Table of Contents
1 History
1.1 Natural Gas
The rediscovery of the tremendous value of naturally occurring gas for the modern age has ensured its place as the fastest growing energy source for the next twenty years (2040) – and liquefied natural gas (LNG) is integral to this growth. LNG is natural gas that has been supercooled to a liquid state at -260° Fahrenheit (-162 C°) for safe and efficient transport. Natural gas liquefied by cryogenic cooling takes up 600 times less space than its gaseous state and becomes non-flammable, non-explosive, and non-toxic. Natural gas in raw form has been widely utilized by humans for nearly 2,500 years. By the 4th century BCE, the Chinese drilled for and transported natural gas through crude pipelines constructed of bamboo; Asia, the Middle East, Greece, and others record the use of gas in the ancient past as a consummate source of energy, mostly for heating and cooking. These naturally occurring hydrocarbon gases (primarily methane) are industrialized in the present day and serve to generate vast amounts of energy for electricity generation, manufacturing, vehicle fuel, heating, and cooking. By the late 18th century, Britain lit her homes and city streets by means of natural gas, though the first real industrialization of gas took place in the 19th century, when scientists began to both compress and liquefy natural gas.
1.2 Liquefied Natural Gas (LNG) and Compressed Natural Gas (CNG)
19th century pioneering scientists James Joule, Michael Faraday, and Lord Kelvin and several others raced to discover techniques for compressing and, particularly, liquefying natural gas. While compressed natural gas (CNG) and LNG share similarities, their differences are key to understanding what current and future uses each respective technology offers. CNG is natural gas reduced to 1/200th the volume of its natural state, roughly 1 percent of its natural atmospheric pressure. CNG is used as fuel for vehicles, mostly large trucks and buses, produces less emissions than standard gasoline or diesel fuels, requires less maintenance than other hydrocarbon fueled transportation, and are safer overall when compared to gasoline powered vehicles and considerably safer in the event of a spill (as the natural gas is lighter than air) mixing easily and dispersing quickly. The trade-off for these benefits is that CNG is much less energy dense (about ¼ the energy of gasoline per gallon) than gasoline and often requires large, bulky tanks for fuel storage. Despite these drawbacks, natural gas-powered vehicles – both CNG and LNG – are making headway around the world. Additionally, CNG locomotives are in operation around the globe.
1.3 LNG in the Present Day
Energy needs have evolved alongside civilization since the dawn of time. For untold thousands of years wood was the dominant source of energy, surpassed by coal in the 19th century, and then dominated by oil. The affordability and availability of oil made it the logical successor in this evolutionary chain of energies. Natural gas maintains this evolutionary process by offering wide availability and affordability, among other distinct advantages. Natural gas is a notably cleaner energy source than coal and oil when used, producing almost no pollutants, only the same water and carbon dioxide that we exhale. Though pipelines remain the primary means of transporting natural gas, liquefying natural gas reduces its volume to 1/600th of the volume of its natural state; this allows for both safer and less expensive transportation and storage. The advantages of LNG rest in its ability to connect producers and markets together around the world. This is achieved by short-range cryogenic pipeline transportation, vehicle transportation, and by LNG vessels and carriers, all of which are specially designed for this purpose.
1.4 LNG Stocks and LNG Future
LNG is the bridge between natural gas production and its utilization as the fastest growing source of energy production in the world. Its place as a critical component of global, low emission, low cost and high efficiency energy is firmly established and growing at an astonishing rate. While capital costs are notoriously expensive, trends in the current LNG market suggest a doubling of market value over the next two decades. By March of 2015, Goldman Sachs noted that global trade in LNG could exceed $120 billion, making it the second most valuable commodity in the world, second only to oil. Inevitably, natural gas will supplant coal and oil as the preferred, cleaner, transition fuel – while ever more renewable resources – such as biogenic gas, solar, wind, nuclear, and future energy production methods (theoretical or yet unimagined) bring us ever closer to complete renewability and greater degrees of efficient energy production. The companies which pioneer LNG are familiar names to the world: Dutch Royal Shell, Exxon Mobil, Gazprom, Sinopec, Chevron, and many others. Large investments of capital are highly valued in the LNG industry, as projects are often planned, but rely extensively on solid investors. The LNG industry, both at facilities and particularly during transport, boast the finest of safety and reliability records in large scale energy industries, with only two incidents of serious note occurring anywhere in the LNG value chain (both at onshore LNG facilities) in nearly a century of operation, with no major incidents at all during transportation of LNG. A verdantly growing industry, destined for great things, with safety and reliability at the pinnacle of all stages in the chain.
2 Sourcing & Production
2.1 Natural Gas Formation
Comprised of carbon and hydrogen, natural gases such as methane, are termed hydrocarbons; these hydrocarbon gases are a byproduct of long dead organic matter, compressed and heated for millions of years, with little or no exposure to oxygen. The chemical bonds formed in this process maintain the solar energy originally obtained from sunlight. Conventionally, natural gas is found within oil reservoir deposits and can be produced by vertical wells and standard pumping techniques. Advancements in both technology and method allow for the sourcing and production of natural gas from challenging environments, know largely as unconventional resources.
