EUROPEAN COMMISSION

DG MOVE

SEVENTH FRAMEWORK PROGRAMME

GC.SST.2012.2-3 GA No. 321592

LNG BC Market development

LNG Blue Corridors Project is supported by the European Commission under the Seventh Framework

Programme (FP7). The sole responsibility for the content of this document lies with the authors. It does

not necessarily reflect the opinion of the European Union. Neither the FP7 nor the European

Commission is responsible for any use that may be made of the information contained therein.

Deliverable No. 7.6

Deliverable Title Market development

Dissemination level Public

Written By Flavio Mariani (NGVA Europe)

Checked by Nadege Leclercq (Westport)

Approved by Javier Lebrato (IDIADA)

Issue date April 2018

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Executive Summary The global LNG market keeps showing a growth trend. The LNG consumption, as well as production

rate is increasing at global level. At present there is a production overcapacity; this situation is anyway

expected to reverse to the other way around in the short to mid-term, until new production plants

planned and under construction come to completion, thus adding to total production capacity. The

global LNG market in fact faces a production surplus of about 20%. Experts predict that this will last

probably until the early twenties, because some new suppliers such as US and Australia will increase

their production rate. The demand for LNG in mature markets such as Japan and South Korea is likely

to stabilize, while Asia is expected to absorb an increasing part of production overcapacity. Especially

expanding may be the demand from south Asian countries such as India, Pakistan and Bangladesh.

The Association of Southeast Asian Nations (ASEAN) region is also expected to be an important market

for LNG in the short term.

The main features of the LNG core business market are:

• Global LNG trade in 2016: 278 Mt (+5% vs 2015) – 618 Mm3

• Short term market of LNG in 2016: 73 Mt (28% of total LNG market)

• Global average LNG supply price: $5.52/MMBtu ( 35c€/Kg – 48 c€/Sm3)

• Global nominal liquefaction capability as of January 2017: 340 MTPA (Million tons per year)

• New liquefaction capability under construction as of January 2017: 115 MTPA (+35% by 2022)

• New liquefaction capability planned in January 2017: 879 MTPA

• Global nominal regasification capability as of January 2017: 795 MTPA

• Capability of FRSU (floating terminals) plants as of January 2017: 83 MTPA

• Global LNG vessels fleet as of January 2017: 439 ships (including FRSU)

• Share of LNG in the global NG offer in 2015: 10%

The LNG BC Project has met its main targets. More than 150 trucks have been involved as actual

Project partners, from 39 fleet operators, collecting operational data along their routes. The initial

target was 100 trucks. 13 stations have been built in the Project, of which 12 are in the budget. The

original target was 14. Some of the stations sold very well since the beginning. Some other increased

sales over the project duration, with increasing trend to reach a reasonably good sale rate. The main

Project figures as of October 2017 are:

Total 13 stations (1 under construction, hence not in time to be financed by EC funds)

Total 156 trucks

Total 61 Partners: 22 Companies; 39 fleet operators; from 11 EU countries

Total cumulative mileage of monitored LNG trucks: 31,639,938 km (early May 2018)

Total number of fillings of Project LNG stations: about 111,000

Total amount of LNG sold by Project stations: 14,206,275 kg (early May 2018)

Average sale rate: 128 kg/filling

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New developments have been on the side of LNG trucks, with IVECO to put on market a second Euro

VI LNG model, more powerful, i.e. the Stralis NP NP AS440S40T/P; engine: Cursor 9; with 400 HP power

delivery and 1,700 Nm torque, and twin LNG tank for up to 1,500 km running range. This was followed

in late 2017 by a third truck model, the Stralis NP 460, propelled by the the Cursor 13 engine, with

power of 460 HP at 1,900 rpm, a torque of 2,000 Nm at 1,100 rpm, and a max running range up to

1,600 km. Also VOLVO and SCANIA are now offering new Euro VI LNG models on the market, which

anyway were not launched in time to join the Project. VOLVO designed the FH LNG, and FM LNG

trucks (on market in spring 2018); they are Euro VI-compliant. Power delivery and torque are

respectively: 420 hp, with 2,100 Nm and 460 hp, 2,300 Nm. Fuel consumption is on a par with VOLVO’s

diesel engines, but 15-25% lower than for conventional gas engines. LNG is stored in tanks at 4-10 bar

and -140 to -125°C. Range: 1,000 km. In 2015, SCANIA launched on the market the P 280 model,

powered by a SCANIA Euro VI engine. In 2017, SCANIA presented the new LNG truck model, the G340

LA4x2MNA; it has two LNG tanks, with a total capacity of 300 kg (190 kg in main tank; plus 110 kg in

optional tank), LNG is stored at 10 bar, -130°C. Its running range is 1,100 km; the average consumption

is ~28 kg/100 km. Engine displacement is 9.3 litres; this 5 cylinders Natural gas engine is the OC09 102

Euro VI.

When the LNG BC Project started in 2013 the LNG infrastructure in Europe was very poor, with just

about 20-30 stations. On average 20 to 30 new stations were built per year since then, with a

significant acceleration in 2017, leading to a total at end 2017 of more than 120 public LNG stations in

operation. In 2018, 10 new stations already opened between January and April, with many more under

construction or planned to be built throughout the year. A number of additional projects have been

announced, which are expected to lead to a total of over 400 LNG stations in operation by the end of

2021.

Other projects financed by the EC (particularly under the CEF – Connecting Europe Facility –

programme) and the enforcement of the DAFI (Directive of Alternative Fuels Infrastructure), as well as

greater vehicle availability and market demand, contribute to stimulate the European automotive LNG

sector in the race to fill its gap to the LNG market in other parts of the world, such as China where it

has sky rocketed, and North America.

LNG, like CNG, can be produced from a variety of renewable, scalable and very low carbon intensity

energy sources, such as biomethane produced from organic waste and biomass through anaerobic

digestion and gasification or synthetic methane produced converting carbon dioxide (CO2) into

methane by using hydrogen produced from surplus green electricity. Renewable gas is fully

compatible with the current natural gas mix, allowing any blend and unlimited use in the existing

infrastructure and vehicles.

Liquified biomethane as biofuel for HD vehicles is a very new business. At the beginning of the LNG

Blue Corridors project, there were only a few pilot plants in Europe and globally. Its development

continued slowly in the 2013-2015 timeframe, essentially in Europe, with a few additional projects

launched.

Since 2016, the European industry has put a much stronger focus on bio-LNG, with a number of new

projects announced, to demonstrate the viability of the solution, start larger scale deployment of

production facilities and availability of bio-LNG for trucks. Even though there are still only few plants

up and running producing bio-LNG in Europe (and globally) today, significant new development is

expected in the coming years, in a growing number of countries.

In the next few years, once these projects and others will be completed, bio-LNG as a fuel for LNG

trucks is expected to be available in a significant number of European countries, including at least

Sweden, Norway, the Netherlands, the UK, Italy, Germany, France, Slovakia and Denmark. This will mark

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the achievement of another major milestone for the market and the environment, making almost GHG

neutral operation really possible for long distance heavy duty trucks (or achieving WTW GHG

emissions reduction by at least 80% compared with diesel, depending on the biomethane source).

By 2030, it seems reasonable to expect that bio-LNG will be produced in much larger volumes, not

only from biomethane (anaerobic digestion), but also from power to gas and gasification processes,

therefore offering great opportunities for GHG emissions reduction in heavy road haulage as well as

economically affordable zero or low carbon heavy goods road transport in Europe.

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Revision History and Statement Of Originality Revision History

Rev Date Author Organization Description

01 Nov 2017 Flavio Mariani NGV Europe

02 April 2017 Nadege Leclercq Westport Review and additions to the report

03 April 2017 Javier Lebrato IDIADA Review general content

Statement of originality:

This deliverable contains original unpublished work except where clearly indicated

otherwise. Acknowledgement of previously published material and of the work of others

has been made through appropriate citation, quotation or both.

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Contents Executive Summary ................................................................................................................................. 3

Revision History and Statement Of Originality ........................................................................................ 6

1 Introduction ................................................................................................................................... 10

1.1 LNG Blue Corridors project .................................................................................................... 10

2 LNG Global market features ……………………………………………………………………………………………………..11

2.1 Global LNG market ………………………………………………………………………………………………………….11

2.2 The future role of Natural gas ………………………………………………………………………………………….13

3 Targets and expectations of potential partners in 2013 ……………………………………………………………14

3.1 The LNG Blue Corridors Project m…………………………………………………………………………………….14

4 European LNG market at beginning of LNG BC Project (stations, trucks, estimated sales)…………17

4.1 Automotive LNG market ………………………………………………………………………………………………….17

4.2 Project stations ……………………………………………………………………………………………………………….18

5 European LNG market at end of LNG BC Project (stations, trucks, estimated sales)……………………21

5.1 Project stations ……………………………………………………………………………………………………………….21

5.2 Automotive LNG Global market ……………………………………………………………………………………….21

5.3 Automotive LNG European market ………………………………………………………………………………….22

5.4 Bio-LNG renewable gas as fuel for LNG trucks ………………………………………………………………….25

6 Trend of station cost during Project deployment ……………………………………………………………………..30

7 Considerations about LNG retail price and NG price …………………………………………………………………32

7.1 General ……………………………………………………………………………………………………………………………32

7.2 Industrial price ………………………………………………………………………………………………………………..32

7.3 LNG fuel retail price at pump …………………………………………………………………………………………..35

7.4 Taxation - excise exemption …………………………..……………………………………………………………….39

7.5 Bulk supply price ……………………………………………………………………………………………………………..40

7.6 Break-even prices and new production ……………………………………………………………………………40

7.7 Asia's effect ……………………………………………………………………………………………………………………..42

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8 Identification of efficient LNG European network and potential cost ……………………………………….44

8.1 Network …………………………………………………………………………………………………………………………..44

8.2 Size…………………………………………………………………………………………………………………………………..44

8.3 Location …………………………………………………………………………………………………………………………..45

8.4 Connector harmonisation ………………………………………………………………………………………………..45

9 Vehicles ……………………………………………………………………………………………………………………………………47

9.1 General ……………………………………………………………………………………………………………………………47

9.2 Vehicle models ………………………………………………………………………………………………………………..48

9.3 Trains ………………………………………………………………………………………………………………………………52

9.4 Social cost benefit ……………………………………………………………………………………………………………54

10 Market barriers/improvers ……………………………………………………………………………………………………..55

10.1 Power delivery ………………………………………………………………………………………………………………55

10.2 Running range ……………………………………………………………………………………………………………….55

10.3 Fuel price advantage ……………………………………………………………………………………………………..55

10.4 Purchase price of LNG trucks …………………………………………………………………………………………55

10.5 Boil-off …………………………………………………………………………………………………………………………..55

10.6 Traffic limitations …………………………………………………………………………………………………………..55

10.7 Fuel quality ……………………………………………………………………………………………………………………56

10.8 GHG emissions ………………………………………………………………………………………………………………56

10.9 LNG Nozzles and receptacles …………………………………………………………………………………………56

10.10 Refuelling pressure and temperature ……………………………………………………………………………57

10.11 Separation distances ……………………………………………………………………………………………………..57

10.12 Consumer information about LNG price ………………………………………………………………………..57

10.13 Parking structure …………………………………………………………………………………………………………..57

10.14 Training …………………………………………………………………………………………………………………………58

10.15 Mobile/re-locatable stations …………………………………………………………………………………………58

10.16 Flexibility of supply systems - UTS …………………………………………………………………………………59

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10.17 Logistic hubs …………………………………………………………………………………………………………………59

11 Trend of core business LNG market ………………………………………………………………………………………..60

11.1 General ………………………………………………………………………………………………………………………….60

11.2 Top north and top south Europe's ends developments ………………………………………………….62

11.3 Europe - Russia - China international NGV corridor 2030 ……………………………………………….63

11.4 Italian infrastructure ……………………………………………………………………………………………………..63

11.5 Recent and future moves of the market, Europe and Global …………………………………………64

12 Operators of the LNG sector …………………………………………………………………………………………………..66

13 The Trans-Europe Blue Corridor Rally ……………………………………………………………………………………..70

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1 Introduction

1.1 LNG Blue Corridors project

The LNG Blue Corridors project’s aim is to establish LNG as a real alternative for medium- and long-

distance transport—first as a complementary fuel and later as an adequate substitute for diesel. Up to

now the common use of gas as fuel has been for heavy vehicles running on natural gas (NG) only for

municipal use, such as urban buses and garbage collection trucks. In both types of application, engine

performance and autonomy are good with present technologies, as they are well adapted to this

alternative cleaner fuel.

However, analyzing the consumption data, the equivalence in autonomy of 1 liter of diesel oil is 5 liters

of CNG (Compressed Natural Gas), compressed to 200 bar. Five times more volume of fuel prevents

the use of CNG in heavy road transport, because its volume and weight would be too great for a long-

distance truck. This opens the way for LNG (Liquefied Natural Gas), which is the way globally natural

gas is transported by ship.NG liquefies at 162º C below zero at ambient pressure, The cost of energy

needed is only 5% of the original gas energy content. This state of NG gives LNG the advantage of

very high energy content. Only 1.8 liters of LNG are needed to meet the equivalent autonomy of using

1 liter of diesel oil. A 40-ton road tractor in Europe needs a diesel tank of 400 to 500 liters for a 1,000

km trip; its equivalent volume with liquid Natural gas would be 700 to 900 liters of LNG, a tank

dimension that could easily be fitted to the side of the truck chassis. LNG therefore opens the way to

the use of NG for medium- and long-distance road transport.

LNG has huge potential for contributing to achieving Europe’s policy objectives, such as the

Commission’s targets for greenhouse gas reduction, air quality targets, while at the same time

reducing dependency on crude oil and guaranteeing supply security. Natural gas heavy-duty vehicles

already comply with Euro VI emission standards, most without complex exhaust gas after-treatment

technologies, which have increased procurement and operational costs.

To meet the objectives, a series of LNG refueling points have been defined

along the four corridors covering the Atlantic area (green line), the

Mediterranean region (red line) and connecting Europe’s South with the

North (blue line) and its West and East (yellow line) accordingly. In order to

implement a sustainable transport network for Europe, the project has set

the goal to build approximately 14 new LNG stations, both permanent and

mobile, on critical locations along the Blue Corridors whilst building up a

fleet of approximately 100 Heavy-Duty Vehicles powered by LNG.

This European project is financed by the Seventh Framework Programme

(FP7), with the amount of 7.96 M€ (total investments amounting to 14.33

M€), involving 61 Partners: 22 Companies; 39 fleet operators, from 11

countries.

This document corresponds to the 7.6 deliverable within work package 7. It is a document describing

the LNG stations location in the project. This document will be available at the project website:

http://www.lngbluecorridors.eu/.

Figure 1-1. Impression of the

LNG Blue Corridors

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2 LNG Global market features

2.1 Global LNG market

LNG is increasingly looked at as a new and promising way of Natural gas trade. It increases the

flexibility and widens the range of NG supply sources. The market of LNG is consequently growing in

most of the areas of the world. The main features of the global LNG market can be summarised as

below:

Global LNG trade in 2016: 278 Mt (+5% vs 2015) – 618 Mm3

Short term market of LNG in 2016: 73 Mt (28% of total LNG market)

Global average LNG supply price: $5.52/MMBtu ( 35c€/Kg - 150 €/m3)

Global nominal liquefaction capability as of January 2017: 340 MTPA (Million tons per year)

New liquefaction capability under construction as of January 2017: 115 MTPA (+35% by 2022)

New liquefaction capability planned in January 2017: 879 MTPA

Global nominal regasification capability as of January 2017: 795 MTPA

Capability of FRSU (floating terminals) plants as of January 2017: 83 MTPA

Global LNG vessels fleet as of January 2017: 439 ships (including FRSU)

Share of LNG in the global NG offer in 2015: 10%

The LNG market main feature trend kept showing a constant growth over the past two decades.

The global LNG imports increased by about 10% to about 290 mn metric tons in 2017, according to

the annual report of the International Group of LNG Importers (GIIGNL) released mid-April 2017, and

SHELL LNG Outlook 2018. The increase was the highest recorded since 2010, contrasting with an

average annual growth rate of 0.5% in 2012-15 and exceeding the rise 5% in 2016. [NGW Magazine]

Figure 2-1. LNG global market trend

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Figure 2-2. LNG liquefaction terminals as of January 2017

Figure 2-3. Liquefaction capability per geographic area, in 2010, 2016 and 2022

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2.2 The future role of Natural gas

The COP21 agreement negotiated and ratified in Paris in December 2015 will probably have a great

impact on the future mix of primary energy sources. Fossil fuels, and especially coal, will be taxed in

order to curb the markets. Coal, as gas, is predominantly used for power generation. Coal is cheap,

scalable and reliable with low or no disruptions. The same characteristics apply for gas. However, coal

emits about twice as much CO2 per energy unit as gas, which makes gas more attractive if the

consumer has to pay for the emissions. Three countries, China, US and India, currently count for 50%

of the global CO2 emissions. Thanks to lowered gas prices (shale revolution) in US, which made gas

more competitive over coal, the world’s second biggest emitter has been able to reduce its annual CO2

emissions by more than 700 million tons (about 10%) since 2007. What happened in US is likely to

happen in the two biggest coal consumers, China and India, as well. Replacing coal power plants with

gas plants has shown to be the most effective step towards a less carbon-emitting world. This partly

explains why gas consumption in IEA’s ‘2-degree scenario’ is expected to increase by 12-14% towards

2040. Gas will need to replace coal to a quite large extent. The highest gas consumption growth will

come in Asia and the Middle East when coal and oil are abandoned and replaced with gas as fuel for

power generator. Africa’s dire needs for energy and power in its race for raised prosperity, will also

play a significant role in the future hunger for gas. Building a sustainable E&P industry needs both the

industry and the government to cooperate and to wear the ‘generation perspective glasses’, in order

to become a success. [Source: excerpt from an article from Henrik Poulsen, Senior Vice President -

Government Relations at RYSTAD ENERGY]

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3 Targets and expectations of potential partners

in 2013

3.1 The LNG Blue Corridors Project

In 2013 many European stakeholders of the NGV market did believe that the LNG Blue Corridors

Project, which was going to start, was one among the actions which might better stimulate and foster

the growth of the NGV market at the European level at that time. In considering joining this Project,

the operators did evaluate the possible synergies with their research plans in the LNG and NGV field.

They did examine carefully and with most interest the different and best options and configuration for

the involvement of their companies in the Project, for example on the following activities relevant to it:

Building of LNG + L-CNG refuelling stations along the corridor routes

Supply of LNG along the corridor routes to refuelling stations

Development and evaluation of Euro VI vehicle technologies

Study of possible solutions to improve standards and regulations related to the use of LNG as

road transport fuel

Collection/elaboration/reporting of data from demonstrated vehicles and stations

Preparation of manuals/handbooks/guidelines/press releases

Evaluation of normative implications

They took in consideration aspects such as:

Main aims of the project to match with their own targets

Partners who had already committed themselves officially to the Project, and were

progressively joining it

Extent of coverage by these partners of the proposed corridors

Expected deliverables

Cost estimate

Available funds

Financing; EU contribution to the total cost incurred by partners

Legal implications

The Project had for the European operators many points of strategic and imaging interest, such as:

The theme of “Blue Corridors” hinging on Natural gas was particularly appreciated by the

biggest gas companies trading in Europe, such as: ENI, ERDGAS, GAZPROM, GAZ DE FRANCE

(now ENGIE). In particular, GAZPROM had been fostering this concept for years, starting back

in the early nineties, for example with supporting the 1991 Rome to Kiev Blue Corridors Rally.

The LNG Project was a potential source of prestige for the partners, and could open the gate

to more operative options for them.

Vice-versa, not participating could convey to the public opinion a negative image of them not

being enough sensitive to the need for development of cleaner mobility, and of LNG in

particular, in a time when the LNG/CNG vehicle market did show signs of increasing dynamics.

