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Abstract Introduction
Natural gas is becoming one of the most Consumption of natural gas has been increasing
important resources of energy with its share in rapidly making it one of the most important
the world consumption expected to increase as energy resources in the world. In 2002 the
much as 50% by 2020. Currently, natural gas is consumption of natural gas was 89.5 Tcf
transported to the markets by pipelines and as worldwide, an increase of about 3% since 2001.
liquefied natural gas (LNG). Transporting the During the last decade the consumption of
natural gas by pipelines is convenient and natural gas increased by almost 25%1 . By 2020
economical for onshore purpose. For offshore natural gas is predicted to increase its world
transport of natural gas, pipelines become energy share to as much as 50% from the
challenging as the water depth and the present of 22%2 . Much of the increased
transporting distance increase. LNG, an consumption is seen to be in the electric power
effective mean of transporting gas for long generation.
distances overseas, constitutes 25% of the world The lower carbon emissions compared to
gas movement. But LNG projects require large oil and coal along with other reduced emissions
investments along with substantial natural gas of nitrogen oxides and particulates make gas
reserves and are economically viable for environmentally attractive. More important is
distances longer than 3000 miles. that the cost of power generation using natural
Compressed natural gas (CNG) gas is 50% less than using coal3 . These factors
technology provides an effective way for have led to future projections of increase of
shorter-distance transport of the gas. The annual consumption in power generation from
technology is aimed at monetizing offshore 5.23 Tcf in 2000 to 9.39 Tcf in 2020, an
reserves, which cannot be produced because of increase of 80%, in the U.S. alone 4 . Similar
unavailability of pipeline or because the LNG trends are seen in the developing parts of the
option is very costly. Technically the world such as Southeast Asia.
technology is easy to deploy with less This increased consumption of natural
requirements for facilities and infrastructure. gas along with the reduction of the market share
Economically for distances up to 2500 miles of existing sources such as coal and oil have
CNG can transport natural gas at prices ranging raised the specter of shortages in supply in the
from $0.93 to $2.23 per MMBTU compared to United States and other nations. With the
LNG, which can cost anywhere from $1.5 to emerging demand and with new ma rket
$2.5 per MMBTU depending on the actual opportunities expected to arise, the ways of
distance. At distances above 2500 miles the cost transporting the gas from offshore reserves and
of delivering gas as CNG becomes essentially overseas sources have generated considerable
the same as the LNG whereas the disparity in and renewed interest.
the volumes of gas transported by the respective Existing means of transporting natural
technologies and market demands play the gas consist primarily of pipelines and LNG.
deciding role for using the technology. Pipelines account for 75%, with LNG making
for the rest1 . Pipelines are the obvious means for
the onshore transport of natural gas. But for
offshore transport, as the water depth and
distance between sources and users increase, have renewed the interest in commercializing
pipelines become economically unattractive. the technology6 .
LNG provides then an appropriate way of One of the proponents of the CNG
delivering natural gas from offshore. However, technology in the early 1990s was Cran &
because of the large upfront investment, LNG Stennings Technology Inc. that proposed a well-
requires large reserves of natural gas near the known concept, “Coselletm ”6 . The idea seeks to
facilities to support a LNG project and get reduce the manufacturing cost of the gas
acceptable returns capital investment. New LNG containment system. Spooling small diameter (6
projects need approximately 0.5 to 1 Bcf per inch) coiled tubing into large carrousels
day of gas throughput to justify the investment 5 . achieves the purpose. The gas is pressured up to
One other requirement for LNG is the 3000 psi at ambient temperatures. Similar
need for a large demand at the user site. For methodology is used by others namely
example, a typical LNG import would require a TransOcean Gas, a Canadian enterprise, and
gas- fired power generating capacity of up to Knutsen O.A.S Shipping of Norway with
5000 MW3 . Such demand limits the potential varying characteristics of the containment
receivers of LNG to a handful of countries and system7 .
locations. Satisfying small demand markets and Another approach to CNG is espoused
monetizing small reserves are the two things Enersea Transport LLC 6,8. They developed the
that CNG transport of natural gas is intended to “VOTRANStm ” concept in which the natural gas
target. is compressed and cooled to lower
CNG technology can be used readily for temperatures6 . This reduces the volume of the
the transportation of gas from smaller and compressed gas compared to just compressing it
marginal fields with small throughputs of, e.g., at ambient temperatures. At the lower
100 MMscf/d3 . The technology is simple and temperatures of 0 to –40o F the process works at
can be easily brought into commercial lower pressures than at ambient temperatures6 .