Where Natural Gas Is Found and How It Is Obtained
2.2 Conventional and Unconventional Gas
Conventional natural gas, gas which is straightforward to source and produce, uses standard, established procedures, non specialized technologies and are less expensive. This makes conventional natural gas the first pursued resource when possible.
Unconventional natural gas is more difficult to source and produce, generally requiring specialized equipment and techniques to extract. These unconventional gas resources present a variety of differing circumstances, each offering a distinct set of challenges and considerations. Unconventional natural gas resources include shale gas, coalbed methane, tight gas limestone or sandstone, methane hydrates, and the renewable resource of biogenic gas.
2.3 Production Overview
Producing conventional natural gas or unconventional natural gas requires a team of exploration geologists, geophysicists, and the accompanying specialists who drill to the appropriate depth and employ the relevant techniques for production.
After an oil reservoir is located by the team, a drilling rig is used to create a vertical shaft and piping is inserted to facilitate the oil and natural gas extraction. Initially the pressure of the reservoir will naturally bring the resources to the surface, as the pressure equalizes a pumping system will be connected to continue production. Once the well has produced to its full extent, it is cemented and capped to protect the area and prevent hydrocarbons from escaping.
Unconventional natural gas is a rapidly expanding field, full of possibility, promise, and versatility, stretching far into the future with biogas and methane hydrates.
Biogenic gas or Biogas is a fully renewable resource composed of methane rich gas and is produced by bacteria called methanogens. Essentially, any organic material is a potential source of bio-gas: food waste, livestock manure, and sewage. While the sources for biogenic gas are extremely varied, there are a few popular ways of producing biogas. An Anaerobic Digester takes the above listed sources of biogas in addition to fats, oils, and grease, breaks them down, and produces natural gas. The natural gas produced must undergo treating and processing to remove impurities before it can be utilized.
Methane hydrate is a naturally occurring crystalline form of methane, largely found deep beneath the ocean floor (estimated 95 percent) and in sediments found in Arctic regions. Methane hydrates are estimated by some to be the most abundant source of unconventional gas worldwide, ranging from twice to ten times the current reserves of natural gas. However, there are difficulties extracting economically feasible amounts of methane from these crystalline formations. As of 2013, methods to extract methane from hydrates made significant progress, and as of May 2017 Japan and China announced a successful extraction of methane hydrate mined in the South China Sea. Despite these advances, it may be several years before this colossal energy source can be produced to scale.
Coal bed methane is a type of natural gas created during the formation of coal and is produced by several means. The methods for extracting this variety of methane rely on technologies designed to produce a specific form of stimulation to the coal beds. First, a well is drilled into the coal seam (coal deposit), as the drill moves through layers of earth pressures exerted on the well change, and measures are taken to ensure the stability of the well and to isolate the surrounding environment. A steel casing is inserted into the well and cement is poured through the steel using specialized equipment to form a steel interior and cement exterior. This process is repeated through each layer until the coalbed is reached, where the final casing is made; horizontal drilling may be used to reach more difficult coal seams. Drilling then proceeds into the coalbed, where water is removed, and natural gas begins to surface. One of the stimulation techniques for producing methane from coal beds is hydraulic fracturing. Fracturing involves creating small perforations in the well casing and pumping hydraulic fluid (containing 90 percent water, 9.5 percent sand, and chemical additives approximating 0.5 percent of the fluid) into the coal seam. The sand present in the hydraulic fluid serves to prop open the fractured coal bed and allow collection of the natural gas. Underground coal gasification involves injecting oxygen and water into the well(s) leading to the coal seam until an appropriate mixture for burning is reached. The partial ignition of the coal bed serves to produce natural gas, which can then be collected as it flows toward the surface.
Tight gas is natural gas trapped within the unconnected pores of sandstone or limestone and is typically extracted using one or more horizontal wells. Hydraulic fracturing is the predominant method for producing natural gas from this type of formation, although deliquefying – pumping up all the water present in the well – as well as acidizing the well, to dissolve sediments and limestone, are also routinely employed techniques for tight gas production.
Shale gas is a variety of natural gas contained within shale formations, often absorbed into organic matter. Shale has a low permeability which disallows the flow of fluids and gases. Natural gas production from shale is achieved through methods like that of coal bed gas and tight gas production: horizontal drilling and hydraulic fracturing. Employing these methods speeds the flow of natural gas and makes the process economically viable. Once these energy rich materials are produced, they must be treated and then processed before reaching the market.
2.4 Transportation for Treating
As the raw natural gas produces, it travels to the nearest treatment facility to undergo several processes which separate the raw gas (sometimes called wet, sour, or feed gas to delineate the primary accompanying components) and ready it for further use. The treatments applied to this gas will produce a dry gas composed of 85 to 99 percent methane.
