Technip Energies eyes big LNG awards this year

French LNG engineering firm Technip Energies is currently working on up to ten LNG FEED contracts and expects to secure new EPC deals this year, according to its chief executive Arnaud Pieton.

Technip Energies said its adjusted revenues were down by 4 percent to 6.4 billion euros ($6.8 billion) in 2022 when compared to the year before, while adjusted order intake was 3.8 billion euros, significantly lower year-over-year.

“While the significantly lower activity on Arctic LNG 2 had an impact on the revenue trajectory in 2022, the underlying project delivery portfolio delivered significant growth buoyed by the ramp up of major LNG and downstream projects, and continued to benefit from strong operational execution,” the firm said.

During the year, Technip Energies and its joint venture partners celebrated the first LNG cargo from Eni’s Coral Sul FLNG project off Mozambique, while Technip Energies and Chiyoda are moving forward with the construction work on the giant expansion LNG export project in Qatar’s Ras Laffan.

Their joint venture CTJV won the key onshore engineering, procurement and construction contract from state-owned LNG giant QatarEnergy and its unit Qatargas in February 2021.

The EPC award is part of the $28.75 billion North Field East project and includes building four mega trains with a capacity of 8 mtpa in the Ras Laffan complex.

This first phase of the expansion project will increase Qatar’s LNG production capacity from 77 to 110 Mtpa, while QatarEnergy is also working on the second phase, the 16 Mtpa North Field South (NFS) LNG project, which will further boost capacity to total 126 mtpa.

Ten LNG projects

Technip Energies and US energy services firm Baker Hughes joined forces last year to cooperate on the joint development of a new mid-scale modularized LNG solution for the onshore market.

The new solution will have a capacity above 1 and up to 2 million tons per annum of LNG and adds to Technip Energies’ SnapLNG solution.

“These solutions will enable accelerated time to market and decarbonize production and are totally relevant as we expect mid-scale LNG to account for as much as 30 percent to 40 percent of the future LNG market,” Pieton told analysts during the 2022 earnings conference call on March 2.

He said that the company expects the global gas and LNG markets to remain “strong” in 2023 and beyond supported by further demand growth in Europe and recovering demand from China.

“Our very active early engagement portfolio consisting of close to 10 FEED across the Middle East, the Americas and Africa confirms our leadership position and we will retain our discipline and selectivity as we look to secure the right prospects in the coming quarters,” Pieton said.

These contracts include both onshore and floating LNG projects.

EPC orders

Asked about the conversion of the FEED studies into EPC contracts, he said that “we don’t fully control the timing of the FID by our customers. It’s always helpful when we give them a price that they like and it’s an encouragement for them to take a faster FID.”

“But having said that, I would say there is high level of likelihood that we convert from FEED to project delivery orders within 2023,” he said.

He said that the company has “about 60 Mtpa worth of energy under preparation through the ten FEED contracts.”

“We should see in this year about 20 Mtpa worth of LNG reaching FID. I think it should be a reasonable target,” Pieton said.

“It’s no secret, we are actively bidding in Qatar and the offers are in the end of our clients now,” he said.

“I mean, all the building blocks are there for multiple awards,” he said, adding that the number of the awards “may depend on the actual volume that is being awarded.”

Discussing the US LNG export projects, he said that the “pace of FID in the Americas could be indeed more towards the back end of 2023. In my remarks we are mentioning very clearly that it is about in the next 12 to 24 months,” he said.

Pieton said that “there’s a lot to be awarded, over 100 Mtpa, and it’s not going to be all awarded in 2023.”

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