2015 - 2018 Triennium Work ReportJune 2018

Flexible LNG Facilities

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Produced by:International Gas Union

Fueling the Future www.igu.org

This publication is produced under the auspices of the International Gas Union (IGU) which holds the copyright. This publication may not be reproduced in whole or in part without the written permission of the IGU. However, irrespective of the above, established journals or periodicals shall be permitted to reproduce this publication, or part of it, abbreviated or edited form, provided that credit is given to IGU. This document contains strictly technical information to be distributed during the 27th World Gas Conference in Washington, DC, USA, and has no commercial intent.

1 ContentsExecutive Summary.................................................................................................................2

1 Introduction........................................................................................................................3

2 Themes, Archetypes and Flexibility – A Definition............................................................4

2.1 Flexibility in Export Facilities......................................................................................4

2.2 Flexibility in the Transportation of LNG......................................................................6

2.3 Flexibility in Import Terminals....................................................................................7

2.4 Flexibility in Peak Shaving.......................................................................................13

3 Drivers and Changes in the Industry...............................................................................15

3.1 Changes in Business Models..................................................................................15

3.2 Business Drivers......................................................................................................17

3.3 Stakeholder influenced drivers................................................................................23

4 Enablers and Challenges for enhancing facility flexibility................................................27

4.1 Export Facilities.......................................................................................................27

4.2 Flexibility in the Transportation of LNG....................................................................29

4.3 Import Facilities........................................................................................................30

4.4 Peak Shaving...........................................................................................................42

5 Case Studies...................................................................................................................43

5.1 Export Terminals......................................................................................................43

5.2 LNG Carriers............................................................................................................43

5.3 Import Terminals......................................................................................................43

5.4 Peak-Shaving..........................................................................................................43

6 Outlook on increasing flexibility in Industry (Import, Export, New market, Transport, Peak Shaving).................................................................................................................................44

7 Conclusions.....................................................................................................................45

8 References......................................................................................................................46

9 Glossary (definition of terms and consistent language)...................................................47

Appendices............................................................................................................................48

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Executive Summary

Chapter 2 is the what here we need to define what each Archetype

Chapter 3 is why changes were made each archetype will find a home in one of the sections. This is captured in is the table we prepared in Oran. There may be secondary reasons for these changes to have been made which you can mention but we do not want each archetype to appear repeatedly.

Chapter 4 is how it was done (or how it will be done in future) This is where we look at what can enable or be a challenge for introducing these archetypes into a facility.

Chapter 5 is where we look in more detail at an example of a facility which has demonstrated flexibility.

Chapter 6 is the future where we will look at how we see the future of the LNG business progressing and an outlook as to where we see flexibility becoming more import and more common.

Chapter 1,7 and the Executive Summary we will write later once we have the content of the report.

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1 Introduction

The rapid changes produced in the recent years in Energy means that the traditional model is no longer performing as expected. This is also affecting the business side and specifically LNG. In this logistic chain, import terminals play an important role that has to evolve from designing regasification services to a portfolio of new services and businesses that will convert them more into a logistic HUB.

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2 Themes, Archetypes and Flexibility – A DefinitionThe traditional LNG value chain consists of four building blocks. These are Export Terminals, Transportation of LNG using LNG carriers, Import Terminals and Peak Shaving facilities. Over the past 50 years the nature of the LNG industry has developed and these building blocks have had to diversify beyond their original purpose. These developments have been driven by many factors such as customer demands, regulatory requirements, new market segment development, and cost challenges. The response to these developments is known as flexibility. Such flexibility is defined as the ability to respond to changes in its business environment both rapidly and at low cost.

This report will define the original purpose of the four original building blocks and will then present several archetypes, which are means in which flexibility can be introduced to the building blocks.

2.1 Flexibility in Export FacilitiesLiquefaction of natural gas enables countries with plentiful natural gas reserves to monetize their stranded gases and reach major markets.

Note :

Put a general sentence here on :

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subchapters 4 (bunkering) and 5 break-bulk / truck loading / train loading facilities. These topics are detailed in chapter for import terminal.

