SPE DISTINGUISHED LECTURER SERIESis funded principally
through a grant of the
SPE FOUNDATIONThe Society gratefully acknowledges
those companies that support the programby allowing their professionals
to participate as Lecturers.
And special thanks to The American Institute of Mining, Metallurgical,and Petroleum Engineers (AIME) for their contribution to the program.
LNG – Roaring Ahead
John MorganJohn M. Campbell & Company
Exclusive Provider of PetroSkills Facilities TrainingHeadquarters Office
1215 Crossroads Blvd., Norman, OK 73072 USA
(405) 321-1383 Office / (405) 321-4533 Fax / (303) 523-6797 Cell
[email protected] / www.jmcampbell.com
©2008 John M. Campbell & Co. and Other Copyright Holders
All Rights Reserved
Where Will it End?
© 2005 Air Products & Chemicals, Inc. All Rights Reserved
$7 Billion Entry Fee
©2008 ConocoPhillipsUsed With Permission
All Rights Reserved
Liquefied Natural Gas (LNG)
1. Allows gas to be sold from remote suppliers Indonesia, Middle East, Australia, Algeria, etc.
to industrialized countries, Japan, Korea, Spain, UK and USA
2. The largest producer of LNG is Qatar.3. Was Indonesia but gas reserves depleted4. The largest market for LNG is Japan5. International trade in 2007 was ~165mtpy
(Equivalent to 217BCMa)
LNGNGL
Methane
Ethane
Propane
Butane
Pentane +
LPG
96%
3%
1%
0.1%
LPG – Liquid Petroleum GasNGL – Natural Gas LiquidsLNG – Liquid Natural Gas
WHAT IS LNG
Example LNG Properties-162oC [-235oF] at atmospheric pressure
Rich Leannitrogen 0.3 0.5methane 88.7 97.5ethane 8.0 1.5propane 2.0 0.5butanes 1.0 -
approx. kg/m3 465 435
CV (higher) MJ/m3 42 38.5
An LNG Export Terminal with Multiple Expansions - Bontang, Indonesia
© 2004 LNG Journal & Reproduced with Permission
The Basic LNG Chain
LNG Production
Shipping
LNG Reception
Gas Utilization
Gas Production
Common Engineering Units
• scf is the volume of gas at 14.7psi and 60oF• scm is the volume of gas at 101.3kPa and 15oC• 1MMscfd is 1,000,000scf/day• 1m3 = 35.3ft3
• Density of water = 1000kg/m3
• Molecular weight of air is 29 (28.97)• Power 0.746kW = 1HP• 1Btu is the energy required to raise the temperature of
1 lb water 1oF• 1Btu = 1.055kJ
Natural GasTransportation Options
5000
1000
500
100
50
MM
scfd
0 1000 2000 3000 4000 5000
Distance to market, km
Pipeline
Uneconomic
Electricity
Gas-to-liquids
LNG
Nominal GasTransportation Efficiency
Historical Developmentof LNG Trade – Last 25 Years
• Projects grow from less than 1 mtpa to 4-6 mtpa• New supplies to Japan,
first imports to Korea, 1987, and Taiwan, 1990
• Late 1990s – present– Slower growth in Asian LNG demand – economic upsets– Growth in LNG demand in Europe, USA and Caribbean– New supply projects in Atlantic Basin and Middle East– Today’s LNG trade
LNG Industry Growth
Source: CERA, CEDIGAZ
5.5%/yr
Historical
Projected
Demand is Met from DiverseSources of Supply
© 2005 Source NPC
LNG Imports Are Needed,but Face Obstacles
© 2005 Source NPC
The Basic LNG Chain
LNG Production
Shipping
LNG Reception
Gas Utilization
Gas Production
The Contract Chain
1. Exploration licenses, production-sharing contracts
2. Gas sales to LNG Producer3. LNG production joint venture agreement4. Condensate/LPG production and sale5. Government and local authority agreements6. LNG sale and purchase agreement
between LNG producer and LNG buyers
© 2005 LNG Journal & Reproduced with Permission
Gas Production PlatformNorth Rankin A
North-West Shelf Project, Australia
The Basic LNG Chain
LNG Production
Shipping
LNG Reception
Gas Utilization
Gas Production
General SchematicGas Liquefaction Terminal
© 2005 LNG Journal & Reproduced with Permission
Pre-cooling and
LPG Separation
Contaminants
What’s in gas (besides light hydrocarbons)?
