Underground Construction - November 2019 - 15

project sanction, with in excess of 60 mmtpa
of capacity likely to take final investment
decisions (FID)," according to Wood
Mackenzie. That is well above the previous
45 mmtpa sanctioned in 2005 and a tripling
of the 21 mmtpa sanctioned in 2018.
"Other projects in the US, Qatar, Papua
New Guinea, Australia and Nigeria are
targeting FID in 2019 too, providing
upside to our already bullish view,"
WoodMac said, citing major projects
such as the US$27 billion Arctic LNG-2 in
Russia and Golden Pass and Calcasieu Pass
in the United States, as well as the small
Woodfibre project in Canada.
Two major FIDS have already been
announced recently. Cheniere Energy
confirmed in June that it will build the
sixth liquefaction train at its Sabine Pass
LNG export terminal in Louisiana. Also,
in June, Anadarko Petroleum formally
sanctioned construction of Africa's largest
single LNG project in history.

REGIONAL UPDATES
Africa

findings published in January 2017.
Westwood Global Energy, meanwhile,
projects a 12 percent increase in
additional mileage installed in
2019-2020 and continued capital
spending to expand infrastructure
beyond this near-term period.

LNG Infrastructure
Developing global LNG markets also
remain a key driver for infrastructure
demand, including pipelines to deliver
natural gas production to new and expanding liquefaction and export facilities
in North America and Africa, as well as
import facilities and infrastructure to
distribute LNG and natural gas in
Europe and Asia.
"Despite a rebalancing global LNG
market, 2019 will be a record year for LNG

Tanzania and Zambia plan to build a
refined products pipeline to transport
petroleum between the two countries at
a cost of $1.5 billion, Tanzania's Energy
Minister Medard Kalemani said. The
840-mile pipeline would connect the
commercial capital Dar es Salaam to
Zambia's mining city of Ndola. Kalemani
did not provide a construction timeline or
financing details but said a feasibility study
will be conducted in the coming year.
Uganda's planned 900-mile East African
Crude Oil Pipeline to Tanzania has entered
the financing stage, with South Africa's
Standard bank Group and Japan's Sumito
Mitsi Banking Corporation working to
help raise debt needed to pay for the $3.5
billion project. The pipeline is designed to
export 200,000 bpd of oil to Tanzania from
Uganda's western field, which is controlled
by France's Total, China's CNOOC and
Britain's Tullow Oil. Development was
slowed by disagreements between oil
companies and the government on
strategy and a delayed decision on the
pipeline's route. More recently, the project
has become the target of environmental
groups, which have petitioned banks to
abandon their funding plans.

Total and Tullow, along with Africa Oil,
also reached agreement in principle in
June with the government of Kenya on a
$3 billion upstream and midstream project
to revitalize the country's oil economy.
Project Oil Kenya, which includes a
$1 billion pipeline, however, began facing
delays almost immediately after it was
approved, Petroleum Economist magazine
reported. A Tullow Oil operational update
predicts the government and partners
will reach an FID next year on the project,
which would include a $1.8 billion
processing facility capable of handling up
to 100,000 bpd of oil and a $1.1 billion,
500-mile pipeline to a planned export
terminal on the northern coast.

Asia-Pacific, Australia
China - the region's largest energy consumer - is expected to introduce a plan this
year to combine the long-distance pipeline
assets of its state-owned energy companies
into a single, national oil and gas pipeline
group and open access to private and
foreign energy producers.
"Economic slowdown, a more considered
approach on coal-to-gas switching and increased domestic infrastructure availability
will mean LNG demand will slow in 2019,
from the 40-45 percent growth we have
seen in 2017 and 2018" said Woodmac,
which believes domestic supply growth and
ramp-up of the Power of Siberia pipeline
from Russia will soften LNG demand post2020. "But China will still grow at around
20 percent, by far the largest source of LNG
demand growth in the global market."
The bulk of construction and installation
work is complete, and testing has begun
on Gazprom's 1,864-mile Power of Siberia
pipeline, which will transport 38 Bcm of
gas from the Irkutsk and Yakutia gas production centers to consumers in Russia's
Far East and to China via its eastern route.
The project, begun in 2014, has involved
construction of extensive gas processing
infrastructure in Russia's Far East.
Construction of the middle section of
the China-Russia east-route natural gas
pipeline project, a major energy cooperation project between the two countries, began in Shenyang City of northeast China's
Liaoning Province in July. This key middle
section, spanning 685 miles (1,100 km) is
expected to alleviate natural gas shortages
UConOnline.com | NOVEMBER 2019

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