Toyo Engineering, Hitachi jointly enter LNG plant business

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Oct. 9 -- Toyo Engineering Corp. and Hitachi Ltd. said they will join forces to make a full-fledged entry into the global market for LNG plants, according to media reports.

Japan’s Nikkei Business Daily (NBD) reported that Hitachi will provide rotating equipment and power control software while Toyo Engineering will manage projects including plant design, equipment procurement, and construction.

US plant equipment manufacturer Chart Industries Inc. is also part of the tie-up, and will provide equipment for chilling and liquefying the gas, along with technologies to treat it.

NBD said the alliance will target small, undeveloped gas fields mainly in Australia and Indonesia, and will market relatively small plants that can produce as much as 2 million tonnes/year of LNG.

Australia and Indonesia hold an abundance of undeveloped small and midsize gas fields that would not be profitable if large plants were constructed for them, the paper said.

Many projects, which boast 5-10 million tpy capacity, cost hundreds of billions of yen and even more than ¥1 trillion to build.

The smaller plants the Toyo Engineering alliance is seeking to build cost 20% less to construct, including power generation equipment. They also take nearly a year less to build than the 4 years needed for most large plants.

The new group already has been commissioned by the Japan External Trade Organization to conduct a feasibility study on small and midsize gas fields in Papua New Guinea, NBD said.

Contact Eric Watkins at hippalus@yahoo.com.

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