H2O CO2 H2S
S He N2 Cl Hg As
Waxes Asphaltenes etc.
Sand Dinosaur Dust
Lubricants Corrosion Inhibitors
Mystery Stuff, etc.
Some Mercury Levels Worldwide
South America 69 119 373 643Far East 1 3 20 16 108Far East 2 58 193 313 1,042Far East 3 0.02 0.16 0.11 0.86Groningen 180 972Mid West P/L 0.001 0.1 0.01 0.54
microgm/m3 Mercury kg/a
Based on 4mtpy LNG production (600MMscfd)
Mixed Refrigerant
LNG Process
© 2005 Air Products & Chemicals, Inc. All Rights Reserved
MCR® Heat Exchanger Tube Bundle Fabrication
© 2005 Air Products & Chemicals, Inc. All Rights Reserved
MCR® Heat Exchanger Tube Bundle Fabrication
© 2005 Air Products & Chemicals, Inc. All Rights Reserved
MCR® Heat Exchanger Tube Bundle Shipping
© 2005 Air Products & Chemicals, Inc. All Rights Reserved
NG LNG
PROCESS
POWER
HEAT SINK
40C60bar
-162C1bara230MW
160MW
390MW
LNG Production 3.7mtpy (500tph)
Based on a 3.7mtpy train
The Liquefaction Heat Balance
Centrifugal Compressors
Horizontally SplitGenerally used in high volume/low pressure applications
Axial Turbine Blades
Overview of LNG ProductionFacilities Technologies
• Established Technologies– ConocoPhillips (Optimized Cascade)– APCI (Propane Precooled)
• New Process Technologies– APCI (AP-X)– Linde (MFC)– Shell (DMR)– IFP (Liquefin)
LNG Facility Comparison
• There are 80 operating trains with a total capacity of 197mtpy (2.5 mtpy/train)
– APCI C3MR (60) 152 mtpy 76.6%– ConocoPhillips Optimised Cascade (9) 30mtpy 15.3%– Shell C3MR(1) 4.2mtpy 2.3%– Linde MFC (1) 4.2mtpy 2.1%– Others (TEAL/SMR) (9) 7.3mtpy 3.7%
• There are 27 trains under construction with a total capacity of 137mtpy (5.1mtpy/train)
– APCI (14) 61mtpy 45%– APCI AP-X (6) 47mtpy 34%– ConocoPhillips Optimised Cascade (3) 10.5mtpy 7.7%– Shell C3MR (2) 8.5mtpy 6.2%– Shell DMR (2) 9.6mtpy 7.0%
ConocoPhillips Optimized LNG Process
Courtesy ConocoPhillips Petroleum Company
Egypt Idku
• 2 Trains 3.4mtpy• On stream in 2006• COP Optimised
Cascade process• Air cooled process• Very long jetty• Space for expansion
Darwin LNG: First LNG March 06
© 2003 Atlantic LNG All Rights Reserved
Atlantic LNG - Train 1
Atlantic LNG
• Train 4: 5.2mtpy from 8 Frame 5 GTs• Started up in March 2006
Atlantic LNG Project Expansion Trinidad
© 2002 LNG Journal & Reproduced with Permission
Overview of LNG ProductionFacilities Trends
• Larger facilities– Bigger Trains– Bigger Turbines
• Reduce Environmental Impact– CO2
• Produced with gas• Developed by turbines
– NOx– Marine Environment
Typical Project ScheduleGreenfield LNG Export Project
Year 0 1 2 3 4 5 6 7 8 9 10
study drilling and appraisal design construction
selection acquisition, approvals prepn.
study concept design FEED EPC - construction
study shipping arrangements ship building
Upstream
Terminal Site
LNG Plant
Shipping
& Evaluation study negotiations -j.v. evaluation first LNGexports
Project Structure
analysis marketing, sales agreementsMarkets
Financingadvice and analysis securing financing
© 2000 LNG Journal All Rights Reserved
Photo Courtesy of CB&I All Rights Reserved
190,000m3 LNG Storage Tank
The Basic LNG Chain
Shipping
LNG Production
LNG Reception
Gas Utilization
Gas Production
1959 – The Methane Pioneer
© 2004 LNG Journal & Reproduced with Permission
© 2008 Hamworthy, Used With Permission, All Rights Reserved
LNG Carrier Fleet
• As at 1 January 2008 the Carrier Fleet was– 250 ships, average age 13 years– 400 ships in 2011– 52% Membrane, 45% Moss, 3% others
• Small carriers 20-80,000m3
• Typical Carriers 125-145,000m3
• New very large carriers on order for Qatar long distance trades (205-265,000m3).
