control weight & gravity center

Onshore LNG

FLNG

Example of Floating LNG Layout

Source: 2009 Technip R&D Study

16

Liquefaction

Pre-treatment

Power Generation

& Utilities

Flare

Cryogenic Export System

Control Room and

Living Quarter

Storage Inside the Hull

Technip Working on the Most Complex Projects

Akpo

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

19

64

19

66

19

68

19

70

19

72

19

74

19

76

19

78

19

80

19

82

19

84

19

86

19

88

19

90

19

92

19

94

19

96

19

98

20

00

20

02

20

04

20

06

20

08

20

10

20

12

20

14

20

16

20

18

20

20

20

22

20

24

Top

sid

e D

ry W

eio

ght

- to

ns

Year Installed

P-58 & P-62

Source: Infield Feb. 2008

Girassol

Technip: a Strong Experience in Large FPSO

N’Kossa

Dalia

FLNG

forecast

FPSO's Installed or Planned by Year and Size

Built by

Technip

Akpo FPSO, Nigeria, 320 x 60m,

Largest ever

18

4. Technip Leadership in the FLNG

Moving from Concept to Reality

20

Concretization of a decade of work

for Technip

Industry experience in large FPSO’s

Open sea transfer of LNG made possible

Issues with processing on moving platforms are

understood

Many FLNG projects at Conceptual, FEED stage

TECHNIP in charge of the TWO EPCIC Contract

for FLNG in the World (Prelude, Petronas)

Technological breakthrough for the energy

industry

Technip’s Unique Combination of Expertise

Offshore floating facilities

Onshore LNG Plant

Subsea field development

21

All the know-how and talents to better manage

projects, risks and interfaces

Floating LNG

EPCIC contract signature 5th June 2012

FLNG - Petronas

Technip leader of a

consortium with Daewoo

(DSME)

Air Products NTM

process

Offshore Malaysia

LNG capacity: 1.2 Mtpa

23 23

Master Agreement 28/07/2009

The design, construction and

installation of multiple FLNG facilities

over 15 years

Generic FLNG – FEED 28/07/2009

Prelude FLNG – FEED 08/03/2010

Offshore Western Australia

Prelude FLNG – EPCI 08/03/2010

Contract under which the FLNG would

be built when the project received the

final investment decision

(FID announced 20th May 2011)

First Steel Cutting in October 2012

Technip leader in a consortium with Samsung

Shell Floating Liquefied Natural Gas Contracts

Generic FEED and Prelude FEED –

finalized

Prelude – Under Construction

FLNG - Shell Prelude

15 year frame

agreement

Technip leader of

consortium with

Samsung (SHI)

Prelude FLNG, Australia

LNG capacity: 3.6 Mtpa

FID : 20th May 2011

1st steel cutting: 14th October 2012

Shell Prelude FLNG

25

FLNG : 488 m

Charles de Gaulle

aircraft carrier : 261 m

A380: 73 m

Australia

488 m x 74 m

600 000 t weight with tanks full

3.6 Mtpa LNG capacity

1.3 Mtpa condensate production

0.4 Mtpa LPG production

Total liquid production: 110 000

boe/day

200 km from the nearest point on the

mainland

200 - 250 m water depth

Conclusion

Concept to reality after many years of work

Breakthrough technology for the energy industry

Technip leadership

All competencies, know-how and talents

Capacity for safe execution

Associated with the biggest oil and gas players

Global footprint

Thank you

Technip, the leading player in FLNG