The range of the operators who had already expressed their interest for this initiative did

include important competitors; hence it did seem sensible to take this challenge.

15

This initiative seemed to contain very concrete synergies with what many company were doing

already in their respective field of operation, already in the short range.

The availability of funds allocated by the EC, even if of limited entity, could have alleviated to

some extent the financial effort required to the operators to develop this sector.

The European operators attribute a great importance to the availability on the European roads of LNG

as fuel for HD long haul good transport, as a tool for increasing the energy security and for improving

the impact of transport system on the environment. In the meanwhile, they also took in consideration

the importance of the side advantage of the L-CNG option, made possible by the installation of a LNG

vehicle refuelling infrastructure. The L-CNG option allows refuelling LD CNG vehicles, be them both

private passenger cars and fleet vehicles (commercial and public fleet vehicles); it allows lower energy

consumption for the refuelling operation, thanks to substitution of the gas compressor for a liquid

pump, with the same pressure increase. The LD NGV were already largely available on the market, and

would have provided a beneficial scale effect, hence ensuring a better profitability and a shorter pay-

back time of the LNG and L-CNG refuelling station capital investment. Furthermore, including the L-

CNG option to the LNG refuelling station would have meant just marginal additional capital

investment.

The Project leaders prepared the European map with the proposed stations, as a first approach. They

covered what they knew as existing, plus the proposed ones in France, Germany, Italy and Belgium,

identified by the long distance Spanish transporters. This map had to be completed by the time.

Table 3-1. Initial set of the four corridors (Source: D 1.5 Interim progress report)

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The main milestones of the Project are summarized in Table 3-2

period Main milestones

2013 - 2014 Some Partners left the project, such as Linde, Cloud. They received an initial budget

(pre-financing); the plan for ENOS station in Slovenia was removed from the Project

2014 - 2015 The first fleet operators started to work for the project such as LC3, ADPO,

DISTRILOG, FERCAM, MARINÉ, NINATRANS, DUARTE … MENDYRA participation was

terminated

2015 - 2016 More fleets joined in such as MAUFFREY, BERT, BERTHAUD, BAUGUINI, TIEL,

MEGEVAND, XPO, MATTHEEUWS, TJA, HAM Transportes.

HAM Criogénica participation was terminated

2016 – 2017

The latest to join were: TRANSORDIZIA, MEC, CARGAQUATRO, CODOGNOTTO,

AUTOTRANSMAR, DSP, TRANSNUGON, ESK, MEYER. Two companies dropped out

the project: HARDSTAFF and RENAULT TRUCKS

2017 - 2018 UNIPER joined the Project with the LNG station in Berlin

Table 3-2. Project Stages

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4 European LNG market at beginning of LNG BC

Project, in 2013 (stations; trucks; estimated

sales)

4.1 Automotive LNG market

In 2013 the LNG market in Europe was just budding. Some few LNG stations, 20 or 30, mainly for

demonstration purposes, were in operation in few countries. At that time, only Spain, the UK, Sweden

and the Netherlands had LNG stations and trucks. Some more stations, in a wider range of countries

were using LNG as NG supply source, which made them independent from the gas grid; but those did

only sell CNG, obtained by pressurization and regasification of LNG under high pressure of 200 bar (L-

CNG solution). In Italy for example there were about 10 L-CNG stations before the LNG BC Project was

launched; but no station supplying LNG. The existence of these L-CNG stations did contribute to make

the operators confident on that LNG could also be sold as low pressure liquid to HD vehicles, if only

such vehicles had been put on the market:

in sufficient number

with a sufficiently wide range of models

suitable to the long haul good transport

with sufficient power delivery and torque to face the characteristics of the European road

system.

The launch of the LNG BC Project further consolidated this confidence, thanks not only to the available

financial resources offered by the EC, but also to the awareness of the availability of at least a couple

(or a couple more) of LNG stations in each European country on the main roads, as a starting point.

The operators of the logistic sector were already well aware of the potential economic benefit provided

by LNG trucks, in case of the suitable scale. And the entrepreneurial approach of the main HD vehicle

manufacturers also convinced them to start this new pathway, with an initially small fleet of trucks, to

be increased by the time if the first operational period results proved positive enough.

Having a look at other markets outside Europe, such as China and North America, also provided some

encouraging messages to the European operators. In China the total fleet of LNG trucks were huge

already then, with a national LNG vehicle fleet of 40,000 units. An inherently large fleet was in

operation also in USA.

In early 2015, there were over 50 public LNG stations in operation in Europe, including approx. 19 in

Spain, 7 in the Netherlands, 15 in the UK, 2 in Portugal, 1 in Italy, 6 in Sweden, 2 in Belgium and 1 in

France. At that time, these countries were the true LNG pioneers within Europe.

Other EC Projects came to support the NGV sector, such as the CEF program. Projects such as LNG/L-

CNG in Finland, BESTWay, Innovative gas solutionsfor road transport, GREAT, BioMovLNG, CNG

Connect, Connect2LNG, LNG Bremen and PAN-LNG have been approved for funding as part of the CEF

2014 programme, leading to the construction of approx. 15 additional LNG stations since 2015, with

more planned by the end of 2019 as these projects are still ongoing.

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All together, the CEF and CEF Blending projects approved for funding since 2014 have enabled the

construction of approx. 20 LNG stations until now (stations in operation as of April 2018), with over

150 more that are currently in planning more or under construction.

In 2016, there were already more than 70 public LNG stations in operation in Europe, plus some private

stations for captive fleets. By end 2016, in the Netherlands there were 162 CNG stations and as much

as 21 LNG stations. In Spain there were 28 CNG and 21 LNG stations. In Italy there were 1,176 CNG, 8

LNG and 9 L-CNG stations; Italy plans to have 100 more CNG, 10 more LNG and 9 more L-CNG

stations in operation by end 2017.

The 2015-2017 period also saw new countries entering the LNG stations' game, such as Finland (1st

station in 2016), Germany (2016), Poland (2016), Austria (2017), Bulgaria (2017), Slovenia (2017) and

Czech Republic (2017). The number of countries with LNG stations in operation or planned does

continue to increase, now with Hungary (1st station in operation in March 2018), Norway (1

st station

planned for 2018), Croatia (1st station planned for 2018), Slovakia (2019) and others expected to follow

the trend. Thanks to these new projects, the network of LNG stations is becoming truly European.

Fig 4-1. EU Funded Projects developing CNG and LNG Infrastructure in Road Transport (source: NGVA Europe, September 2017)

4.2 Project stations

In the Project, the first station opened in Piacenza, Italy (ENI, built by Vanzetti), in April 2014, already

supplying a substantial fleet of trucks since the very beginning.

Also in 2014, LNG stations were opened in Orebro, Sweden (SGA), Kallo, Belgium (DRIVE), Carregado,

Portugal (DOUROGAS), Barcelona, Spain (GAS NATURAL FENOSA).

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In 2015, LNG stations were opened in Nimes, France (ENGIE), Matosinhos, Portugal (GALP), and Elvas,

Portugal (DOUROGAS).

In October 2015 France opened in Rungis (ENGIE, built by HAM), its first public service station capable

of supplying LNG and CNG. This was the second LNG station built in France. In the Rungis station the

supply of LNG can be accomplished by pump or pressure differential with only preselect mode of

operation and without modifying the installation. It was the first LNG supply station that could operate

with this functionality. It allows refuel all types of vehicles and reduce operating costs as it enables

optionally not use the cryogenic pump.

GNVERT’s Lyon LNG station was ready by mid-2016 due to delays with the permits from the

authorities. In 2016 was also opened in Pontedera, Italy the second station of ENI, built by HAM.

In 2014 and 2015 all the other LNG stations which progressively opened could count on limited fleets

of some trucks; generally not more than three. The situation improved rapidly in 2016.

The Project experienced some difficulties along its path, related to the implementation of the planned

14 LNG stations, then reduced to 13, as well as to the different progress made by the various OEMs in

the development of LNG trucks.

The largest problem with the LNG stations was identified in Germany, since ERDGAS did not find the

business case and the Consortium was asked to find a new solution. Three companies (GASREC, GNF

and GNVERT) proposed themselves to conduct a business study and competed for the allocation of

the LNG station to them; however none of them achieved the goal. UNIPER was able to build the

station at last. As the core activity “Demonstration” could not fulfill the goals in the scheduled duration

period, a project extension was agreed for 1 year to selected partners (LNG stations and fleet

operators mainly).

The fact that one of the LNG stations of the project, i.e. that built by BRUCARGO (DRIVE), was awarded

in parallel with a TEN-T project had impact to the LNG Blue Corridors, since only 13 LNG stations were

to be constructed. The EU Commission agreed to keep the process for 1 LNG station in Germany while

the funds for BRUCARGO were used for additional trucks monitoring. It was also not necessary

anymore to have 14 LNG stations since CEF funding was supporting many LNG stations in Europe.

Some of the stations were in the beginning mobile stations, for example in the case of Lyon, Nimes

and Berlin. They were planned to become fixed stations at end of Project. This proved to be a sensible

strategy for a developing market in totally unexploited areas.

The development of the LNG market faced most problems in Germany, where only 1 station in the

Project could be opened only in late 2016 in Berlin (UNIPER). It is a mobile station, and a substitution

for a stationary one is planned in 2018. The very last station of the Project to open, i.e. the 13th

is the

one in Sines (GALP) Portugal, which could still not be opened by the end of the project in April 2018.

An LNG station was planned by the Project in the Brussels airport (DRIVE LNG/Bru Cargo). This station

was built, but as it already was granted financial incentives from another EC Project, i.e. TEN-T CEF, it

was removed from the Project. The Project initially included a station in Slovenia (ENOS), but this

station was never built due to a lack of a good business case; ENOS LNG operates anyway a small LNG

liquefaction plant in Slovenia. For this reason the stations in the project are 13 instead of 14, and the

funds available for the station in Croatia were re-allocated for more trucks/fleets. The timing of

construction of the Project stations had to take in due account the real progressive availability of

trucks.

20

At end 2015 i.e. end of the second year of the Project, 8 LNG stations (61%) had already been

constructed, including Matosinhos - Portugal, Rungis and Nîmes – France. That meant at least one

station per Corridor, already in operation or just built in 6 different countries (Italy, Sweden, Belgium,

Portugal, France and Spain). And the demonstration was taking place in at least 2 additional countries

since of course some of the LNG Blue Corridors trucks did not limit their operations to the origin

country, but travelled across national borders, as all long haul vehicles do. For example, countries like

The Netherlands and Germany had already at that time more LNG trucks on their roads. However,

there were another 5 LNG stations which could not be ready by the end of 2015/mid 2016 for various

reasons.

The Portuguese station in Elvas built by DOUROGAS had some delays due to the reallocation of its

budget – originally it was going to be built by CLOUD. Finally the Pontedera (ENI) and Sines (GALP)

stations also experienced some delays with the permits. By mid-2016, 11 stations hence 84% of the

planned stations were in operation or built. The last two came later: the one in Berlin, Germany

(UNIPER) in late 2016, and the station in Sines, Portugal (GALP) will be the last one, in 2018.

trucks Cumulative

LNG sales

Cumulative

fillings

Avg. LNG

sales/month/station

Cumulative

kilometres

Jan 2015 10 >290 tons ~3,500 10 tons ~600,000

Feb 2016 <50 >2,300 tons ~20,000 27 tons >10 million

June 2017 >110 >6,660 tons ~56,000 69 tons ~20 million

Oct 2017 >140 >10,000 tons ~78,500 63 tons >25 million

May 2018 156 ~14,200 tons ~111,000 66 tons ~32 million

Table 4-1. Project features trend

21

5 European LNG market at end of LNG BC

Project, in 2018 (stations; trucks; estimated

sales)

5.1 Project stations

participant Corridor country city opened

1 ENI MedBlue Italy Piacenza 04/2014

2 AGA - SGA SoNorBlue Sweden Orebro 04/2014

3 DRIVE WeBlue Belgium Antwerp (Kallo) 05/2014

4 DOUROGAS AtlBlue Portugal Carregado 10/2014

5 GNF MedBlue Spain Barcelona 12/2014

6 GNVERT AtlBlue France Rungis 12/2015

7 GNVERT MedBlue France Nimes 02/2016

8 DOUROGAS SoNorBlue+AtlBlue Portugal Elvas 04/2016

9 GNVERT SoNorBlue France Lyon 06/2016

10 ENI MedBlue Italy Pontedera 11/2016

11 GALP AtlBlue Portugal Matosinhos 11/2016

12 UNIPER WeBlue Germany Berlin 04/2017

13 GALP SoNorBlue+MedBlue Portugal Sines 2018

Table 5-1. The 13 Project stations

5.2 automotive LNG global market

During this period of time the automotive market of LNG has increased remarkably worldwide,

especially in Asia (China, Japan) and North America. China had already in 2013 a national fleet of

18,000 LNG buses and 45,000 LNG trucks, fueled by about 1,000 LNG stations. At end 2014 the CHINA

LNG GROUP expressed intent for direct investment in a minimum 100,000 LNG-fuelled trucks and

indirect-investment in 200,000 LNG-fuelled trucks by 2020. In 2017, the LNG trucks account for about

22

4% of the more than 6 million HD vehicles able to haul 40 to 49 tons of goods that are on China’s

roads. The national demand for LNG trucks is soaring as companies and manufacturers shift to vehicles

that run on the gas that China’s Government sees as a key part of its war against ambient air pollution.

Sales of LNG heavy trucks surged by 540% to nearly 39,000 in the first seven months of 2017 [Source

Cassie Liu, a truck analyst with the IHS Markit consultancy]. That was partly stimulated by a ban in 2017

on the use of diesel trucks to transport coal at northern ports in provinces like Hebei and Shandong,

and in the city of Tianjin.

The production of large LNG trucks broke records in 2017 in China, with a total of 96.000 LNG trucks

produced in that year; a sharp contrast to 19.600 in 2016, according to an industry report. Gas trucks

are believed to be more environmentally friendly and more economical in China, where it is estimated

that gas trucks can cut fuel costs by 61 yuan (9.5 U.S. dollars) per 100 kilometers, and the demand for

gas trucks will continue to rise in 2018. The strong growth of gas truck production is part of China's

continued battle against air pollution through encouraging the use of clean energy-powered vehicles

and tightening control over pollutant emissions from new motor vehicles. [source: NGV Magazine]

5.3 automotive LNG European market

The automotive LNG market has seen some significant increase in Europe too. The main fuel

companies have invested all around Europe in LNG stations, especially in Spain, The Netherlands, Italy

and the United Kingdom. Spain is favored by the long time existence of many (now 7) LNG terminals,

well located along the country’s coasts. The Netherlands remains as the leader of investments in

Europe, especially thanks to the allocation of public funding at very high levels (50% of the LNG

stations) the routes inside the country are not as long as the ones in the LNG Blue Corridors Project,

which focuses on medium and long distance transport. These routes are flat, and this means that also

low-powered trucks are suitable for this country. UK started very early with developing the LNG

mobility. In the UK, the Government implemented the Low Carbon initiative. The trial has had £11.5

million of funding from the UK Government to increase the number of low carbon trucks and refuelling

stations. It is set to deploy around 350 gas trucks and 28 refuelling stations. Italy can count on the

longest and widest experience with the CNG mobility sector, ranging back to the thirties of the last

century. Its CNG market still remains the greatest in Europe. In Italy there are now about 1,000,000

CNG vehicles, served by about 1,200 CNG stations (there are plans for 2,000 in total), selling about 1

billion Sm3 of CNG per year. The NGV market in Italy is facing a bit of a slow-down trend in this period,

mainly due to the competition of hybrid and LPG vehicles. This long and successful experience is now

leading to a natural prosecution on the LNG mobility field. Italy has become one of the champions in

Europe of the LNG automotive market. The operators of this sector estimate a grown demand for LNG

in the automotive market to more than 15,000 ton in 2017 (LNG + L-CNG), i.e. two times as much as in

2016. The total number of LNG stations has grown to 15 in 2017, compared to 6 in 2016. The LNG

truck national fleet amounts in 2017 to 400 dedicated vehicles, plus 100 dual fuel, LNG/diesel. The

National Strategic Plan (Quadro Strategico Nazionale) is predicting the total demand of LNG as

automotive fuel in 2030 to amount to 2.5 million ton/year, and a total of 800 LNG refuelling stations.

This network would be sufficient to refuel a national fleet of 30,000 LNG HD vehicles. The L-CNG

refuelling stations could also increase their total demand of LNG to about one million ton/year. Finally,

in 2030 the application of LNG to the industrial market might demand for more than 2 million ton/year

as substitution of traditional fuels; the residential market application might demand for half a million

ton/year of LNG. [Source: LIQUIGAS]

23

A substantial help also came from the Trans-European Transport Network Executive Agency (TENT-T

EA) call 2012, which recommended funding 7 projects related to LNG, some under development. They

are:

Flexible LNG bunkering value chain on the Spanish Mediterranean coast [2012-ES-92034-S]:

approx. 1 M€ funding, to support removing the barriers for an LNG bunkering in the

Mediterranean coast.

LNG hub in the northwestern Iberian Peninsula [2012-ES-92068-S]: 0.6 M€ for the Port of Ferrol,

focusing on the design of facilities, procedures to apply LNG as fuel for vessels.

LNG Rotterdam Gothenburg [2012-EU-21003-P]: approx. 34 M€ funding for the LNG break bulk

facility at the Port of Rotterdam and the small-scale satellite terminal in Gothenburg.

SEAGAS [2012-EU-21006-S]: approx. 1 M€ funding support for feasibility studies about LNG

bunkering facilities in 2 ports: Roscof (France) and Santander (Spain).

LNG Pilot Project about bunkering infrastructure solution and pilot actions for ships operating in

the Motorway of the Baltic Sea [2012-EU-21009-P]: approx. 23 M€.

LNG Masterplan for Rhine-Main-Danube [2012-EU-18067-S]: approx. 40 M€ funding for feasibility

studies, trials and pilot actions related to inland vessels.

Study to test the potential of Bio-LNG to contribute to European Renewable energy targets based

on a pilot refuelling and storage network trialled with HGV fleet operators in the UK [2012-UK-

26061-S]: 5.7 M€ funding for pilot studies to test the Bio-LNG in a live trial with HGV operators

using a pilot network of open access storage and refuelling terminals. It includes fixed and mobile

stations. This Project has similarities to the LNG Blue Corridors, and will be deeply monitored. Also

Gasrec, partner of the LNG Blue Corridors, was proposing this topic funded by TEN-T, and it is

expected to have a good exchange of information to understand the impact of the Bio-LNG in

Europe.