• The order book is 142 ships• Some Fleet owners now looking to replace older
ships >35 years
One of the World’s Smallest LNG Carriers The 19,100 m3 Capacity Surya Aki
© 2008 Hamworthy, Used With Permission, All Rights Reserved
Partial Loading of LNG Cargoes
Photo Courtesy of ABS
A Typical Large-Size LNG CarrierThe 135,000 m3 Capacity Al Bidda
© 2002 LNG Journal & Reproduced with Permission
Qflex
© 2008 Hamworthy, Used With Permission, All Rights Reserved
©2008 Hamworthy©Used With Permission©All Rights Reserved
© 2008 Hamworthy, Used With Permission, All Rights Reserved
The Basic LNG Chain
LNG Reception
LNG Production
Shipping
Gas Utilization
Gas Production
Costs in an LNG Project
Gas Gathering US$ 1.5 – 2.0 billion
Liquefaction (1 train) US$ 1.5 – 2.0 billion
Ships 5 @ $250 m US$ 1.3 billion
Regasification US$ 0.5 – 1.0 billion
TOTAL US$ 4.8 – 6.3 billion
Could easily reach $7,000,000,000
Negishi Terminal, Japan : Single Containment Tanks (background)
Inground Tanks (foreground)
© 2002 LNG Journal & Reproduced with Permission
US LNG Terminal: Elba Island
The Basic LNG Chain
Gas Utilization
LNG Production
Shipping
LNG Reception
Gas Production
Seasonal Demand PatternEurope & North America
Gas Markets
1. Residential & Commerciala. Heating demand highly seasonal (low load
factor)b. No fuel switching capabilities
2. Industriala. Fuel for factories, chemical plants, steel
mills, etc.b. Power generation for factories, chemical
plants, steel mills, etc.c. Chemical feedstock – ammonia, methanol,
GTLd. High load factore. Fuel switching capability
Ship-to-Ship Transfer
• Power Generationa. Combined cycle most popular
• GT + waste heat boiler Eff.~55%• Low CO2 emissions
7 – 8 tonnes/MW compared to25 – 27 tonnes/MW for coal
b. Higher load factor than residential & commercial
c. Quick response to demand swingsd. Summer demand higher than winter
(A/C)e. Fuel switching capability
Gas Markets
Gas-Fired Electric Power Generation
© 2002 GE All Rights Reserved
GE GAS TURBINESH-Technology
400-480 MW combined cycle output
Firing at 2600°F, 1430°C
23:1 compressor, 18 stages4 stage turbine
60% combined cycle efficiency
Example Heating Values
36 38 40 42 44 46 48 50
UK
USA - Florida
Japan – Power Plant
MJ/m3Adapted from: Bramoulle, Morin and Capelle, “LNG Quality and Market FlexibilChallenges and Solutions”, LNG 14, Doha, Qatar 2004
Examples of Sales Gas SpecificationsQualityQuality USAUSA CanadaCanada EuropeEurope UKUK
Water ContentWater ContentDew PointDew Point
44--7lb H2O/MMscf7lb H2O/MMscf3232ooF at 1000psiF at 1000psi
--1010ooC at 7000kPaC at 7000kPa65mg/std m65mg/std m33
--88ooC@C@70barg70barg
--1010ooC@C@85barg85barg
HH22SS0.250.25--1gr/100scf1gr/100scf
(4(4--16ppm 16ppm volvol))66--23 mg/m23 mg/m33
(0.25(0.25--1 gr/100scf)1 gr/100scf)5mg/m5mg/m33 4mg/m4mg/m33
Total STotal S 55--20 gr/100scf20 gr/100scf(20(20--100 100 ppmppm volvol)) 2323--115 mg/m115 mg/m33 30mg/m30mg/m33 50mg/m50mg/m33
COCO22 22--3%3% 2%2% 2.5 mole%2.5 mole% 2.0 mole%2.0 mole%
NN22 22--3%3% Typically not Typically not specifiedspecified
Typically not Typically not specifiedspecified 5 mole%5 mole%
OO22 0.1%0.1% 0.4%0.4% 0.01 mole%0.01 mole% 0.001 mole%0.001 mole%
HydrocarbonHydrocarbonDew PointDew Point
+15+15ooF @ F @ 800psia800psia
--1010ooC @C @Specified pressureSpecified pressure
--22ooC@70bargC@70barg --22ooC@85bargC@85barg
WobbeWobbe IndexIndex Typically not Typically not specifiedspecified
Typically not Typically not specifiedspecified
13.613.6--15.8kWh/m15.8kWh/m33 47.247.2--
51.4MJ/m51.4MJ/m33
Gross Heating Gross Heating ValueValue
10001000--1200 1200 btu/scfbtu/scf3737--45 MJ/std m45 MJ/std m33 3535--39 mJ.m39 mJ.m33
8.48.4--13.113.1kWh/mkWh/m33 36.936.9--
42.3MJ/m42.3MJ/m33
Gas Interchange Diagram
Non Methane components %
Adapted from “A Guide to the Gas Safety (Management) Regulations
1996 – Guidance on Regulations Health & Safety Executive.
