RULESOFTHUMBFORSCREENING LNGDEVELOPMENTS

PresentationtoIEAustPerth,2/10/12 PreparedbyNickWhite,DirectorProcessEngineering,Clough PresentedbyDrJulieMorgan

Introduction
TherearecurrentlyA$170billionofLNGliquefactionprojects underdevelopmentinAustralia Thispresentationprovidessomerulesofthumbformaking screeninglevelassessmentsofonshore, onshore baseloadLNG liquefactiondevelopmentsandincludes:
GasreservesrequiredtosupportanLNGdevelopment CriteriaforselectionofLNGexportratherthanalternativessuchasa pipeline Therelationshipsbetweenproductioncapacity capacity,refrigerationpower andemissions LNGstorage,loadingandshippingrequirements CAPEX breakdown b kd of fth themain i components t of fanLNGd development l t

Why yChooseLNGforGasExport? p
Pipelinevs LNGdevelopment determinedbydistancefrom supplier li tocustomer:
<2500km:pipeline >2500km:LNG

Liquefactionreducesspecificvolumeofgasbyafactorof600 makingtransportationoflargevolumesofgasbyshipfeasible Alternativeshippingoptionssuchasgastoliquidsand p naturalg gaseitherimmature,and/ormoreexpensive p compressed LNGaproventechnologywithexcellentsafetyrecord

Nonexplosiveinliquidorvapourstateinunconfinedspaces Onlyonemajoraccidentattheoperatingfacilitiesworldwide

LNGisenvironmentallyfriendly
SignificantlylowerCO2 emissionsthancoaloroil

FeedGasSupply
Gasreservesrequired:1tcf ofgasrequiredperMtpa ofLNGover 20years ForanoffshoregasfieldinAustraliatheminimumeconomicLNG plantcapacitywouldbeapprox4Mtpa requiring4tcf ofgas Wheredoesthefeedgasgo(conventionalnaturalgas)?

LNG - 85% Fuel - 8% LPG - 3%

C5+ - 2% CO2 - 2%

LNGLiquefactionPlantandLNGTrain
ALNGplantcomprises: Feedgaspipelinereceptionfacilities OneormoreLNGtrains comprising:
GasPretreatment(AcidGas(CO2 &H2S)Removal, Dehydration,MercuryRemoval)
Feed Gas from Pipeline Reception Facilities

NGL Removal Liquefaction(condensestheNG)

Endflash(autorefrigeratesLNG,removesN2and recompressesendflashgasforuseasfuelgas)

CO2 and H2S Removal

LPG & C5+ Removal

(LNG quality control)

Fractionation

Fractionation
SeparatesLPGs forrefrigerantand/orproduct
Dehydration Liquefaction

LPG and d Condensate to Storage

Productstorageandloading(includingBOG)
LNG,Condensate,LPG

Refrigerantstorage Utilities
P Power,h heating ti medium, di fuel f lgas,water, t instrumentair,nitrogen

Mercury y Removal

End Flash

F l Gas Fuel G

Generalfacilities
Firewater,flares,drains,plantbuildingsand infrastructure
LNG Train

LNG to Storage

HowMuchPowertoProduce1MtpaofLNG?
Mtpa =DailyproductionatTav (tpd)x365dayspaxSystemAvailability BOGlosses
TypicalaverageambienttemperatureinNorthernAustralia,Tav =27oC

1Mtpa =3,220tpd (37kg/s)x365x0.88x(1 0.03)

Assumingoverallsystemavailabilityof88%and3%BOGlosses

Enthalpychangetoliquefymethane:HG HL =861kJ/kg
Refrigerationduty:H=37x861/1000=32MW Refrigerationcompressionpower(work): Heat H trejected j t d t toatmosphere: t h

TypicalspecificpowerforbaseloadLNGplantatanaverageambienttemperatureof 27oCis1,120kJ/kg(13kW/tpd)
W=37x1120/1000=41MW Q=W+H=41+32=73MW

Heat Rejection, Q

GAS HG GAS:

LNG LIQUEFACTION UNIT

LNG HL LNG:

Work, W

RulesofThumbforLiquefactionPlants
Factors impacting LNG production:
Ambient temp: 1oC increase reduces LNG production by approx 1.7% Refrigerant condenser: 1% increase in UA increases production by approx 0.3% Feed gas pressure: 1 bar increase raises production by approx 0.7% Feed gas MW: 1% increase raises production by approx 1.4%

