Singapore’s Keppel Shipyard has landed a US $735 million deal to undertake a tanker conversion to provide a floating LNG (FLNG) vessel to a client that does not yet have a contract for the unit.

Awarded by Golar Hill Corp., the deal is to convert an existing Moss LNG carrier, the Golar Hilli, to become what Keppel said will be the world’s first conversion of its kind into an FLNG vessel. The deal, which carries options for two more such vessel conversions, follows up on a conditional contract Keppel first revealed on 25 June, which was dependent on a milestone payment for the project.

Golar LNG—chaired by Norwegian-born shipping and energy magnate John Fredriksen, and which has substantial project experience in the LNG and FSRU sector—recently completed an equity offering to finance the on-spec conversion of the 125,000 cubic metre LNG carrier Hilli into an FLNG vessel.

Keppel’s scope is for provision of the design, detailed engineering and procurement of marine systems and all of the conversion-related construction.

Black and Veatch has been selected by Keppel as a sub-contractor for detailed engineering and process design of the liquefaction topsides. It will also specify and procure all topsides equipment on the vessel, provide commissioning support and supply its proprietary PRICOÂ technology for the gas liquefaction.

According to Golar LNG, the vessel conversion will be completed by February 2017. The company also confirmed it has firm options for the conversion of two more vessels, which could be delivered in third-quarter 2017 and first-quarter 2018.

The Golar Hilli is due to arrive at Keppel within the next three to four months, allowing conversion to start, where Golar said key systems onboard will be renewed, while topsides units are manufactured. “The FLNG production equipment will be mounted on two new sponsons, which will be connected to the vessel,” Golar stated.

Predicting the FLNG vessel conversion will be delivered within 31 months, Golar said this timing provides one of several strong competitive advantages. “This will make it possible for the company to offer a cost-effective and reliable LNG production facility to its customers several years ahead of any potential competitors.” Golar’s plans are also focused on targeting projects that are relatively small or mid-scale in FLNG terms, of between 1.0-2.5 MMtpa.

The deal follows a year-long FEED exercise by Keppel with Black & Veatch, performed as part of a previous agreement with Golar, which was for the conversion of up to three vessels.

Golar has previously successfully converted four tankers into FSRUs.

Offshore