One of the most dynamic changes facing seaports, worldwide, is the anticipated ‘gold rush’ in the building of new liquefied natural gas (LNG) shipping and receiving facilities in ports throughout the world, followed by the traffic these facilities will generate.
According to data assembled by Pan EurAsian, the present liquefaction capacity in the world of about 146.5 million tonnes per year will increase to 366.5 million tonnes per year by the end of 2011 (See Figure 1). This extraordinary growth is precipitating unprecedented growth in the construction of LNG facilities in ports throughout the world. All of this LNG tonnage will move in seaborne trade. About 500 LNG carriers, averaging 120,000 m3 each, will be needed to carry this trade. Most of the LNG receiving, or regasification (regas) facilities will be located in North America, Europe, South Korea, Japan, India and China. In short, a major new seaborne trade is coming to market. As port operators and industry participants plan for this new business, a number of critical issues will develop. This article examines one of them.
Future projects and implications
Pan EurAsian is presently tracking over 50 LNG regas projects and facilities in North America, some of which are well advanced and many of which will never get built. Most observers suggest that at most ten new projects (beyond the four existing regas terminals now in operation in the US) are actually needed to satisfy market demands for natural gas between now and 2010. An equal number of projects may be built in Europe during the same time frame. China, South Korea and Japan have plans to expand import facilities as well, with China alone considering about ten new facilities by 2010. On the supply side, Pan EurAsian has identified over 40 liquefaction facilities projects that are planned to come on line by 2011. Collectively, this constitutes a major gold rush to build LNG related facilities in ports around the world.
In addition, to support these facilities, over 100 new ship buildings are expected in the over 150,000 m3 LNG class. The South Korean shipyards alone are presently building over 30 LNG ships per year and expect to maintain this level for the next three to four years. Beyond the difficult permitting and safety issues, all of the expected construction will create shortages and stresses in the supply of some of the highly specialised materials and construction services that are required for LNG. In discussions with major developers and their suppliers, it has become apparent that the predominant critical path item in the building of new LNG facilities is storage tanks. This article addresses why this is the case.
Constraints of producing storage tanks
Storage tanks are the most visible aspect of LNG port terminal facilities. Regas terminals will have two, three or even four of them. The construction of tanks will be the most apparent visual sign that the LNG building boom is happening. In addition, LNG carriers will also have their own LNG storage tanks.
The tanks located on land are large, and quite complex. The larger tanks each contain about 160,000 cubic metres of natural gas (just over one million barrels or about 100 million m3 of gas equivalent). They rise about 175 feet (53 metres) above their base, and are about 270 feet (82 metres) in diameter.
LNG is stored in a tank within a tank. The outer tank is made either of steel or of concrete. The inner tank is made from nine per cent nickel steel plate. As is the case with other flammable liquids, the tanks are surrounded by berms that create a containment area sized to contain 110 per cent of the liquid in the tanks should some catastrophic failure occur, either naturally or unnaturally.
Availability of nickel steel alloy
Building these tanks is presently considered the critical path in the actual construction of an LNG liquefaction or regas facility. The constraint is the availability of the steel plate for building the inner tank, a nine per cent nickel steel alloy that is very complex to produce.
Nine per cent nickel steel is used throughout the LNG chain; presently at liquefaction plants and at regas terminals. Although nine per cent nickel steel has not been used for storage tanks on LNG ships, new ship tank designs are emerging that will require it as well.
Natural gas (mostly methane) is liquid at -256ºF (-161ºC). Therefore, the material used to contain and pipe LNG must be able to withstand such temperatures without failure. There is zero tolerance for corrosion. The nine per cent nickel steel alloy that is used for the inner tank is selected for its excellent performance with cryogenic liquids.
The inner tank holds the liquefied natural gas. The outer tank actually encloses the inner tank and contains the LNG at a slight pressure of about two psig. Between the two tanks, the void is filled with insulating material. Because LNG is stored at slightly above atmospheric pressure, the liquid is constantly boiling: about 0.05 per cent of the gas is boiled off per day. The boiled off gas is either used on site, put into a pipeline and sold, or re-liquefied and put back into the tank depending on the particular circumstances of the facility.
In modern LNG storage tanks, there are no penetrations of the inner tank shell. All the piping and control connections are through the open top of the inner tank. Submersible pumps are used to remove LNG from tanks for regasification.
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