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Mubadala And IPIC Seek Financial Advisor For Fujairah LNG Regasification Terminal

Mubadala Oil and Gas, a unit of Abu Dhabi’s Mubadala Development Company, and the International Petroleum Investment Company (IPIC) are seeking financial advisors for their joint venture LNG regasification facility in Fujairah, MEES understands. Mubadala told MEES that the project team is talking to a range of organizations which may have an interest in the facility, named Emirates LNG, although said that it could not provide further information at this preliminary stage. MEES understands that there have already been meetings with banks and an advisor is expected to be appointed sometime soon. “If they want to get the terminal ready in 2014, they will need to appoint an advisor and have financial close very quickly,” said one expert. Ideally they should approach banks for project financing sometime this year, he adds. LNG experts suggest that the project could cost more than $500mn.

“It is significant that Abu Dhabi is doing a floating regasification facility. It sends signals about how they see security of supply,” commented one gas expert. Abu Dhabi plans to import 1.2bn cfd of LNG – about 8mn tons/year – into the emirate of Fujairah, bypassing the Strait of Hormuz. This would cut shipping insurance costs and boost energy security at a time of tension in the Gulf due to the standoff between Iran and the international community over Tehran’s nuclear plans. Fujairah, which is on Dolphin Energy’s gas pipeline network that links Oman to Qatar via Abu Dhabi, is on the Gulf of Oman, which opens into the Indian Ocean. The terminal will start importing gas via Phase 1, a floating storage and regasification unit (FSRU), in 2014-15, eventually ramping up to a fourth phase via a permanent onshore regasification terminal that will take at least four years to build. Phases 1 and 2 total 600mn cfd, which Phases 3 and 4 will double (MEES, 26 March).

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