RasGas II exercises train 4 options

04 October 2002

Ras Laffan Liquefied Natural Gas Company II (RasGas II)is understood to have notified in late September the engineering, procurement and construction (EPC) contractors on its train 3 project to proceed with train 4. Train 4, which will have a design capacity of 4.7 million tonnes a year (t/y), is due to take about 36 months to build and will primarily meet RasGas' sales and purchase agreement (SPA) with Italy's Edisonfor 3.5 million t/y, for which deliveries are due to begin in 2005 (MEED 13:4:01).

Train 4 is being built under options contained in the train 3 EPC contracts. A Japanese/Italian venture of Chiyoda Corporation, Mitsui & Companyand Snamprogettiis the onshore contractor, while the offshore contractor is Dubai-based J Ray McDermott. The two EPC contractors were given the go-ahead by the client last year to place the long lead items for train 4.

The train 4 scope of work is similar to train 3's. The main differences are that the onshore works for train 4 will include the construction of a new cryogenic storage tank and an additional berth, but not a slug catcher.

Work on train 3 is running ahead of schedule and under budget on both the onshore and offshore packages. Mechanical completion is scheduled for December 2003. The output from the 4.7 million-t/y train will go towards meeting the SPA with India's Petronet LNGfor 7.5 million t/y.

For the Edison cargoes, RasGas II will charter four tankers from a Japanese consortium. The first two-vessel order has already been placed by the group of Japanese companies with South Korea's Samsung Heavy Industries. The vessels will have capacity of 138,000 cubic metres. The contract for the other two vessels is due to be awarded in the first quarter of 2003 (MEED 23:8:02).

The total cost of trains 3 and 4 is put at $2,400 million. RasGas II is planning to go to the commercial debt market for $900 million-1,200 million in the first quarter of 2003. At present, work is being financed out of equity. In addition to the commercial loan and debt, RasGas II's shareholder ExxonMobil Corporationof the US has agreed to support the project with a senior loan.

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