Offshore LNG Terminal Tomorrow’s natural gas supply chains

As onshore infrastructure looks increasingly ill-suited to the new challenges of the LNG market, offshore terminals have emerged as an interesting alternative.

Floating terminals
Floating terminals are gaining ground over “conventional” onshore terminals for their ability to meet the challenges related to marketing remote offshore gas resources and transporting LNG over long distances.

Once little more than conventional ships, LNG carriers now perform several LNG terminal operations. This is notably the case for SRV (Shuttle and Regasification Vessels) and FSRU (Floating Storage and Regasification Units).

Combining these functions makes economic sense, as the cost of building a floating unit has remained stable while onshore terminals have grown more expensive.

These facilities present their fair share of technical challenges:  while offshore terminals eliminate certain constraints related to location (i.e. no need to find space on the waterfront or at an existing port), they still need to be specially equipped to handle the docking of LNG carriers and to connect cryogenic offloading arms at sea and all year round.

New systems are continually developed and implemented to meet these challenges, such as the STL (Single Turret Loading) buoy system for loading and offloading at sea.

Offshore terminal in Uruguay
The GDF SUEZ Group takes an exceptionally proactive approach to developing offshore terminals. After commissioning one of the world’s first offshore LNG terminals in Boston, the Group is currently developing similar projects in Uruguay, India and China. Located 4 km from Montevideo, the GNL del Plata offshore storage and regasification terminal will offer a 263,000-m3 storage capacity and is scheduled for delivery in 2016.

Greater collaboration with China
Cooperation with China has notably expanded through new partnership agreements signed in 2014 with Beijing Enterprises Group (LNG supply and sale, offshore gas exploration-production) and Shenergy Group (natural gas transport and distribution).

GDF SUEZ is also supporting Shanghai Gas Group, a subsidiary of Shenergy Group, in a project to expand one of its LNG terminals.

Organized through a partnership with CNOOC (China National Offshore Oil Corporation), the sub-chartering of the GDF SUEZ Cape Ann LNG carrier in Tianjin led to the construction of the country’s first floating regasification terminal.

Designed to supply 3 billion m3 of gas per year, the terminal currently powers Tianjin and Beijing, and will eventually supply the provinces of Hebei and Shandong.

LNG retail A key growth market

Retail LNG is developping worldwide and is promising to demonstrate solid growth moving forward. Today, the Group offers retail LNG services in the United States, Europe and soon in Asia, along with LNG fuel services.

Context
Retail LNG encompasses two activities: LNG fuel (intended for ships, trucks and trains) and transported LNG (supplying customers not connected to the main gas pipeline network). This sector offers a strong growth perspective, by some estimates it could represent 10-15% of the global LNG market by 2025, or 60 million metric tons per year.

Transported LNG
Transported LNG (its name derives from the fact that it’s transported by tanker trucks) allows the supply of small or remote markets that are not connected to the main gas pipeline network.

Depending on the demand, GDF SUEZ can supply off-terminal LNG to intermediaries who supply, in turn, their clients, or sell directly to clients (industrial, LNG fueling stations, etc.).

In Europe, GDF SUEZ began its transported LNG market activity in 2013. However, the activity has grown at a rapid pace in response to rising demand from industrial customers located outside of established gas networks. These are clients looking to convert to natural gas for its competitive prices and low carbon output.

The Group’s LNG terminals are now adapted to this activity. Montoir-de-Bretagne and Fos Tonkin in France as well as terminals where the Group has acquired long-term capacity (Zeebrugge in Belgium and Isle of Grain in the United Kingdom) all feature LNG truck loading and transport services. Montoir-de-Bretagne recently celebrated its 1000th truck loading operation and LNGeneration, a GDF SUEZ subsidiary dedicated to transports LNG, delivers on a daily basis to a range of industrial clients.

LNG fuel
Retail LNG is taking off notably because it is much cleaner than LPG, heavy fuel oil and diesel. Used by ships, trucks and trains in place of these conventional fuels, LNG fuel is gaining wider industrial use for its environmental benefits (it emits 20% fewer CO2 emissions and 95% less fine particulate matter than diesel).

In fact, environmental regulations (stipulating that ships must reduce emissions first in Northern Europe, then worldwide by 2025) led GDF SUEZ, Mitsubishi and NYK to sign an agreement to develop LNG as a marine fuel. By chartering LNG Bunkering Vessels, the joint venture will transship fuel to supply LNG-powered ships. The first LBV ordered by GDF SUEZ will be delivered by 2016.

In Europe, LNG Solutions offers an LNG supply solution to the Dutch transport market, supplying trucks, barges and coastal shipping.  In 2013, it opened its first refueling station and in April 2015 partnered with DCB Energy to create ten others throughout the country, including four by the end of the year.

In the Northeast United States, GDF SUEZ supplies LNG fuel for the fleet of TransGas, a leading regional LNG truck transport company.

Through its wide range of LNG expertise, GDF SUEZ is well positioned in the global retail LNG market. The Group is currently planning a rapid development of this activity in Indonesia, Chile and India.