3 Treating & Processing
3.1 Pre-cooling Treatment and Requirements for Processing
Natural gas processing begins at the wellhead, where the gas is produced. The composition of this raw natural gas varies depending on the type, depth, and location of the deposit as well as the surrounding geology. Natural gas processing plants purify or dry the raw gas by removing common contaminants such as water, hydrogen sulfide, and carbon dioxide; the presence of these contaminants at an LNG plant could cause significant disruption to the liquefaction process, or the liquefaction plant. Sweet gas, sour gas, and acid gas are all terms which denote content: relatively free of hydrogen sulfide, containing hydrogen sulfide, containing significant quantities of carbon dioxide, hydrogen sulfide, or similar acidic gases, respectively. Once common contaminants are removed, mercury is removed by adsorption processes, sometimes followed by nitrogen removal. Recovery of natural gas liquids (NGL) typically concludes the processing, leaving a refined natural gas product fit for a spectacular array of industrial applications.
3.2 Who Processes Natural Gas to Liquid Natural Gas
Liquefaction plants are typically proposed and constructed by oil production companies or corporations. These corporations generally focus on the exploration, production, refining, marketing, and transportation of oil and natural gas products. Among them are familiar names such as Royal Dutch Shell, Exxon Mobil, Gazprom, Sinopec, Chevron, Total S. A., Lukoil, Reliance Industries Ltd., BP, and Equinor, though there are many others. These LNG facilities convert natural gas to its liquefied form, which is a colorless, odorless, non-flammable, non-explosive, non-toxic, highly transportable resource when maintained at the cryogenic temperature of –260° F (-160° C).
3.3 LNG Liquefaction Plants
The continuously expanding LNG industry has liquefaction facilities (large scale) both proposed and under construction in double digit numbers around the globe. All LNG plants are comprised of the experts and technologies required to process dry natural gas into a liquefied phase, they also contain the necessary, specialized storage equipment and cryogenic pipelines required to transport the LNG to nearby peak-shaving facilities, transport vehicles, or specialized maritime vessels designed to safely store and transport the cryogenic, liquefied natural gas. The construction of these central elements in the LNG value chain often take several years to complete.
What is LNG? Turning Natural Gas Into Liquid
3.4 Small Scale Liquefaction (SSLNG)
Small scale liquefaction (SSLNG) is a relatively small and new, but growing aspect of the LNG industry, which has proven itself scalable, profitable, and brimming with potential. It is capable of meeting the fueling demands of shipping and trucking industries which require more environmentally friendly and efficient fuel sources than diesel and oil. Small scale liquefaction provides a greater degree of flexibility that larger facilities and fleet transport vessel may be unable to provide, such as providing bunkering fuel for marine vessels and off grid power generation.
Small-Scale LNG: A Reality Today May Be A Game-Changer For Tomorrow
4 Natural Gas Liquefaction Process
4.1 Liquefaction Methods
There are three basic methods of liquefaction, the classic cascade, mixed refrigerant cascade, and the expansion cycles (although several variations on these methods exist). Each of these processes requires a specialized arrangement of equipment and refrigerants which will vary depending upon the site conditions, production, and feedstock requirements. All liquefaction processes will require the use of compressors, heat exchangers, and refrigerants to produce LNG.
Gas turbines are widely used to drive refrigeration compressors at LNG facilities. Powerful and efficient aeroderivative turbines are reliable, heavy duty, and widely used, though conventional heavy-duty gas turbines are still the norm in the industry. LNG facilities have gone from having two choices in the 1960s for compressor drivers, to seven or more by 2016. As with the other equipment choices, this choice is dependent on the needs of the LNG producer.
Coil-wound heat exchangers emerged from the technology of 19th century locomotive boilers. Multiple layers of tubes are wound within a pressure vessel shell. Natural gas and high-pressure refrigerant both cool as the ascend the tubes. Very cold refrigerant descends around the tubes inside of the shell. The wound tubes can provide a heating surface area equivalent to tens of thousands of square meters. These units are compact, but rather large, and bear a slight resemblance to a Saturn rocket. Coil-wound heat exchangers can contain pressure nearing 250 times atmospheric pressure and can be made from different materials.
The plate-fin heat exchanger is lighter and smaller than coil-wound heat exchangers. Easily scaled from small to large sizes, they are comprised of alternating layers of corrugated fins separated by flat, aluminum, plates which serve to transfer heat between the natural gas and refrigerants. The fins enhance heat transfer from the fluid and conduct more heat to the plates. Layers of fins and plates are arranged to optimize the process. The aluminum plates are brazed together, headers are attached to direct the flow of natural gas and refrigerants. This type of heat exchanger is stored inside of a heavily insulated box, known as a cold box, which allows more flexibility during both steady and changing conditions. Plate-fin exchangers transfer around six times more heat in a given space than coil-wound heat exchangers.
