Global Energy Ventures Ltd (ASX: GEV), a developer of global integrated compressed natural gas (CNG) projects, has completed the design for its 200 million standard cubic foot CNG Optimum (CNG Optimum 200) ship.
All pipe required for ABS testing of the CNG Optimum 200 ship technology in Edmonton, Canada, will depart Osaka port (Japan) on the 9 April 2018; and Milestones GEV set in 2017 for calendar year 2018 remain on schedule.
The Company describes its patented CNG Optimum Technology as revolutionary for the CNG industry, in that the volume of gas that can be stored on a ship is much larger and as a result the comparative shipping cost is drastically reduced relative to traditional marine CNG technologies. This cost advantage provides an excellent opportunity to deliver CNG projects in the near-term.
CNG Optimum 200 ship design finalised
Following completion of the ship design, GEV is finalising its CNG shipping package to submit to three pre-selected ship yards in April 2018, with a view to selecting a preferred ship yard in the second quarter of 2018. This will allow GEV to firm up pricing, financing and construction schedules, and later in the year, award construction contracts.
GEV has previously advised it will need to obtain American Bureau of Shipping (ABS) approvals during 2018 to commence construction of the CNG Optimum 200 ships. To obtain these approvals, pipe proposed for use in the ships’ construction must be fully tested. GEV is pleased to confirm that following the manufacturing of the required pipe in Japan, it will be despatched from the Osaka port on 9 April and delivered to the ABS-approved testing centre in Edmonton (Canada) in the second week of May 2018. GEV and ABS have agreed the testing plan, which remains on schedule and budget, with all approvals scheduled for third quarter 2018.
Marubeni-Itochu Steel (Marubeni Corporation is a shareholder of GEV) is ordering and overseeing the delivery of the high-strength pipe required for the ABS required testing program. The pipe will be manufactured by JFE Steel Corporation and delivered to CFER’s testing facility in Edmonton. The testing program will include cyclic pressure tests as well as structural tests to confirm the engineering analysis of GEV CNG Optimum Technology. These tests are required by ABS as part of their approval process.
2018 Milestones remain on track
GEV’s Chairman and CEO, Maurice Brand, said the Company had made significant progress on all technical and commercial aspects for the CNG Optimum 200 ship. GEV is on track to deliver its 2018 milestones, namely:
- Obtain all ABS and related approvals, allowing GEV’s selected ship yard to commence construction of CNG Optimum 200 ships;
- Achieve final investment decision for GEV’s first marine CNG project with financial close and awarding of all contracts to follow in first half of CY2019;
- Announce a second marine CNG project; and
- Secure equity in gas resources that are capable of supporting a CNG project on a fully integrated basis.
Mr Brand added that the Company would shortly appoint its ship broker whom would assist in negotiating with the shipyard, follow up with the selected yard during construction and assist with funding arrangements with GEV.
“It is important to consider that 80-85% of the capital costs for each CNG project, excluding gas supply, relates to the CNG ships. The way the CNG ships are financed has a significant impact on shareholder value and GEV is determined to ensure the market is fully informed of the financial structures available to the company in order to provide future guidance on project valuation.” he said.
Source: Global Energy Ventures Ltd