FLNG Production Planned

FLNG Production PlannedFLNG Production Planned

The National Iranian Oil Company is on course to build facilities for producing floating liquefied natural gas or FLNG, managing director of investment at the National Iranian Oil Company said.

"A trio of tenders to trade associated petroleum gas will be finalized in the near future, one of which is aimed at producing FLNG," Ali Kardor was quoted as saying by Shana.

The official added that new tenders are slated to be called for selling Iranian APG, which is burned off in gas flares.

"We are on the verge of sanctions removal and a bigger number of foreign firms are expected (to bid) for the tenders," he said.

FLNG production includes all systems to enable offshore liquefaction of natural gas into LNG. An FLNG facility would produce, liquefy, store and transfer LNG at sea before carriers ship it directly to markets.

Kardor said investing in FLNG infrastructure is financially viable, because the cost of producing LNG offshore is relatively on a par with LNG production at onshore facilities.

According to reports, no FLNG facilities currently exist, but Malaysia's state-owned Petronas is constructing such a facility. In addition, the UK-based oil and gas major Royal Dutch Shell is reportedly working on the world’s biggest FLNG project.

A week before Iran and six world powers clinched a deal on curbing Tehran's nuclear program in exchange for an end to sanctions against the Islamic Republic, gas officials said they were in talks with a major global company for producing FLNG.

The unnamed company was reportedly keen on “immediately” starting its FLNG project in Iranian waters after the lifting of sanctions.

  LNG Talks

Sitting on some of the world's richest hydrocarbon resources, the Persian Gulf country is planning to develop the LNG sector in the post-sanctions period.

Iran is projected to officially join the LNG Exporters Club in the next two years, NIOC's managing director said on Sunday, outlining the construction of new LNG production units as a top national priority.

Last month, Oil Minister Bijan Namdar Zanganeh discussed LNG supply to Spanish terminals and, from there, to other European destinations. Later that month, LNG exports were discussed with a Polish delegation in the capital Tehran.

In addition, French oil and gas giant Total has also expressed interest in buying and marketing Iranian LNG.

For the gas transfer to Europe, Iran has ruled out the pipeline option which is too costly. Officials, instead, have hinted at LNG shipments but the first cargo is not believed to come about at least in the near future.

According to plans, the country's gas exports, including LNG, should rise to 80 billion cubic meters per year by 2021.