Total’s ‘disappointment’ with Angola LNG adds to production gap

6/17/2014

By EDUARD GISMATULLIN and TARA PATEL
Bloomberg

Angola LNG, a $10 billion liquefied natural gas (LNG) plant halted in April due to a leak, has proved to be a disappointment for Total.

“The real concern is that we are at least one year late and even much more than that in terms of start of production,” Yves-Louis Darricarrere, head of upstream, said in an interview at an energy conference in Moscow.

Angola LNG, which produces the super-chilled fuel for spot deliveries to destinations from South Korea to Brazil, is expected to restart in the middle of next year. The plant has experienced halts since production started last June after an 18-month delay caused by several fires and accidents.

Total, with a 13.6% stake, is “missing” about 25,000 bpd of oil equivalent in natural gas due to the halt, Darricarrere said. “It’s a disappointment, but at the same time for us it’s marginal.”

The French company has sent experts to the site, he said.

The halt adds to output gaps this year for Total at Kashagan in Kazakhstan, where leaky pipelines must be replaced, and the loss of a concession in Abu Dhabi. The company targets increased production over the coming years, a goal that will be helped by the start of production at the Clov field off Angola this month.

Angola LNG was running at about 50% of planned capacity before the latest incident because the composition of the plant’s associated gas supply required additional equipment, according to Chevron, the operator and largest shareholder.

The April incident took place during the commissioning and testing phase as part of a ramp up to full liquefied natural gas production.

Chevron holds 36.4% of the project, with state-owned Sonangol EP owning 22.8%. Total, BP and Eni each hold 13.6%, according to Angola LNG’s website.