Some LNG plants use pure hydrocarbon refrigerants (methane, ethane, and propane individually) others use a mixture of hydrocarbon refrigerants.
Technology and Methods of Liquefying Natural Gas
Australia Pacific LNG: An Overview of the LNG Facility
4.2 Storing
LNG is transferred cryogenically to specially insulated storage tanks in one of several facilities:, onshore and offshore import terminals, liquefaction facilities, and to a lesser extent at peak-shaving facilities[6]. Designed to minimize “boil-off gas” (evaporation) and maintain cryogenic temperatures, LNG storage is engineered with safety, containment, and efficiency in mind. Boil-off gas (BOG) is necessary to maintain the temperature by keeping the pressure constant; this gas is then captured and cycled back into the LNG facility, or otherwise made use of. Storage facilities can employ venting if overpressure is a concern, due to stratification within the tanks. Densitometers are utilized within the storage facilities to monitor such developments and operators are trained to mix the LNG in response to break up any stratification. A variety of tanks exist to meet the needs of LNG producers: Single, Double, and Full containment tanks, membrane tanks, and in-ground tanks all serve in this endeavor, according to the site conditions and production requirements.
Single containment tanks are composed of a self-supporting, nickel steel, inner cylindrical container, surrounded by an outer tank of carbon steel that holds insulation in the annular space. Though the outer tank is incapable of holding cryogenic material, an external bund (i.e. dike, berm, dam) is always present to completely contain the material in the event of a total failure of the inner tank. Single containment tanks require a relatively large area of land and are the most commonly used tanks; they lay claim to an excellent track record for safety and reliability.
Double containment tanks are very similar in construction to a single containment tank. This type of LNG storage tank makes use of a post-stressed concrete wall (as opposed to a dyke) which will contain the liquefied natural gas, should the inner tank fail. Though this type of storage tank is more expensive, it requires less land to store LNG than a single containment tank.
Full containment tanks are a variety of double containment tank which fill in the annular gap between the first and second container, creating a vapor and liquid tight operation around the clock. A metal or concrete roof will cap the wall surrounding this storage tank. Many of the tanks built in the last decade were constructed as full containment tanks.
Membrane tanks are built from post-stressed concrete with an inner, load-bearing insulation, thinly covered by a stainless-steel corrugated membrane. This design allows the concrete tank to support the weight of the LNG by transferring that weight through the membrane (which expands and shrinks with changing temperature) and insulation.
In-ground tanks are generally more expensive and time consuming to construct than their above-ground counterparts (4-5 yrs. on average, compared to 3 yrs.) , because specifications prioritize site conditions, surroundings, and safety. Naturally, these tanks have no need of containment dykes or walls, which allows for a lesser required degree of separation from adjacent lands. Often, these tanks are constructed where both land and space are at a premium (e.g. Japan or Korea). The safety of in-ground tanks is best evidenced by more than 45 years of incident free operation.
5 Loading and Transport
5.1 Land-Based Transportation
Cryogenic pipelines, tanker trucks, and railway tankers are the primary means of transportation for LNG over land. LNG pipelines are used for transportation over short distances due to the cost of maintaining the -260°F cryogenic temperatures. Tanker trucks are most often used in mid-range and regional transportation of LNG to areas that lack LNG pipeline access. LNG by rail is a promising, viable land-based form of transportation which is most effectively utilized at ranges exceeding 150 miles (200-250 km); while this form of transportation over land is not widely in use outside of Japan, efforts are underway in the United States and other countries to implement LNG transport by rail. While land-based transportation of LNG plays in important role, capable of much growth, the bulk of LNG transportation and trade is conducted via LNG carriers and a variety of sea going vessels.
5.2 Water Based Transportation
A revolution in modern energy transportation began in 1959 as the world’s first LNG carrier left the Louisiana Gulf coast to complete a successful delivery to the UK. The staggering growth rate and subsequent demands has catapulted the worldwide LNG fleet to a tremendous 500 carriers with a further 100 on order [1.][4.]. LNG carriers are an absolute marvel of engineering, gargantuan in size and capacity, these carriers range up to one third of a mile in length (350m or more), longer than the Eiffel or Petronas towers are tall. A single shipment from an LNG carrier of this class can power an astonishing 70,000 homes for an entire year. The capacity of over-water LNG ships varies from 1,000 cubic meters to nearly 270,000 cubic meters in the largest of carriers. Most LNG carriers are designed to transport LNG in either geometric membrane tanks or spherical tanks (Moss sphere design). LNG is carried aboard double hulled vessels in specially insulated storage tanks nearing atmospheric pressure that reside within the inner hull. Principles of LNG storage persist aboard these vessels and are put to ingenious use; the boil-off gas produced on many of these ships not only refrigerates and maintains the chilly –260° Fahrenheit (-160° C) temperature required for liquid natural gas, it provides the fuel which powers the engines on board. Though these vessels are among the most technologically advanced in existence, they meet the highest regulatory standards in the world.