Same for jetties extension and storage as well (see import terminal)

But for export: the target is different (see chapter 3)

2.1.1 Accommodation of new feed gases- LNG with more CO2 : Add facilities to accommodate the CO2 %

- More liquid / less liquid : Liquid content (heavy / light comment)

- different N2 content

- different Sulphur content

- different Mercury content

Only add equipment on site. Or change the process (different absorbent,….)

Nota : Not forget depletion compression Need to add compressor (upstream issue)

Result : change on LNG quality

2.1.2 N2/LPG/ethane/Helium extraction- N2 is a new business (Ex: Algeria)

N2 is transferred to an other plant to produce N2.

N2 is stored on site and sell

- Same for Helium (direct on container).

- LPG : Nothing new for Algerie

But use of stored LPG to blind LNG on liquefaction plant.

Result : LNG quality adjustment

- ethane : For nearby petrol chemical plant by pipeline. (Ex : new mega train in Arzew).

Lesson learn : To adapt the distillation column for this extraction process

Result : We can use it to change the quality of LNG.

2.1.3 LNG quality adjustmentSee chapter 2.1.2.

Blending or segregation different LNG qualities (ex : Algeria, Qatar)

They do in the storage tanks, not during ships loading.

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2.1.4 Export to import conversionEx : Aurun (Indonesia).

Idku (Egypte). It could be down ?

- To shut down liquefaction train (decommissioning) and add facilities to pump LNG and vaporize LNG.

2.1.5 Plant abandonment:Create an overhaul archetype (with import, LNGC, peak-shaving,…)

Ex : Camel (Algeria)

Technical center, training center, museum,… Use the abandoned plant for R&DUse the existing jetty for other product (methanol, ethylene)

Use the tank for an other product (ethylene...)

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2.2 Flexibility in the Transportation of LNGThe changing global LNG market has implications for LNG logistics and transportation. Traditionally LNG carriers, both chartered and owner operated, have been employed in the transportation of long-term contracted LNG between Export Terminals and Import Terminals

2.2.1 Conversion to FLNG/ FSRU/FSUThe introduction of new larger and more efficient LNGCs has led to creation of a surplus of older vessels. To create value from the older vessels, companies have been exploring opportunities to convert carriers considered for retirement to floating terminals (FLNG/FSU/FSRU). To date, xxx conversion projects have been completed.

LNGCs can be used for simple storage of LNG (FSU) with traditional liquefaction facilities or regasification facilities onshore (inshore configuration). The liquefaction or regasification modules can also be installed on the carrier itself for nearshore (FSRU or FLNG) or offshore/ open ocean deployment (FLNG only).

2.2.2 Redeployment of Floating TerminalsExmar originally proposed the world’s first floating liquefaction, regasification, and storage unit (FLRSU) in Colombia; Caribbean FLNG. The Unit was barge-based designed with a carrier vessel permanently moored alongside functioning as external floating storage unit (FSU). However, that project design was modified to remove the regasification functionality.

Floating liquefaction facilities are generally considered to be flexible by nature; they can be reused and moved from location to location as the economics or recourses changes.

As an example, Caribbean FLNG was complete when the project got cancelled in March 2016 because the feed gas was no longer available at the original location. The Caribbean unit is now waiting to be re-located.

However, to make use of this advantage, the FLNG design needs to be flexible enough to handle a wide range of feed gas qualities, operating conditions (weather) and met-ocean conditions (forces introduced by wave motion). This can be challenging in view of the costs, weight and space constraints faced during detailed design.

Another example of enhanced flexibility in LNGC fleets is the introduction of smaller LNGCs to break-bulk LNG in order to access new markets.

For example, when supply needs to be made to LNG bunkering facilities or island regasification terminals there is a demand for carriers in the order of 1,000m3 to 20,000 m3.

2.2.3 Flexibility shipping routes

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2.3 Flexibility in Import Terminals

Changes in import terminal functionality are part of the changes in LNG markets and can be driven by changing business models and opportunities such as truck loading, reloading transhipment and bunkering as well as changes in market conditions facing design functions like send out/ BOG management/liquefaction and gassing up and cool down.

From conventional regasification operations, they must be transformed into a LNG hub being able to offer their customers a variety of new services in addition to standard regasification.

