Chiyoda of Japan and CB&I of the US have reached agreement with Golden Pass LNG on completing construction of the initial train at its $10 billion liquefied natural gas export facility in Texas, US, getting the project back on track after the lead contractor filed for bankruptcy
The 15 million tonnes per annum Golden Pass LNG scheme is a joint venture between state-owned QatarEnergy and US supermajor ExxonMobil.
Chiyoda and CB&I are the remaining two engineering, procurement and construction (EPC) contractors at the liquefaction project, which was derailed after Zachry, the lead contractor in the EPC consortium, filed for bankruptcy.
Chiyoda on Monday said the duo had continued “cooperative discussions” with Golden Pass LNG, relating to completing the full EPC scope for Train 1, which is under construction.
“On 21 November, in US time, we reached an agreement on the amendment of the engineering, procurement and construction contract and associated commercial terms for the completion of the full scope for Train 1,” Chiyoda said in a statement.
Financial terms and other details of the agreed deal were not divulged.
The Japanese contractor added that it and CB&I would continue engagements on subsequently amending the contracts for completing Trains 2 and 3 and would “disclose promptly when we conclude such agreement”.
“As announced by Chiyoda and CB&I, we have reached an agreement on the amendment to the EPC contract and associated commercial terms for the completion of the full scope of Train 1,” a spokesman for Golden Pass LNG told Upstream.
The US Federal Energy Regulatory Commission (FERC) last month granted Golden Pass LNG a three-year extension until 30 November 2029 to start operations at the greenfield liquefaction project.
FERC’s original order, issued in 2016, called for exports by 2021 although the commission subsequently gave the project five years’ relief until 2026 after other regulatory approvals took longer than expected and delayed the final investment decision.
The project cited delays caused by Zachry Group’s bankruptcy filing in May and eventual withdrawal from Golden Pass, which is now being led by CB&I, formerly a junior contractor in the EPC consortium.
Work currently is about 80% complete on the Port Arthur, Texas LNG export project.
QatarEnergy holds a 70% interest in Golden Pass LNG with ExxonMobil having the remaining 30% share.
The last statement from the project’s operator was on 29 July, when it acknowledged court approval of Zachry Holdings’ motion in bankruptcy court.
“This allows Golden Pass and our construction contractors McDermott (CB&I) and Chiyoda to ramp up site construction activities and progress our LNG terminal.
“We are focused on getting people back to work, including local workers and vendors, and progressing this critical energy project. We are committed to a safe and successful completion of this world class facility,” said Golden Pass LNG.
Source: By Amanda Battersby from upstreamonline.com