RPT UPDATE 1-Angola LNG shutdown to last until mid-2015

Wed May 28, 2014 12:14pm EDT

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By Oleg Vukmanovic

MILAN May 28 (Reuters) - The Angola liquefied natural gas (LNG) export project is expected to resume production in mid-2015, a spokesman for the Chevron-led venture said, after a rupture on a flare line forced a shutdown last month.

The $10 billion project has struggled to squeeze out cargoes since starting up last summer thanks to a succession of technical faults.

A rig capsize, electrical fires, pipeline leaks and limited success in processing the plant's liquids-rich gas have hampered performance over the past year.

Last month a major rupture on a flare line triggered a facility-wide shutdown.

"Following investigation into the incident that took place at the plant in Soyo on 10 April 2014, Angola LNG will pull forward a planned shutdown to allow its contractor Bechtel to both correct items from the incident and - in parallel - address plant capacity issues," the spokesman said.

It is expected that this work will continue into next year, with the plant expected to restart in mid 2015, he added.

Reuters reported last week that Angola LNG had approached shipbrokers to lease out its entire tanker fleet, signalling a prolonged inability of the plant to produce fuel for export.

Reacting to news of the shutdown, a shipping source on Wednesday said the availability of so much shipping capacity would weigh on already-depressed rental rates.

"Massively negative for LNG shipping to see Angola vessels trade spot for 12 months," he said.

Chevron has a 36.4 percent share in the plant, while Angolan state oil firm Sonangol has 22.8 percent. Other stakeholders include Total, BP and ENI.

(Reporting by Oleg Vukmanovic; editing by Keiron Henderson)

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