These new services are based mainly on advantages intrinsically linked to LNG terminals. Let us define these new services for an import terminal:

2.3.1 Import to Export ConversionNew Segment – Suggest that import terminals group work on Storage and Loading aspects based on reloading experience. Support from Ted for Liquefaction section.

2.3.2 Truck LoadingTruck loading involves supply of LNG for customer facilities which are not connected to the network. The service provided by the terminal consists of filling LNG truck containers from LNG terminal storage.”

In areas or counties where the pipes infrastructures are not sufficiently developed, LNG can be loaded on LNG trucks to supply LNG satellites stations which are not connected to the main transportation grid and feed industries or towns/cities.

While truck loading has had a strong historical presence at some import terminals, new opportunities to expand natural gas markets and end uses makes it an important option and business model for traditional import facilities that have not recognized these opportunities.

2.3.3 Reloading and transhipmentReloading and transhipment of LNG has developed as a means of conveying landed LNG to other markets by reloading onto carriers serving other trades, separate from the original port of call..

Reloading and transhipments can be used to address alternative business opportunities where price arbitrage and changing local demand versus transhipment gas destination markets call for changes in the ultimate destination for regasification.

A prime advantage for offering this service is an LNG Terminal´s location on the waterfront.

For the reloading process, the LNG is previously unloaded into terminal storage tanks where it is stored until the second vessel arrives to the terminal.

For transhipment, both ships are moored at the terminal and LNG is directly transferred from the discharging ship to the receiving ship according to 2 different configurations.

1. For terminals designed with 2 berths: The transhipment service uses connections composed of the terminal’s transfer arms and cryogenic pipelines linking the two berths

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of the terminal between the ships. Consequently, LNG transferred is neither mixed nor stored in the terminal’s tanks.

2. For terminal designed with one single jetty: Transhipment is performed through flexible hoses between side-by-side vessels double banked at the berth. This type of service is named STS (ship to ship).

Reloading / Transshipment allows to divide a large cargo into smaller ones (break-bulking) to optimize transportation costs so it can be transported from the liquefaction facility in one vessel and then break it into smaller vessels to be sent to different locations.

Another possibility is terminal limitations related to jetty design or storage capacity so it is required to break the vessel to meet with the destination terminal requirements.

It allows also optimizing the LNG tanker fleet between the sellers and buyers of a cargo (ship swap).

In some contracts it is mandatory to unload the LNG in a specific country. So, once this is done, it can be reloaded for selling LNG in a higher LNG price market

2.3.4 BunkeringUse of imported LNG at the receiving terminal to serve a marine or “bunker” fuel is a relatively new application and opportunity.

Supply LNG from the terminal to a ship smaller than conventional LNG tanker. If the LNG is used just as fuel for the ship, the service is called bunkering. For capacities normally lower than 30.000 m3 and afterwards distributes it, it is called small scale.

Vessel bunkering needs at the import terminals meet strongly developing opportunities to reduce air pollutant emissions and international requirements for contamination reductions.

LNG terminals are usually located in industrials and commercials ports, which allow them to load LNG barges to supply other ships, such as ferries or merchant ships.

2.3.5 BOG ManagementAlternatively, reduced local market demand may call for efforts to minimum send out (even suspending send out) and consequent innovative efforts to manage boil off gas (BOG) at import terminals, even while alternate uses of LNG are explored.

The use of LNG terminal in low or zero send out scenarios. The terminals are designed for a minimum send out capacity but in the last few years, especially in some areas as Europe, the use of these infrastructures has decreased forcing to operate below design conditions.

BOG management under conditions of minimum send out and zero send out provide alternatives to deactivating facilities and reducing complexities of restart if local market conditions improve and if other offsite markets justify ramping up terminal throughput minimizing the flaring and optimizing the energy consumption

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2.3.6 Gassing up and Cool Down

Gassing up occurs after LNG cargo dry docking. It consists to replace in the cargo tanks, inert gas or nitrogen by warm LNG vapor at the receiving terminal. This is because, inert gas contains carbon-dioxide, which will freeze at around -60°C and can block vessel’s equipment, such as valve, filter, and nozzles.

