A consortium of four Japanese companies are buying a percentage of a floating production, storage and offloading facility off the coast of Ghana, .
A consortium of four Japanese companies, including ocean carrier “K” Line, are purchasing a 26 percent stake in a floating production, storage and offloading (FSPO) unit in the African nation of Ghana owned by Malaysia-based Yinson Holdings, the parties involved said in a joint announcement Tuesday.
The value of the stake is estimated at between $104 million and $117 million.
In addition to “K” Line, the other companies involved in the purchase are general trading company Sumitomo Corp, engineering firm JGC Corp., and the Development Bank of Japan.
FPSO refers to facilities used for offshore crude oil and gas production – i.e. storage of the produced crude oil in a tank and direct offloading onto a tanker.
Yinson has a 15-year long-term FPSO chartering agreement with Eni Ghana Exploration & Production Ltd., an affiliate of Italian oil company Eni SPA, and in May began oil production about 37 miles southwest of Ghana.
Barring any unforeseen circumstances, the domestic supply of natural gas from FPSO facilities is expected to commence in Ghana by mid-2018, according to Yinson Holdings.
FPSO is a key infrastructure piece for deep-water oil and gas production, both projected to steadily increase in the coming years, thus increasing demand for FPSO.
“In preparation for this demand, ‘K’ Line, Sumitomo Corp. and JGC will acquire knowledge and expertise through the project as their first FPSO owning and chartering business,” the companies explained in a statement. “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 say they’ll contribute to stable oil and natural gas supplies in Ghana, and help solve natural gas and electricity shortages in the country.
The FSPO project, which produced its first oil on May 22, is capable of producing 58,000 barrels a day of crude oil and 210 million square feet/day of natural gas, according to Yinson. It also has a storage capacity of 1.4 million barrels, the company has said.