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Hong Kong floating LNG terminal project now has most elements in place for start by 2021

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The Singapore office of international law firm, Ince, has given additional details of the planned Hong Kong offshore LNG import terminal project, involving the world’s largest floating storage and regasification unit.

Ince acted as adviser to the Japanese shipping line, Mitsui O.S.K. Lines (MOL), which is chartering the FSRU to two Hong Kong utilities.

The project involves a joint venture between sponsors Castle Peak Power Co. Ltd. and the Hongkong Electric Co.

MOL will provide the vessel “MOL FSRU Challenger”, along with operations and maintenance services, to the project aimed at supplying regasified LNG for gas-fired power at the Black Point and Lamma Island power stations.

“With a storage capacity of 263,000 cubic meters, the ‘MOL FSRU Challenger’ is the largest FSRU in the world and the project will ensure a reliable and stable fuel supply for Hong Kong,” said Ince.

The “MOL FSRU Challenger” is currently deployed as an import facility offshore Turkey.

MOL had previously said the FSRU is expected to enter service off Hong Kong around the end of 2020 or early 2021 and after an accord was signed by the shipping line back in June 2018.

The Japanese-owned vessel will supply the Black Point Power Station located in the New Territories and the Lamma Power Station on Lamma Island to improve air quality and the environment in Hong Kong, which was returned to Chinese sovereignty in 1997 after 156 years of British rule.

Law firm Ince said it advised MOL on the negotiation of the FSRU Time Charter Party and Services Agreement, Hong Kong regulatory issues and complex finance-related issues.

The Ince team which comprised of shipping, energy and finance lawyers was led by Devandran Karunakaran, Singapore office Managing Partner, with a team of lawyers from Singapore and Hong Kong.

“We are delighted to have supported one of our key clients, MOL, on this project, a milestone both in terms of the FSRU and energy sectors,” said Karunakaran.

“Ince’s role in this project is a testament to our vast experience in, and continued commitment to, the offshore energy sector in general and the FSRU sector in particular,” he added.

“Our cross-border team was able to give real-time advice on shipping, offshore energy, finance and local regulatory issues,” the lawyer stated.

Simon Hems, the firm’s head of Energy and Infrastructure and a Partner in London, said Ince’s involvement in supporting one of the most significant players in this market-leading project, is testament to its global team’s ability to advise on complex, cross-border energy projects.

“We look forward to standing with MOL in their future endeavours and wish them every success with the Hong Kong Offshore LNG terminal project,” said Hems.