Cool down is an operation to pre-cool cargo tanks after gassing up. It’s carried out by using LNG received from the shore terminal. Cool down can be an initial cool down (after dry dock) or an ordinary cool down (after cargo tanks warm-up due to a long voyage for instance). Cool down generally occurs before reloading operation.

In some cases, it can result very convenient as complementary to reloading so the vessel can travel to the terminal direct from shipyard. In many cases, the shipyard is closed to the LNG terminal.

2.3.7 Cold Energy IntegrationVarious facilities have improved their energy consumption by utilizing cold LNG energy. The cold utilization options are cryogenic air separation facility, carbon dioxide liquefaction facility, cold storage warehouse, cold heat source for chemical plant, cryogenic power generator and so on.

LNG is "cold" has a very low temperature of -162 degree C. The cold energy for 1kg LNG is equivalent to that 2.5 kg water freeze to ice. Effective utilization of LNG cold energy drives earning of the terminals growth.

Generally, import terminals use cold energy for re-condenser. But this section excludes the re-condensation of BOG.

Example of air liquefaction and separation plant Air liquefaction and separation plants are designed to generate oxygen, nitrogen and argon from air through the process of compression, cooling, liquefaction and distillation of air. Because of required temperature level for air liquefaction and separation plant is very low, using LNG cold energy utilization is high efficiency and high economical. Reduction of electric power consumption is about 50% as compared with conventional- Raw material is atmospheric air.- The dust in the air is eliminated by the filter.- The filtered air is cooled, liquidized and separated into nitrogen, oxygen and argon by using

difference of boiling point. - Cooling source of the air is provided by circulating nitrogen process with compressors and

expanders. Using LNG cold energy is able to reduce load of the compressors and expander for cooling. Additionally the cost of the compressors and expander for cooling is able to save.

Consideration is below- The market for production, nitrogen, oxygen and argon.- The demand of send out gas for cold energy demand.Lesson learned- It is important of balance between demands of cold utilization facility and demand for

pipeline. Especially, higher utilization of LNG cold energy for demand of pipeline make it very difficult for operation.

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- It is importance of terminal location, because it is necessary to locate LNG cold utilization plant in LNG terminal or neighborhood.

Example of cryogenic power generatorThe cryogenic power generator is a facility that converts cold energy of LNG into electric power and effectively uses it. Intermediate heating medium, propane, a hydrocarbon mixed gas, etc. as a working medium, and obtains output by a Rankine cycle that operates between a high temperature source such as seawater and a low temperature source of LNG.The LNG pressure is increased by LNG pumps. The LNG vaporizer transfers heat from intermediate heating medium to LNG. Vaporized LNG then enters the NG heater and is heated to 0 degree C or higher by sea water. The intermediate heating medium condensed in the LNG vaporizer via heat exchange with LNG is pressurized by the circulation pump and sent to the intermediate heating medium vaporizer where it vaporizes at a pressure in accord with the temperature of sea water. Vaporized intermediate heating medium drives the turbine during the expansion process and generates electricity. Subsequently, the intermediate heating medium is condensed again in the LNG vaporizer.

Consideration is below· The demand of send out gas for a certain scale is required.

2.3.8 Extension of Jetty and receiving facilitiesExtension of Jetty and receiving facilities is carried out to improve the functionality of the jetty & equipment in the existing LNG terminal. This can be done by expanding or reinforcing the facilities in order to deal with demand increase, upsizing or downsizing of the LNG carrier and new business, instead of contraction of new terminal.

In the existing LNG terminal, the size of LNG carriers and the capacity of receiving facilities have been decided from the planning stage by site constraints, negotiation with the authority of harbour, and business model considerations.

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However, it may be necessary to deal with LNG carriers of different sizes due to increased demand in the market, changes in the environmental requirements, and the occurrence of a new business model after terminal is started.

Although it is possible to deal with new construction of LNG terminal or Jetty matching the conditions of LNG carriers, it is generally very costly and laborious. In addition to securing an appropriate site, in the case of constructing a new terminal, a large market demand is required.If the demand is not expected to increase, expanding Jetty and facilities will be good solutions.Re-load between terminals through pipeline is that the LNG terminal reloads to another LNG terminal by LNG pipeline.

