The process barges used in the LNG Lite system use standard gas plant technology. (Image courtesy of SeaOne)

A new business model proposes to rescue stranded gas by knocking down many of the barriers keeping it from market. SeaOne Martime Corp. has secured Approval in Principle and Interim Design Approval from the American Bureau of Shipping for its LNG Lite marine gas transportation system and is on the verge of commercializing it as a solution for monetizing marginal and remote natural gas reserves.

Identifying the problem

Fields are stranded for many reasons, but in most cases stranded gas is simply too far from a pipeline or shoreside processing plant or exists in reservoirs that are too small to pay back the costs required by current development strategies. Estimates indicate that of the 6,000 Tcf of proven gas reserves on the planet, more than 2,000 Tcf is stranded.

The US Energy Information Agency estimates that by 2030, gas demand could reach 190 Tcf — 27% of global energy need. If that occurs, today’s known non-stranded gas would barely get civilization past the middle of the century. Considering that many new gas field discoveries are in increasingly remote and undeveloped areas, it is easy to see why accessing stranded gas is high on the list of priorities for the industry.

Wellstream gas is about 70-90% methane (CH4), which is the lightest component of natural gas and the most widely used source of energy. Not surprisingly, gas field development is very much focused on monetizing methane. The remaining mix of wellstream gases, known as natural gas liquids (NGLs), is divided chiefly among ethane (C2H6) or C2, propane (C3H8) or C3, and butane (C4H10) or C4, with small percentages of heavier hydrocarbon gases including pentane (C5H12) and impurities such as water, hydrogen sulfide, and carbon dioxide.

Conventional LNG business models separate methane, which is then cryogenically condensed at -260°F (-162°C) and shipped as LNG. The heavier ends, used for industrial feedstocks and commercial applications, are liquefied in separate processes at much warmer temperatures, around -40°F
(-40°C), then pressurized and shipped to market aboard liquefied petroleum gas carriers or via a liquids pipeline. This requires the reserve owner to finance two supply chains to fully monetize gas assets.

For fields far from subsea pipelines and shoreside facilities, the price of establishing an LNG chain is the critical factor in calculating whether the field is worth producing. LNG requires costly and complex liquefaction plants on the production side and equally costly regasification facilities on the market side in addition to the specialized tankers that must carry it. If a field does not contain enough methane to pay for this infrastructure, the reserve lies fallow.

Companies have been working for some time to solve these vexing problems. SeaOne has introduced the LNG Lite system concept to answer this industry need.

This combined processing and transport solution embodies three proprietary technologies: a new liquefaction method, a new type of gas carrier, and a new overall concept of how these combine into a marine gas transportation system that brings the complete gas stream from wellhead to market. The cornerstone of the system is compressed gas liquids (CGL) technology.

Proposing a solution

LNG Lite is a combination of proven technologies and standard components. In the CGL process, a hydrocarbon solvent is added to the natural gas stream after it is cleaned of impurities. Its effect is to cause the gas to liquefy when subjected to a temperature of -40°F and a pressure of 1,400 psi. This step is accomplished on a loading barge moored at the wellhead in the first phase of the system. This eliminates the need for the most expensive part of the standard LNG chain, a large liquefaction facility.

The conditioned natural gas stream is then piped aboard the CGL carrier in liquid form and stored in its pipeline containment system — a shipboard pipeline made of standard carbon steel pipe. The horizontal pipe sections are arranged in bundles, their ends connected to form a continuous pipe that packs the cargo area of the ship rather like a giant serpentine. The bundles are enclosed, insulated, and refrigerated with chilled nitrogen in the ship’s cargo areas. A single compressed gas liquids carrier (CGLC) with a gas cargo volume of 1.5 Bcf can contain 102 miles (164 km) of 42-in. pipe.

At the market end of its journey the CGLC offloads to an offloading barge, where gas is expanded and separated for delivery either as pipeline quality gas or fractionated products. The solution needs no shoreside liquefaction trains, special storage, or reception facilities to make it work, and the solution is scalable. Furthermore, one voyage is able to bring the full range of wellstream gas to one or more markets.

Patents have been issued for various parts of this proprietary system. The first project is expected by early 2011.

Stranded no more?

The key factor in marine natural gas transport is to be able to load and economically transport volumes of natural gas to market. The farther the market is from the sources of the gas, the larger the volume of the gas needed for favorable project economics.

To be transported, the natural gas has to be stored in a vessel. Storage is accomplished through pressurization, refrigeration, or a combination of both. The exact technique used is determined by the gas composition being processed.

The greatest storage volume of methane is achieved with the cryogenic LNG process. The high cost of the LNG solution, however, puts strict limits on gas field economics.
Two systems are required to get the full wellstream gas to market. The key parameters affecting the dollar cost per MMcf are distance from market and proven reservoir size.

The CGL system greatly improves the storage capability of natural gas by working with the full wellstream gas in liquid form. Among the advantages of the SeaOne approach are that the system operates in the standard pressure range of 1,400 psig (ANSI 600) at -40ºF, with all hardware available off the shelf — including the standard, cold-temperature carbon steel pipeline that makes up the containment system.

One of the challenges of this approach was to ensure operation in a standard temperature and pressure range. The loading and offloading barges use standard gas plant and fractionation technology, and there are no exotic steels or coatings on the ship.

Another significant benefit to SeaOne’s system is that it consumes substantially less total energy to deliver the gas stream to market by eliminating the energy-intensive liquefaction and regasification processes. Third-party studies comparing the energy used to bring natural gas plus the natural gas liquids to market with the LNG Lite system indicate the new solution uses 93% less energy per unit volume of gas — with the twin benefits of lower emissions and adding more value to the reserve.

The new system could be the green solution to moving gas to market.