The smaller variety of LNG carriers (1,000 – 25,000 up to 40,000 cubic meters capacity) are designed to fill specialized roles such as: short-distance coastal and river trading, delivery to various land-based industries, power plants, and suppliers of LNG as for purposes of fueling vehicles or maritime vessels. This niche market is expected to grow as the ever-increasing demand for cleaner burning, readily accessible natural gas rises. These smaller vessels allow greater degrees of flexibility in the overall value chain for LNG and can make excellent use of Ship to Ship LNG transfer or a floating storage and regasification unit (FSRU).
6 Receiving and Regasification
6.1 Offshore Regasification (FSRUs)
Often secured by a type of jetty or Single Point Mooring (SPM) buoy, floating storage and regasification units (FSRUs) are either adapted LNG carriers or floating installations which act as a versatile LNG terminal for storage and regasification. These marine based terminals store the LNG before converting it back to gaseous form, although floating regasification units (FRU) may be used to simply convert LNG to its gaseous state, if storage is not necessary. At these terminals, LNG is transferred from the carriers via unloading arms or hoses, through a cryogenic pipeline into a storage tank and stored or processed further. Low pressure LNG pumps transfer the liquid gas to higher pressure pumps, and through an LNG vaporizer, where it is warmed back to its gaseous state. FSRUs use several methods for heat exchange and can vary in other aspects. Once the transition is completed from liquid to gas, the natural gas undergoes several treatments before it is sent to market. Offshore regasification facilities provide the LNG industry with additional versatility by further reducing risks, expense, environmental impact, while supplying a mobile (by towing) regasification unit. An FSRU is particularly suitable when near-shore access is difficult or limited as a result of environmental considerations, densely populated areas, or prohibitively costly land. The use of FLNG assets such as FSRUs and floating production, storage, and offloading units (FPSOs) are an increasingly desirable trend as an effective use of capital expenditure (CAPEX) in the LNG industry, as it is considerably less fixed, and therefore significantly reduces potential risk that may be associated with a landed terminal[9]. FPSOs are capable of producing and processing both oil and natural gas and for storing this cargo and then offloading it to an oil tanker or LNG carrier to pick up, often dispensing entirely of pipelines (and onshore facilities) in the process.
Single Point Mooring (SPM) Calm Buoy Systems – The Ultimate Guide
6.2 Onshore Regasification Plants
While FSRUs boast many benefits, particularly where short term projects are concerned, onshore import and regasification terminals or plants, are typically more economical for endeavors with lifespans exceeding ten years. If additional land is available, onshore regasification plants are readily adaptable in terms of storage and regasification volumes. Onshore regasification plants consist primarily of storage, processing, distribution, and receiving installations. Once a carrier is berthed at the jetty, unloading of LNG to storage containers begins. After storage is completed, the LNG cis regasis regasified or sent to loading facilities, which may have installations for truck, railcar, container loading, barge loading, or ship bunkering. If regasification is the next step after storage, there are several available vaporizers for converting LNG to gaseous state in preparation for the market, the choosing of which depends on the overall needs of the project.
7 From Regasification to Market
Once regasification is complete the resultant natural gas undergoes additional treatment either at the regasification terminal or at another facility a short distance from the terminal. Due to the colorless and odorless properties of natural gas, its presence is undetectable without proper equipment. Before the natural gas is distributed to market, an odorant is added, and finally the gas is metered and sent by pipeline to both industrial and residential customers.
8 Uses for LNG
8.1 Power Generation/Grid Power
Natural gas production and consumption is on the rise, with natural gas in second place behind coal, making up a quarter of the total electricity generation worldwide. This output is largely achieved by utilizing natural gas power plants, of which there are two primary types. Simple (sometimes open) cycle gas plants and combined cycle gas plants. The simple cycle gas plant develops energy by heating and propelling gas through a turbine, thereby generating electricity. This process generates waste heat, which simple cycle plants do not make use of. These plants are ideal for handling the peak hours and seasons due to their dispatchability, or the ease at which they can turn on and off or increase their output. Combined cycle gas plants generate power in a similar manner and can also contribute peaking power; the combined cycle plant makes use of its waste heat by heating and boiling water to produce steam, which drives an additional turbine, greatly increasing the overall efficiency of the plant’s energy operations. Modern combined cycle plants can achieve upwards of 60 percent efficiency.
