(EnergyAsia, July 11 2014, Friday) — Singapore’s Keppel Shipyard Ltd said it has secured a US$735 million contract from Golar Hilli Corp, a subsidiary of Golar LNG Ltd, to convert an existing Moss liquefied natural gas (LNG) carrier, the Hilli, into a floating liquefaction vessel (FLNGV) by the first quarter of 2017.

Keppel Shipyard, a wholly-owned subsidiary of Keppel Offshore & Marine Ltd, said it has engaged Black & Veatch to provide design, procurement and commissioning support services for the topsides and liquefaction process as well as supply its proprietary PRICO® technology for the liquefaction process.

In carrying out the FLNGV conversion, Keppel Shipyard said it will be responsible for the provision of the design, detailed engineering and procurement of the marine systems and all of the conversion-related construction services.

The contract, which includes options for another two similar units, follows the completion of a year-long front-end engineering and design (FEED) study by Keppel Shipyard and Black & Veatch. The FEED study was conducted as part of the terms of a term sheet agreement with Golar to convert up to three LNG carriers into FLNG vessels.

The conversion has been approved in principle by Norway’s DNV in accordance with its classification rules and international standards.
Work on detailed design, engineering and manufacturing of the topsides will start shortly. The Hilli will be delivered to Keppel Shipyard later this year for renewal work on key marine systems onboard the vessel.

“The FEED study for Golar has come into fruition with the award of the world’s first FLNG conversion project to Keppel Shipyard. We are excited to collaborate with trend-setting partners such as Golar and Black & Veatch. Keppel Shipyard had successfully delivered to Golar the world’s first floating storage and regasification unit (FSRU) back in 2008, which was followed by two more similar units,” said Michael Chia, Keppel O&M’s managing director (Marine & Technology).

“We see this project as another excellent opportunity to offer innovative solutions to help address the growing midstream needs in bringing small and mid-scale LNG to market to meet the rising global demand for energy. Mid-sized FLNG solutions such as this one offer a faster and more cost effective liquefaction solution.”

According to consultant Douglas-Westwood, the global FLNG industry is expected to attract more than US$65 billion of investments through to 2020, driven by rising costs of onshore LNG terminals. The Asia-Pacific region is expected to account for the bulk of  the world’s FLNG investments due to the large number of planned regasification and liquefaction projects.

Golar LNG is one of the world’s largest independent owners and operators of LNG carriers with nearly 40 years of experience. The company developed the world’s first FSRU projects based on the conversion of existing LNG carriers.