Bonny Island LNG Plant, Nigeria

The Shell Nigerian LNG (NLNG) project at Bonny Island has been constantly expanded since it began commercial operation in 1999.

In December 1995, a consortium of engineering firms comprising Technip, Snamprogetti, MV Kellogg and Japan Gas Corporation (TSKJ) was awarded a turnkey Engineering, Procurement and Construction (EPC) contract for the construction of the plant, the gas transmission system and the residential area.

Construction of the plant site commenced in February 1996 (a lump sum turnkey contract worth about $1.2bn) and by August 1999 one of the two trains (train two) was completed.

In August of the same year, the plant was ready for start-up, and production of LNG commenced in September.

The second train of the base project, train one, came on stream in February 2000. Train three came into operation in November 2002.

The NLNGPlus project, comprising trains four and five, came on-stream in November 2005 (for train four) and February 2006 (for train five). Trains four and five are estimated to have required an investment of $2.1bn.

Features of trains four and five include an air-cooled C3/MR design, 4.1mtpa LNG and 0.5mtpa LPG, two GE-7 gas turbine drives with 10MW starter / helpers, an extended end flash system, parallel APCI cryogenic heat exchangers, higher liquefaction pressure, extension of LPG jetty for LNG loading, two additional GE-6s for power generation and extension of LPG chilling unit (U-3700).

INFRASTRUCTURE AND FURTHER DEVELOPMENT

The plant is built on 2.27km² of largely reclaimed land in Finima, Bonny Island. It currently has five trains in operation. With the completion of the NLNGPlus project, the Nigeria LNG Plant has an overall capacity of some 18mtpa of LNG and 3.4mtpa of LPG. It requires 2.8bcf/d feed gas intake at full production.

In July 2004, FID was taken for train six, otherwise known as NLNGSix. Train six came on-stream in late 2007 (despite delays due to industrial action of contractor employees). It is a duplicate of trains four and five. With the new NLNGSix on-stream, the entire complex is capable of producing 22mtpa LNG and 4mtpa of LPG and condensate from 3.6bcf/d feed gas intake.

In March 2007 Foster Wheeler in a joint venture with Chiyoda Corporation of Japan was awarded the FEED (Front-End Engineering Design) contract for the NLNGSevenPlus project in Nigeria (Bonny Island).

This new project will involve the construction and commissioning of two of the largest LNG liquefaction trains in the world (trains seven and eight). Each of the trains will produce 8.5 million metric tonnes of LNG per annum.

The FEED contract is being carried out as part of dual-FEED preparation. KBR with its joint venture partners, JGC, Technip and Snamprogetti were also awarded a FEED contract for the SevenPlus project in May 2007.

A Final Investment Decision (FID) on the project from NLNG is due by the end of 2007. The construction phase will probably only see one train constructed with a decision on the second train deferred to a later date.

Once the FEED specification is finalised for train seven (possibly for train eight as well) contractors will be appointed for the EPC contract which is tentatively expected to be completed and the new train on-stream by 2011. Production capacity at the facility will then be around 30.5 million tonnes per annum of LNG (train eight will push production to 39 million tonnes per annum).

MAIN ELEMENTS OF THE PLANT

The main elements of the operational plant are:

• Dedicated gas transmission pipelines passing through over 110 communities
• Three LNG storage tanks with a capacity of 84,200m³ each
• A common fractionation plant to process LPG (1mtpa)
• Two condensate storage tanks with a capacity of 36,000m³ each
• Two 65,000m³ LPG refrigerated tanks (for propane and butane)
• Eight generators with a total capacity of 320MW
• Two LNG export jetties
• One LPG and condensate export jetty
• 20 LNG ships dedicated to NLNG service
• 20 materials off-loading jetty
• A residential area covering 2.08km²

GAS RESERVES

The supply of additional gas feedstocks will be provided by the upstream oil and gas joint ventures operated respectively by the Shell Petroleum Development Company (SPDC) of Nigeria Limited and by Nigeria Agip Oil Company Limited.

The Nigerian National Petroleum Corporation (NNPC) is the major partner in both these joint ventures. Other partners are Elf Petroleum Nigeria Limited and Phillips Oil Company of Nigeria.

The total gas reserves needed for the project over the first 22.5 years (the duration of the initial LNG sales contracts) is estimated to be 197bscm.

Netherland, Sewell and Associates Inc, a petroleum engineering consultancy firm, performed a detailed evaluation of the gas reserves and production capability of the fields dedicated to the project and confirmed the presence of the required reserves and the feasibility of the development plans.

Gas will be supplied from the onshore concession areas of the eastern part of the Niger Delta, where about 50% of Nigeria’s proven and probable gas reserves, estimated in excess of 2,800bscm, are located. SPDC joint venture is currently supplying feed gas from several fields including Soku, Bonga, BNAG, Awoba and Cawthorne Channel fields.

In future, the current supply will be supplemented by associated and non-associated gas from other gas fields such as Forcados Yokri and Odidi. The Gbaran / Ubie fields will also be deployed by SPDC to bring in additional volumes for the six-train complex.

FINANCE FOR TRAINS FOUR AND FIVE

NLNG approached five international and six national banks to lead the funding of the new facilities. The international banks are BNP Paribas, Citigroup, Credit Lyonnais, MCC and West LB. The Nigerian banks are Citibank Nigeria, First Bank of Nigeria, FSB International Bank, Guarantee Trust Bank, Union Bank of Nigeria and United Bank for Africa.

The international facilities comprise four international commercial bank loans supported by Export Credit Agency (ECA) guarantees or insurances totalling $620m with an eight-year maturity period.

NLNG TRAIN SIX

This part of the project now requires an additional 670mmscfd of feed gas, bringing the total gas requirement of the six-train complex to 3,500mmscfd.

The Final Investment Decision (FID) on train six was taken in July 2004. The EPC contract for the train (identical to train four) was awarded to TSKJ, while the contract for the building of additional storage facilities was awarded to Entrepose Contracting (EC) of France.

Volumes of LNG from train six will be marketed by Endessa (Spain), Total and Shell Western LNG for destinations in Europe and the United States. All five ships to be used in train six are under charter agreements. Three ships are from Bergesen (built in Daewoo Shipyard, South Korea) and two from NYK (Nippon Yusen Kabushiki Kaisha) built in Samsung Shipyard, South Korea. LNG train six has the same features as trains four and five.

In addition, there is the upgrade of the electricity network to 132kV; implementation of advanced control on gas turbine generators; one 84,200m³ LNG tank; one butane and one propane tank, each 65,000m³; one condensate tank 36,000m³ and three additional Gas Turbine Generators (GTGs).

NIGERIA LNG LIMITED

Nigeria LNG Limited is a joint venture company to develop the project with the following shareholding: Nigerian National Petroleum Corporation (NNPC) 49%, Shell Gas BV (Shell) 25.6%, Total 15% and Eni 10.4%.