This may occur when the existing terminal has a limitation in the maximum acceptable LNG carrier size, for example Q-flex or Q-Max may not be acceptable.

Although it is possible to constructed a new LNG terminal or additional jetty, it is generally very costly and laborious. If another terminal exists in the neighbourhood of the terminal, re-load between terminals through pipeline could be an attractive solution.

2.3.9 LNG BlendingLNG blending is carried out to increase quality range (blending) through the addition of Propane enrichment facility.This can be done by increasing quality range by using calorie control equipment at import terminals, new opportunities to expand natural gas markets and end users makes it an important option and business model for traditional import facilities that have not recognized these opportunities.

LNG importers vaporize LNG in accordance with the demand, and then inject LPG so that the heating value could be adjusted to meet the gas quality specifications.

The LNG importer has an obligation to provide consumers with a supply of natural gas at a required level of calorific value. If natural gas with nonstandard calorific value is supplied, damage may result in relevant gas facilities. To prevent this, the importer mixes LPG which has high calorific value with the low-calorie imported natural gas.

2.3.10 TrainingImport terminals can provide training courses by using small pilot LNG storage tanks (capacity of 1,000m3).

As LNG demand increases, new countries and companies are preparing for the construction of LNG receiving terminal. Experienced operators are needed to store such the cryogenic LNG safely and reliably. The purpose of this training is to provide new operators with hands-on training using pilot LNG storage tank.

Training offers the opportunity to gain experience in pre-commissioning, commissioning and start-up under actual service conditions. It normally takes years to acquire a solid foundation for how to operate a LNG storage tank. The KOGAS training course offers experience in

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Pre-Commissioning and Commissioning activities and can provide the experience of pre-commissioning, commissioning and ready to achieve a successful Start-up

2.3.11 Storage Capacity EnhancementStorage capacity can be enhanced by replacement of existing LNG storage tank.This scenario is employed for growth in demand or/and flexibility (volume, schedule) of LNG vessel received. The spec of exiting LNG storage is due to restrictions of site, agreement of government, business model, and construction technology of LNG storage tank at that time. After the terminal commissioned, in the event of growth in demand, changing of business environment, and new business model, it will be necessary to enhance of LNG storage volume. If an additional LNG storage tank is built, the storage volume enhancement will meet the event. But it is difficult to prepare the site for additional tank.The innovative construction technologies enhance capacity of LNG storage tank in the same area. The replace of LNG storage tank in existing terminal is generally very costly and laborious to newly construction of LNG terminal.

All these new services make today's LNG terminals as a real LNG HUB, where LNG is unloaded, stored, reloaded, redistributed and reused.

Thanks to the expertise acquired by LNG terminal operators around the world for more than 65 years of experience, import terminals have been able to transform and adapt by their own to the new world of LNG.

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2.4 Flexibility in Peak Shaving[NOTE: Indentations shown in this section is only provided to illustrate the logical flow of topic and subordinate statements and will not be the format of the final text, unless consensus of SG3 is to adopt that format.]

Development of LNG peakshaving infrastructure is limited worldwide to gas markets requiring periodic peaks in supply requirements chiefly related to weather-sensitive natural gas demand and pipeline constraints in meeting that demand.

[How?] Generally and in North America in particular, peakshaving plants were built to serve end use markets connected to a highly-integrated transmission pipeline system but where that pipeline system had physical constraints for delivery of natural gas during peak demand periods. These periods were and are most pronounced during periods of cold weather when natural gas use by end use customers for space heating drives marginal increases in demand.

[Why?] Peakshaving plant construction in North America, most active in the 1970s and 1980s, was dominated by pipeline-constrained regions, often occurring at the “end of the pipeline” locations where network flows of natural gas was unavailable to replace or supplement deficiencies from any one supply source or serving pipeline.

[How2?] As designed, North American peakshaving plants were generally optimized to the “200/20” rule of thumb, where approximately 200 days of liquefaction was installed to store LNG over the course of the calendar year to meet peak demands lasting up to approximately 20 days of regas send out to the local distribution network.

