About 15 years ago, upon returning from an industry meeting that featured a couple of presentations on LNG, I wondered aloud to a veteran Oil & Gas Journal editor why we seemed to give it such scant coverage.
"LNG is going nowhere," he replied, …or words to that effect. Too expensive for such a cheap commodity (i.e., natural gas), it'll always be an industry bit player. A player—big and bit—it has certainly become, although perhaps not exactly as we foresaw.
By the late 1990s and early 2000s, it was clear that demand for natural gas for all sorts of uses was rising, especially in such developing-world markets as Asia-Pacific and Latin America.
It was also clear that markets in Europe wanted to diversify their gas sources, principally away from Russia, as well as rely more on cleaner burning natural gas than on heavier hydrocarbons, especially fuel oils and coal.
All these markets spawned plans for import terminals, which simultaneously spawned plans in gas-producing regions for LNG liquefaction plants, which spawned plans for more and larger LNG carriers.
As this major—and expensive—infrastructure grew, something else began to grow: bits of LNG use few of us had thought of in the 1990s.
It's the medium
With apologies to Marshall McLuhan, LNG is not the message or, in this case, the fuel. In conversations with friends and others from outside the oil and gas industries, I find myself reminding them that LNG is only the means of storing and moving the fuel, which is natural gas.
Had I a firmer grasp on this fact years ago, I and others probably would have been less surprised years later to watch the scale of LNG liquefaction and regasification reach current levels: Qatar now boasts several 7.8-million tonnes/year liquefaction trains, the world's largest. And most newer land regasification terminals can accommodate the new 200,000+ cu m Q-Flex and Q-Max LNG carriers that hold more than twice as much as many vessels from the 1980s and 1990s.
With growth in capacities, however, has come expansion in scope. In this space more than 3 years ago, I noted such a trend (OGJ, June 23, 2008, p. 19):
Linde Group and Waste Management Inc. built a $15 million plant in California to liquefy landfill methane to fuel 300 trash trucks and recycling collection vehicles.
LNG doesn't fuel the trucks; the trucks burn methane vapor produced by a simple onboard regasification loop, according to Jeff Beale, president of CH-IV International.
Announcements of such configurations are now more frequent:
• A few days ago, engine manufacturer Wartsila and Shell Oil Co. announced an agreement to promote use of "LNG as marine fuel." Shell will make the LNG available to Wartsila's gas-powered vessel operators and other customers.
In fact, LNG has been in use for a while on small and medium-sized ferries along Europe's Scandinavian coastlines.
• Mohawk Industries, Calhoun, Ga., has also announced that five of its tractor trucks will "run on LNG," mostly for deliveries in California.
• Also in California, Pacer International Inc., a freight transportation provider, will add several "LNG-powered" trucks to its Southern California Cartage fleet. Such trucks, according to Pacer, produce 33% less NOx and 20% less greenhouse-gas emissions than diesel-fueled trucks.
• In Louisiana's Haynesville shale play, operator Encana Natural Gas Inc. last spring announced it would supply LNG from a mobile LNG fueling station to Heckmann Water Resources, which provides water-hauling services to natural gas producers in the play.
Technology creep
For some time, of course, compressed natural gas has been available for vehicle and other engine applications. It has established itself in many markets as a dependable fleet fuel. LNG is unlikely to supplant it.
What I find interesting about LNG is its migration, its evolution—from large-scale logistics (liquefaction-shipping-regasification) and expensive, exotic equipment (stainless steel) in its early and even recent history to smaller and more localized niche applications today.
If natural gas (the fuel) is to realize its potential—and soon—as the bridge hydrocarbon to fuel economies toward reducing GHG emissions, surely LNG (the medium) is the path it must take.
More Oil & Gas Journal Current Issue Articles
More Oil & Gas Journal Archives Issue Articles
View Oil and Gas Articles on PennEnergy.com
