Because of its capital intensiveness, LNG is only cost-effective with very large scale projects, with correspondingly large reserve sizes and markets. The transit distance crossover point between LNG and CNG varies depending on the type of project, reservoir size, market size and economic drivers of both the supplier and the market. However, in general the economics of LNG will crossover with CNG somewhere around 2500 kilometers assuming a very large reservoir (3-5+ TCF) and correspondingly large gas flow rates.
Advantages for Stranded Gas Development
|Lowest Initial Field Development Investment||X|
|High Flexibility for Changing Volumes||X|
|Easy Access to Multiple Markets||X||X||X|
|Rich (incl. Associated) or Lean Gas||X||X||X|
|Offshore Loading, Offloading Options||X||X||N/A|
|Low Terminal Costs||X||X|
CNG projects have much shorter development timelines than LNG, resulting in a dramatic increase in net present value when compared to green field LNG projects.
LNG projects require enormous amounts of capital invested in fixed facilities – typically over 60% of the overall LNG project cost. EnerSea’s VOTRANS™ technology is designed to have less than 15% of its total capital costs invested in fixed facilities. The vast majority of capital tied up in an EnerSea project is in the vessels that are re-deployable. Accordingly, VOTRANS has the potential flexibility to accommodate smaller projects in applications that have higher risk issues and can also take advantage of changing market opportunities.
In order to confirm reserves large enough for LNG projects, producers face high appraisal and development costs, schedule and risks. VOTRANS’ ability to lower development risk by initiating earlier cash flows with smaller proven reserves can provide an attractive complement to potential LNG projects. If the project reservoir subsequently proves substantial enough for LNG, then the producer can utilize VOTRANS until the LNG trains are constructed and then re-deploy the VOTRANS vessels to another project. Otherwise, the producer can profitably produce the smaller reserve base using VOTRANS and will have managed his risk by doing so.
EnerSea’s VOTRANS technology is cost competitive when compared to deepwater or long-distance pipelines. Further, pipelines offer no option for redeployment. Even though pipelines are well-established solutions for gas developments, there are advantages that CNG has over pipelines for stranded gas developments, such as:
- CNG is scalable and can be expanded or scaled back based on field development objectives.
- CNG systems are re-deployable, which allows application for shorter field depletions.
- CNG costs are independent of water depth.
- CNG systems can be applied in arctic areas that have iceberg exposure.
- CNG can overcome cross-border issues that can prevent pipeline projects.
Many operators are now investigating small-scale floating LNG, or FLNG. EnerSea has developed a floating gas production solution that addresses the challenges operators are facing by advancing the development of its VOTRANS compressed natural gas (CNG) carrier into an all-in-one gas production and transport system called GPSS (Gas Production Storage Shuttle). The GPSS is analogous to an FPSO used in oil service in all environments worldwide with the added capability of transporting its gas product to market. EnerSea’s CNG solution, which allows production, storage and transportation, provides significant advantages over FLNG:
|Issue||GPSS Scenario||Floating LNG|
|Application in sea conditions||Worldwide, all sea conditions||Mild sea conditions only|
|Investment fixed assets
(excluding wells and intra-field flowlines)
|Riser and buoys||Riser and buoys|
|Investment: Re-deployable assets||GPSS fleet, with onboard production, compression and gas handling facilities||Gas production facility; gas cleaning and pre-processing facility, LNG vessel with liquefaction train(s); LNG transport vessels|
|Market||Regional markets; simple offloading terminals. CNG storage can be provided.||Markets with existing LNG regasification terminals|
|Capacity expansion||Add GPS shuttle(s)||Add liquefaction trains, gas pre-processing and LNG ships|
Many aspects of FLNG are unproven, such as offshore liquefaction and tanker-tanker cargo transfer systems. FLNG also requires separate facilities (e.g. FPSO) for cleaning and pre-processing of raw gas well stream required for LNG. Additionally, due to the tall towers required for FLNG pre-processing and the offloading methods, it will be very challenging to design and operate an FLNG system offshore in harsh environments without significant uptime penalties. Additional advantages of an FPSO, such as risk management and re-deployability, also apply to the GPSS.
Benefits of VOTRANS™ vs. High-Pressure CNG Technology
VOTRANS has many advantages over alternative High-Pressure CNG technology, including:
- Storage Efficiency: Alternative efforts by EnerSea’s competitors to develop high-pressure CNG concepts all store gas at ambient temperature (approx 15 – 25°C) and pressures in excess of 235 bar (3400 psi), which require pressure vessel designs having much greater wall thicknesses or supplemental fiberglass wrapping with corresponding higher weight and much greater cost. EnerSea’s lower pressure approach ensures that VOTRANS steel cylinders are also the lightest containment option available to store a given volume of gas, even when compared to fiberglass or hybrid tanks. Compared with other CNG technologies, VOTRANS can store 60% more gas (mass) per pound of steel due to the optimization of pressure and temperature. This efficiency would enable EnerSea to carry the same gas volume per ship at a lower cost per unit. As a result, VOTRANS-based transportation costs are as much as 30% less than other High-Pressure CNG alternatives.
- Gas Handling System: EnerSea’s patented liquid displacement system used for unloading gas allows the evacuation and delivery of up to 98% of its gas cargo versus only 85-90% for blowdown systems. Therefore, High-Pressure CNG competitors must build ships that have 10-15% larger storage capacity than a VOTRANS ship simply to deliver the same gas volume.
- Cold Temperature Cycling: Another advantage of EnerSea’s patented liquid displacement system is enhanced safety. High-Pressure CNG alternatives require expansion to occur within their cargo containment system, subjecting the cargo systems to large temperature and pressure variations. EnerSea’s liquid displacement process allows the temperature drop associated with expansion of the gas to occur outside the storage containment system, at a control point (similar to
J-Tvalves in gas plants), thereby protecting the containment system from potentially damaging, severe and repetitive cycles in temperature.
- Range of Gas Compositions: EnerSea’s VOTRANS technology is designed to maintain control of pressure and temperature during unloading operations which allows the transport of rich gas as well as lean gas. Expansion and subsequent temperature drop during offloading within High-Pressure CNG systems causes natural gas liquids to drop out of the vapor phase in the containment system, creating potentially undesirable slug flow.
- Lower Pressures: VOTRANS is designed to operate at a pressure of approximately 125 bar, compared to 235+ bar for High-Pressure CNG systems, which results in less compression requirements on client’s platforms and significantly less capital and operating costs for compression facilities.
- Energy and Facilities: Compression and gas cooling are required for both VOTRANS and High-Pressure CNG systems and the energy required for both are approximately equal. However, the energy split between compression and chilling for VOTRANS is about 50/50, while High-Pressure CNG is about 90/10. EnerSea’s primary benefit is that utilization of this volume optimization principle results in a significant reduction in steel weight and resultant cost savings. Additionally, EnerSea’s offloading system consists primarily of liquid pumps, which are easy to maintain and low cost as compared to scavenging gas compression required for High-Pressure CNG alternatives.
|Ship cargo operating pressure (bar)||125||235 -275|
|Ship cargo operating temperature (°C)||–30||15-25|
|Unloading method||Liquid Displacement||Blowdown & Scavenging|
|Steel / gas weight ratio (MT/mmscf)||75||105-135|
|Allowable water content (Lbm/mmscf)||up to 7||<1-3|
|Ability to transport lean and rich gas||Yes||???|
|Energy required to store gas (ratio)||1||1|