© Crown Copyright (UK) 1996
Commercial Trends1. Rapid increase in capital cost2. More competition, more risk-taking. Global supply
strategies3. Building ships/terminals in advance of firm
supply/sales contracts. Merchant facilities4. Increasing power generation market
5. Regional market trendsa. Asia. Liberalization of existing markets. India.
China.b. Europe. Open access. Market related prices.
LNG and pipeline supplies.c. Americas. USA – more terminals? Price volatility. d. Central/South America.
6. Market niches: small-scale supply projects, reception, satellites.
Flex LNG concept
• SPB type Cargo Containment• Flat deck to mount process plant
LNG – Roaring Ahead
Where Will it End?
© 2008 Hamworthy, Used With Permission, All Rights Reserved
Reduce Environmental Impact
1. Reduce CO2– Inject Produced CO2– Install most efficient drivers
• Cogeneration• Larger Turbines• Electric Motor Drivers
2. Reduce NOx– Install “Clean-burn” technology
3. Effect on Marine Environment– Use of air coolers
UK Gas Supply and Demand
World LNG Trade
© 2005 LNG Journal & Reproduced with Permission
Some of Today’s Challenges in LNG…..Many
• Permits for US Imports
• Crews for LNG Carriers
• LNG quality variations
• Security
• Materials and Staffing
LNG – Roaring Ahead
John MorganJohn M. Campbell & Company
Exclusive Provider of PetroSkills Facilities TrainingHeadquarters Office
1215 Crossroads Blvd., Norman, OK 73072 USA
(405) 321-1383 Office / (405) 321-4533 Fax / (303) 523-6797 Cell
[email protected] / www.jmcampbell.com
©2008 John M. Campbell & Co. and Other Copyright Holders
All Rights Reserved
Where Will it End?
Melkoya Island
StatoilHydro Snøhvit Plant
• Europe's first LNG export facility
• Capacity 4.2mtpy• Linde MFC process• First shipment 20th
October 2007• 140km tie-back to
subsea templates• CO2 sequestration
THE END
Thank You!
Bontang Train B Incident April 1983
Natural Gas Reserves/Consumption
1. Russia (Gazprom) 26.6%) 14.7%2. Iran (NIOC) 14.9%) 56% 3.2%3. Qatar (Qatargas) 14.3%) 0.6%4. Saudi (Saudi Aramco) 3.8% 2.5%5. UAE (Adnoc) 3.4% 1.5%6. USA 3.0% 23.0%7. Nigeria (NNPC) 2.9%8. Algeria (Sonatrach) 2.5% 0.9%9. Venezuela (PDVSA) 2.4% 1.1%10. Iraq (INOC) 1.8%11. Indonesia 1.5% 1.3%12.Australia 1.4% 0.9%13.Malaysia 1.4% 1.3%14.China 1.3% 1.7%15.Norway 1.3% 0.2%16.ROW 17.5% 37.1%
Courtesy BP Statistical Review 2006
Prices in 2006 (77) ($/MMBtu)
• Japan 7.14
• EU 8.77• UK 7.87
• USA (HH) 6.76
• Oil 10.66 (20)
• Current Prices 10-15
© 2008 Hamworthy, Used With Permission, All Rights Reserved
Costs in an LNG Project
Gas Gathering US$ 1 – 1.5 billion
Liquefaction (1 train) US$ 1 – 1.5 billion
Ships 5 @ $180 m US$ 0.9 billion
Regasification US$ 0.5 billion
TOTAL US$ 3.4 – 4.4 billion
Could easily reach $5,000,000,000
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