Samsung C&T wins deal to build Singapore's first LNG terminal

May Wong/Jonathan Peeris, Channel NewsAsia 8 Feb 10;

SINGAPORE: South Korea's Samsung C&T Corporation has won the tender to build Singapore's first liquefied natural gas terminal.

Samsung C&T will handle the engineering, procurement and construction of the terminal under a contract worth about S$1 billion.

The Singapore LNG Corporation (SLNG) announced this at a signing ceremony on Monday. SLNG was incorporated by the government's Energy Market Authority to own and develop Singapore's first LNG import terminal.

SLNG's executive director, Neil McGregor, said: "There were many factors that led to selecting the Samsung proposal. Key to this was a very novel and efficient design, which minimised the footprint of the new terminal, thereby freeing up land within the site that SLNG can capitalise on to expand its business and the range of services it can provide in the future."

All in, the government is investing S$1.5 billion in the LNG terminal project.

LNG is natural gas cooled to liquid form, making the gas more practical to transport and store.

The LNG terminal, which will occupy 30 hectares of land on the southwestern part of Jurong Island, is expected to be Asia's first open-access, multi-user terminal.

It will not only provide capacity for Singapore to import re-gasified LNG for its own needs, but also open up opportunities for companies to make use of the terminal for LNG trading.

The LNG terminal will have an initial capacity of 3.5 million tonnes per year, slightly above past projections of 3 million tonnes, with provisions to expand it to 6 million tonnes per year or more if needed.

The terminal is now due to be completed in early 2013, after a deferment of one year. Foster Wheeler Asia Pacific has been named the project management consultant.

The government said in June last year it was taking over development of the terminal to avoid more delays due to the credit crunch. The project was previously fronted by a PowerGas-led consortium, which included GDF Suez.

Currently, 80 per cent of Singapore's electricity comes from gas-fired power plants. LNG will be an additional source to help Singapore meet increasing energy needs.

Lawrence Wong, chief executive of Energy Market Authority, said: "From an energy security point of view, our imperative is to want to diversify our sources of gas. The terminal enables us to do that, because with the LNG terminal, we plug into the global gas market and we would have a much more diversified source of gas that we can get from all over the world.

"Of course, through our aggregator British Gas, whom we've appointed, we would be able to access gas on a market basis, on a competitive price. So, I think, from that point of view, the LNG terminal is a critical infrastructure that will provide for our energy security and ensure that we have a more sustainable energy future."

- CNA/ir

LNG terminal gets out of the starting gate
Samsung wins contract for the main building of Singapore's first LNG terminal
Joyce Hooi, Business Times 9 Feb 10;

(SINGAPORE) The drawn-out crawl to the dotted finishing line finally came to an end yesterday, with the main building contract for Singapore's first liquefied natural gas (LNG) terminal being awarded to the Samsung C&T Corporation (Samsung).

Singapore LNG Corporation (SLNG) announced yesterday that Samsung had beaten two other tenderers - CB&I and the WSKL Consortium - to win the contract for the engineering, procurement and construction (EPC) of the 30ha Jurong Island project.

The budget of the project, which is funded by the government, is $1.5 billion, of which $1 billion has been earmarked for the development of the terminal.

The remaining $500 million serves as a provision for the building of a second jetty on the premises of the terminal as well as other development costs related to designing and regulatory approvals.

Samsung - which is currently involved in two Downtown Line projects, two Marina Coastal Expressway projects and the Power Seraya project - won the contract for a sum that cannot be disclosed because it is 'commercially sensitive' information.

The South Korean firm won the contract because of its focus on efficiency, according to Neil McGregor, SLNG's executive director.



'Key to this was a very novel and efficient design, which minimised the footprint of the new terminal, thereby freeing up land within the site that SLNG can capitalise on to expand its business and the range of services it can provide in the future,' said Mr McGregor.

A separate contract for the management of the project was awarded to engineering firm Foster Wheeler Asia Pacific Pte Ltd, also for an undisclosed sum.

Plans for the LNG terminal have been in the works since 2006. PowerGas and GDF Suez had originally been appointed the project's developer, but they had run into financing difficulties during the turbulence of the credit crunch last year.

The Energy Market Authority had then set up SLNG to spearhead the project.

The terminal will have an initial capacity of 3.5 million tonnes per annum, with an option to expand to six million tonnes per annum or more.

At present, Singapore imports about six million tonnes per annum of piped natural gas from Indonesia and Malaysia. The capacity of the LNG terminal could be used to meet new demand, as well as for LNG trading.

Currently, SLNG expects initial sales to end users to reach 1.5 million tonnes per annum.

The commercial contracts for the aggregation and sale of LNG initial volumes to end users and sale of terminal services are 'well-advanced and are fast nearing completion', according to Mr McGregor.

BG Group, the appointed LNG aggregator or sole buyer, has the exclusive franchise to supply up to three million tonnes per annum of LNG to Singapore or until 2023, whichever happens earlier.

Construction of the terminal will start in about six months and is slated to be completed in early-2013.

All parties appeared confident that they have seen the back of delays in the project.

'We fully expect to carry out the work on time, within budget, and to the highest standard of quality,' said Jeong Ki Chul, senior executive vice-president of Samsung, yesterday.

Samsung wins Singapore LNG terminal job
Jessica Cheam, Business Times 9 Feb 10;

SOUTH Korea's Samsung C&T Corporation has clinched a contract to build Singapore's first liquefied natural gas (LNG) terminal.

The deal is to handle the engineering, procurement and construction (EPC) of the Jurong Island facility and could be worth up to $1 billion.

The terminal's total budget, funded by the Government, is $1.5 billion with about $1 billion earmarked for the EPC contract, said Mr Neil McGregor, executive director of the Singapore LNG Corporation (SLNG), which awarded the contract yesterday.

Issues of commercial sensitivity mean the exact value of Samsung's contract could not be disclosed but it is under $1 billion, added Mr McGregor.

Yesterday's signing ceremony marked the start of a key energy project that has been beset by delays.

The plant was first mooted in 2006 and was meant to be developed and operated by Singapore Power's unit PowerGas and French partner GDF Suez and completed by 2012.

But the global credit crunch threatened the plans. The Government said last June that it would take over the development and ownership of the terminal as it was central to the country's efforts to diversify its energy sources.

LNG is natural gas cooled to liquid form and exported via tankers from source countries such as Australia.

SLNG said yesterday it instructed Samsung to start immediately the detailed design, engineering and construction phases of the terminal.

Mr McGregor said Samsung clinched the deal over its competitors due to its 'novel and efficient design, which minimised the footprint of the new terminal' and freed up land that could be used for future expansion.

The other tenderers were CB&I (Chicago Bridge & Iron) and a consortium led by British company Whessoe and including SK Engineering and LG International.

Energy Market Authority chief executive Lawrence Wong said that 'with the award of this contract to Samsung, we have taken a major step forward in the project, and can look forward to the start-up of the LNG terminal in 2013'.

Samsung senior executive vice-president Jeong Ki Cheol said yesterday that Singapore was a key priority for the firm.

The terminal, which will be on a 30ha site on the south-western part of Jurong Island, will have an initial annual capacity of 3.5 million tonnes with provisions to increase capacity to 6 million tonnes.

SLNG yesterday also appointed Foster Wheeler Asia Pacific as its project management consultant. Both firms will jointly manage the EPC contract.

Mr McGregor said the remainder of the $1.5 billion budget will be for a second jetty and extra storage tanks for the terminal as well as development costs.