Compressed natural gas sea shipment. Utopia or reality?

CNG (Compressed Natural Gas) technology is a new breakthrough technology of compressed natural gas sea shipment in cylinders under pressure up to 25 MPa in special CNG vessels. Although nowadays CNG technology has been a common subject, there have been no examples of its practical application so far. What is the reason of such a situation? Andrey Alexandrovich Vlasov, CNG Offshore Project Manager of “Intari” Company, answers this and other important questions.

P>– Andrey Alexandrovich, so far the world hasn‘t seen any CNG vessel built. Why nowadays are there more and more talks about compressed natural gas shipment?

– First of all, for the last 2 – 3 years economic situation has drastically changed. In conditions of resource depletion in traditional regions of natural gas production and constantly growing demand for power sources the world stepped into the phase of steadily high prices for power sources. In such conditions gas transportation new technologies application and CNG technology in particular, which allows to commercialize medium and small scale natural gas deposits on continental shelf, became economically profitable.

Secondly, reliable technologies of natural gas storage and transportation under high pressure appeared and came to wide use in various industries. Among them are technologies of large diameter pipe production for underwater pipelines, designed to withstand the pressures of up to 25 MPa; high pressure compressors; offshore terminals for vessels loading directly from the sea deposit and gas discharge from the vessels in the sea at a considerable distance from the shore. This made practically possible to build special gas vessels for compressed natural gas transportation, and today a number of international consortiums and companies are focused on the development of compressed natural gas transportation system. So the first CNG vessels and compressed gas commercial shipment can be expected to start in 4 – 5 years, necessary to complete vessels development and construction.

– Is this your general assessment of the situation, or a prediction based on concrete facts?

– I believe this is general assessment based on concrete facts. Our company has been conducting research in compressed natural gas sea shipment technology for quite a long time, and we try to constantly monitor the situation. In the early 2006, when we were launching Internet project CNG Offshore, we had general assessment of the situation: CNG technology is of current importance and it is high time to study it. Today the whole row of facts proves our assurance. Thus, in March this year the first tender for CNG technology practical application was held by government power company GAIL (India). Almost all companies developing CNG vessels technologies took part in the tender separately or as part of international consortiums:

  • EnerSea Transport LLC, USA;
  • Knutsen OAS Shipping, Norway;
  • Compressed Energy Technology AS (CETech), Norway;
  • TransCanada Pipeline Ltd., Canada;
  • Trans Ocean Gas Inc. (TOG), Canada;
  • Sea NG Management Corporation, Canada.

Each company has conceptual projects of CNG vessels in its portfolio, which got Approval in Principal by classification societies DNV or ABS.

CNG vessels designed by the companies will have from 3 up to 33 million m3 tonnage of natural gas. The developers‘ conception is that large tonnage vessels are intended for large projects with routes ranging from 2000 - 2500 sea miles and low tonnage vessels – for short local routes.

According to main shipbuilding parameters CNG vessels will be to a large extent similar to modern LNG vessels. CNG vessels main dimensions will be in the following ranges: length 280 - 320 m, beam: 55 - 60 m, draft: 13.5 – 14.5 m, full speed – 17.5 – 18.0 knots (see picture).

– Is there any space for new technology application in Russia, or only gas sea shipment projects by foreign companies can be considered?

– An article in the previous issue of your magazine elucidated precisely this subject. I think among all projects the programme of natural gas supply to Kaliningrad Region is of the most current importance today. Both our company and OAO “Gasprom” have been working on technical and economical aspects of this project time and again and have proved a possibility to solve the task of gas supply to Kaliningrad Region with the help of just a few CNG vessels. So we hope that the administration of Kaliningrad Region will take active part in the development of CNG project.

– It is often said that vessels construction in Russia is not profitable because of crediting terms and taxes. What are the advantages of CNG vessels construction in Russia?

– It is true that financing terms for shipbuilding in Russia considerably differ from those practiced in the world. The most shipbuilding countries have powerful protectionist mechanisms supporting national wharfs in the form of government subsidies for ship owners. In Russia government subsidies for ship owners are not considered in legislation till now. Commercial crediting conditions are well-known – with extremely short repayment terms and high percent.

But even in present conditions shipbuilding in Russia have a number of undoubtful advantages, the main advantage being several times lower labour wages compared to foreign wharfs. Considering the fact that foreign built vessel cost has up to 60% expenditures for labour payment, a lower level of labour payment allows Russian wharfs to reduce the vessels cost. Besides. cargo-pumping system cylinders weight on CNG vessels can reach ten thousands tons and make up to 70-75% of displacement (for example, the project of “Intari” implies the weight of cargo system as 60 thousand tons with displacement 84 500 tons). Higher steel intensity of CNG vessels means higher labour-intensiveness of their building. The costs of metal, power and constructing and cargo system mounting works are lower in Russian wharfs compared to those abroad.

This gives assurance that Russian CNG vessels will be 1.5 times cheaper than foreign vessels of the same type.

Complex of government measures for supporting shipbuilding will make Russian CNG vessels even more competitive.

– Andrey Alexandrovich, how would you sum it up: is the sea shipment of compressed natural gas utopia or reaityl?

– CNG technology is not utopia any more and today the specialists have no doubts in the possibility of natural gas sea shipment by special gas vessels. To make sure about this and to get a further insight into various aspects of this technology I invite the magazine readers to visit out site CNG Offshore (www.cng.intari.com) and wish the guests of our site a useful travel on its pages.

Is it a reality? Not yet. And this may be the most important conclusion of today‘s talk. Not a single CNG vessel has been built in the world. We are not “desperately late” in this field.



We can make this technology a reality…
Or we can see the others doing this…
The choice is ours.

Go to Index of # 4(18) 2006

 

# 4(18), 2006
Ocean and shelf exploration