When the LNG Blue Corridors FP7 Project started, the regulatory framework related to LNG was not

fully developed. This situation has changed substantially, and nowadays LNG technology is mature and

can be approved and certified. The publication and entrance in force of UN Regulation 110.01 in 2013

has been one of the key items for the success of the project since it opens the possibility to register

vehicles using LNG as a fuel throughout Europe. Furthermore, ISO standards that were initially in

preparation have developed the requirements to be fulfilled by the LNG Refuelling Stations. The use of

common standards and regulations guarantee the safe use and the compatibility of the LNG vehicles

and the LNG refuelling stations around Europe. A not negligible amount of work is still to be done in

the field of certification - standardization and some technological aspects should be improved. The

estimated total number of public and private LNG stations in Europe is in excess of 150 as of early

2018. An average sale rate for them can be expected at 1,000 ton/y as starting point, leading to an

initial LNG automotive market in Europe of 150,000 ton/y, as conservative estimate.

country Public + private

LNG stations

(2018)

Public CNG stations, including

L-CNG stations (2016)

Private CNG

stations

Planned new LNG stations –

short term (2018 - available

info)

Austria 1 172 5

Belgium 6 76 2 2

Bulgaria 0 125 2 1

Croatia 0 2 3 1

24

Cyprus 0 0 0

Czech Republic 1 143 41

Denmark 0 15 1

Estonia 0 6 0

Finland 4 27 (of which 1 L-CNG) 0

France 18 51 (of which 6 L-CNG) 150 17

Germany 3 883 67 3

Greece 0 10 2

Hungary 0 10 16

Ireland 0 1 2

Italy 22 1,176 (of which 10 L-CNG) 45 14

Latvia 0 0 1

Lithuania 0 3 6

Luxemburg 0 7 0 1

Netherlands 24 162 (of which 2 L-CNG) 15 3

Norway 0 7 3 1

Poland 4 27 (of which 1 L-CNG) 4 3

Portugal 6 12 (of which 7 L-CNG) 1 1

Romania 0 1 0

Serbia 0 13 5

Slovak Republic 0 11 0

Slovenia 0 4 0 1

Spain 31 44 (of which 16 L-CNG) 0 3

Sweden 6 167 60 1

Switzerland 1 140 5

UK 30 (inc. 15 priv.) 20 (of which 4 L-CNG) 15

25

TOTAL 156 3,315 (of which 47 L-CNG) 451 52

Table 5-1. The European LNG infrastructure as of April 2018 (NGVA Europe’s estimate, based on available information; some of the

listed L-CNG stations also sell LNG in liquid form; some other don’t)

Table 5-2. The main features of the Project stations, as of end September 2017 (available information)

5.4 Bio-LNG, renewable gas as fuel for LNG trucks

LNG, like CNG, can be produced from a variety of renewable, scalable and very low carbon intensity

energy sources, such as biomethane produced from organic waste and biomass through anaerobic

digestion and gasification or synthetic methane produced converting carbon dioxide (CO2) into

methane by using hydrogen produced from surplus green electricity. In Europe, this liquefied

26

renewable gas is often referred to as “bio-LNG” or “liquefied biomethane” (other terms are also found,

e.g. “LBM” for “liquefied biomethane”, “liquefied biogas” and “LBG” e.g. in Sweden). Renewable gas is

fully compatible with the current natural gas mix, allowing any blend and unlimited use in the existing

infrastructure and vehicles.

In March 2018 NGVA Europe and EBA (European Biogas Association) released a report on renewable

gas in transport (“Renewable Gas in Transport - Opportunity to fast accelerate decarbonisation with a

clean and sustainable solution”, EBA and NGVA Europe, March 2018). This study has explored the

benefits of natural gas combined with renewable gas as a transport fuel, both looking at the

greenhouse gas (GHG) emissions reduction and improvement in the air quality by a progressive

substitution of gasoline and diesel. The EBA-NGVA analysis quantified the possible GHG emission

reductions of renewable for heavy duty vehicles (HDVs) in 2030, in comparison with diesel. When

comparing these fuels from a well-to-wheel perspective for HDVs, the study shows that renewable gas

can produce total CO2 reduction over truck lifetime of 968 to 2315 ton depending on the renewable

gas source.

Liquified biomethane used as biofuel for heavy duty vehicles is a very new business. At the beginning

of the LNG Blue Corridors project, there were only a few pilot plants in Europe and globally, the

following ones being known by the LNG BC project partners:

- One in the Altamont Landfill near Livermore, California, USA, which was the world’s largest

landfill gas to LNG plant when Waste Management Inc. and Linde North America started its

operation in November 2009;

- One in Albury, Surrey, the UK, operated by Gasrec, producing liquefied biomethane from

landfill to fuel commercial vehicles in the UK;

- One in Lidköping, Sweden, which started operation in summer 2012, initially run by Lidköping

Biogas AB (now Air Liquide), producing transport fuel for cars, trucks and buses in both

gaseous and liquefied form.

The development for bio-LNG continued slowly in the 2013-2015 timeframe, essentially in Europe, with

a few projects launched e.g. near Oslo in Norway (it has been opened in February 2014 by Cambi AS,

with a bio-LNG production capacity of 11 tons per day – source:

http://www.biogaspartner.de/fileadmin/biogas/documents/Kurznachrichten/2016/eng/2016_03_21_Pur

ac_Puregas___bio_LNG_presentation.pdf) and in the Netherlands. Several bio-LNG pilot projects have

been experimented in the Netherlands, including the following ones:

- First Dutch pilot plant by Rolande LNG, Gastreatment Services and Attero at the Wijster site of

Attero, with production capacity of 177 kg of bio-LNG per hour / 1,550 tons per year, start of

operation in 2014 (Sources http://www.rolandelng.nl/nl/news/rolande-attero-bio-lng.htm and

https://www.coebbe.nl/sites/default/files/documenten/Bio-LNG-Ook-een-green-deal-Brabant-

Carlijn-Lahaye-Attero.pdf)

- Small scale fiel test at Landschap Vallei in Veluwe, with Cirmac raw biogas upgrading to

practically pure biomethane and Osomo liquefaction using a Stirling Cryogenerator, with a

liquefaction capacity of about 7.5 kg per hour. (Source:

- https://groengas.nl/documenten/factsheet-productie-van-bio-lng-in-een-opkomende-lng-

markt.pdf)

- At Accres in Lelystad, DMC biogas upgrading and Osomo's Stirling cryogenerator used for

liquefaction. (Source: https://groengas.nl/documenten/factsheet-productie-van-bio-lng-in-

een-opkomende-lng-markt.pdf)

27

- Gastreatment Services in Haarlem, with a full-fledged liquefaction system with a capacity of

122 kg bio-LNG per hours. (Source: https://groengas.nl/documenten/factsheet-productie-van-

bio-lng-in-een-opkomende-lng-markt.pdf)

Since 2016, the European industry has put a much stronger focus on bio-LNG, with a number of new

projects announced, intended to demonstrate the viability of the solution, start larger scale

deployment of production facilities and availability of bio-LNG for trucks. Even though there are still

only few plants up and running producing bio-LNG in Europe (and globally) today, significant new

development is expected in the coming years, in a growing number of countries, as stated by the

following examples:

- Announced in March 2016, the Biokraft Norway plant intended to be Scandinavia’s ‘largest

biogas plant to provide fuel for buses’. It is planned to be located at the Norske Skog Skogn

paper mill near Trondheim, with a system supplied by Wärtsilä using Purac Puregas process

converting cleaned biogas from fishery waste and residual paper mill slurry into liquefied

natural gas fuel. For this plant, Wärtsilä claimed a novel natural gas liquefaction technology

based on readily available, well proven components, “specially designed to liquefy small

methane-based gas streams”. Initial production capacity is planned to be 12.5 tons of liquefied

biomethane per day, then doubling to 25 tons per day. (Source: Fleets and Fuels, March 21,

2016 and

http://www.biogaspartner.de/fileadmin/biogas/documents/Kurznachrichten/2016/eng/2016_0

3_21_Purac_Puregas___bio_LNG_presentation.pdf)

- In France, the first bio-LNG demonstration (pilot) project is BioGNVAL, located in Valenton,

operated by ENGIE’s subsidiary LNGENERATION, coordinated by SUEZ and with Cryo Pur in

charge of biogas purification and liquefaction. This bio-LNG project started in 2013 and the

production site was inaugurated in May 2015. Demonstration project period was October 2015

- April 2017. (Sources: http://www.engie.fr/actualites/biomethane-liquefie-premiere-industrie/

- http://www.gaz-mobilite.fr/actus/cryo-pur-biogaz-biognl-bioco2-interview-simon-clodic-

1171.html)

- In the Netherlands, in addition to the above mentioned pilot projects, a number of other bio-

LNG projects are under development. Rolande LNG has been awared EU funding from the CEF

2017 programme for its BIOLNG4EU project, which is expected to enable the company to get

bio-LNG to the market faster. The goal of the project is to install two bio transformation

stations (BTS) and four Bio-LNG fuel stations in the Netherlands and Belgium. The two BTS’s

will transform locally produced biogas to liquefied Bio-LNG. This action is part of a global

project of 50 LNG and Bio-LNG refuelling and 15 bio transformation stations that will be

established gradually close to large distribution centres and/or to major highways along the

TEN-T Core network Corridors in North Western Europe. (Sources:

https://www.lngworldnews.com/rolande-to-make-a-push-for-bio-lng/ -

https://www.ngvglobal.com/blog/rolande-says-end-fossil-era-trucks-step-closer-0728 -

https://ec.europa.eu/inea/en/connecting-europe-facility/cef-transport/biolng4eu)

- As for Germany, Titan LNG and Osomo Projects signed in November 2015 a partnership

agreement to realize a Bio LNG production facility planned to be the first in Germany. Osomo

Projects represents iLNG, the owner of the certified and patented Bio LNG liquefaction

technology. (Source: http://titan-lng.com/en/bio-lng-for-germany/)

- Also in Germany, the LNG Bremen project has been approved for EU funding from CEF 2014

programme, enabling HGM to build a bio-LNG production unit in Bremen as well as a supply

system to stations. The action is a study and full-scale real-life deployment project of a

liquefaction and supply facility for LBG at the port of Bremen. (Source:

https://ec.europa.eu/inea/en/connecting-europe-facility/cef-transport/planning-construction-

demonstration-and-market-roll-out)

28

- Then, German energy company Erdgas Südwest GmbH announced in March 2017 a new bio-

LNG production plant using Puregas upgrading technology supplied to Wärtsilä. Wärtsilä

reported that the technology for this plant represents a new and unique response to market

needs to liquefy and store methane-based energy streams. Both gas cleaning and liquefaction

are cost- and energy efficient, thereby making profitable projects possible even for smaller gas

streams. (Source: http://www.puregas-solutions.com/second-bio-lng-plant-puregas-

solutions/)

- In Italy, there are at least ten projects for bio-LNG production plants, with production capacity

from 5 to 50 tons/day. (Source: Consorzio Italiano Biogas

https://www.dena.de/fileadmin/dena/Dokumente/Veranstaltungen/EBC_2017/Vortraege_EBC/

panel2-2-Maggioni.pdf)

o Cooperative 3A “Assegnatari Associati Arborea” project in Arborea, Sardinia is

planning to produce ~4.5 tons of bio-LNG per day using Galileo Cryobox and to build

L-CNG stations to use it as fuel for trucks and other vehicles. (Source:

https://oilnonoil.it/wp-content/uploads/2016/09/Pieroni_Case-study_limpianto-di-

biometano-di-arborea.pdf)

o Caviro distillery project is planning to produce 8 million Sm3 of bio-LNG per year from

grape waste of member wineries.

o S.E.S.A. (Società Estense Servizi Ambientali S.p.A.), one of the most important refuse

collection and treatment companies in Italy, based in Veneto region, has been

authorized a production plant of 4,500 Sm3/hour of bioLNG and bioCNG, which will

fuel 150 waste collection and transportation trucks.

o Cryo Pur announced one tender won for a project in Italy.

- In France, there are also several bio-LNG projects in preparation. At least two more bio-LNG

production plants are planned with Cryo Pur equipment, one in Angers (expected in 2018) and

another one (Source: https://www.biogas2020.se/wp-content/uploads/2017/11/nr-8-

201711cryo-pur-presentation-skive.pdf). As part of the CEF funded BioMovLNG, Proviridis is

planning the installation of a bio-LNG production unit at a Waste Water Treatment Plant.

(Sources: https://www.afgnv.info/attachment/599777/ - http://www.gaz-

mobilite.fr/actus/biomovlng-reseau-francais-stations-gnl-proviridis-1039.html)

- In Slovakia, the project « LBG: Fuelling Renewable Transport” was approved for funding as part

of the CEF 2016 programme and will include the realization of a bio-LNG production facility in

Slovakia, together with a network of stations and roll-out of LNG trucks in the Visegrad

countries. (Source: https://ec.europa.eu/inea/en/connecting-europe-facility/cef-

transport/liquiefied-biogas-fuelling-renewable-transport-visegrad)

- In Northern Ireland, the first ever bio-LNG production project was launched in July 2016 by

Greenville Energy and Cryo Pur in Tyrone, with planned production capacity of 3 tons of bio-

LNG per day. Greenville Energy was already producing biogas from anaerobic digestion, based

on waste from dairy and other food industries. With the new project, excess biogas production

will be transformed into bio-LNG. This first commercial bio-LNG production unit from Cryo Pur

was commissioned in October 2017. (Sources: http://www.gaz-mobilite.fr/actus/cryo-pur-

lance-premiere-installation-bio-gnl-irlande-du-nord-1304.html -

https://www.biogas2020.se/wp-content/uploads/2017/11/nr-8-201711cryo-pur-presentation-

skive.pdf)

- In Denmark, GreenLNG A/S intends to develop a bio-LNG production plant in the port of

Hirtshals. Planned production capacity is 160 tons per day / 70 million Sm3 per year and first

delivery expected in Q1 2020. This project was submitted and rejected for CEF 2017 funding

but may be confirmed at a later stage. (Sources: http://www.gaz-mobilite.fr/actus/europe-

projets-gnv-ecartes-programme-cef-1833.html -

http://www.golng.eu/files/Main/GoLNG_2017_conference/7_Green%20LNG_HRO.pdf)

29

In the next few years, once these projects and others will be completed, bio-LNG as a fuel for LNG

trucks is expected to be available in a significant number of European countries, including at least

Sweden, Norway, the Netherlands, the UK, Italy, Germany, France, Slovakia and Denmark. This will mark

the achievement of another major milestone for the market and the environment, making almost GHG

neutral operation really possible for long distance heavy duty trucks (or achieving WTW GHG

emissions reduction by at least 80% compared with diesel, depending on the biomethane source).

By 2030, it seems reasonable to expect that bio-LNG will be produced in much larger volumes, not

only from biomethane (anaerobic digestion), but also from power to gas and gasification processes,

therefore offering great opportunities for GHG emissions reduction in heavy road haulage as well as

economically affordable zero or low carbon heavy goods road transport in Europe.

30

6 Trend of station costs during Project

deployment arket at end of LNG BC Project, in 2018 (stations; trucks; estimated s

Before the start of this Project, the construction cost of the very first LNG refuelling stations did tend to

be very high, mainly due to lack of standards and lack of experience, which had to be remedied with

some redundancy. A first generation LNG refuelling station might even cost about 2.0 million Euros.

The second generation stations take profit of some experience gained meanwhile, and have in general

lower CAPEX, but still tend to be quite expensive, in this case due to low scale effect.

The increase trend of number of LNG stations during the project is all in all not negligible and quite

interesting. An average rate of about 30 new LNG stations were built per year. More stations can be

counted in this respect, if including the stations only delivering L-CNG to their customers, as in the

total network there are stations selling both L-CNG and LNG in liquid form, but also stations selling

only L-CNG, as e.g. some 9 stations in Italy. In many cases, even if maybe not always, these L-CNG

stations are more or less ready to enlarge the range of offered fuels, extending to LNG with a limited

additional investment which is just a fraction of CAPEX (LNG dispenser, LNG low pressure pump if

needed, LNG conditioner heat exchanger, if needed). This pace of 30 new stations per year is anyway

not yet intense enough to originate the scale effect which can further curbe in a detectable way the

cost of stations. This cost was and still is only depending on the adopted technology and solutions. For

one thing, this increase in the number of stations involves now 14 countries, and hopefully some more

in the future; hence the number of new stations in each country is for sure below the desirable level to

affect significantly the cost of station components, let alone the lump sum cost. Then, most LNG

station/plant components are specific to LNG, so no or very limited synergy is available with other

cryogenic or normal temperature operational components. The used materials and metals are valuable

and expensive: stainless steel and special alloys. The technology needed for some of them, primarily

the cryogenic tanks and pumps, is quite sophisticate, so the market needs very high numbers to have

access to a large scale effect on the side of costs. Also, some technology needs such as boil-off

recovery and LNG truck tank vent recovery, will play against reduction of average station prices. In the

early steps of this market development, quite often the LNG station manufacturers resolved to offer

their customers special promotional prices, with which they accepted to renounce to a part of the

legitimate and normally expectable margin and profit, to encourage their customers to take the

challenge, for sake of promotion of this new pathway. With the development of this sector, at least in

the beginning of the subsequent stages, any possible intentions for reduction of prices due to scale

effect would hit against the need of the manufacturers for some recovery of the lost profit which they

did sacrifice with the early contracts.

The improvement of the technology, and the harmonization of technology solutions, service

conditions and components, in particular connectors, will offer some help to reduce the CAPEX and

OPEX to a certain extent. A big help can come in this respect from harmonization of standards for LNG

stations in Europe (e.g. EN ISO 16924). To make one of the best examples, the future advisable general

adoption of a single solution for service conditions, for example low pressure and temperature (now

down to 8 bar and potentially only low pressure – 3 bar – in the future), besides being profitable in

terms of longer running ranges and residence times of LNG in tank, and larger sale rates per individual

filling, would allow some economy in CAPEX, as less components would be needed installing in the

stations (e.g. LNG conditioning heat exchanger, pump etc.). The increase of the LNG HD vehicle fleets

will also improve all business cases, which might have an indirect twofold effect on prices. On the one

hand it would make more and more operators to be willing to build their own LNG station, be it

31

private or public. This will eventually provide the desired scale effect. On the other hand, the new

stations built in a more settled market would probably have to be bigger than the ones in the former

generations; hence more expensive. This would mean higher CAPEX; but despite this, the expectable

pay-back time would be shorter, due to the better utilization rate of larger fleets.

Another deliverable of this Project has identified the typical average cost of the LNG refuelling stations,

as a function of their type/technology. The following table is an excerpt of D 3.8, cost analysis of LNG

refuelling stations. The content of the table is still applicable to the general situation in Europe at end

2017.

type Stationary station Mobile station

technology saturated LNG

at 7-8 bar

saturated LNG

and CNG (L-

CNG)

super

saturated (18

bar) and

saturated LNG

super

saturated and

saturated LNG

and CNG (L-

CNG)

saturated LNG

at 7-8 bar

super

saturated and

saturated LNG

and CNG

(L/CNG)

Common

cost

estimate

171,000

Specific

cost

estimate

284,000 681,000 374,000 771,000

Total cost

estimate

455,000 852,000 545,000 942,000

Common

cost actual

67,000

Total cost

actual

470,000

580,000

÷

814,000

563,000

971,000

÷

1,150,000

301,000

473,000

Table 6-1. Typical CAPEX of LNG refuelling stations (excerpt from D 3.8, rounded figures) – stationary stations and mobile stations -

Euros

This analysis does not ignore, but intentionally does neither take in consideration the potential effect

on the prices/costs in the European LNG market, which could derive from import of technologies and

products coming from other LNG makets and operators in the world.

32

7 Considerations about LNG retail price and NG

price

7.1 General

At present it is not possible to address to any official document about fuel price forecasts, which is a

rather complex prevision to do, especially in the energy and fuels market. Some of the deliverables of

the LNG Blue Corridors Project address the LNG market items. These documents might give some hints

on the possible future trend of costs and prices. What is possible at the present stage of the LNG

market development about this item is just some general considerations, and the personal opinion of

Project Partners, about factors that can affect the future price trends, in one direction or another.

The price of LNG at pump, as that of any other automotive fuel, is entirely at the option of the retailer,

and subject to market dynamics of offer/demand. It consist of three components:

industrial price; including production and transport costs plus wholesale and retail margins

excise duties (tax)

VAT (tax)

In all Europe, the VAT is applied on the sum of the industrial price plus the excise duties; this means

that there is a tax applied over a price component that is already a tax.

7.2 industrial price

The industrial price could be affected in a positive way (meaning lowered), by a constant increment of

the global LNG market, leading to a larger offer. The global LNG production capability is now about

300 million ton/year. Also the increasing availability of this fuel, now coming from new sources, such as

those in North America (e.g. the LNG terminal in Louisiana operated by Cheniere), and Australia (e.g.

the new NG liquefaction plant of Gorgon, operated by Chevron Corp, on the Barrow island, capable of

15.6 million ton/year), and in future also coming from new sources in East Africa, will probably have a

positive effect, provided the new production pathways (e.g. fracking), are not too expensive, especially

in the case of low Oil prices, and get reasonable breakeven prices to support and justify E&P costs,

which seems to be the case often enough.

