Cluster Liquefied Natural Gas: A New Paradigm for Small- and Medium-Scale LNG Business

Abstract

This article, written by JPT Technology Editor Chris Carpenter, contains highlights of paper SPE 171510, “Cluster Liquefied Natural Gas: New Paradigm for Small and Medium Liquefied-Natural-Gas Business,” by JungHan Lee, LNG Solutions, prepared for the 2014 SPE Asia Pacific Oil and Gas Conference and Exhibition, Adelaide, Australia, 14–16 October. The paper has not been peer reviewed. Small- and medium-scale liquefied natural gas (LNG) is different from conventional LNG in trading distances, target markets, and application areas. Small- and medium-scale LNG may better coordinate needs between regional gas producers and consumers. Cluster LNG is a new concept of LNG technology suitable for emerging market environments. High performance of cluster LNG originates from higher liquefaction temperature and the adoption of efficient refrigerants for the temperature ranges. The inherent high performance of cluster LNG enables low capital expenditure (CAPEX) and low operational expenditure (OPEX). Background Small-scale LNG has so far constituted only a minor portion of global LNG production. However, there are many necessities of regional energy infrastructures and technologies that are different from those of traditional LNG. In Southeast Asian countries, natural gas and LNG sometimes compete with diesel oil rather than large-scale pipeline gas or large-scale LNG. At the same time, there are many small scattered gas sources remaining to be monetized for domestic markets in the region. Nevertheless, these domestic gas fields have not been developed properly so far because of small units of production and, as a result, high cost per unit. In this regard, new technologies suitable for small- and medium-scale LNG development may be necessary. LNG for global exports and LNG intended for regional demands may need different approaches. Typical large-scale LNG aims to export at a radius up to 10 000 km; on the other hand, small- and medium-scale LNG may need only a 500- to 2 000-km radius.