Australian company Venice Energy has signed a new commercial understanding with AG&P LNG, a subsidiary of AG&P Group and developer of LNG terminals and downstream infrastructure, that guarantees that Venice Energy’s Outer Harbor LNG project at Port Adelaide will receive a converted FSRU.
The new development was shared by Venice Energy’s Chairman who said the new deal guarantees that the converted FSRU will be delivered at an improved cost and in a timely manner.
Back in mid-2022, Venice signed an initial FSRU supply agreement with Greek shipping company GasLog . In 2023, GasLog underwent a major restructuring and in doing so decided to sell off a number of vessels.
“In December 2023, AG&P LNG and GAS Entec emerged as a strategic partner to our project to provide the fully converted FSRU. We had some good discussions with them over last two months and we have secured a new commercial understanding,” Venice Chairman said, underlining that AG&P has converted three LNG carriers into FSRUs through GAS Entec, which is integral to the development of the Outer Harbor project.
The FSRU for the Outer Harbour project will also be fully converted by GAS Entec in a South Korean shipyard.
Furthermore, it was disclosed that Venice has been approached by 15 companies to date to discuss the purchase of the project, and eight companies registered as part of the due diligence process following the opening of a data room.
Venice has appointed international M&A specialists CLSA to run a process for interested companies.
Construction update
Following an exclusivity agreement with Origin Energy in October 2023, Venice kicked off stage 1 enabling works at the Outer Harbour project in Port Adelaide.
These works have now been completed and the project is shovel-ready, Venice Regas CEO John Nicholson reported.
Stage 1 enabling works included a significant dewatering of large-scale dredge ponds and the earthworks for the construction of access roads and the lay-down area to bring bulk materials to the site.
Additionally, a major program of geotechnical drilling was also undertaken, to a depth of more than 40 meters. Drilling was undertaken adjacent to the proposed wharf construction area and will allow finalization of the wharf design.
Construction of the terminal and associated infrastructure will run for approximately 24 months, with the first gas expected to flow into the network by May 2026 following a period of commissioning.