A chief opportunity for expanding LNG peakshaving functionality comes from the availability of excess LNG storage capacity in areas where additional capacity is difficult to site.

[Why?] Excess storage capacity may arise from increased pipeline capacity to the local distribution area, decreased local peak gas demand, and/or observed declines in weather-sensitive demand.

[How?] Increased pipeline capacity development has been stimulated by increased aggregate natural gas demand and the need to integrate new natural gas supplies into the network.

[How?] Natural gas demand on existing networked systems such as those in North America have expanded end uses, particularly to serve displacement of other fuels (most notably fuel oil for heating) and increased use in power generation.

[How2?] Development of shale gas in the U. S. particularly has brought additional supplies into the integrated market and formed new supply regions, in many cases requiring new pipelines, expanded capacities of existing systems, and even flow reversals in existing pipelines to match these supplies to existing markets.

[How2?] Declines in local peak demand has resulted from milder winter temperatures for most of the last decade, increased and optimized pipeline

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operations, development of other storage sources, and changed in end use markets and peak services requirements.

[Why?] Extremes in North American winter temperatures have been lessened in following with generally warmer winter weather, lessening the requirement for peaking services (i.e., “needle peaks”) and pipeline deliverability constraints.

Why2?] Expanded pipeline segments, rejuvenated compression facilities, and improved dispatching has helped to optimize pipeline operations and resulting improved delivery during peak periods.

[Why3?] Increased capacity of underground storage in mid-stream regions and near local distribution systems has alleviated deliverability constraints in many local markets, even during peak services.

[Why2?] Most peakshaving capacity in located within developed areas where “greenfield” LNG storage capacity is hard to site due to regulatory restrictions and public opposition.

[Why?] In North America generally, and in the U. S. in particular, site requirements implemented by federal and state/provincial governments form barriers to siting of new LNG facilities, focusing particularly on siting of LNG storage.

[How?] Under the U. S. regulatory regime, LNG storage facilities build before new legal and regulatory requirements promulgated in the late 1970s were “grandfathered” from many of the new storage requirements, which in densely occupied areas effectively banned siting of new facilities.

[How2?] In Canada, [to be developed].

[Why2?] Public opposition to new LNG facilities, particularly those that involve large storage facilities, continues to be strong and manifests itself in “NIMBY” (“Not in My Back Yard”) opposition and state/local and federal siting proceedings. [Add Canadian perspective.]

[How?] In part, public opposition is rooted in an incomplete understanding of LNG, realistic hazards that large LNG storage facilities represent, and hazard mitigation measures associated with design and operation of LNG facilities.

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3 Drivers and Changes in the Industry

Note : add general sentences somewhere for Bunkering facilities and Plant abandonment which is common for export and import. Same for LNGC (abandonment)

3.1 Changes in Business Models

For all new services developed by LNG import terminals, the main target is to create value, on one hand, with existing facilities and, on the other hand, with LNG itself.For example, using unloading facilities to reload small and large vessels, in order to multiply LNG destinations and LNG use in countries not yet supplied or using the advantages of LNG (volume reduction) to supply new customers by truck, by train or by barge or storing LNG and then redistribute it according to markets.

This is a new business model for import terminals owners, but also for LNG producers. The liquidity of LNG over the world obliges import terminals owners to adapt their facilities to become more flexible and adaptable to the LNG market changes.

The major FSRU companies that are exploring and developing FSRU and FLNG projects using LNGC conversions, like Exmar and Golar LNG, are following quite a different design approach from the traditional major energy companies.

Instead of designing vessels on a project bespoke basis following a project specific design method, these companies are following a more standard design approach based on functional specifications focused on applying standard equipment that is readily available off the shell.

The advantages of supplying relatively standard designed vessels on basis of functional specifications is that these facilities can be leased and re-used on other fields reducing sunk cost on a specific project.

The standard design approach and the typical lower project unit costs for LNGC conversions compared to new-built may also be an enabler to for the building of speculative vessels.

Where Flex LNG was unsuccessful to develop a speculative vessel based on new-built, lower CAPEX investment for conversion projects could make this business model work. This concept is yet to be proven for FLNG facilities.

