Study on the LNG distribution to mobile power plants utilizing small-scale LNG carriers

Abstract

In recent years, the use of small-scale liquefied natural gas (LNG) has grown alongside demand from industrial users of natural gas. Small-scale LNG is an alternative to the supply of natural gas to remote areas with a cost-effectiveness challenge. To address this challenge, five mobile power plants located in remote areas with limited depth of water level in western Indonesia are used here as a case study. The objective of this paper is to optimize LNG distribution using small-scale LNG carriers and carry out an economic analysis in this region. The capacitated vehicle routing problem model was used to optimize the maritime routing of a small-scale LNG supply chain. The maximization of the volume cargo with a given LNG vessel capacity set as the objective function was therefore provided with the optimum inventory routing and economic analysis of the transport of LNG. Cluster 1 serves three power plants with a total demand of 966 m3/day and a distance is 913 Nautical Miles, while cluster 2 serves two power plants with a total demand of 690 m3/day and distance of 1,483 Nautical Miles. Economic analysis of the two clusters shows that there is a minimum difference in the margin rate needed to make it worth the investment, which is 3 USD/MMBTU for cluster 1 and 4 USD/MMBTU for cluster 2. Thus, this paper concludes that the cost of LNG transportation depends on the amount of cargo demand and shipping distances.