Visionary Yinson Production unveils the world’s first-ever offshore carbon capture plant
Backed by an excellent track record in project execution, safety, uptime performance, and a prominent position in sustainable floating, production, storage, and offloading (FPSO) vessel designs, Yinson Production Ltd (Yinson) stands as a top-tier FPSO contractor. Originally serving as a modest transport and logistics company in Malaysia, Yinson was founded by Lim Han Weng in 1984. Interestingly, the name ‘Yinson,’ which was derived from Lim’s mother’s name – Yin – also translates to ‘cloud rising’ in Chinese, conveying his aspiration for the company to rise as high as the clouds. Through an unwavering commitment to exceptional customer service and timely delivery, what started as a small enterprise grew exponentially. Over a 20-year span, Yinson became one of Malaysia’s biggest transport companies, boasting a fleet of 365 trucks and supplying an additional 565 trucks to its valued customers.
Yinson entered the oil and gas industry by forming a consortium with PetroVietnam Technical Services Corporation (PTSC, a subsidiary of PetroVietnam). The joint venture company was awarded a contract for the charter of a floating, storage, and offloading (FSO) vessel named PTSC Bien Dong 01. This paved the way for Yinson to win a contract for the charter of FPSO PTSC Lam Son.
Impressive uptime
In 2014, the business was further strengthened with the acquisition of established Norwegian FPSO company, Fred Olsen Production ASA. By mid-2016, Yinson divested its non-oil and gas businesses, streamlining the company to specifically serve the offshore oil and gas industry. This strategic decision allowed Yinson to grow over the ensuing years to become one of the largest independent FPSO leasing companies globally. To date, Yinson has a fleet of nine FPSOs located in Ghana, Malaysia, Nigeria, Brazil, and Angola.
Jahn Høgberg, COO, provides further details on the company’s primary services. “As specialists in leasing and operating FPSOs, we exclusively handle our own assets and do not operate FPSOs owned by others. Serving as a one-stop shop, we design and build our FPSOs, ensuring they are operational before long-term contracts. Our core mission is to assist our clients in achieving efficient and cost-effective oil production while maintaining industry-leading uptime and safety. Yinson operates throughout Southeast Asia, West Africa and South America,” he begins.
Since its last feature in Energy, Oil & Gas magazine, Yinson has been involved in multiple projects, as described by Jahn. “Indeed, we have secured several new contracts, beginning with the FPSO Anna Nery in Brazil at the end of 2019. Upon successfully completing that project, it achieved first oil on the 7th of May 2023, and has since been operating for over a year with an impressive uptime performance. Additionally, we have secured three more FPSO contracts: the Maria Quitéria for Petrobras, Atlanta for Enauta, and Agogo for Azule Energy, which is our latest contract in Angola. The FPSO Maria Quitéria is currently en route from Singapore to Brazil and is expected to achieve first oil later this year. Meanwhile, the FPSO Atlanta is undergoing the marine campaign in Brazil, and is also anticipated to commence operations in the second half of this year. Finally, the FPSO Agogo is 75 percent completed at HRDD shipyard and will relocate to Cosco Shipyard outside Shanghai. With the addition of these recent contracts, our order backlog exceeds $22 billion, with contracts leading up to 2048.”
With so many contracts already secured for the next two decades, Jahn uncovers the key factors prompting customers to choose Yinson over other firms in the industry. “Yinson offers various unit sizes, and we specialize in conversions as well as redeployments of existing FPSOs. Presently, we stand as one of the three largest companies in the sector, ranking second in terms of order book and third in fleet size. What sets us apart from our two main competitors is that we are the only company specializing in the conversion segment still with large-scale production capacities. In fact, we proudly stand as the number one enterprise in that segment, as we continually strive to be the best. Notably, we have achieved the industry’s highest uptime, maintaining an impressive 99.7 percent technical uptime across our entire fleet for the past five years. Naturally, our exceptional performance is a massive benefit to our clients, as it translates to increased revenue every year,” he enlightens.
Carbon capture commitment
Just as crucial as the substantial revenue that Yinson empowers its customers to generate, its products and services also play a vital role in helping them reduce their emissions. “When it comes to sustainability, we are at the forefront of the FPSO sector,” notes Jahn. “Recently, we have implemented more emission-reducing technologies than any other company in the industry. These technologies encompass combined cycle power generation, all-electric drives, and frequency converters for large drives, to optimize efficiency and reduce energy consumption. Additionally, we have made investments in closed flare systems, hydrocarbon blanketing, and a turbine to regenerate power from the cooling water discharge. Most importantly, we operate the first-ever offshore carbon capture plant on an FPSO. A key partner of ours, Carbon Circle, is delivering this carbon capture plant for installation on our FPSO Agogo. Yinson is looking forward to the successful completion of its installation and operational deployment, with the aim to showcase its capabilities.
“Once FPSO Maria Quitéria commences operations in Brazil later this year, it will become one of the first FPSOs in the world to operate with a combined cycle power plant. This type of plant is the largest contributor to emissions reduction, even with today’s technology, resulting in approximately a 20 percent decrease in emissions compared to conventional power generation designs. Internally, Yinson has set its own sustainability targets, which are focused on driving down the overall carbon intensity of its entire fleet. Consequently, when considering new projects to undertake, we carefully evaluate the carbon emissions impact and decline any proposals that do not contribute to reducing our fleet’s average emissions,” he continues.
Moving forward, Jahn elaborates on Yinson’s approach to supply chain relationships. “Undoubtedly, our suppliers are extremely important to us, especially considering the fact that there are not many in our industry. In some cases, only two or three subcontractors exclusively provide a certain piece of equipment. Therefore, it is vital for us to work closely with them for every project we undertake and maintain a healthy and mutually beneficial relationship. When it comes to our contract model, we solely partner with subcontractors who demonstrate reliability and a proven track record of timely delivery. Overall, we tend to prefer working with some of the same suppliers and subcontractors, although we strive to spread out the workload to give everyone opportunities to collaborate with us every now and then,” he explains.
Operational reliability
As the end of our interview approaches, Jahn provides us with valuable insights into Yinson’s endeavors for the remainder of 2024. “For the rest of this year, most of our focus will be on commencing operations of our FPSOs Atlanta and Maria Quitéria in Brazil. Moreover, we are set to commence modification projects for existing assets in West Africa, which will contribute to driving down emissions. It is worth noting that these projects will be conducted by Yinson in collaboration with globally renowned companies. One of these projects involves FPSO Abigail Joseph in Nigeria for First E&P, while the other one is for ENI on FPSO John Agyekum Kufuor in Ghana. Lastly, we will participate in several new tenders, but it is unlikely that any of them will be finalized before next year, when we will have plenty of capacity to manage a couple of new contracts.”
Looking further afield, Jahn shares what readers can expect to see from the company in five years. “In the long term, our target is to establish ourselves as the recognized frontrunner in sustainable FPSOs. We aspire to shape the future of offshore energy and to set the global benchmark in sustainable FPSO solutions, championing design, operational reliability, and environmental excellence,” he ends.
Through strategic collaborations, environmental stewardship and dedication to best-in-class safety and customer service standards, Yinson seems poised to solidify its leadership in FPSO solutions while pioneering innovative sustainable operations globally.