Fuel gas consumption: 7 to 9% of feed flow (depending on liquefaction technology (specific power) and driver type) Dehydration unit mol sieve regeneration flow: ~7% 7% of feed gas flow CO2 produced by process:
Combustion: 0.25 t CO2 / t LNG (base load plant with industrial GTs) From AGRU: 1 mol% CO2 in feed equates to approx 0.03 t CO2 / t LNG

Quantity of LNG shipped ~85% of rundown capacity when account taken of system y availability y and BOG
Overall system availability typically ~88% BOG losses from storage & loading facilities ~3% of LNG rundown rate

SizeRange g ofLiquefaction q Plants

LNGTrain CapacityRange Mtpa MiniLNG <0.1 Typical Liquefaction Technology Nitrogenexpander Application

Peakshavingplants, vehicle fuel,shipboiloff gasliquefaction Fordomestic consumption,transport byroadorrail Overseasexportbyship

Mid Scale

0.2to1.5

Singlemixedrefrigerant

BaseLoad

3to5* 5

Propaneprecooled mixedrefrigerant, dual mixedrefrigerant,pure componentcascade

* 3 to 5 Mtpa trains provide the optimum capacity in terms of economies of scale although larger trains have been constructed (e.g.8 Mtpa in Qatar)

Comparison p ofLiquefaction q Technologies g

LiquefactionTechnology Singleexpander Dualexpander Singlemixedrefrigerant(SMR) Purecomponentcascade Propaneprecooledmixedrefrigerant(C3MR) Dualmixedrefrigerant(DMR) APCI APX (C3MRplusnitrogenexpander cycle) Relative Efficiency 1.7 13 1.3 1.2 1.1 1.0* 1.0 1.0 LNGTrainCapacity Range,Mtpa <0.1 0 1to1 0.1 1.5 5 0.1to1.5 1to6 1to5 1to5 5to8

* Specific power at an average ambient temperature of 27oC is approximately 1120 kJ/kg (13 kW/tpd)

LNGStorage, g ,Loading gandShipping pp g

Storagevolume:volumeoflargest ship hi plus l 3days d production d i (approx.) ( )
Todatelargesttankvolume200,000m3

MaximumLNGloadingberth occupancyabout50%
Typically8Mtpaperloadingberthto allowformaintenanceandother downtime

Numberofshipsdeterminedbyshipcapacityanddistanceto importterminal
Shi Shipping i f fromNWAustralia A li tonorth hAsia: A i one130,000 130 000m3 ship hi can transport1Mtpa (i.e.15roundtripspa) Conventionalships p 130,000 , to145,000 , m3,latestQmax ships p 260,000 , m3

CostsofaBaseLoadLNGDevelopment
CurrentCAPEXofGreenfieldLNGdevelopmentsinAustralia(includesupstream developmentandLNGplant)~A$2,500to3,000/tpa S b Subsequent ttrains t i (brownfield) (b fi ld)economically i ll veryattractive tt ti asmuch hcanb beshared h d withthefoundationprojectgivingeconomiesofscale(e.g.gassupplypipelines, LNGstorageandloading,infrastructure) LNGSupply pp yChainCAPEXBreakdown:
UpstreamDevelopment: LNGPlant: LNGTransportation: Recei ing&RegasificationTerminal Receiving Terminal: 10% 40% 30% 20%

LNGPlantCAPEX Breakdown:
Pretreatment: 6% Liquefaction: iquefaction: 50% Utilities: 16% LNGStorage: 18% LoadingFacilities: 10% N t Li Note: Liquefaction f ti only l 20%of ft total t lsupply l chain h i CAPEX. CAPEX

OPEXtypically3%ofCAPEXperannum

Conclusion
Simplerulesofthumbhavebeenpresentedthatallowhighlevel screeningofonshore, onshore baseloadLNGdevelopmentswithrespectto: Selectionofpreferredexportoption Relationshipbetweengasreservesandplantcapacity Facilityrequirementsandcapacities Factors F t influencing i fl i processperformance f Indicativedevelopmentcostsandeconomiesofscale Fi ll itshould Finally, h ldbe b noted t dthese th areonly l rules l of fthumb th band dshould h ld beusedaccordingly