Shell To Build World's First Floating LNG Facility

Abstract

Shell will build and deploy the world’s first floating liquefied natural gas (FLNG) facility, a milestone in industry efforts to commercialize gas supplies that have been stranded for economic reasons stemming from logistical, technical, business, and marketing challenges. The Prelude FLNG project, which Shell will operate with a 100% interest, received its final investment decision in late May. The facility will produce an estimated 3 Tcf of gas and equivalent resources from the Prelude field, discovered by Shell in 2007 approximately 125 miles offshore northwest Australia. First production is anticipated in 2017. On the facility, field gas will be produced, processed, liquefied, stored, and offloaded to oceangoing LNG carriers that will transport cargoes to multiple markets. The facility will also handle field liquefied petroleum gas (LPG) and condensate for ship-borne transport to market. “Our decision to go ahead with this project is a true breakthrough for the LNG industry, giving it a significant boost to help meet the world’s growing demand for the cleanest-burning fossil fuel,” said Malcolm Brinded, executive director of upstream international at Shell. The FLNG technology, he said, “is an exciting innovation, complementary to onshore LNG, which can help accelerate the development of gas resources.” A consortium composed of Technip and Samsung Heavy Industries (SHI) has been contracted by Shell to provide engineering and procurement and perform construction and installation of the Prelude FLNG facility. The facility will be the largest floating structure ever built, measuring 1,602 ft (488 m) long by 243 ft (74 m) wide. Its length is slightly less than the height of the Willis Tower in Chicago and greater than the height of the Petronas Towers in Kuala Lumpur. With a weight of more than 600,000 tons when fully ballasted, the facility has a displacement approximately six times that of the world’s largest aircraft carriers. Construction will take place at SHI’s Geoje Shipyard in South Korea, one of the few locations in the world with a dry dock big enough to accommodate a facility of this size. Once constructed, it will be towed to location—a six-week journey—where it will be fully moored and commissioning of the facility will begin. Once operational, it will produce 4 million tons/yr of LNG, 1.4 million tons/yr of condensate, and 0.4 mil-lion tons/yr of LPG. On a composite basis, the production is equivalent to 110,000 bbl of oil.