As a matter of fact, the LNG industry in these very time is trying to figure out what is the safest way to

manage the temporary oversupply while avoiding a shortage and associated price spikes early next

decade. As the production surplus of LNG begins to rise, questions are being asked about how to deal

with this in a way that does not destroy value.

US has exported $139mn worth of LNG to China in the first seven months of 2017. US LNG deliveries

to China have surged in this period, as low prices have encouraged buyers to switch from coal.

On 8th

June 2017 two small but significant sales and delivery of spot-priced LNG from the US, i.e. the

equivalent of 95 million Nm3 produced by CHENIERE ENERGY, from its liquefaction terminal in

Louisiana, landed on the shores of Poland at Swinoujscie LNG Terminal. Following this, also Lithuania’s

state gas trader, LIETUVOS DUJU TIEKIMAS received a supply of US LNG at its Terminal in the port of

Klaipeda on 21t August 2017. For decades, the countries in the CEE region have mostly purchased

33

Natural gas from a sole supplier, GAZPROM, which has traditionally asked higher prices compared to

western hub prices, in long term contracts with take-or-pay stipulation. As an immediate consequence,

the Russian producer has already shown more contractual flexibility.

With an increasing lot of new sources available from emerging suppliers, and traditional LNG providers

like Qatar looking to supply new markets, coupled with easily accessible and more affordable “floating

storage and regasification units” (FSRU) infrastructure, LNG is getting ever closer to becoming a global

commodity, that could not only supply Natural gas to countries like Poland, but also to other states in

Central & Eastern Europe (CEE), even those that are landlocked.

Energy savings and the incremental recourse to renewable energy sources will be asked for by the de-

carbonization strategies of the Governments, to curb traditional fossil fuels consumption in future. The

resulting migrating demand for fuels among different countries and areas of the globe is also affecting

the routes and final destination of LNG supply, and the end industrial prices are influenced by this

varying offer/demand in a hardly predictable way.

Just as an example, exports of LNG to Japan from the east coast of Australia crashed to a 17-month

low in September 2017, while volumes to China edged higher to a new record high, on October 6

[Source: Gladstone Ports Corp (GPC)]. Japan received just 60,539 metric tons of LNG in September

2017 from the Port of Gladstone in Queensland; hence down by 82% both year on year and month on

month.

Nowadays the energy companies are investing in the LNG sector, with the construction of Natural gas

liquefaction terminals in the production sites, and LNG reception and re-gasification terminals in the

consumption areas. More plans are in place also for smaller intermediate LNG storages and terminals,

to create a capillary infrastructure, also aimed at the use of LNG in the automotive market, and in the

maritime fuels market.

According to a study done by McKinsey, the global LNG market is long, with supply exceeding demand

and may be long until the middle of the next decade. Yet there is still a long list of liquefaction projects

that are hoping to enter the market in the coming years. The global LNG supply glut that we are facing

today is exacerbated by the 100mtpa of new export terminal capacity currently under construction in

the US and Australia. By 2019, the oversupply peaks at roughly 60mtpa. The forecast deem the market

to remain oversupplied unless today’s low prices can stimulate a demand recovery. However, to date,

the demand response to the low prices seen in the past two years has been limited. Given the market

may remain oversupplied until 2024 and that it takes three to five years from Final Investment Decision

(FID) to construct and start up a liquefaction terminal, one could argue that in theory, no new

liquefaction terminals need to take FID for at least the next two years. In reality, new supply could still

hit the market if it is able to displace more expensive existing supply or stimulate new demand

currently served by piped gas or an alternative fuel. This likely tends to keep supply price of LNG in the

lower range. [Source: Energy Insight by McKinsey].

According to BP Energy Outlook, nearly one third of the present growth in the LNG supply potential

occurs over the first four years of the Outlook, i.e. until 2022, as a series of projects currently under

development are completed. Then, after a temporary lull while this initial wave of LNG supplies is

absorbed, the potential LNG supply growth is assumed to resume at a more moderate pace.

In this case, there is a risk that this second wave of LNG supply growth is slow to materialize causing a

temporary period of tightness within LNG supplies. Asia remains the largest destination for LNG. China,

India and other Asian countries all increase their demand for LNG, helping gas to grow faster than

either oil or coal in each of these economies.

34

SHELL mentions as well forecast for transport as well as new investments needed in 2020 to meet

demand. The global LNG market has continued to defy expectations, growing by 29 million tonnes in

2017, according to SHELL's latest LNG Outlook. Based on current demand projections, also SHELL sees

anyway the potential for a supply shortage developing in the mid-2020s, unless new LNG production

project commitments are made soon. [SHELLL LNG Outlook 2018 - https://www.shell.com/energy-and-

innovation/natural-gas/liquefied-natural-gas-lng/lng-outlook.html ]

Also the Malaysian state energy company PETRONAS expects the global LNG market to remain

oversupplied until as late as 2023. Rising LNG production over the last two years, mainly from Australia

and the United States, has exceeded demand and depressed prices. Asian spot LNG prices LNG-AS are

now down by around 70% from early 2014. PETRONAS, in September 2017 scrapped a proposed $29

billion LNG terminal project in western Canada, as market conditions made the project economically

unviable. The PETRONAS Chief Executive Officer Wan Zulkiflee Wan Ariffin told Reuters in an interview

that things are volatile, but at present the firm predicts LNG market balance in 2023. The market will

tighten when demand centers in developing economies start growing, as current low prices mean

more take up of LNG supplies. PETRONAS is the sole manager of Malaysia’s oil and gas reserves,

making it the world’s third-biggest LNG exporter after Qatar and Australia.

Figure 7-1. Possible additional future LNG plants in the world (Source: McKinsey)

The changing interconnection (correlation) of price between Oil and Natural gas will have an impact as

well. The price of Natural gas is expected to become in the future more independent in its trends from

the price of Crude Oil.

European provisions such as the Directive 2014/94/EU, DAFI, are mandating the construction of an

infrastructure for alternative fuels, including LNG. All this is expected to have a strong stimulation

effect for the LNG automotive market. The cost of the construction of new LNG stations, and the need

for the pay-back of this cost in a reasonable length of time might lead to an increase of the end

industrial price of LNG as automotive fuel. It is also true that this tendency to increasing price may be

mitigated by a positive scale effect, above a certain consumption threshold. Investors look very close

to pay-back time, and a large market may allow acceptable pay-back times even with moderate sales

margins.

35

On the other side of the coin, in the middle-long term, we will likely face a strong increase of LNG fuel

consumption in the maritime sector; this might result in some increase of LNG price at the production

level, as a consequence or reaction to growing demand. That’s what finance is about.

7.3 LNG Fuel Retail Price at the Pump

The European Natural gas industry has been adopting for nearly six decades LNG as one of the forms

of Natural gas supply for general applications, through re-gasification at receiving terminals. The

market of LNG as automotive fuel is younger than that instead. It has been just ground for research

and demonstration and pilot initiatives across the last couple decades, and it was just budding on a

larger scale back in the beginning of this decade, through which European operators have

accumulated some good experience already, even if the European LNG automotive market is not yet

as large as that in other parts of the world, such as China and North America. The market increase has

been interesting anyway also in Europe, as we have now more than 120 public LNG refuelling stations,

plus some private for captive fleets, most of which have been built in the last five years. Undoubtedly,

part of the merit for this goes to the LNG Blue Corridors Project, which pushed the button for example

in Italy, and to some other projects, financed by the EC, which believes in this fuel having a promising

future. But for sure the automotive market is showing an increasing interest for LNG. Some European

countries e.g. Spain, Netherlands, Italy, UK, France, have done already substantial investments in this

sector. In Germany there are now three LNG quite small stations, but there are also short-term plans

for further development, and larger plants. In a recently published study (2017), “Initiative

klimafreundlicher Strassenguterverkehr” the German Ministry of Transport and Digital Infrastructure

BMVI identifies LNG among the applicable solutions for long-distance haulage, especially in the short

term and for the next 10 to 15 years. In general, the LNG fuel prices at pump have kept quite constant

over the start-up period so far in Europe, similar to the case of CNG, which price trends show more

stability over time compared to gasoline, diesel and even LPG.

History of retail fuel prices at the pump in Europe (c.f. below figure with example for Italy) show that

CNG and LNG are significantly cheaper than diesel and gasoline, but also that their price is much more

stable over time, thus making it much easier for fleet operators to predict their fuel costs.

36

Figure 7-2. Example of automotive fuel price trends in Italy, over last ten years, as of end October 2017 - price at the dispenser,

including tax - all prices in €/litre, except CNG: €/m3(the same price of CNG applies to LNG in Italy; both CNG and LNG are sold in

€/kg; price in €/m3 = €/kg x 0.7 kg/m3) [source: elaborations based on data from: https://www.prezzibenzina.it/]

Analysis of LNG and diesel retail prices in Italy in January 2018 (based on LNG price information from

metanauto.com) shows that LNG is 52% cheaper than diesel at the pump (comparing LNG in liters of

diesel equivalent with diesel in liters). Italy is one of the European countries with the most attractive

LNG price vs. diesel at the pump, partially due to high diesel price. As 1 kg of LNG does not contain

the same quantity of energy as 1 liter of diesel, a direct comparison of LNG price in €/kg and diesel in

€/L is not possible. In order to allow for an accurate comparison of fuel prices, the approach taken here

is to compare prices of similar energy content for both fuels, in this case liters of diesel and “liters of

diesel equivalent” for LNG. This is calculated assuming 1 kg of LNG equals 1.38 liter of diesel

equivalent.

In the UK, LNG has been on average over 40% cheaper than diesel every year since 2016, and this price

gap is expected to increase steadily in the coming years to reach 50% price differential already from

September 2018, as shown in the below figure 7-3.

0,5

0,7

0,9

1,1

1,3

1,5

1,7

1,9

may

-07

oct

-07

mar

-08

ago

-08

ene-

09

jun

-09

no

v-0

9

abr-

10

sep

-10

feb

-11

jul-

11

dic

-11

may

-12

oct

-12

mar

-13

ago

-13

ene-

14

jun

-14

no

v-1

4

abr-

15

sep

-15

feb

-16

jul-

16

dic

-16

may

-17

oct

-17

Fuel price trend - Italy

gasoline €/l diesel €/l LPG €/l CNG €/m3

37

Figure 7-3. Example of LNG vs. diesel automotive fuel price trends in the UK, history since 2013, projections until 2021. Source:

Gasrec, April 2018 – fuel price at the dispenser, excl. VAT and other taxes

In the Netherlands, in February 2018 LNG was 38% cheaper than diesel at the pump, comparing as

above LNG in liters of diesel equivalent with diesel in liters (analysis based on data from PitPoint

accessed from https://www.pitpoint.nl/app/uploads/sites/4/2018/04/Prijshistorie_lng_pitpoint.pdf).

This price gap has been similar in 2017, after recovering from significant diesel price drop early 2016.

Figure 7-4. Example of LNG vs. diesel automotive fuel price trends in the Netherlands, history since 2012. Source: PitPoint, April

2018 – fuel price at the dispenser, VAT included, diesel price in €/L, LNG price in €/kg.

The available fuel price examples, summarized in the below table, show that in most of the European

countries that already have a significant number of LNG trucks in operation, LNG is sold at an

attractive price compared with diesel, i.e. approx. 40% cheaper than diesel or more. Given the limited

38

number of LNG trucks and stations in some countries and the lack of publicly available LNG price

information, it is not possible to provide a complete fuel price comparison for all European countries. It

should be noted that, even for the countries show in this table, the information for each country is

partial (based on available data) and does not necessarily reflect the average price of LNG in the

country.

Country Diesel price

in €/L

LNG price

in €/kg

LNG price

in €/LODE

LNG price savings

vs. diesel

Italy 1.44 0.95 0.69 52%

Spain 1.15 0.81 0.59 49%

France 1.39 1.04 0.75 46%

Netherlands 1.25 1.09 0.78 38%

United Kingdom 1.41 1.34 0.97 39%

Table 7-1. Summary of LNG vs. diesel automotive fuel price examples in February 2018. Source: Westport analysis based on LNG

price data from metanauto.com, gibgas.com and other public data sources and diesel price data from

https://ec.europa.eu/energy/en/data-analysis/weekly-oil-bulletin Feb 12, 2018. Fuel price at the dispenser, VAT included, diesel

price in €/L, LNG price in €/kg and €/liter of diesel equivalent (LODE).

Further to this, the national strategies of LNG fuel retail prices at pump have been mainly oriented to

the market development and promotion, and still are today. So the price of LNG tends to be set to a

very similar level to that of CNG, or even the same price is adopted for both, in terms of €/kg. In future

the industrial part of LNG price, when the market will be more mature, might face some slight increase,

if the operators will resolve to change their strategy, and will apply some premium to LNG over CNG,

in consideration of its value and advantage for the long haul transport operators; but this can happen

only in case of higher prices of diesel, in which case the price differential between LNG and diesel

would likely remain at least as high as today. At present in most of the countries the operators still

seem quite cautious on this item, as they perfectly know that the differential in prices between diesel

and LNG directly affects the propensity of HD vehicle fleet owners to go for the new pathway.

The Fig 7-5 shows the evolution of the price at pump of the LNG stations in the project.

39

Figure 7-5 Evolution of the public price of all LNG BC refueling stations [source: D 6.3]

7.4 Taxation - Excise exemption

On the side of taxation, long haul HD vehicle fleet operators are offered in some cases a partial excise

exemption on diesel. In Italy for example, a partial excise rebate of 0.21418 €/litre is available to diesel

truck operators, applicable to the fuel consumption in the summer 2017 [Testo Unico delle Accise -

Art. 4-ter, comma 1, lett. f, of D.L. 22 ottobre 2016, n. 193, converted into Law 1° dicembre 2016, n.

225, and Art. 24-ter, comma 1, of Decreto Legislativo n. 504/95]. In Portugal, the government has

decided to reduce the diesel tax by 10c €, reaching an amount below the limit value of the directive on

the taxation of energy products. The owners of the LNG refuelling stations are free to set the LNG fuel

prices they deem appropriate, as it is the case of any fuel. But they must not forget this partial excise

exemption granted to diesel when setting the LNG price at pump, so to keep the suitable end price

differential between diesel and LNG, if they want to stay in the market.

Further on the side of taxation, some national Governments have so far supported the CNG and LNG

automotive fuel pathway, by means of reduced excise duty e.g. Czech Republic, Finland, France,

Germany, Italy, Sweden (for bio-methane), or even no excise duties e.g. Belgium, Croatia, in

consideration of the offered environmental benefits, and taking into account the increasing share of

Natural gas coming from renewable sources (Biogas and Power to gas, turned into CNG and LNG), in

substitution of fossil. This is an important part of a European shared strategy aimed at supporting the

environment friendly fuels. To make just a couple of examples, Italy has the largest CNG market in

Europe, and also has a strongly growing LNG market. The Italian Government has applied so far a very

low excise duty on Natural gas used as automotive fuel. A new subsidy campaign has been launched in

September 2017 in support of purchase of clean vehicles, including those on LNG. Also Germany has

had a similar supporting strategy for NGV, now ranging up to 2026. Today it seems rather too early, if

40

anything, for the national Governments considering to abandon or mitigate the present strategy of

favorable excise duties for CNG and LNG. And this applies also to the mid-term. It is important that

this is kept for the future, at least until this market can be considered sufficiently mature to stand a bit

more taxation. This applies to all the countries in Europe.

7.5 Bulk supply price

Because of the present overcapacity, global prices for LNG are deemed as just too low right now to

send the price signals needed for investments into more liquefaction, in the opinion of the experts

attending a conference in Japan in late 2017. This means that the industry could see a shortfall in a few

years, according to an article on Reuters. This also means that there may not be enough LNG for some

of the countries depending heavily on LNG as Natural gas import source, such as Japan, which is the

world’s biggest LNG buyer. To avoid a shortfall, some of the market operators, such as TOTAL called

for more investment into LNG in the future, but investments in such projects can run in the billions.

[source: TOTAL SA Chairman and Chief Executive Office Patrick Pouyanne]

LNG projects typically require billions of dollars of investment over many years of development. The

LNG industry has usually relied on long-term contracts linked to Oil prices to ensure producers can get

financing on favorable terms. An increased competition among LNG suppliers has resulted in buyers

seeking better prices. Especially under the “Fukushima effect”, the spot LNG prices in Asia were at

more than $20 per million British thermal units (mmBtu) in 2014 (~0.956 $/kg, based on a LNG LHV of

49.5 MJ/kg), but with the more recent surplus they are now trading in 2017 at less than $6 per mmBtu

(~0.287 $/kg). According to some experts, a sweet spot in pricing of between $7 and $8 (0.335-0.382

$/kg), would stimulate investment into new projects.

7.6 Breakeven prices and new production

The Asian LNG markets will be paramount for East African LNG export. Similar to the oil market, the

North American shale industry did turn the gas markets upside down in 2015. The rapid increased

production sourced from shale gas reservoirs made US self-supplied and left the country with a

significant export potential. The price of Henry Hub plummeted, and the same effect spilled over to

the (Asian) LNG markets. The new LNG price became suddenly dependent on the Henry Hub pricing,

as US commenced to export most of its excess production as LNG to other continents. LNG is now

priced as Henry Hub + liquefaction- and transport costs. The large numbers of sanctioned LNG

projects in Australia and US before the price crash has left the world currently swamped in LNG.

RYSTAD ENERGY has estimated that the LNG market will remain over supplied to 2023, with a peak in

2020, where the supply capacity excess the demand by almost 70 bcm/y. However, they predict LNG

demand to continue its strong growth as gas is becoming a more and more important primary energy

resource in Asia and the Middle East. By the end of the 20’ies, it will be a deficit of more than 200

bcm/y, if no new LNG projects are sanctioned for development. It is likely that by 2023 the world will

face a deficit on LNG, due to lack of LNG project sanctioning the last couple of years. The year 2023

coincides with prediction of the first LNG to be exported from East Africa. East Africa can/will be

instrumental in filling the deficit supply gap in the second half of the next decade. If no projects are

sanctioned for development the coming years, the LNG deficit by 2030 will surge to more than 200

bcm/y. East African LNG will of course face strong competition from other producers, especially Qatar,

Australia and Papua New Guinea, in the race for the rising demand in South-East Asia and the Middle

41

East. East Africa benefits from its reasonable vicinity to India and Pakistan compared to Australia. The

majority of the growing gas production in the Middle East will be needed for domestic purposes to

cover an increased gas consumption. Hence, the production increase in Qatar and Iran will not find its

way to Asia. It is predicted that the production deficit gap in 2025 will be about 50 MTPA (70 bcm/y),

which soon need to be covered. By assessing breakeven prices for potential future LNG projects it is

possible to predict which projects will most likely be developed, and to which breakeven cost. An LNG

price at 7-8 $/MMbtu (0.335-0.382 $/kg) is needed in order to develop another 50 MTPA by 2025. Fig

7- 7 ranks potential future LNG-projects to come on stream by 2025 by breakeven price. Projects to

the left have the lowest breakeven costs. The development of Area 1 offshore Mozambique (in red

circle) has the 3rd

lowest breakeven price (6.2 $/MMbtu, i.e. ~0.297 $/kg) among the most profitable

projects believed to come on stream by the mid of next decade. [Source: Henrik Poulsen Senior Vice

President - Government Relations at RYSTAD ENERGY]

Figure 7-6. Expected trend in LNG supply/demand (Source: RYSTAD ENERGY)

42

Figure 7-7. Breakeven prices for new LNG production (Source: RYSTAD ENERGY)

7.7 Asia’s effect

In October 2017, the emergence of LNG hubs in Asia could be expected to be a game-changer for the

region’s future energy mix, global energy security, infrastructure investment as well as the

environment. The expanding LNG hub-based pricing could stimulate regional gas demand from

emerging importers, and encourage policies to progress coal substitution for NG in large, heavily-

polluted Asian cities. The Indian government announced launching a NG trading platform in 2018.