application. Present ly no major CNG projects This paper is an attempt to optimize the
are commercially operated but recent transport of natural gas as CNG using the
developments in the ability to ship economically concept developed by EnerSea Transport LLC
large volumes of gas over long distances and and develop an understanding where the
ongoing work in engineering designs suggest technology stands from the economic
that the technology is at the threshold of been perspective compared to the LNG technology
applied commercially6 . for the transport of natural gas.
Qch =
Q $ / BHPch = $ / BHP × f 2
12,000 BHPch= Chiller compressor size
Table 2 shows the factors used for each
Qch = Heat duty in tons of refrigeration stage of refrigeration used and the cost of power
1 ton refrigeration = 12,000 BTU/hr. per ton of refrigeration.
Transport
17
Distance cost Unit cost
Shipping miles $/MMBTU $/MMBTU
89% 500 0.4 2.55
1000 0.5 2.65
1500 0.6 2.75
2000 0.7 2.85
2500 0.8 2.95
Figure 3- Cost components for a CNG 3500 1.1 3.25
project 5000 1.5 3.65
Commercial Opportunities
What are the worldwide potential applications
of CNG, especially in light of many recent
announcements for LNG projects, all expected
to remedy the otherwise looming natural gas
shortages?.
As determined earlier for distances up to
Figure 4- Plot of unit price of delivered gas as 2500 miles, or even longer, CNG is potentially a
CNG and LNG against considered distance. very successful means to transport natural gas.
Figure 5 is a map of the world showing regions
with large commercial possibilities for CNG6 .
Figure 4 shows a plot of the comparison These include the major markets of North
of the unit price of gas delivered as CNG and as America, Asia and Europe. Considering present
LNG. From Table 6 and Figure 4 it is clear that market prices of natural gas and LNG’s
for distances up to 2500 miles CNG can deliver advantage to transport more gas, LNG stands a
the gas in amore cost-effective manner than better chance for distances between Australia,
LNG. With increasing distance the price of the Indonesia and Nigeria and the United States or
gas delivered as CNG becomes equal or exceeds the same countries and Japan or the emerging
the cost of LNG. The main reason for the CNG huge market of China. However, CNG would be
cost escalation is the substantial investment an obvious option for the Pacific Coast of
Russia to Japan and China, Algeria and Libya
to Europe, Atlantic Canada and the Northeastern way for containment and transport of gas.
Part of the United States, the Cook Inlet and the Simple loading and unloading requirements
Northwestern Coast of the United States. Even provide an advantage in using the technology
announced projects such as Trinidad to the for offshore purposes.
United States and (potential) Venezuela to the Economically, 90% of the investment is
United States should seriously consider CNG in transportation making CNG projects less
instead of LNG. risky. This gives the flexibility to move assets
around as per needs in case a project fails to live
up to its expectations.
One drawback is the smaller volume of
gas transported. LNG transports two to three
times of the amount of gas that CNG can
transport based on present concepts.
The main advantage of CNG is the low
cost at which it can transport gas over distances
up to 2500 miles in which CNG is more cost-
effective than LNG. CNG’s ability to market
small reserves is an additional major benefit.
Figure 5- Scope of applying the CNG The technology has a wide scope of
technology worldwide6 commercial application linking major markets
such as North America, Japan and China and
Europe.
One way of applying the CNG
technology is in conjunction with LNG6 . It can Acknowledgements
work as a complement for a LNG project The authors wish to thank Messrs. Paul Britton
because CNG can serve as a temporary solution and Charles White, Enersea Transport LLC and
for reserves that can eventually support a LNG Mr. De La Fuente, Paragon Engineering for
project. Such an application would “accelerated their extensive help in this study. Also, the
cash flow and economic return for the professionals at Toromont Process Systems
exploration costs”6 . Monetizing the reserves provided substantial technical and economic
earlier can both help and in the process, through information.
production behavior can prove their viability to
support a long-term LNG project. Also CNG References:
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