October.07.2015
Orrick has advised on the negotiation and signing of a gas convention with the Republic of Cameroon in connection with the installation and operation of a floating liquefied natural gas (FLNG) facility located off the coast of Kribi in southern part of Cameroon. The project is the first of its kind in Africa and will enable Cameroon to enter the small circle of LNG-exporting countries. It is also the first project of this kind implementing the new gas code adopted in 2012.
We represented Golar Hilli Corporation and Golar Cameroon of the Golar LNG group, which is one of the largest independent owners and operators of liquefied natural gas (LNG) carriers, in the negotiation and signing with the Republic of Cameroon, the National Hydrocarbons Corporation (SNH – the public company managing the interests of the Cameroonian State in the oil and gas sectors) and Perenco Cameroon (the largest oil and gas producer in Cameroon).
Along with the gas convention, the project is based on a production sharing agreement between SNH and Perenco, a tolling agreement for liquefaction services between SNH, Perenco Cameroon, Golar Hilli Corporation and Golar Cameroon, the terms of which are finalized and expected to be signed shortly, and LNG sales agreements.
The project is based on the allocation of 500 billion cubic feet of natural gas reserves produced by the SNH-Perenco joint-venture from offshore Kribi fields. Liquefaction services will be performed on the Golar “Hilli” vessel, now under conversion at Keppel Shipyard in Singapore. The project will have a production capacity of 1.2 million tons of LNG per annum, which will be exported to global markets, over an approximate eight-year period. The project will also enable the production of 30,000 tons of liquefied petroleum gas (LPG) per annum and 5,000 barrels of condensate per day. It is expected that LNG production will commence in the second quarter of 2017.
Golar LNG is a Bermuda registered company listed on NASDAQ. With over 40 years of LNG industry experience, the company is a leading worldwide owner and operator of LNG carriers and floating storage and regasification units (FSRUs). Golar LNG and its partners together own and manage a substantial fleet including in particular 15 LNG carriers, six FSRUs and three vessels currently under conversion into floating natural gas liquefaction units.
“This is the first project of this kind in Africa and one of the first worldwide,” said Yves Lepage. “We are proud to have assisted Golar during the negotiations that led to the signature on this convention, which constitutes a major milestone in the development of the project.”
The Orrick team was led by energy & infrastructure partner Yves Lepage and included energy & infrastructure of counsel Olivier Meledo and energy & infrastructure associates Laure Weymuller and Lynda Amadagana.