8.2 Marine Vessels
Though LNG carriers have long used their cargo as a source of highly efficient propulsion, the environmentally cognizant market is increasingly adopting LNG as a cleaner source of bunkering fuel that presents the additional benefit of a decrease in operating costs. This LNG powered fleet includes a diverse range of vessels: ferries, patrol ships, tug boats, oil and chemical tankers, as well as platform supply vessels. Long term benefits of converting existing oil powered ships to LNG is clear, particularly considering emission regulations but initial investment costs are high. Scrubbers and other technology can reduce emissions while increasing operational costs significantly. Vessels purpose-built to fully operate on LNG fuel will play a vital role in moving towards an environmentally friendly transportation and trade industry. The world’s largest cruise ship operator, Carnival Corporation, made history in December of 2018 with the first fully LNG-fueled cruise ship; seven more of these ships are set to follow between now and 2022[11].
8.3 Trucks (Commercial Market)
Nearly 27 million natural gas vehicles (NGV) are currently in operation around the world, most of these vehicles are engaged in commercial and fleet operations – with sound reason [14]. LNG and CNG (Compressed Natural Gas)fueled vehicles advance a sizeable list of benefits for commercial operations. CNG and LNG fueled vehicles share the advantages of considerably lower particulate and greenhouse gas emissions, reduced engine wear, increased safety and theft prevention, up to 50 percent noise reduction, comparable or less expense than diesel, and simple gasoline or diesel to natural gas engine conversions (or bi-fuel engine conversions). There are however, tremendous differences in these technologies: fuel cost, fueling equipment, capital cost, tanks, pumps, and hazards. Some of the key differences as a fuel for commercial vehicles rest on the nature of these two technologies. LNG for instance, is more than twice as energy dense as CNG, and can travel up to 2.4 times the distance than a CNG fueled truck, allowing for a much greater range of transportation. While CNG fueled vehicles have made some headway with fleet vehicles in the inner city, extra-urban use is stymied by the limited energy storage volume. The bulk of data regarding LNG trucks in the commercial market come from Asian countries and North America; currently more than 3,600 LNG fueled trucks operate in North America and upwards of 100,000 LNG vehicles are in use throughout China. Evaluations of the performances of various types of trucks, including dump trucks, buses, freight transporters, and others have been conducted in these countries, demonstrating variables such as travel range to tank size ratios, recharging time, and weight saving capacity of LNG fueled trucks in contrast to CNG fueled trucks. A dump truck, BelAZ-75485, with a LNG 560-liter fuel tank, stores the LNG equivalent of nearly twenty seven CNG cylinders, saving over 2,000 kgs of carrying capacity. A LNG bus operating in Beijing with a 335-liter fuel tank routinely travels 450 km without stopping to refuel. Similarly, an LNG fueled freighter truck traveling between the U.S. and Canada with a 680-liter fuel tank could travel 800km before refueling[10]. The refueling time of LNG is roughly 1/3 to 1/5 compared to that of CNG fueled vehicles. Currently, manufacturers of LNG trucks offer such vehicles with operating ranges of over 1100 km. The use of LNG powered commercial vehicles is increasing worldwide, as emission standards improve, and more effective methods of energy are pursued.
8.4 Cars (Domestic Market)
While the spotlight for LNG fueled vehicles is on heavy duty trucks, the potential it represents for the domestic market is not easily dismissed. The same advantages listed above for NGV vs. gasoline fueled vehicles apply to the domestic market. The domestic market has mostly experimented with bi-fuel CNG vehicles, which only partially run on natural gas. As with diesel engines, standard gasoline engines can be easily converted to run entirely on CNG or LNG. LNG has a few distinct advantages when it comes to the future of automobile fuels. Commercial fueling stations for each technology create unique demands which are highly strenuous for CNG. Utility infrastructure, capital, electricity, and the expensive, high pressure tank requirements for CNG stations would be prohibitive in establishing the necessary availability of commercial stations in addition to the fact that refuel times range from hours (fast fuel systems) to days (slow or home fuel systems) [16]. Slow-fill stations would be economically competitive (in an operational sense) with LNG fuel stations but would require many hours to fill a CNG tank. Theoretically, CNG filling stations could be connected to city gas lines to allow home fueling of a CNG powered vehicle using a gas compressor (with the vehicle tank acting as a home energy storage device). As developments further the production of biogas, natural gas (thus LNG) is assured a crucial role in the further development of renewable, green energy resources.
Business Case for LNG As Vehicle Fuel
8.5 Trains
LNG fueled trains have been in the sights of developers around the world for many decades, but could not manage the feat, until November of 2017, when Florida East Coast Railway unveiled their fleet of 24 locomotives that had been converted to run on LNG. The long decades of testing, debating, and engineering are over, and the pursuit of cleaner, more efficient, and less expensive transportation by rail has finally been realized. This extraordinary breakthrough will have a profound impact on the future of long-range transportation over land, particularly in transitioning from diesel to LNG fueled locomotives, as the global LNG industry charges forward[11].
