Energy major Chevron and Israel’s NewMed Energy have selected companies to work on competitive front-end engineering and design (FEED) contracts for the planned Leviathan floating LNG (FLNG) production unit for the Mediterranean.
TradeWinds has learned that South Korea’s Daewoo Shipbuilding & Marine Engineering partnered with engineers Technip and separately Sembcorp Marine of Singapore, working on its own, will undertake parallel FEED work for the unit.
The partners in Leviathan are targeting a 4.6-million-tonne-per-annum unit and have been pushing to advance work on their project in recent months.
FLNG projects have received a boost in interest due to sky-high gas prices seen in 2022 and the recent concerns about energy security.
On paper, offshore LNG developments can stack up as cheaper to bring to market, but large FLNG units can prove complex and many project partners have complicated the advancement of some developments.
FLNG units also absorb considerable berth space at shipyards at a time when there is already significant competition for slots for conventional vessels.
The Leviathan FLNG project has gone through many iterations.
Shipyards tackled a FEED tender for a 3-mtpa FLNG unit for the gasfield back in April 2014, with pre-FEED work on a floating liquefaction development started several years in advance of this.
The gas field of the same name is located about 130 km off the shores of Haifa in Israel and, according to NewMed contains about 22.9 trillion cubic feet of recoverable gas.
Pipeline gas started flowing from the first phase of its development in 2019 with volumes supplying Israel, Egypt and Jordan.
In a second phase, NewMed and its partners plan to almost double the output with a liquefaction unit that would allow gas from the field to be exported to customers outside the Eastern Mediterranean to those in Europe and Asia.
NewMed said commercial negotiations have been held with two existing liquefaction facilities in Egypt — these are the Damietta and Idku plants — “while an option for liquifying natural gas on a floating facility anchored in the Israeli EEZ is being explored”.
“Phase B of Leviathan is expected to propel it onto the global stage, and to secure the East Med as one of the world’s most important energy hubs,” the company said.
NewMed has a 45.3% stake in Leviathan while Chevron, which bought out Noble Energy in 2020, holds 39.7% and Ratio Energies 15%.