Japan and India cooperate to promote a flexible and open LNG market. But Asian global gas players

must press ahead with regional hubs rather than getting distracted by short-term market opportunities

that slow them down. The 2014-2017 low oil price and the return of competitive oil-indexed LNG

prices in Asia have removed the urgency for buyers to diversify away from oil-indexed pricing and

bring hub-based formulas to the region.

As Brent crude prices have plummeted since mid-2014, oil-indexed NG prices have dropped ~40%. As

a result, Asian buyers have entered into competitive LNG contracts that are indexed to oil – adhering

to traditional price formulas. More than 11 million tons (~20 billion Sm3) of NG in new oil-indexed

contracts have been signed in 2017.

LNG stakeholders, governments, industry, and lenders, should not limit to short-term considerations.

Oil prices are likely to spike again in future. They are advised on focusing on regional hubs to help

importers get more competitive and transparent pricing systems. That would also enable exporters to

trade more easily in the global market with new and smaller buyers. It also facilitates selling their

surplus and uncommitted spot volumes at a time of supply glut. The emergence of LNG hubs in Asia

43

has become credible with the ongoing transformation of the global LNG market that started in 2014.

The rapid growth in LNG supplies, rising volumes of flexible spot supplies, and the increase in the

number of market players have led to more serious steps to create one or several regional hubs. Asian

LNG hub initiatives would differ from existing hubs in the US or Europe by generating liquidity through

increased LNG flows within the region, rather than through NG pipeline integration or domestic

production. Some NG hub initiatives in Asia are underway in different progress e.g. in Singapore,

Shanghai, Tokyo. An Asian market-based reference price would put the industry in a better position to

confidently trade LNG or invest in new LNG infrastructure projects. This new hub-based Asian LNG

price benchmark could make LNG prices competitive and transparent. The main benefits of this

approach are:

energy security, as a trusted hub contributes to a more liquid and better functioning market;

genuine Asian LNG price marker that helps resolve the current investment paralysis, paving the

way for decisions to build new liquefaction plants which could transform LNG project finance;

more affordable and accessible LNG that strengthens the environmental prerogative to favor

cleaner gas over coal and fuel oil in the power sector and polluted cities.

If Asia’s LNG hub initiatives fail, the current status quo for Asian LNG pricing will continue, at the risk of

darkening LNG’s future as the appropriate fuel in Asia at a time of energy transition, demand

uncertainty, and environmental degradation. With Asia serving as the engine for global LNG demand

growth, the resolution of the Asian LNG pricing issue would transform not only Asia, but also the

outlook for global LNG markets.

44

8 Identification of efficient LNG European network

and potential cost

8.1 Network

The Directive 2014/94/EU, DAFI, mandates the build-up of sufficient infrastructure, but is not

mandating any particular pattern for the refuelling stations network. It gives anyway an indication of

suitable maximum distances between filling points, as 150 km for CNG stations and 400 km for LNG

stations in 2025. At first this was proposed as a mandatory prescription; then some constraint on this

parameter were realized, and the prescription become just suggestion. European countries have

different characteristics in terms of land, woods, mountains and lakes. There are large portions of un-

inhabited land in some of the countries, especially in northern ones. There are regions full with a large

number of lakes, like Finland, and large forests, like Germany. Europe has a complex system of high

mountains ranges, e.g. the Alps, Apennines, Ardennes, Balkans, Carpathians, Pyrenees, etc. All these

characteristics are bound to make a mandatory maximum distance between stations not advisable in

many cases. Instead in the more industrial areas with dense population rates, the distances between

stations can and should be shorter than the limits the Directive suggests. In early 2015 one of the LNG

stations in northern Europe caught fire. Due to this, it had to be shut down for a period of time for

repair, during which the truck drivers passing by in that area had to face a long diversion from their

itinerary, of more than 200 km for the whole trip back and forth. This can happen also in case of less

dramatic instances, such as components break-down, extraordinary maintenance interventions, strikes,

vandalism acts, etc. And this can eliminate all the economic advantage offered by the price differential

between diesel and LNG. Unexpected and unpredictable situations such as this one must be taken in

account; truck drivers must be offered alternative options for refuelling, just in case. The LNG truck

driver should plan more carefully his trip beforehand, compared to the case of diesel trucks, taking

into account the development rate of the LNG network. Anyway all the main roads, be them

motorways or highways, must offer the LNG truck drivers the possibility to refuel with limited diversion

length, which means waste of money and time. A well set network, with a multiple option offer, also

goes in the direction of a suitable level of commercial competition between operators, leading to fair

prices, at least as theoretical tendency.

8.2 Size

Due to the current low consumption of some of the stations in Europe, partial charges must be

planned for the stationary tanks of the LNG stations. This of course increases the OPEX cost. But this

will stop being an issue as soon as the market grows and settles to higher levels, which appears now

quite likely to happen in the short-term. Based on the current LNG tank capacities, it seems they can

perfectly refuel trucks on daily basis with no risk of fuel depletion. The capacity tank is high in most of

cases of the stations at present in operation (>60m3). In some cases, stations must be charged with

fuel every 2 days like in the case of Piacenza, but in other cases, almost 3 weeks like in the case of

Barcelona.

45

8.3 Location

The installation of a LNG refuelling plant inside existing diesel and gasoline station seems the solution

to be preferred, as it will take profit of already existing land, structures, safety system, building and

personnel. The existing liquid fuels station must be chosen in consideration of parameters such as:

Distance from the nearest LNG supply site (LNG terminal; small scale local terminal; small scale

local LNG storage tank); a number of plans are in place for small scale LNG; with the exception

for the mono-fuel LNG stations built inside or close to the LNG terminals, or inside some of

the small scale plants, the supply of LNG to the station must involve the LNG tanker truck or

the LNG train. The trip of the LNG tanker truck supplying the fuel to station should not be too

long; distances in the order of 300-500 km are acceptable anyway. For trains this distance can

be longer. In the case of LNG stations built inside the logistic hubs, the best option for LNG

supply seems to be by rail; rail carts can transport more product per trip compared to tanker

truck; trains are not prone to traffic conditions, and less prone to weather conditions; the

specific transport cost is probably lower also (train fuel cost is shared with the rest of train

load; no hotel and meals cost of drivers; salary cost of train drivers is shared with the rest of

train load; if the train only transports LNG, the very large amount of product reduces the

specific cost).

Importance of the road system in the proximity of the station; motorways and highways

should be the preference, but sometimes the bureaucratic process and contractual aspects in

the case of motorways might be an obstacle to this operation. For example, a limited time

concession reduces the pay-back expectations, hence the investing propensity. Logistic hubs

seem to be a preferable option when available, also due to scale effect and possible synergies.

Available space inside the station for the additional devices to be installed; national LNG

station norms are different in Europe between countries on this item; sometimes there is still

no norm for LNG, in which case generally a suitable professional risk analysis is part of the

design process; the adoption and publication of EN ISO 16924 LNG refuelling stations, may

simplify this aspect. The norm was positive under ballot. The publication was done in early

2018.

Available space inside and around the station to meet the requirements of internal and

external safety distances (same as above point).

8.4 Connector harmonisation

Three connector profiles are at present on the market:

JC CARTER

PARKER KODJAK

MACROTECH

46

Figure 8-1. Nozzles compatibility

They are not fully interchangeable in terms of compatibility with the respective receptacles, one to

another; in particular PARKER KODJAK cannot connect to the receptacles that are suitable to the other

two connectors. But the situation is becoming increasingly complex now. At present the

connectors/receptacle system is, or should be in compliance to the international standard ISO 12617.

ISO is now working on another connector profile standard, the ISO NP 21104, aimed at better

performance in terms of:

Lower service pressure; 18 bar instead of 31.

Extremely low spillage of LNG at decoupling: < 1cc, to minimize GHG emissions, and avoid risk

of cold burn.

The activity is also aimed at some additional improvements, which in the opinion of most experts of

this sector, can anyway be reached already with the present profile (ISO 12617):

Easy and simple handling (“Diesel-like”); possibility of one-hand operation.

A single line for the delivery and for venting, including grounding; i.e. combining filling and

gas return over the same hose, thus improving user friendliness and reducing the amount of

potential leak sources.

No need for special protection to be worn during filling (i.e. special clothes, gloves, face shield

mask etc.).

Proper swivel functionality as part of the nozzle to prevent hose failure due to torque forces.

Mechanical interlock functionality; mechanically secured.

This standard might be published in 2019 or 2020.

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9 Vehicles

9.1 General

In the Project 100 LNG HD vehicles were planned. At mid-2015 this level was already reached. At end-

2015 the monitored trucks, representing the Euro V and Euro VI technologies, of the LNG Blue

Corridors had successfully covered more than 4 million kilometres using only (Spark-Ignited) or

partially LNG (Dual-Fuels) and had consumed more than 1,200 Tons of LNG. The Project had a total of

115 trucks monitored during the Q3-2015, with budget still to be allocated for other companies. So

the goal to reach more than 120 trucks as was expected was reached.

During the period 2014 to 2015 an important technical achievement of the LNG sector was the

certification of an IVECO LNG truck to EURO VI. IVECO Stralis Euro VI became available in the third

quarter of 2014 at commercial level, while the fully compliant R110 LNG tanks were approved in July

2014 and available from February 2015.

At end-2015 the Project the demonstration in different corridors was at this stage:

AtlBlue: Portugal, France and even Spain

MedBlue: Mainly routes from Spain to Italy, operation in the North of Italy

SoNor: Combination of AtlBlue and MedBlue routes

WEBlue: Belgium, The Netherlands and even Germany

Also at end-2015 the balance of Dual-fuel and Spark-Ignited trucks was about 30% Dual-fuel and 70%

spark-ignited trucks. Among these trucks, about 33% of them (36) were Euro V and 66% were Euro VI.

During Proyect deployment, about 30 additional LNG Euro VI trucks progressively joined in, which

perfectly meet the request of the EU Commission regarding the number of LNG trucks. In the end the

Project had the participation of more than 140 trucks, thus exceeding by 40% the original plans.

Figure 9-1. Project truck distribution at mid-2017 (78% IVECO; 22% VOLVO)

48

By early May 2018, the truck fleet had run a total of 31,639,938 Kilometres, and had consumed a total

of 14,206 tons LNG, with 111,000 refuelling, and an average refuelling rate of about 128 kg LNG per

fueling operation.

One of the initial aims of the Project was to know how dual-fuel engines were going to be able to

achieve compliance with the Euro VI emission limits and to understand the new efficiencies, which

should be closer to Diesels. New Emissions UNECE Regulation 49-06 and EC 595/2009 (Euro VI,

amended in 2014 with the Dual-Fuel requirements), regulate the emissions of the engines (CO, THC,

NHMC, CH4, NO2, PM, PNP, NH3) and the THC limits are especially difficult to fulfil for Natural gas

engines (lean burn or dual-fuel) because of the very low new limit for Hydrocarbons. Dual-fuel engines

were at the beginning of Project the only ones which provided more than 340 HP (IVECO Stralis

dedicated engine delivered at that time 330 HP). Companies like IDIADA have developed engines,

demonstrators mainly, which deliver up to 560 HP with replacement of Diesel higher than 70% in some

conditions and better than Euro V (EEV emission levels), making them the choice preferred then by

fleet operators which were new to using LNG or for those who needed to ensure the operation of the

truck at any time and did not have guaranteed gas deliveries. Also these engines units were preferred

by those companies who had to transport goods on routes where a power of 340 HP is not considered

enough because of the profile of the route (as for example MONFORT or MATTHEEUWS). In the

majority of the cases of fleet operators, the standard configurations for the trucks are, regarding the

engine, 450 HP or more. The fuel savings and vehicle reliability are, for the fleet operators, the main

concern. Aspects like the fuel consumption efficiency of Euro VI Natural gas engines when compared

to the diesel units is of high interest and therefore the fuel consumption of the bigger NG engines is

crucial for the transport sector LNG adoption. The CO2 reduction is also critical, and the reduction

achieved when compared to Euro VI diesels or Euro V diesels/gas engines is one of the most

interesting topics to be explored. Savings between 6% and 10% are well within reach normally.

9.2 Vehicle models

All Euro VI truck models from OEMs were supposed to be in the market in early 2014. But until late

2016, because of different reasons, there were only Euro VI trucks provided by IVECO. These launching

trucks delays make the construction of most stations start with delays as well. Some stations started to

be built late because approval issues. A budget was available in the Project for the theoretical VOLVO

Euro VI trucks which was not finally used. The LNG market in Europe did tend to be affected by a

certain lack of truck models; VOLVO offered at the beginning a dual-fuel model, followed by a more

sophisticated and powerful one. This came on the market too late for joining effectively the Project.

HARDSTAFF dealt with dual-fuel vehicles. It went into administration at the beginning of 2015 and a

new company, Vayon Group, took over their dual-fuel technology. As consequence, HARDSTAFF left

the Project. RENAULT TRUCKS did also withdraw from the project. The company tried to be involved

with a spark ignited truck based on its current commercial product D-WIDE CNG, however finally the

management decided for internal reasons they could not participate in the LNG Blue Corridors project,

so RENAULT left the Project in 2015, because of lack of commitment in development of prototypes.

IVECO has been since the beginning very committed to the LNG market and to the Project. The first

generation IVECO LNG Stralis has a Chart LNG tank, 26”diameter x 90” wide, with a net capacity of 511

litres, as well as 4 CNG tanks of 70 litres capacity each. The CNG tanks are used to ensure system

sealing and to ensure the vehicles can be moved if they are stopped for a long period of time. The

working pressure of the LNG tank is set to 8.5 bar, which means an LNG density of about 0.395 kg/litre.

Therefore a total of 201 kg of LNG and 45 kg of CNG is available. In 2016 IVECO introduced to the

market a new model Stralis NP NP AS440S40T/P, propelled by the Cursor 9 engine, with increased

49

power delivery to 400 hp, 1,700 Nm torque and increased running range to 1,500 km, with the twin

LNG tanks. IVECO sold 400 LNG trucks already at end 2015. By mid-2017 up to 1,300 LNG Stralis NP

400 trucks were sold in Europe which shows a real market interest for this side of the NGV sector. It is

the first NG truck specifically designed for long-haul operations and the only truck running on CNG

and LNG to deliver the power rating, comfort, transmission technology and fuel autonomy to suit long

haulage missions. With more than 22,000 units sold, IVECO claims position as the absolute market and

technology leader in Natural gas commercial vehicles. IVECO has at present 90% of the LNG market in

Europe.

In October 2017 IVECO has secured the largest deal for Stralis NP vehicles to-date, with 500 new trucks

set to enter operation with the pan-European transport and logistics specialist, the Belgian Jost Group.

The first 150 vehicles will enter operation during 2018, with the full fleet to be in service by 2020. The

500 Stralis NP trucks will replace 4 to 5 years old diesel-powered vehicles in the firm’s fleet of 1,400

trucks and 3,000 trailers. The company already operates 132 Stralis vehicles, including two running on

CNG. The Company begins a strategic move away from its dependence on diesel and towards green

logistics, as requested by its customers, who are demanding a more sustainable transport. The plan of

the Company for the next three years is to have 35% of its fleet running on LNG. The group is also

supporting this with an investment in its own LNG refuelling infrastructure, with plans to open up to

three filling stations within its major operating centers in Belgium.

In late October 2017 IVECO has presented to the public its new Stralis NP 460 at its heavy trucks center

of excellence in Ulm, Germany. Classed as the most sustainable truck ever, the Stralis NP 460 achieves

close to zero emissions on bio-LNG, cutting CO2 emissions by up to 95% when running on compressed

or liquefied biomethane. The Stralis NP 460 is fitted with the most powerful Natural gas engine on the

market, the IVECO Cursor 13 NP engineered by CNH Industrial’s powertrain brand FPT Industrial. It has

got the latest-generation automated transmission. The Cursor 13 NG engine delivers power up to 460

HP at 1,900 rpm and torque up to 2,000 Nm at 1,100 rpm. The Stralis NP 460 delivers a 99% reduction

in particulate matter, a 60% reduction of NOx in comparison with Euro VI limits; noise emission level is

less than 71 decibels. The truck’s double LNG tank version ensures a range of up to 1,600 kilometers. It

offers up to 15% less fuel consumption and up to 9% lower Total Cost of Ownership than a diesel

truck. [Source: NGV Journal – October 31]

Figure 9-2. IVECO LNG truck

In August 2017 the first LNG filling was done from Rolande at Gate terminal to a LNG truck with LNG

as engine fuel. This was the first case ever of a LNG tanker truck fueled with LNG, i.e. the same fuel that

the vehicle transports. So far, generally the LNG tanker trucks have been running on diesel. Also,

50

subsequently, during the Oil&Nonoil fair in Rome on 11th and 12th October 2017, a new IVECO LNG

Stralis Natural Power 400 CV LNG tanker truck was in exhibition, and this was the second case. This is

also a new step forward, allowed by the recent amendment of the ADR directive on the transport of

dangerous goods, in force since January 2017. The second initiative in Italy is the merit of the

Company TRANSADRIATICO, from Grottammare (San Benedetto del Tronto), which is active since 1951

in transport and logistic of liquid fuels. The Iveco truck set has been arranged by OMPS Macola, which

is also working on a second vehicle with the same features. The LNG transport service that this

Company plans to offer, starting from the main LNG terminals in Europe, will take profit of an

electronic satellite data communication system. The customer will hence be able to remote monitoring

the state of transport, product conditions and all the operations done by the truck driver, besides all

normal information provided by the traditional vehicular GPS sets.

The first SCANIA LNG truck was the P 280 model, launched on market in 2015, powered by a SCANIA

Euro VI engine.

Figure 9-3. SCANIA LNG truck

More than 100 SCANIA LNG trucks are to be used in northern Germany in late 2017, in an initiative to

make the transport activities of the Volkswagen Group more environmentally compatible. The VW

project is supported by the German Government, associations and gas suppliers. SCANIA maintains

that its trucks, with an LNG powertrain emit up to 20% less CO2 than comparable diesel engines. The

use of regional and local biogas even reduces CO2 emissions by as much as 90%. In addition to the

improvement in the carbon dioxide balance, these powertrains emit some 95% less nitrogen oxides

(NOx). Particulate matter emissions are almost completely avoided (-95%). Compared with diesel

engine trucks, the noise levels produced by combustion are reduced by about 50% (-3 db). The

commitment to the use of LNG trucks is part of the Green Logistics initiative of Volkswagen Group

Logistics. This is based on the “TOGETHER 2025“ Strategy under which the Volkswagen Group has

committed itself to responsible management of the environment and the continuous reduction of

emissions. The objective of the Green Logistics initiative is to ensure sustainable logistics within the

Volkswagen Group. During AUTOPROMOTEC in Bologna on 22-26 May 2017, SCANIA has presented

its new LNG truck model put on the market, the G340 LA4x2MNA. It has two LNG tanks, with a total

fuel capacity of 300 kg (190 kg in the main tank on the left of truck, plus another 110 kg in the

optional one on the right side), LNG is stored on-board at a temperature of -130°C and pressure of 10

bar. It has a running range of 1,100 km, with an average specific consumption of about 28 kg/100 km.

This innovative SCANIA LNG truck is propelled by the 9.3 litres 5 cylinders Natural gas engine OC09

102 Euro VI. In November 2017 SCANIA launched a new, more powerful NG engine Euro VI. So now

SCANIA is hence offering on the market LNG trucks with three engine options:

9.3 litres, 5 cylinders - power: 280 HP at 1,900 rpm – torque: 1,350 Nm at 1,000 – 1,400 rpm

51

9.3 litres, 5 cylinders - power: 340 HP at 1,900 rpm – torque: 1,600 Nm at 1,050 – 1,400 rpm

13 litres, 6 cylinders - power: 410 HP – torque: 2,000 Nm at 1,100 – 1,400 rpm

Characteristics: Otto Cycle SI, stoichiometric combustion, turbocharged with Wastegate, Scania EGR (5-

20%), multipoint injection, 3 way cat.