9 Safety & Environmental Record
9.1 Natural Gas (Liquefied) and Emissions
Natural gas is, without question, a fossil fuel; when burned it produces carbon dioxide in the least amount of any hydrocarbon energy source, 50 to 60 percent less than coal and 30 percent less than oil, while producing negligible amounts of particulate matter[12]. The implications of these facts are staggering; as the natural gas industry grows, replacing coal and oil, global emissions of greenhouse gases will fall dramatically. This directly translates to public health benefits as well, given that the reduction of these harmful particulate emissions associated with coal plants, means a reduction in the occurrence of asthma, lung cancer, bronchitis, inflammation, and heart disease[12].
The rise of LNG within the last decade has made natural gas the only true rival of coal electricity generation as power generation moves away from coal and oil and towards natural gas. This shift was made possible by the advancements made in natural gas collection and LNG; which is the principal way such vast quantities of natural gas were made viable for energy production. The unique ability of LNG effectively and economically power trains, vehicles, seagoing vessels, and generate cleaner electricity places it in an ideal position for transitioning global energy away from archaic forms of energy production and toward a new age of possibility.
As we strive for ever greener, more renewable resources, the role of natural gas and the vital processes to make it a cleaner, viable resource cannot be overstated. LNG is an invaluable asset as industries transition to greener technologies. Mentioned above, biogenic methane gas is a boundless, renewable source of natural gas that represents the frontier of tomorrow’s energy needs; biogas produced in the present-day makes use of existing LNG technology to provide the safest, economically sound transportation and distribution available.
9.2 Safety of LNG Plants
Safety considerations are primary in the modern LNG industry, demonstrated by rigorously employed systems of procedures, codes, equipment and regulations dedicated, at every step of the process. All LNG facilities and terminals make use of liquid and gas vapor leak detection equipment, multiple layers of containment, and monitoring equipment (often control rooms) as well as veritable panoply of technologies to gauge pressure, prevent, detect, and extinguish fire or any other possible contingency[2.6]. These strict precautions permeate the entirety of the LNG industry. Though accidents at LNG facilities have occurred since the inception of large-scale liquefaction of natural gas, only two incidents have occured since LNG production began 82 years ago.
On the afternoon of Friday, October 22nd, 1944 above ground storage tank No. 4, containing liquefied natural gas belonging to the East Ohio Gas Company began to discharge vapor from a seam on the side of the tank. Carried by the wind, the vapor entered the sewer system where it mixed with sewer gas and air, igniting an explosion. It was thought that the initial explosion was a single event, with firemen present, onlookers returned home. Within half an hour, a second above ground tank exploded, leading to yet more fire and explosions, which traveled through sewers, into drains located in nearby houses. When the disaster concluded and order was restored, a total of 130 lives were lost, and many hundreds left homeless[13]. The magnitude of this disaster created a lasting impact on both the producers and users of natural gas. The Cleveland East Ohio Gas Explosion served as a major catalyst for change in the nascent natural gas industry and continues to drive those involved in the gas industry to maintain the highest industry standards of safety, with an ardent commitment to painstaking risk management.
Regardless of the type of LNG facility, multiple layers of protection are exercised from siting and design, control and monitoring, prevention, protection, facility emergency response, to community emergency response. These layers are designed meticulously, with a great degree of planning, preparation, and disciplined practice of responses and protocols[2.6].
Around 6:40 p.m. on Jan. 19, 2004, Unit 40 at the Skikda LNG plant in Algeria exploded, mere seconds later the nearby units, 20 and 30, exploded in a chain reaction. The blast damaged nearby structures, including a power plant, a harbor berth, numerous homes, and community buildings. In total, 29 lives were lost, and nearly $1 billion worth of damage was caused. Various sources reported that Unit 40 at Skikda had not been renovated since its commission date in 1978, also frequent technical issues indicated that the unit operated only intermittently from May 2003, until the accident. Maintenance and security workers cited Unit 40 as requiring significant technical intervention on a bi-weekly basis for nearly six years, noting deficiencies in the cryogenic units, which were allegedly leaking gas[15]. Outdated and aging steam-based equipment made production targets exceeding difficult to reach, putting pressure on the plant managers to push their equipment too far. The disaster at Skikda was the first and only LNG facility disaster to occur in 60 years following the 1944 tragedy in Ohio.
9.3 Safety of LNG Transportation
LNG transportation maintains a sterling safety record over the course of 60 years, from the first LNG carrier voyage, to the present day. More than 100,000 LNG deliveries have embarked with cargo and arrived at their destinations without major accidents, safety problems, security issues, or loss of cargo containment[17]. LNG is notably not carried under pressure, as it is simply natural gas cooled to liquid state and maintained at the necessary temperature for liquefaction. In liquid state, it is non-toxic, non-flammable, and non-explosive. Should the highly unlikely event of a loss of containment occur, the LNG would revert to its gaseous state and dissipate, with no impact on water or land.
What’s Cool About LNG? Everything!
