Liquified Natural Gas in a container
The commonly recognised 40-foot long shipping container is set to widen the market for LNG over coming years to include those potential gas consumption areas not serviced by mainland pipeline networks and without local access to natural gas resources.
This conclusion was released by the international law firm and energy sector specialist, Baker Botts L.L.P., which said the use of the containers is emerging as a cost competitive transport solution that brings the benefits of natural gas to “isolated” markets.
Mr Steven Miles, Baker Botts’ Energy Sector Chair and head of the firm’s worldwide LNG practice, is delivered a global perspective on the relatively recent trend in containerisation of LNG and the commercial models driving its growth, in an address to the LNG 18 conference in Perth early next in March.
“The natural gas ‘revolution,’ and in particular the rapidly expanding international seaborne LNG cargo trade, is bringing benefits to consumers in many countries through lower energy costs, reduced carbon emissions and a cleaner environment,” Miles said.
“However, these benefits have largely been limited to residents of countries with access to a natural gas pipeline system, or a deep-water port facility able to receive large tankers carrying liquefied natural gas (LNG),” he added.
“This has created gas ‘islands’ by nature of their geographic isolation, or location on a mainland not connected to natural gas sources. These pockets are typically left to use coal, petroleum, or other energy forms that are more expensive and less environmentally friendly than gas or LNG,” he noted.
However, according to Miles, emerging commercial, legal and technological developments are now allowing LNG in ISO containers to be delivered to these previously inaccessible LNG market destinations.
According to Miles, the containers are typically 40-foot long forms that can be loaded with LNG and shipped by freighter, rail or truck, and delivered to a power plant. “This containerisation trend will increasingly bring highly mobile, cost competitive additional LNG consignments into the overall energy market mix with the broader community gain of a much lesser negative environmental footprint through the phasing out of more intensive fossil fuels used in these previous ‘gas island’ areas,” he added.
Miles said the subsequent unloading and re-gasifying of container transported LNG was a relatively straightforward process that did not involve the degree of capital commitment needed for a conventional maritime-based LNG import terminal or pipeline.
The containerised route to market may also offer a reduction in regulatory and land-use requirements compared to those for siting a conventional LNG receiving, storage and regasification terminal.
The LNG 18 conference in Perth was the biggest LNG conference and exhibition ever held in Australia and the world’s largest event on the 2016 global LNG calendar.