In fact, most OEMs, such as VOLVO, had in the beginning no commercial versions for Euro VI LNG

trucks was seen as a barrier since many fleet operators seemed to prefer this OEM, and no commercial

versions were expected from VOLVO before 2018. Therefore the project has only the IVECO solution

for Euro VI, as the VOLVO LNG trucks in the Project are only Euro V, dual-fuel. In a press release in late

2017, released by Lars Mårtensson, Director Environment and Innovation at VOLVO Trucks, VOLVO

maintains that by replacing diesel with LNG or biogas, CO₂ emissions from heavy trucks can be

drastically reduced. LNG is today used primarily in industrial operations, but it has excellent

prerequisites for being a competitive vehicle fuel with considerable environmental benefits. This is the

opinion of VOLVO Trucks, which is now intensifying its development of natural gas-powered trucks for

heavy regional and long-haul operations. Reducing climate-impacting emissions from heavy

commercial fleets is a challenge that engages politicians, transport purchasers, haulage companies and

vehicle manufacturers. Many of VOLVO customers and their customers already work hard to reduce

their environmental footprint. Regulations will drive the development of lower emissions, where the

firm see a clear possibility for increasing LNG market shares as a vital part of the solution. The vision is

that trucks from VOLVO will eventually have zero emissions, although the way of achieving that is not

by one single solution but rather through several solutions in parallel. Natural gas is mainly a fossil

fuel, but it can produce 20% lower CO2 emissions than diesel. If biogas is used instead, the climate

impact can be cut by up to 100 per cent. Biogas is thus far only produced in limited quantities, but has

a good potential already in the mid-term. The long-term availability of Natural gas is excellent in a

global perspective. VOLVO shares the opinion that this is an important condition for large-scale

expansion, as is a competitive price. In many European countries, natural gas costs less than diesel. A

strategy for expanding LNG infrastructure is also included in the European Commission’s and member

states’ action packages for securing Europe’s long-term energy supply. VOLVO believes that this

makes LNG the best widely available climate alternative on the market for long and heavy transports.

What is needed now is gas-powered trucks that can compete with diesel in terms of performance and

fuel consumption, and continued expansion of LNG infrastructure. In both cases major progress has

been achieved. [Source: Lars Mårtensson VOLVO Trucks].

At last, during the 14th

edition of the Solutrans, held on 21st to 25

th November 2017 at the Paris

Eurexpo, with the theme: “Performance au service de demain”, VOLVO Trucks France put in exhibition

for the first time its last innovation product: the FH LNG, which will be on market in spring 2018. This

innovative technology represents a considerable step in terms of fuel cost, productivity and emissions.

VOLVO Trucks is now introducing Euro 6-compliant HD trucks running on LNG or biogas. The new

trucks have the same performance, drivability and fuel consumption as VOLVO’s diesel-powered

models. Furthermore, the new trucks’ CO₂ emissions are 20–100 per cent lower compared with diesel,

depending on choice of fuel. The new VOLVO FH LNG and VOLVO FM LNG are available with 420 or

460 HP for heavy regional and long-haul operations. Instead of an Otto cycle engine, which is the

conventional solution for gas-powered vehicles, the VOLVO FH LNG and VOLVO FM LNG are powered

by the G 13 C engines utilizing Diesel cycle technology. VOLVO’s 460 HP gas engine delivers maximum

torque of 2,300 Nm while the 420 HP version produces 2,100 Nm. This is the same as VOLVO’s

corresponding diesel engines. What is more, fuel consumption is on a par with VOLVO’s diesel

engines, but 15 to 25% lower than for conventional gas engines. In order to maximize the driving

range, LNG is stored in the tanks at 4-10 bar pressure at a temperature of -140 to -125 °C. The biggest

52

fuel tank variant contains enough LNG for a range of up to 1,000 km. When driving, the fuel is warmed

up, pressurized and converted into a gas before it is injected into the engine. In order to ignite the gas,

a tiny quantity of diesel is added at the moment of injection. A 100% reduction of CO2 emissions

requires that fossil diesel is replaced with HVO (Hydrogenated Vegetable Oils) and combined with bio-

LNG. VOLVO Trucks is now working together with gas suppliers and customers to develop the

expansion of LNG infrastructure in Europe. This development is also being supported politically in

many countries and by the EU.

Figure 9-4. VOLVO LNG truck

VOLVO new NG and biogas trucks received Italy’s Sustainable Truck of the Year 2018 award. It was

handed over at a ceremony in connection with the Ecomondo exhibition in Rimini on 7th

November

2017. Behind the Sustainable Truck of the Year award is Vado e Torno, one of the truck magazines in

Italy, in cooperation with Italian university Politecnico di Milano. [Sources: NGV Journal – VOLVO]

9.3 Trains

Railway trains are out of the scope of the LNG Blue Corridors Project, apart from being a possible and

interesting way to supply LNG to inland applications. This document is anyway focused on the market

development of automotive LNG. This form of transport may have a not negligible impact on, and

synergy with the market of LNG; so some attention also to trains is devoted in this document. The

railroad sector is potentially of some interest for LNG, as there still is a part of the railroad system

which is not electrified, and is today the realm of diesel engines. The LNG application as fuel for train is

just budding. Some few initiatives have been launched in the recent years in North America and in

Europe.

In 2017, BRYANSK MACHINE BUILDING PLANT, part of the TRANSMASHHOLDING group, delivered the

LNG-powered TEM19 locomotive to Russian Railways. The construction of the locomotive is part of the

Russian Railways’ effort to replace diesel fuel with Natural gas. The total investment program provides

for the purchase of 484 locomotives at a cost of 60.2 billion roubles. According to the company, the

world’s first locomotive to be powered by LNG was delivered to the Yegorshino locomotive depot at

Sverdlovsk Railways. The development of the six-axle TEM19 shunting locomotive with a gas-piston

engine began in 2012. The gas engine is manufactured by MAMINYKH VOLGODIESELMASH in

Balakovo. TEM19 consists of the driver’s cab, a cryogenic unit with a system of gas preparation and

LNG feeding, a motor-generator set, a cooling system, an equipment chamber, an electrodynamic

53

brake equipment module, and a compressor unit. LNG is stored in a removable cryogenic tank based

on a 20-foot container.

In July 2017, GAZPROM GAZOMOTORNOYE TOPLIVO has started fuelling Russian railroads with LNG,

in the station of Egorshino, in Sverdlovsk region. At present three engines are running on LNG, in the

section Egorshino-Serov-Sortirovochny of the railroad line of Sverdlovsk. One is a dual-fuel diesel

engine switcher; the other two are dedicated main-line gas turbine locomotives. The rail station in

Egorshino also has now an LNG stationary tank, which is supplied through tanker trucks by GAZPROM

GAZOMOTORNOYE TOPLIVO, under a contract signed with Russian railroads which amounts to a total

supply of 600 tons LNG. The plan is to install fueling depots along the non-electrified railroad sections.

In April 2017, VTG Aktiengesellschaft, European wagon hire and rail logistics company, loaded an LNG

tank car with cryogenic LNG at Brunsbuttel Ports’ Elbe port for the first time, in cooperation with

CHART FEROX A.S. and PRIMAGAS. The companies also built the tank car’s tank. More than 80 m3 of

LNG was pumped into the wagons from two PRIMAGAS LNG trucks. This is yet another milestone in

the development of LNG transportation via rail. With a volume of about 111 m3, the LNG tank car can

carry approximately 95-100 m3 of product. This corresponds to an energy value of about 600,000 kWh

per wagon. Even industries with a very large energy requirement can be supplied permanently with

LNG in this way. In cooperation with Brunsbüttel Ports as an LNG terminal location, using the LNG tank

cars to supply the Baltic Sea ports is deemed to be a conceivable idea.

In late 2017 the Members of the Baltic Sea Region LNG cluster, representing Lithuanian business

organizations, and two science institutions signed LNG hybrid rail locomotive production agreement in

Vilnius Locomotive Repair Depot. First stage of prototype design and development will take about six

months. The locomotive, expected to be operational by 2020, will be used to maneuver in the territory

of Klaipėda Seaport. Gradually the trajectory will be expanded. The project has combined the

engineering and technological resources of the LNG cluster members and partners including AB

Lietuvos geležinkeliai (Lithuanian Railways), Klaipėda Stevedoring Company BEGA, AB Klaipėdos nafta,

Vilnius Gediminas Technical University and Klaipėda University. Development of innovative technology

will provide great benefits for the logistics industry and should give significant impact in reducing

pollution. It is estimated that LNG-powered locomotive fuel consumption will be up to 40% lower,

while carbon dioxide emissions will be reduced by 25%. Project partners are the first in the whole Baltic

Sea region to focus on the possibility of using cleaner railways.

RENFE, GAS NATURAL FENOSA AND ENAGÁS, in collaboration with Institut Cerdà, ARMF (Association

for the Reconstruction of Railway Material) and Bureau Veritas, are also preparing a pilot test for

locomotives powered by LNG in Europe; it is the first in the world for passenger rail transport. The aim

is to verify the feasibility of a solution with potential environmental and economic advantages for

traffic currently running on diesel power. This innovation project will assess the feasibility of adapting

locomotives to run with LNG engines and tanks, and the relevant technical, legal, economic and

environmental analysis for the Spanish and European rail network. The project is coordinated by

Institut Cerdà and also involves ARMF as rail integrator, and Bureau Veritas as the specialist inspection

and certification company. It is part of the Strategy for the promotion of Alternative Fuel Vehicles (AFV)

in Spain 2014-2020, in line with the purpose and scope of Directive 2014/94/EU on the deployment of

alternative fuels infrastructure in Europe. The agreement involves a pilot test being carried out with an

LNG-powered engine on a locomotive from the Feve diesel train depot along a 20 km section between

Trubia and Baiña stations, extending to Figaredo, in Asturias. For this purpose, the diesel engine on

one of the two paired locomotive units will be replaced with one powered by Natural gas, and tanks

for storing LNG will be fitted, alongside other necessary auxiliary equipment. The test will allow the

results obtained for both diesel and gas technology to be compared, given that a locomotive running

on each type of fuel will be used on the same train. This track test will be used to draw conclusions on

54

technical requirements for space, weight, refrigeration, and autonomy for running on NG, as well as

other considerations and comparative variables in emissions and operating economy. Spain has had

wide experience in LNG management, and its logistics system is being considered under the

frameworks of action developed by the Ministries of Industry and Development under European

directives, factors that may guarantee the security of supply for this potential market. RENFE, GAS

NATURAL FENOSA AND ENAGÁS are also assessing the possibility of presenting a second phase in this

project for the CEF European funding, intended to support the financing and subsidising of innovation

projects for the environmental improvement of transport systems along the core European rail

network corridors.

9.4 Social cost benefit

Another deliverable for this Project has shown that the aspect of social cost benefit is rather complex.

The LNG trucks have shown a certain tendency so far to have higher social cost, as they have lower

environmental cost, but higher purchase price, a social cost of reduced government revenue, and

higher fuel cost before taxes in some cases (This is anyway to be updated to the actual situation). In

general, the sale prices of HD LNG trucks in Europe still tend to be too high compared to the

expectations of the NGV sector, which is not in favor of the development of the market. By end of

Project, 25% of the fleet in the Project is made of EURO V trucks; the rest is EURO VI trucks.

55

10 Market barriers/improvers Many aspects, technological and economical have an impact, negative or positive on the development

of the use of LNG as automotive fuel. Below are shown and commented some among the main

aspects that are hampering or vice-versa stimulating the growth at European level of the LNG sector.

10.1 Power delivery

The maximum available power and torque delivery of LNG engines used to be one of the main issues

in the beginning. During Project more powerful LNG trucks entered, and are still entering the market

now, built by some of the OEM, with a power delivery up to 460 HP, hence the same as diesel versions,

also in the case of maximum torque, thus providing an increasingly effective solution to this.

10.2 Running range

More or less the same considerations apply as those of the power delivery. Last generation LNG trucks

tend to increasingly adopt larger or twin LNG on-board tanks, thus providing almost the same driving

range as the diesel version, in the order of 1,100 up to 1,600 km. This is a real breack-through.

10.3 Fuel price advantage

Diesel price for HD goods delivery vehicles is granted some excise reduction in some countries. This

reduces the price advantage versus LNG, which is mostly hinging on excise differential. This point is

discussed further elsewhere in this document.

10.4 Purchase price of LNG trucks

Even if the global fleet of LNG HD vehicles is growing constantly, there is not yet a scale effect suitable

to reducing the purchase price differential between diesel and LNG trucks. A price premium of 35-40%

is still to be expected for LNG trucks compared to their diesel counterparts.

10.5 Boil Off

Usually in the start-up period of a LNG refuelling station located in a virgin area, there is an initial low

sale rate, which may be the cause of some boil-off gas (BOG). This does require special care and

generates extra OPEX in order to prevent venting to atmosphere. As the local market increases, with

more LNG trucks joining in, this problem dissolves. Until a regime situation is reached, refilling of the

stationary LNG storage tank needs careful planning. LNG station manufacturers claim today that they

are anyway able to design plants adopting zero-venting solutions.

10.6 Traffic limitations

In general, no traffic limitations apply to LNG trucks, apart from the normal limitations in place for HD

vehicles, deriving from their size and weight. Some limitations are in place instead in the case of

tunnels. Traffic through tunnels of LNG vehicles (whether or not ADR) depends on national regulations.

In some cases, an inspection could be done to provide LNG vehicles that cross the tunnel regularly

with a special badge (Mont Blanc case). Running along The Eurotunnel connecting France and UK is

forbidden to all NGV (CNG and LNG); maybe this will be the case also in future. Boarding of ferries and

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ships is generally not forbidden instead for NGV, provided the ship has the necessary safety devices

and is designed taking gas vehicles in consideration, which is normally the case. Other Deliverables of

the Project cover these items.

10.7 Fuel quality

Fuel quality is an important item. It is in fact even more important for the engine applications of NG

than it is for all, or most of the other applications. What is seen as an important target in this respect, is

to develop a main LNG quality specification in order to meet the demands from the automotive

industry, so it is in a better position to design very clean and efficient vehicles. This is covered by other

deliverables of Project. Some recent milestones:

CEN/TC 408 – EN 16723 “Natural gas and bio-methane for use in transport and bio-methane

for injection in the natural gas network” - Part 2: Automotive fuels specification - Approved

June 2017

CEN/TC 234 – EN 16726 “Gas infrastructure – Quality of gas – Group H” - Published December

2015

Sector Fora Gas – formed a WG in order to evaluate EN16726 - Main purpose: to include more

parameters such as Wobbe Index

10.8 GHG emissions

The LNG sector is very active in developing technologies, measures and strategies to minimize and

eventually eliminate any boil-off gas. NGVA Europe has set his target of “Zero venting target policy”. In

the older LNG stations, a rate below 1% BOG was considered as something which could be accepted.

This is absolutely no longer the case, and BOG must go down to zero for all new stations. Stations

must not vent to atmosphere in normal conditions. ISO 16924 covers venting in several aspects:

Prescriptions for prevention of venting of natural gas

Venting of the LNG storage tank during filling

Prevention of venting from vapors generated by cool down, operation and cold standby

Hose design and dispenser installation

Pipework and venting

The present generation trucks in Europe have got engines with closed crank-cases and vapor recovery,

hence they are also not emitting NG from the engine in normal operations, besides unburned methane

at tail pipe, which is strichtly regulated by legislation (e.g. R 49). The LNG trucks and buses may need

on-board tanks to be vented before LNG refuelling, to relieve built-up pressure; the stations must

provide this collateral service, by recovering the vented gas in a suitable way. This aspect is peculiar for

LNG, and no other fuel needs addressing it; not even LPG, thanks to its far higher boiling temperatures.

10.9 LNG nozzles and receptacles for station supply

Couplings (nozzle) between the station tank and the thermo trailer (LNG tanker truck) supplying LNG

are expected and required to change to dry cryogenic couple (without drips). ISO 16924 states the

requirements of safe LNG delivery to the station from the LNG tanker, but does not fix the design of

the LNG connector from supply tanker truck to station. Connections and disconnections between

tanker trucks and stations tanks are far more limited in number compared to customer truck to station

connections and disconnections; for the sake of a zero vent strategy, also this aspect must be dealt

with anyway, and it is actually.

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10.10 Refuelling pressure and temperature

The need to cope with different LNG on-board systems service conditions (temperature, and relevant

saturation pressure), impose to station designer the inclusion of additional devices in the plant, with

the consequence of higher CAPEX and more complex operations. For this main reason, in the short

term the sector goal, especially on the side of vehicle OEM, should be to standardize on 8 bar on-

board tank pressure, and as consequence station pressure, as the harmonized pressure system. Over

the longer term, further lower pressures should be the target, in order to minimize potential venting

and maximize vehicle range. Lower saturation pressure means lower temperature, and higher density

of LNG. It also means longer holding time, as more time and heat creep-in would be taken before the

vent valve is operated by excessive internal pressure of the tank. “Saturation on the fly” is a technique

that is becoming increasingly available at LNG stations. This technique allows LNG stations to provide

LNG vehicles with different pressure depending on onboard installed LNG pump.

10.11 Separation distances

As LNG is inherently new as automotive fuel, the Authorities so far tend to be overcautious on plants

prescriptions, when editing norms, also to compensate for the short operational experience that might

be available to them. The safety distances have the aim of avoiding domino effect in case of accidents,

protecting from flying fragments in case of explosion, and from heat radiation in case of fire, and

allowing safe access to rescue people in case of emergency (protection distances). Hence long

separation distances are among the provisions more often adopted with redundant margins. The

proper and reasonably cautious approach to internal safety distances is to be recommended regarding

LNG installation, LNG dispenser/truck refuelling with LNG, shop and other vulnerable components of

the establishment, so to adopt the proper safety level, while not imposing too expensive prescriptions,

in particular in respect of the land surface requirements. Besides the effect on the cost of required

land, long safety distances also affect the actual feasibility of installation of LNG selling points inside

already exisiting traditional fuel stations. ISO 16924 and ISO 16923 set provisions relevant to

separation distances in Annex B.

10.12 Consumer information about LNG price

LNG is a new fuel; customers must be able to easily compare it to the other fuels, especially in terms of

price and cost. The fuel is generally metered by electronic mass meters, which directly and accurately

detect how many kilograms are flowing through the dispenser during the filling operation. So the price

should be displayed in €/kg in the station, also for metrological reasons. Who tried in the past to

change this, had to discover how difficult that may be. In order to facilitate price comparison, it would

also be beneficial to indicate, besides the official price in €/kg, the price of LNG in some other units

more familiar to the vehicle users/owners. Somebody proposes the €/DLE (Diesel per litre Equivalent).

Others are more in favor of energy units, such as €/kWh, or €/MJ, with reference to the Net Heating

Power. Some is inclined to consider €/100 km run, by doing the correct and necessary assumptions.

What is important is the same approach for all fuels. The EC is looking after this aspect with possible

enforcement of future provisions, as another consequence of Directive 2014/94/EU, DAFI. The EC

seems to prefer the option of €/100 km run.

10.13 Parking structures

In case of indoor parking, this is quite an important, even if maybe not much obvious, aspect affecting

LNG development. Indoor parking structures for LNG vehicles face the very unlikely but still possible

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challenge of very low temperature potential leak gas clouds, which are heavier than air for a while, and

vehicle vent valves, which might actuate in some (extreme) conditions of vehicles staying out of

operation for long time. The option at parking structure should be chosen between installing methane

detectors or prove that the ventilation system is good enough to vent out any possible methane

emissions. In theory, something worth considering is also the installation of a piping system in the

parking so that the fuel system of the vehicle can be connected and the gas is vented outside the

building structure when parking for a period longer than the holding time. Venting to atmosphere is to

be avoided (prohibited) anyway, and ways to store and/or consume the vented gas are to be

considered as a must. The vehicle operation manual should contain information about long-term

parking. There also is a need to define the equipment to recover gas from LNG tanks prior to long-

term parking and how to use it.