10 LNG Market Outlook
10.1 Current
Over the last decade the volume of global LNG trade has nearly doubled from 227 billion to over 400 billion cubic meters. Much of the rapid increase in production and trade of natural gas is driven by a need for cleaner fuel, technological advancements in producing natural gas resources, the discovery and development of bountiful natural gas fields, and the increasing interest of countries around the world in LNG. The Shale Revolution, a combination of horizontal drilling and hydraulic fracturing techniques, allowed the United States to dramatically increase its production of natural gas from formations virtually inaccessible in the past. This development has caused a shift in worldwide imports of LNG and will continue to influence the future trends in the LNG industry. The largest LNG trade flow route continues to be intra-Pacific trade, with high demand growth continuing in China. Demand for LNG continues to grow in Europe.
10.2 Developing
The LNG market is a dynamic and flourishing environment, with many projects for a variety of LNG facilities and resource production, in development across the globe.
Major projects for liquefaction plants are under proposal in Eastern Australia, and Offshore Australia, Western and Eastern Canada, Alaska and the U.S. Lower 48, Mozambique, Nigeria, Tanzania, Djibouti, Equatorial Guinea, Congo (Republic), Papua New Guinea and Russia.
Liquefaction plants are under construction in several countries, 9 plants start construction in the U.S. in 2019 with a tenth starting in 2020. Russia is constructing 3 plants in 2019, while construction of a plant in Malaysia and Indonesia will start in 2020. Mozambique will begin construction of a liquefaction facility in 2022 (with approx. 75 Tcf. of recoverable natural gas).
Several receiving terminals began construction in China and India in 2018 with more planned to start in construction in 2019 & 2020.
No fewer than ten countries in Europe, which do not have an existing large-scale LNG import terminal propose to construct terminals, five of which have start dates set for 2019.
While proposals may be delayed or, in some cases, not pursued, these proposals and construction projects illustrate a vibrant, developing future for the LNG industry, which will continue to grow for decades to come.
For a further look into these developing frontiers of LNG investigate these videos and articles:
Africa:
Anadarko: Mozambique LNG Project Overview 2018
https://www.youtube.com/watch?v=ShniplHWZ-I
$500 million mini LNG plant in the works for Rivers State (Nigeria)
Block 2 LNG project, Tanzania: Introduction
Ethiopia, Djibouti sign gas pipeline deal
Equatorial Guinea thinks big on LNG
NewAge taps opportunity in African FLNG
Asia:
Liquefied Natural Gas: the Yamal LNG Project
Novatek plans Murmansk LNG terminal
Project for LNG supplies to Kaliningrad Region
Australia:
LNG Changes Everything For Australia’s East Coast Gas Market
10.3 Future/Trend
Current trends in LNG, particularly niches in the global market, such as FLNG concepts which allow increased flexibility as LNG sales contracts move towards shorter terms, play an important role in the overall future outlook of the LNG market. Medium and small-scale LNG has yet to find a definite place as value solutions for long term or as bridge solutions awaiting the development of larger production and consumption. While LNG FSRUs have a proven track record and high momentum, FPSOs have had less success following trends of the last several years in the LNG industry, though may prove ideal for risk-averse international investors in countries such as Angola and Nigeria, where onshore facilities may be considered a risk. The Indian subcontinent is increasing its LNG import capacity as the export capacity of the U.S. is set to more than double by the end of 2019 (reaching 8.9bcf/d), making it the 3rd largest exporter in the world behind Australia and Qatar. Canada will begin exports from the West Coast, which may have a large impact on Gulf Coast projects. The LNG fleet of 513 ships continues to grow with the orderbook listing 99 additional vessels; nearly 40 vessels will arrive in 2019 and 2020. As LNG trade has quadrupled over the last two decades, and is set to double over the next two, the LNG market has an incredible amount of room to continue to grow as the future unfolds.
11 Sources/References
- IGU (International Gas Union) 2018 World LNG Report: 27th World Gas Conference Edition p. 7,
- The International Group of Liquefied Natural Gas Importers. (GIIGNL) (Papers 1 [2.1], 2 [2.2], 3 [2.3], 4 [2.4], 5 [2.5], 6[2.6], and 7[2.7] respectively)
- GIIGNL 2017 Annual Report
- GIIGNL 2018 Annual Report p. 10,
- IGU 2017 World LNG Report
- ADI Analytics – A New Role for Small-scale and Peak Shaving LNG Infrastructure
- LNG Facility Siting
- Wood, David A., et al. Handbook of Liquefied Natural Gas. 1st ed., Elsevier, Inc., 2014. Handbook of Liquefied Natural Gas
- FPSO
- LNG: an alternative fuel for road freight transport in Europe
- NVG America – High Horsepower
- Environmental Impacts of Natural Gas
- East Ohio Gas CO. Explosion and Fire
- Current Natural Gas Vehicle Statistics
- Deadly LNG Incident Holds Key
Lessons For Developers, Regulators - Natural Gas 101: Choosing Between LNG and CNG
- SIGGTO Anticipates Gas-Transport Growth Ahead of 2050
