Standardized, Modular, Small-scale LNG with Low Lifecycle Cost Paper

 In Papers

Natural gas has developed into the fossil fuel of choice for power generation, industrial use and domestic heating. It produces 30%–40% lower carbon emissions than oil or coal, and zero sulfur emissions. The capital cost of gas-fired power plants is half that of coal-fired facilities. For this reason, LNG is regarded as a high-growth market and is expected to become a low-carbon bridging fuel, pending full deployment of renewables and green or blue hydrogen-based fuels.

At present, the bulk of LNG is produced at low cost in large baseload plants with capacities of up to 7 MMtpy per train and having significant LNG storage facilities. After shipment, LNG is typically stored in a receiving terminal, regasified and used as fuel in power plants and gas grids. In addition to bulk supplies, LNG production plants and receiving terminals can provide competitively priced LNG to smaller markets within a reasonable distance by offering break-bulk volumes.

New LNG markets, including bunker fuel and transportation fuel applications, are developing fast due to environmental pressures around carbon dioxide (CO2), nitrous oxides (NOX) and sulfur (SOX) emissions. These markets are more distributed and often cannot be economically served by break-bulk volumes from existing LNG storage facilities. They are candidates for LNG sales from small-scale LNG liquefaction facilities operating on pipeline gas, flared gas, coal seam gas, biogas and small gas fields. However, these small-scale LNG plants face challenging economics given their small scale. Special emphasis must be placed on developing a competitive offering with the lowest lifecycle cost.

Achieving the lowest lifecycle cost requires:

  • A process configuration that strikes a competitive balance between CAPEX and OPEX
  • A project development and implementation approach that benefits from a lean, standardized, modular design; low-cost shop fabrication; and reduced project schedule.

This article developed by the Freek Van Heerden, Fred Haney and Geoff Skinner in Gas Processing News describes an optimized solution to this challenge. Click on Standardized, modular, small-scale LNG with low lifecycle cost (gasprocessingnews.com) to see the full paper.