10.14 Training

Training for LNG trucks drivers and for station attendants is an important and complex item. It needs

harmonization and development and is under development of CEN TC 326. It has important

implications both for safety and for the environmental affect of the LNG sector operations. Local

institutions are looking after or planning such training courses, e.g. in Italy, Netherlands, Spain.

10.15 Mobile/re-locatable stations

This is a winning asset for new market in virgin areas. As a good example of this concept, in September

2017, the Breda based Company LIQAL, turnkey supplier of small-scale LNG systems, developed a skid-

mounted LNG refuelling station that offers station operators the flexibility of a re-locatable system at

lower investment requirements for both fuelling equipment and onsite project preparations. This

completely pre-fabricated and transportable LNG refuelling unit, the ‘MRU’, is SIL-2 classified and

complies with the latest international standards such as ISO 16924. It has an on-the-fly saturation, a

vapor return economizer, a MID certified LNG dispenser with patented heated and purged nozzle

docking bay and 24/7 iSCADA remote monitoring system. The fuelling performance can be compared

to a fixed LNG station configuration. Any tank type including mobile ISO storage can be connected to

it, which also holds space for LIQAL’s proven micro liquefaction technology that ensures unlimited

holding time of LNG in the storage tank and enables supply of both saturated- and cold LNG to

effectively fill all available LNG truck types. The MRU offers the opportunity to position the dispenser at

a distance from the skid for 2-sided refuelling of LNG and to add a L-CNG system. After turnkey supply

and commissioning of the MRU, LIQAL takes responsibility for technical operation and maintenance of

the system, if requested by client.

Figure 10-1. Drawing simulating the re-locatable LNG station, connected to an ISO LNG portable container [source: LIQUAL]

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10.16 Flexibility of supply systems - UTS

The new concept of the Universal Transfer System (UTS) is now a market-ready system that widens the

range of possibilities in the LNG small scale business, by means of floating LNG ship to shore system.

GAS NATURAL FENOSA and CONNECT LNG have made the successful sea launch of the first full-scale

UTS on 7th

October 2017. The companies carried out a complete operation including transfer of LNG

from SKANGAS’ LNG carrier Coral Energy to the onshore LNG terminal at Herøya, in Norway. The UTS

is a game changing floating solution for LNG transfer, consisting in a platform which can connect to

any LNG carrier. LNG is then transferred from the platform to the onshore terminal through floating

flexible pipes. The design and fabrication of the UTS has involved the highest safety standards, and the

complete system has undergone an extensive classification process by DNV GL. The patented UTS will

replace the need for expensive and environmental intensive harbor and jetty structures. This solution

allows for rapid expansion of the value chain and transfer of LNG at locations where it was previously

not possible due to environmental and economic constraints. It is a plug&play solution which requires

no modifications to the LNG carrier. [Source: CONNECT LNG – NGV Journal]

Figure 10-2. UTS floating LNG ship to shore system (Source: NGV Journal)

10.17 Logistic hubs

Logistic hubs offer opportunities and synergies to the automotive LNG market. Different transport

systems are present and simultaneously operate inside logistic hubs, e.g. trucks, vans and trains, which

can take profit of innovative fuels, LNG, CNG, bio-methane. The large vehicle fleets hinging on them

create good business cases for the multi-fuel refuelling stations to be built inside their premises, or for

LNG selling plants to be added to the diesel existing stations. The presence of train offers a promising

alternative option for quick and reliable mass fuel delivery, also applicable to LNG, already at present,

and in prospect. In Italy, on Friday 21st April 2017, LIQUIMET held the inauguration of its LNG/L-CNG

Station in Padova Interporto (Padua’s logistic hub), and the concurrent delivery of the first 20 trucks

IVECO NP/400 LNG to AUTAMAROCCHI logistic company. This was the first step of the GAINN4DEP

national project for the build-up of the LNG infrastructure in the more strategic Italian spots, (Core

ports and logistic hubs), as part of the national strategy to fulfill DAFI. This is the first LNG station in

Italy, and probably also in Europe, to be supplied with LNG by train. In fact, LNG is not taken there by

tanker truck from Marseille or Barcelona, as has been the case so far for all the other LNG and L-CNG

stations in Italy, but is delivered through railroad train, coming from Rotterdam LNG terminal, by

means of ISO containers, loaded on train cars. This station has some more innovative features as well.

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11 Trend of core business LNG market

11.1 General

The LNG core business infrastructure has developed significantly over the last years, and the efforts of

the European Commission to facilitate the development of a genuinely integrated single market are

bearing fruit. The LNG market is increasingly active, European and worldwide. Here some facts or

predictions are enlisted, to show how differentiated and dynamic this sector is becoming.

The LNG shortage following the events of 2013-2014 very quickly turned into an abundant LNG supply

in the following years. This was partly due to a rapid ramp up of American production and the

emergence of the US as a major exporter. There is a huge industry in Australia as well, but the

Australian investment consisted of long lead times and projects which were reasonably predictable.

The US had a very rapid ramp-up in shale production and quickly turned from an LNG importer to an

LNG exporter.

The imports of LNG to Japan, which is the largest LNG importer in the world economy, were stabilized

and then they began to decline, because nuclear power is coming back to the Japanese energy system,

several new coal plants were built, solar power is doing very well in Japan, and the country has always

been very successful in energy efficiency and in curbing energy demand.

So, overall, there has been a ramp-up of supply and declining demand at the largest importer

coinciding, and all this created an abundant LNG supply in global markets. Among the largest gas

companies, GAZPROM reacted to this and changed its marketing strategy by renegotiating long-term

contracts, adopting more flexible, market-oriented pricing, being prepared to compete to maintain

market share. Despite the abundance of LNG in international markets, Russian gas exports to Europe

are at an all-time high – they’ve never exported more gas to Europe than in 2016. This was achieved by

a sharp competition between LNG and Russian gas. If combining the better infrastructure, better

regulation and better competitive conditions in global markets, the effects are quite significantly

positive for Central and Eastern Europe, where in general renewables are lagging behind the leading

European countries. Romania, for one, has a decent wind and solar fleet; Poland has some wind in the

Baltic Sea region, but overall the growth of wind and solar has been less rapid in CEE than in the West.

In general the political environment is more favorable to nuclear power in Eastern Europe than in most

European countries. In Eastern Europe there are several important countries where the government has

declared publicly nuclear power as strategically important. This means that NG will have to find the

niches, and there is a fair amount of ageing coal capacity in Eastern Europe. It is possible to foresee

some coal plant construction here and there but not to the extent that the old coal plants will be

decommissioned. So if combining the future decommissioning of coal, the slow growth of wind and

solar, and even with the pro nuclear politics, there are some interesting opportunities for NG.

Considering the future of NG in that region and the various infrastructure projects, LNG terminals, etc.,

experts try to figure out how much of the actual LNG will be consumed, or see if it is just part of

creating diversification of sources. The point of the drive towards a single integrated market in Europe

is that in a genuine single market it doesn’t really matter where the LNG is coming in. For example,

Germany doesn’t have an LNG terminal at all and many German companies have investigated the

viability of an LNG terminal in northern Germany, near Hamburg, and the result was always that it is

not commercially viable. However, Germany is very well interconnected with the Netherlands, with

France and the North Sea system via which Norway can supply NG either to Germany or to the UK.

That region has four gigantic LNG terminals – Dunkerque, Zeebrugge, Rotterdam and South Hook – all

61

more than half empty. It has a powerful impact upon the German NG market, even without a single

LNG terminal in Germany.

This is not the case in Central & Eastern Europe which doesn’t have that intensive infrastructure

integration that Germany has with Northwestern Europe and the distances in CEE are also bigger. So

projects like the Polish LNG terminal, the Lithuanian LNG terminal, a possible terminal in Croatia, make

a difference in terms of integrating the region into LNG markets.

The NG pipeline system in the Czech Republic, which plays a very important role as a hub, is fully

reverse-flow capable and can deliver gas from the east to the west and from the west to the east. This

is also a very important development. It was not the case just a couple of years ago. The International

Energy Agency currently see a decline of LNG investment as the big projects in Australia are

completed. The investment spending is still sizeable, but most of the spending is committed to

projects that were launched before 2014 – that was the year when global prices collapsed.

Countries like Poland and Lithuania now have their LNG terminals. Other countries like Estonia,

Bulgaria, Hungary, Slovakia, Ukraine don’t; so for them energy diversification is more of a problem. But

EU member states in the CEE region have been urged by EC to join up their gas markets via gas

interconnectors that can provide reverse-flow capacity. The completion of the North-South Corridor

project would mean the complete networking of the gas networks of the European member states

along a north-south axis through central Europe. This would result in all of these countries being able

to access the gas delivered via LNG terminals in both the north and south of the region. So 12

countries in the region have pledged to come together to improve infrastructure and trade and to

develop better connections in transportation, digital communication and energy, including NG along a

north-south axis. One target is a connecting the LNG terminal in Poland with a pending project in

Croatia which plans to finish the construction of an LNG terminal off of the island of Krk in 2019. A

project that has been in the works for nearly a decade, in early 2017 received a € 102 million grant

towards construction of the terminal; it has got the support of the Slovak transmission system operator

EUSTREAM, and preliminary underwater research and drilling activities began at the site at end August

2017.

A long period of high prices for oil and gas at the first half of the decade made the industry a bit

complacent, so several large LNG projects experienced cost inflation and project delays. Now industry

has to shape up and get better.

In the US there is an increasing interest in brownfield projects, e.g. adding one more liquefaction train

to a project, taking advantage of the existing pipeline structure and independent shale upstream.

There also is increasing interest in 1 – 2 million tons/year-sized floating liquefaction units. Some of the

most interesting projects that succeeded in attracting investment finance in the current market

environment, like Cameroon or one of the projects in Mozambique, used this smaller sized floating

LNG technology. Instead of taking a decade to build a gigantic land-based facility, they construct a

floating unit of 1-2 million ton/y size in three years, and if market conditions allow they can add more.

Some projects show better management than others. Papua New Guinea LNG for example is located in

an extremely challenging remote region nevertheless it came online on-budget and ahead of schedule.

Probably, the project management capability is going to be one of the key competitive advantages for

the industry. [Source: László Varró IEA Chief Economist- September 29, 2017 – speaker in the session:

“LNG in Transition” at the Budapest LNG Summit on 16-17 October]

The Italian company ENI believes that the price of Mozambique LNG would fit well into European gas

markets when ENI ships its first cargo in 2020. Europe has been using only 25% of its LNG import and

regasification capacity because it has been relying more on lower-priced pipeline NG and coal.

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Mozambique LNG would be priced correctly to fit European markets because the gas exploration and

production costs there are very low. Probably the US LNG prices would fit better into the Asian

markets, leaving Europe open to supply from Mozambique. It takes only 3-4 weeks to drill a well in

Mozambique, allowing production to be increased quickly and economically. ENI is expecting to get its

first cargo of LNG from Mozambique from the Rovuma Basin by a 2.5 million mt/year floating

liquefaction train, which will be followed by two onshore trains later. The ENI’s gas resources in

Mozambique are enough to satisfy the whole Italian demand for 30 years. [Source: Claudio Descalzi,

CEO of ENI - keynote address at IHS Cambridge Energy Research Associates (CERA) week – October

2017]

11.2 Top north and top south Europe’s ends developments

The EC has approved the Finland strategy for NG import diversification through the construction of

small scale LNG terminals, as an alternative option to the pipeline NG import from Russia. On late 2017

Margrethe Vestager, European Commissioner, announced the support to the construction of a LNG

small scale reception terminal in the port of Hamina, on the south coast of Finland, and the grant offer

of € 31.5 million. The EC has allocated a similar subsidisation sum in 2015 for another LNG terminal

planned on the west coast of the country. This strategy is in line with all efforts so far in that region to

remedy to the energy isolation of Baltic countries and to improve energy security there. In the

intentions of the EC, these small scale terminals will provide a new source of clean fuels also for

maritime applications.

Finland's Wartsila has been awarded on October 4 a turnkey contract to supply the LNG receiving

terminal to be built in Hamina. The contract was awarded by HAMINA LNG, a joint venture of

municipally-owned HAMINA ENERGIA and Estonian infrastructure group ALEXELA, which decided in

June to build the € 95 mn project. Completion of works is expected in 2018. This is also a valid example

for the other Baltic countries: Lettonia, Estonia and Lituania, which like Finland only depend on Russia

for their supply of NG. This solution could also suit to the case of south end of Europe, i.e. some

regions in the Mediterranean Sea, such as Sardegna and Corsica, which are at present the only regions

in the Tirreno Sea that don’t have a NG network, and to the case of the costs of Balkan countries,

which have neither NG pipelines nor LNG re-gasification plants.

In this respect, in 2017 ENI has submitted to the Italian Ministry of Economic Development the

feasibility study for the construction of a LNG Terminal, in the port of Gela, south of Sicily. The initiative

follows the Protocol signed in November 2014, under which ENI has committed to evaluate the

possibility of building an infrastructure for the supply/storage of LNG or CNG, with the aim of

bunkering both maritime transport and heavy transport on-land. For its industrial conversion project,

ENI has decided to focus on the LNG solution. This would involve the construction of a small scale

liquefaction plant of NG, imported from North Africa by pipeline, and a storage and distribution

infrastructure for the shipping and heavy-duty land transport needs. The feasibility study has

examined, inter alia, the potential LNG market in terms of future developments in the maritime and

on-land transport, the synergies with the existing port and the logistical and distribution infrastructure,

the opportunities in other Mediterranean basins which do not have yet NG infrastructures. [Source:

Conferenza GNL]

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11.3 Europe – Russia - China international NGV corridor 2030

In late September 2017 Vitaly Markelov, Deputy Chairman of the GAZPROM Management Committee,

Huang Weihe, Vice President of PETROCHINA, and Daniyar Berlibayev, Executive Vice President for

Transportation, Processing and Marketing of KAZMUNAYGAS, signed a Memorandum of

Understanding at the 7th St. Petersburg International Gas Forum. The document reflects the interest of

the parties in long-term strategic cooperation in the NGV market, including via developing the NG

refuelling infrastructure at the Europe – China international transport corridor. The MOU also provides

for an assessment of the potential number of NG freight trucks and the amount of NG that could be

used for refuelling vehicles at the Russian, Kazakh and Chinese sections of the route in the period up

to 2030. The results of the assessment will serve as the basis for the drawing up of the tripartite

Roadmap for the development of a natural gas filling network along the Europe – China international

transport route.

11.4 Italian infrastructure

Despite being among the more active European countries in the automotive LNG market, Italy lacks a

national supply source on the large scale side, let alone the small scale one. At present there are three

LNG terminals in Italy. The oldest one is in La Spezia, and it started back in 1973. Another one is close

to Rovigo, on the Adriatic Sea, and the third one is in Livorno, on the Tirrenian Sea; both started in the

present decade. The terminal in La Spezia is the only one on-shore, but it is old now, and the

characteristics of its location prevent access to LNG tanker trucks there. The other two terminals are off

shore, so no way to supply LNG directly to tanker trucks also in their case. Therefore Italy needs

building up from scratch the intermediate infrastructure for the supply of LNG to the tanker trucks. At

present the supply is through trucks coming from the terminals of Barcelona or Marseille, and via train

from the terminal of Rotterdam; this last a very recent step. A national supply source would reduce

travel needs and costs. After successfully passing the feasibility study phase, the project of new small

scale LNG terminal which DECAL and SAN MARCO PETROLI are planning to build in Porto Marghera, is

starting the authorization procedure. The new infrastructure will have total storage of 32,000 m3, made

of one atmospheric full containment tank of 30,000 m3 and two horizontal pressurized “bullet”, full

containment tanks of 1,000 m3 each. This plant is designed for LNG tanker ships carrying from 7,500 to

30,000 m3 load. The plant is meant for supplying in its turn LNG in liquid state to the automotive

market, as well as for the supply of residential applications not connected to the national NG pipeline

system, and as bunker for marine applications. Besides the mooring pier for ships unloading LNG, the

plant will also include an additional pier to load LNG on small tanker ships of about 1,000 m3 load,

which will be bunkering dual-fuel ships sailing in the port of Venezia. Five tanker truck loading bays

will be also part of the plant. In a second project step a loading bay will be added for railroad trains.

In the port of Santa Giusta – Oristano in Sardegna HIGAS has started the construction of a coastal LNG

small scale storage in the Mediterranean Sea, after the release in January 2017 of Authority permission

for this work from the Ministries of Industry and Transport, and after the land purchase. The majority

share of HIGAS has been acquired by the Norwegian company STOLT NIELSEN, specialized in fuels sea

shipping. The plant expected CAPEX is 30 million euro. Total capacity of the coastal LNG storage is

9,000 m3, divided among six 1,800 m

3 tanks. The Norwegian company aims at diffusion of LNG as

marine fuel in the Mediterranean Sea, besides fulfilling the need for it in Sardegna, where it will be

applied as automotive fuel, and as fuel for the local industry and for residential applications. The ship

manufacturer KEPPEL SHIPYARD is already building in Singapore for STOLT two 7,500 m3 LNG carriers

which will serve coastal LNG small scale terminals and will offer ship-to-ship LNG bunkering.

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11.5 Recent and future moves of the market, Europe and Global

Lithuania‘s LITGAS, the gas trade arm of state energy holding LIETUVOS ENERGIJA (Lithuanian Energy),

begun LNG sales to Poland's electricity and gas supply company DUON in late 2017. The gas is hauled

there by trucks from Lithuanian seaport Klaipeda‘s new ground LNG distribution station.

Figure 11-1. Independence, the Hoegh terminal in Klaipeda (Source: Hoegh)

The Norwegian firm CONNECT LNG and GAS NATURAL FENOSA have successfully used pioneering,

'plug and play' technology, Universal Transfer System (UTS), to deliver LNG ashore in an operation

carried out in Norway on October 7. During the successful sea launch of the first full-scale and market-

ready UTS, CONNECT LNG and GAS NATURAL FENOSA carried out a complete operation including

transfer of LNG from Skangas’ LNG carrier Coral Energy to the onshore LNG terminal at Heroya.

The Port of Rotterdam plans in 2017 to build a new multifuel bunker station for the refuelling of LNG

and other cleaner fuels. Krabbegors/Duivelseiland at Dordrecht Inland Seaport has been designated as

the location for the station. Port of Rotterdam and PITPOINT.LNG signed a letter of intent to jointly

further study the feasibility of the station. This will encourage the use of LNG as an alternative to fuel

oil in shipping. Dordrecht Inland Seaport is the most inland seaport in the Netherlands. It forms the

meeting point of the shipping lanes for the cities of Amsterdam – Rotterdam – Antwerp, and the main

shipping route into Germany. All fuels (including LNG/CNG and hydrogen) supplied by the multifuel

bunker station should produce fewer harmful emissions than traditional fuels. This includes fuel for

ships, trucks and/or commercial vehicles with the aim of working together to achieve cleaner air and a

better living environment. This station forms part of PITPOINT.LNG’s strategy of developing a

European LNG refueling infrastructure.

Greek gas supply monopoly DEPA has signed a co-operation agreement with Greek utility GASTRADE,

the company developing an LNG terminal in Alexandroupolis in northern Greece. The two CEOs –

DEPA's Theodoros Kitsakos and Gastrade's Konstantinos Spyropoulos – agreed that DEPA would

contribute to Gastrade's share capital and share in the further commercial development. [Source: Depa

- October 16 2017]

Norway-based ADD ENERGY is planning to use small floating liquefied natural gas (FLNG) vessels to

unlock standard gas fields. In October 2017 the company OFFSHORE AUSTRALIA declared interest for

the initial pilot project. It has partnered with Australia’s TRANSBORDERS ENERGY to create a rapid

deployment business model for the FLNG industry that ADD ENERGY promised will free up small-scale

stranded resources around the world.

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REGANOSA has launched its LNG hub project in the Northwest of the Iberian Peninsula. The energy

company aims at providing LNG as marine fuel to a wide range of clients from its first regasification

terminal, located in the port of Ferrol (Galicia, Spain). Every year, there are 40,000 ships sailing close to

there on route from Europe to America, Africa and Asia, and vice versa. REGANOSA is supporting the

transition to NG as the fuel of choice among many sectors and, for that reason, is trying to create a

hub in the northwest corner of Spain which serves the whole of Europe. In the plan of the Company,

the LNG HUB in Galicia will serve as a major lever for guaranteeing sustainability within some of the

most important sectors, such as fishing and the port network.

Dhaka is preparing Bangladesh industry for the start of imports of LNG from April 2018 [Source: state-

run Petrobangla chairman Abul Mansur Md Faizullah].

The PETRONET’s Kochi LNG terminal capacity utilisation is expected to rise to 40% by 2018. The

terminal has had in 2017 a low capacity utilisation of just 15-16% owing to a lack of pipeline

infrastructure.

A joint venture comprising Malaysia's PETRONAS LNG, Hongkong Shanghai MANJALA POWER and a

Bangladeshi company GLOBAL LNG is preparing to build a 3.75 million metric tons/year floating

storage unit and a fixed jetty-based regasification unit at Kutubdia island in the Bay of Bengal near

Cox's Bazar district in southeastern Bangladesh. In October 17 the Shanghai-based HONGHUA GROUP

has awarded a $12 mn front-end engineering design (Feed) contract to UK-based contractor WOOD

GROUP, for an LNG platform development in the West Delta area of the US Gulf that Houston-based

developer ARGO LNG, headed by ex HOEGH LNG CEO Gunnar Knutsen, aims to complete around

2020. Japan announced a $10 billion public-private initiative that will help to boost LNG infrastructure

in Asia. The announcement was made by Hiroshige Seko, minister of economy, trade and industry, at

the LNG Producer-Consumer Conference October 18. The Yemen LNG has been now offline for 30

months. October 2017 marked two and a half years since Yemen LNG declared force majeure in mid-

April 2015. YLNG stopped all LNG producing and exporting operations 14 April 2015, evacuated most

staff, and said arrangements were in place to protect the Balhaf liquefaction site. [Source: NGW -

October 17]

The Queensland CURTIS LNG facility (QCLNG) on the east coast of Australia hasn’t sold a spot cargo of

LNG since March 2017; as all volumes in excess of the contracted levels at QCLNG have been sold in

Australia to local customers [Source: Shell Australia’s Chairwoman Zoe Zujnovich].

The MEXICO PACIFIC Ltd LLC (MPL), owner and developer of a LNG project on the Gulf of California in

Mexico, received an investment from AECOM Capital’s Infrastructure fund to advance development of

its liquefaction complex. Based at Puerto Libertad in the state of Sonora, MPL is a cost-advantaged and

scalable liquefaction project that has a deep-water port and is interconnected with the U.S. shale gas

grid by multiple natural gas pipelines, which are already in service bringing NG to the site. This is

considered an important milestone that advances the ability of that operator to offer the lowest all-in

cost LNG to Mexican, South American, Central American and Pacific basin markets from a next-

generation west coast LNG facility. [Source: Mexico Pacific Limited]

In 2017 ENI reached a final decision on development (FID) of the Coral South gas field in Mozambique.

The project will be developed by a floating LNG (FLNG) production unit. The production capacity is (by

the operator) estimated to be 3.4 million tons per annum MTPA, equivalent to 4.7 bcm/yr. RYSTAD

ENERGY believes first LNG shipment from Mozambique to be in either in 2023 or 2024, and Tanzania

to follow 4-5 years later. The combined gas and LNG production in East Africa is expected to exceed

120 bcm/yr by 2040, whereof LNG will be the dominant product. [Source: Henrik Poulsen Senior Vice

President - Government Relations at RYSTAD ENERGY]

66

12 Operators of the LNG sector The group of operators of the international and European LNG market is inherently small; but its

commitment to this market is in constant growth. The following list of companies is focused on on-

road LNG infrastructure (i.e. fueling stations for trucks) and tries to be as comprehensive as possible,

anyway it is not necessarily exhaustive of the whole LNG sector. The manufacturers and operators of

which the Project partners are aware of were included in it.

Operator Address Product

AGT AMERICAN GAS &

TECHNOLOGY 1695 S. Seventh street - San Jose, CA 95112 T: +1 (408) 292 6487 f:

+1 (408) 292 7143 LNG infrastructure

construction

AIR LIQUIDE www.airliquideadvancedtechnologies.com LNG infrastructure

construction

AXEGAZ 120 Rue Jean Jaurès 92300 Levallois-Perret France Edouard de

Montmarin T: +33 601 641 538 edouard.demontmarin@axegaz.com

http://www.axegaz.com

LNG infrastructure

construction/operation

BALLAST NEDAM IPM

B.V. Nijverheidstraat 12 4143 HM Leerdam The Netherlands Joost

Jansen www.ballast-nedam.com email: joost.jansen@ballast-

nedam.comT+31 (0)345 639250 M+31 (0)6229 12499

LNG infrastructure

construction/operation

BOHLEN & DOYEN

GmbH SAG Group Hauptstraße 248 26639 Wiesmoor Marcus Reher T+49 (0)4944

301437 F+49 (0)4944 301423 M +49 (0)160 531 32 93 E

m.reher@bohlen-doyen.com I www.bohlen-doyen.com

LNG infrastructure

construction/operation

BRN BERNARDINI operative headquartes Via G. Galilei 35, Faenza, Italy Legal

heaquarters and Call Center: Via Finlandia 70, Modena, Aldo

Bernardini T+39 335 – 7194094 / +39 0546 - 62 67 13 Fax: +39

0546 - 62 67 41 aldo.bernardini@bernardininet.com http://

www.bernardininet.com

LNG infrastructure

construction/operation

CHART FEROX a.s. Ustrecka 30 CZ-405 30 Decin - Czech Republic Mr. Vaclav Chrz

Vaclav.chrz@chart-ind.com Josef Semeràd Josef.semerad@chart-

ind.com T: +420 412 507 349 f: +420 412 507 297 FEROX GmbH -

Brosshauser Strasse, 20 D-42697 Solingen Germany T: +49 (0) 212

700 570 f: +49 (0) 212 700 578 sales@chart-ferox.com

http://www.chart-ferox.com

LNG components

CRYOMEC

Binningerstrasse, 85 - CH – 4123 Allschwil 1 - Switzerland T: +41

61 487 3300 f: +41 61 487 3399 Service.commercial@cryomec.com

www.cryomec.com

LNG components

CRYONORM SYSTEMS

BV Koperweg 3 2401 LH Alphen aan den Rijn The Netherlands Office:

+31 172 41.80.80 Fax: +31 172 43.88.19 LNG infrastructure and

cryogenic vaporisers

CRYOSTAR SAS

2 rue de l’Industrie - ZI BP 48 - 68220 Hesingue (F) T: +33 389

702727 f: +33 389 702777 Josef pozivil T +33 (0) 3 89 70 29 11 F

+33 (0) 3 89 70 29 00 info@cryostar.com www.cryostar.com

LNG components

CRYOVAC GMBH & CO

KG

Heuserweg 14 D-53842 Troisdorf Phone: +49 (0) 2241 84673-0 Fax:

+49 (0) 2241 84 673-29 info@cryovac.de

Cryogenic tanks

67

DRIVE SYSTEMS NV Leeuwerikweg 8 B-3300 Tienen Belgium Philippe Desrumaux T:

+32 494 89 69 96 philippe@drivesystems.be

http://www.drivesystems.be

LNG infrastructure

construction/operation

ENERGOCRYO Hauptstrasse, 49 CH 4422 Arisdorf T: +41 61 811 2386 f: +41 61

811 4358 Je.tornare@eblcom.ch Engineering/consulting

ENGIE LNG Solutions BV

GDF Suez LNG Solutions

BV

Grote Voort 291 8041 BL Zwolle The Netherlands Jan Joris Van Dÿk LNG infrastructure

construction/operation

ENN Business Park “de Bedrijvige Bij” Lagendijk 1-3 Suit C148 | 1541 KA

Koog aan de Zaan |the Netherlands Joost Jansen Business

Development Manager T +31 (0) 207470178 O +31 (0)207470178

M +31 (0)622912499 E-mail joost.jansen@enncleanfuels.com

www.enneu.com www.enn.cn

LNG infrastructure

construction

ENOS LNG d.o.o. C. Zelezarjev 8 SI-4270 Jesenice Slovenia Andrej Stušek T: +

386 4 581 0240 andrej.stusek@enos.si http://www.enoslng.si LNG infrastructure ss

liquefaction

construction/operation

FLUXYS Belgium Av. Les Arts, 31 1040 Brussels Belgium Vincent Malisoux T: +32 2

282 72 55 vincent.malisoux@fluxys.com http://www.fluxys.com

LNG supplier; LNG terminal

operator

GABADI GABADI, S.L. Polígono Industrial Río do Pozo Avd. Xesús Fernández

Pita, 53 – 15578 Narón – A Coruña Telf. [+34] 981 39 73 01 Fax:

[+34] 981 39 72 95 E-mail: gabadi@gabadi.com

Membrane LNG tank

GALILEO Av. General Paz 265 Sàenz Pena Buenos Aires B1674A Argentina

Osvaldo Del Campo T +54 11 4712 8002 F +54 11 4712 6003

info@galileoar.com www.galileoar.com

LNG

components/infrastructure/ss

liquefaction

GAS AND HEAT SPA Livorno Cryogenic tanks

GAS FIN 62, Rue des Romains LU-8061, Strassen Luxembourg

http://www.gas-fin.com

Liquefied Natural Gas (LNG)

infrastructure operation

GNL ITALIA S.p.A.

Sede legale: Piazza S. Barbara, 7 - 20097 San Donato Milanese (MI)

- Tel. 02 520.1 - Sede operativa: Località Panigaglia - 19020

Fezzano (SP) Tel. 0187 790046 - Giuseppe Vareschi 0187 794325

giuseppe.vareschi@gnlitalia.it www.snamretegas.it

LNG supplier; LNG terminal

operator

GOLDENGAS Viale Giordano Bruno, 20/4 - 60019 Senigallia (AN) Italy tel. 071

791091, 800 700300 fax. 071 7925130 www.goldengas.it info

@goldengas.it

LNG trade

GTT Gaztransport & Technigaz 1, route de Versailles 78470 Saint-Rémy-

lès-Chevreuse France T: +33 (0)1 30 234 789 commercial@gtt.fr

LNG tanks

HAM CRIOGENICA Polígono Industrial Sant Ermegol P.11 08630 Abrera Spain Jaume

Suriol T: +34 93 7704 760 ham@ham.es http://www.ham.es LNG infrastructure

construction/LNG

transport/supply

JC CARTER LLC World Headquarters 26451 Curtiss Wright Pkwy, Suite 106

Cleveland, Ohio 44143 1-440-569-1818

JCCarterCares@jccarternozzles.com

LNG connector/receptacle

INDOX - ROS ROCA

INDOX CRYOENERGY Industrial la Serra s/n 25320 Anglesola (Lleida) Miquel Fontova

Cemeli Tel: 639392193 Email: mfontova@indox.com LNG infrastructure

construction/operation

68

LINDE BoC Priestley Centre Surrey Research Park GU2 7XY Surrey UK Linde AG

Seitnerstraße 70 82049 Pullach Germany Mark Lowe (UK) - Olof

Kallgren (Germany) http://www.linde.com

LNG

components/liquefaction

LIQAL Heilaar Noordweg 2 4814 RR Breda The Netherlands Phone +31

(0)85 4861 000 Mail address: P.O. box 9407 4801 LK Breda The

Netherlands Email info@LIQAL.com

LNG infrastructure

construction

LIQUIGAS via Giovanni Antonio Amadeo, 59, 20134 Milano Andrea Arzà

https://www.liquigas.it/imprese/gnl-liquigas/ LNG infrastructure

construction/operation

LIQUIMET S.p.A viale Montegrappa 18/a Treviso – Italia Antonio Nicotra Presidente

Antonio.Nicotra@liquimet.it www.liquimet.it LNG infrastructure operation

MARITIME LNG

PLATFORM e.V. Esplanade 23 20354 Hamburg Germany Georg Ehrmann LNG trade

MOLGAS ENERGÍA S.A.U Avenida Astronomía, 41 28830 San Fernando de Henares Madrid

Tel: +34 916601662 info.madrid@molgas.es LNG trade

NATIONAL GRID-

GRAIN LNG Grain LNG Terminal Isle of Grain Rochester Kent ME3 0AB Paul Ocholla T:

+44 1634 273173 Paul.Ocholla@nationalgrid.com

https://www.nationalgrid.com/uk/grainlng

LNG infrastructure/LNG

terminal operator

NEXGEN FUELING 3505 County Road 42 West - Burnsville, MN 55306-3803 T: +1 800

838 0856 f: 952 882 5172 www.nexgenfueling.com LNG trade

PARKER HANNIFIN Racor Filter Division Europe Shawcross Business Park Dewsbury

WF12 7RD United Kingdom Steven Wilson T: +44 (0)1924 487000

filtrationinfo@parker.com http://www.parker.com

LNG connector/receptacle

PIT POINT Gelderlandhaven 4 3433 PG Nieuwegein The Netherlands Kim

Bentum T: +31 30 410 08 00 kim.bentum@pitpoint.nl

http://www.pitpoint.nl/#1

LNG infrastructure

construction/operation

POLARGAS S.r.l. via Avv. Giovanni Agnelli, 10 - 12033 Moretta (CN) t: 0172 915811

f: 0172 915822 ing. Diego Pegorari cel. 334 60 5066 – e-mail:

pegorari@polargas.it

LNG transport by tanker

truck

PRF PRCF Gás, Tecnologia e Construção, S.A. E.N. 356/1- Km 5,8

Alcogulhe 2400-821 Azoia Leiria Portugal Joao Pedro Cordeiro

Ferreira T: +351 914933358 joaopedro@prf.pt http://www.prf.pt

LNG infrastructure

construction

PRIMA LNG N.V. Uitbreidingstraat 2-8, 2600 Berchem, Antwerpen, Belgium Peter

Frühwirth info@primalng.com http://www.primalng.com LNG infrastructure operation

RAG ROHÖL-

AUFSUCHUNGS

AKTIENGESELLSCHAFT

SCHWARZENBERGPLATZ 16, 1015 Vienna Austria Georg

Dorfleutner T +43 (0)50 724, http://www.rag-austria.at

erdgas.mobil@rag-austria.at

LNG tanks

REGO GMBH Industriestrasse 9 D - 35075 Gladenbach Germany Freddy Deyk T:

+49 6462 91470 info@rego-europe.de http://www.rego-europe.de

MACRO TECH connector

LNG infrastructure/LNG

connector/receptacle

ROLANDE LNG Postbus 61 4286 ZH Almkerk The Netherlands Peter Hendrickx T:

+31 183 583 446 P.Hendrickx@Rolandelng.n

http://www.rolandelng.nl/en/home.htm

LNG infrastructure

construction/operation

ROSETTI MARINO SpA via Trieste, 230 - 48122 Ravenna Italy Marino Rosetti T 0544

878 111 F 0544 878 188 rosetti@rosetti.it www.rosetti.it LNG infrastructure operation

69

ROS ROCA Indox Cryo

Energy S.L. Pol. Ind. La Serra s/n – 25320 Angesola (Lleida) Spain Ismael

Callejon Agramunt T +34 973 308 530 F +34 973 308 528 M +34

661 888 041 jcallejon@indox.com www.indox.com

LNG infrastructure

construction

SAPIO S.r.l. v. Silvio Pellico, 48 – 20052 Monza (MI) Italy Sergio De Sanctis t.:

+39 039 83981 f.: +39 039 836068 e-mail: gruppo@sapio.it

www.grupposapio.it

Technical gas supplier

SIAD SIAD S.p.A. Via S. Bernardino, 92 24126 Bergamo Tel. 035.328.111

Fax. 035.328.318 https://www.siad.com/it

Productiob plants of

technicalgases

STIRLING CRYOGENICS

& REFRIGERATION BV P:O: Box 218, Building AQ – 5600 MD, Eindhoven (NL) T: +31 40

2766522 f: +31 40 2766144 LNG components

TECNOCRYO via Ugo Foscolo, 820060 Basiano (MI) Italy T: +39 02 95764120 f:

+39 02 95764120 www.tecnocryo.com tecnocryo@tecnocryo.com

Marcello Riva t 02.95764120 f. 02.95764102 m. 335.6020781

m.riva@tecnocryo.it

LNG components

TERMINALE GNL

ADRIATICO Srl p.za della Repubblica, 14/16 – 20124 Milano Italy t. 02 636 981 f 02

636 98222 via Canalini, 2 – 45100 Rovigo t 0425 421035 f 0425

460095

LNG storage & supply

UNIPER Technologies GmbH Alexander-von-Humboldt-Strasse 1, 45896

Gelsenkirken Cliff Muller-Trimbusch Project Manager Cooperation

& Business Development T +49 2 09-6 01 32 06 M +49 1 72-2 64

74 69 Cliff.mueller-trimbusch@uniper.energy www.uniper.energy

LNG infrastructure operation

VANZETTI

ENGINEERING Srl Via Avv. Giovanni Agnelli, 10 - 12033 Moretta (CN) Italy t. 0172 91

5811 f. 0172 91 5822 - info@vanzettiengineering.com LNG

infrastructure/components

construction

VRV S.p.A Via Burago, 24 20060 Ornago (MI) Italy Massimiliano Spada T: +39

039 6025 1 f: +39 039 6025 499 www.vrv.it LNG tanks

VCT Vogel GmbH

(CHART)

Table 12-1. Manufacturers and Operators involved the European LNG truck refueling infrastructure market

70

13 The Trans-Europe Blue Corridor rally

On 18th

September 2017 the “Blue Corridor-2017: Iberia – Baltia Rally” kicked off from Carregado

(Lisbon). The rally, which is promoted and organized by GAZPROM Group and UNIPER, gathers every

year representatives of energy and logistics companies, vehicle manufacturers and operators in the

NGV market, to demonstrate the benefits of NG as automotive fuel. The participants drove across

Europe to St. Petersburg in 19 days, running more than 5,300 km, and passing through 12 countries:

Portugal, Spain, France, Italy, Switzerland, Lichtenstein, Germany, Poland, Lithuania, Latvia, Estonia, and

Russia. The Blue Corridor Rally 2017 demonstrates the progress made in the development of the NG

infrastructure in Europe, confirming the viability of this fuel in long haulage, and rose awareness of the

benefits of LNG use in the transport sector. Along the route, some events were held in Lisbon, Milan,

Ulm, Berlin, and Tallinn. Government officials, OEM, representatives of the gas industry and transport

companies discussed the technological and legal aspects, and environmental, economic and social

benefits of NGV. The caravan did stop at IVECO’s Ulm plant in Germany to refuel at the station which

was the first to open in Germany. On September 25th, IVECO did host at its Ulm Delivery Centre a

round table with customers and other stakeholders in the development of NGV. The Rally ended in

October 5th

, coinciding with the St. Petersburg International Gas Forum.

The main theme of the rally was the use of LNG in heavy vehicles. LNG-powered trucks successfully

completed every stage of the rally. Among them were Russia’s first certified LNG-powered vehicles: the

KAMAZ truck and the URAL NEXT workshop truck with a crane manipulator. The prototypes of the

trucks were developed by the KAMAZ concern and the GAZ Group in conjunction with GAZPROM. The

rally also involved LNG-powered trucks made by IVECO, SCANIA, and Minsk Automobile Plant, as well

as CNG cars from VOLKSWAGEN, SEAT, and LADA.

Figure 13-1. Start of the Rally in Carregado

71

Figure 13-2. Arrival of the Rally in St Petersburg

This year’s edition of the Rally focused on LNG for freight transport, to show that this sustainable fuel

combines the benefits of excellent environmental performance with cost efficiency, and provides a

viable alternative to diesel for freight transport that is available now.

72

Partners