With the strategy to build standard designed vessels, companies like Golar LNG and Exmar also offer the option to lease these converted vessels. This provides an opportunity for early monetization of gas reserves (FLNGs), quick new market entries (FSRUs and break-bulk FSUs) and quick development of LNG trading hubs (FSRUs or FSUs).

Furthermore, the option to lease (converted) vessels (FSU/FSRU/FLNG) provides an opportunity to smaller energy companies to deploy these vessels on projects without having to arrange project financing. But also for major oil and gas companies, that have limited

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capital available for investments in a low oil price environment, these leasing or tolling arrangements can be an attractive solution to realize projects.

In July 2016, Golar LNG and Schulumberger announced the creation of ‘One LNG’, a joint venture to rapidly develop low cost gas reserves to LNG. The intent of ‘One LNG’ is to offer a ‘one stop shop’ for the supply and operation of the full offshore development scope including development of the reservoir, subsea facilities and FLNG vessel to gas reserve owners. This could be in particular interesting for smaller energy companies with limited technical and financial resources.

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3.2 Business Drivers

3.2.1 New Market Segments In the recent years, it has been a development of new applications for LNG mainly conducted by new Natural Gas resources in different countries together with environmental regulations.

The lack of pipelines infrastructures and the long distances make LNG use attractive to be used transported by large/small vessels/barges, trucks or even trains.

It is also becoming more important as fuel for vessels and trucks.

3.2.1.1 Export terminal

New market for LPG/Helium (space industry, medical, Zepplin industry,…) / N2

Ethane for petrol chemical.

Decrease of environmental impact.

3.2.1.2 Truck Loading Truck loading can be used to cover delays in pipeline construction in cities and to industries. Pipelines construction requires big capital investments and implementation periods that typically ranges in 3-5 years. In many cases there are needs before the gas pipeline is put in place so truck loading is a perfect temporally solution.

In other cases, if the demand is not high in an area or industry, it is not justified the investment in the pipeline so, again, truck loading together with a satellite regasification unit can be the perfect solution.

As a result, truck loading can be used to create the market until the network is profitable for other industries or as a permanent solution if it is never profitable.

LNG inventory can be used as liquid for trucks, ships, and trains as fuel. As compressed natural gas, LNG can be vaporized and compressed as CNG fuel. In any case, it will be transported as liquid doing the regasification, if required, in the destination point.

For customers far away from the pipeline network, including industries and farms and growers, trucked LNG can serve as an energy supply.

Additionally, Trucked LNG can be combined with ship transportation so it can be sent to remote locations saving lots of road kilometres transportation or sent it to islands. Combining these solutions with satellites regasification unit is an interesting option to supply an area with natural gas

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As an alternative in some terminals, LNG it is adapted to train loading by means of ISO containers which is more convenient for this purpose as it has more capacity than standard truck container.

Truck loading serves the opportunity to supply LNG to customers that do not have access to pipelines with a relatively low investment and in a short period of time compared with pipelines. This is especially outstanding in big countries where pipeline is not developed or in isolate locations like certain industries or towns, the use of LNG trucks together is a good solution.

3.2.1.3 BunkeringBunkering allows supplying LNG to ships that uses LNG as fuel. This is becoming rapidly a reality due to air pollutions constrains combined with high LNG offer.

Another possibility is to supply LNG to small vessels that normally uses for local distribution to ships or small scale facilities so the ship has not to go to the terminal and can combine the fueling with other activities saving time and uncomfortabilities.

Cover a new market of using LNG as marine fuel as it is expected to be in near future where there other possibilities competing as marine gas oil with scrubbers, ethane, hydrogen, etc.

Replace conventional fuels as Marine Gas Oil, Fuel Oil, etc. that nowadays are the main suppliers for ships

Environmental impact. COP 21. Seca (Sulphur Emission Control Areas) with stricter limits in north sea after 1/1/2015

(0,1%) (Mediterranean sea after 2020) General Sulphur limits in other sea areas (0,5% after 1/1/2020).

Lower Price compared with other conventional fuels Lower taxes for with conventional fuels due to government promotion by to reduce

contamination.

Focus should be on terminals offering bunkering as means to enter New Markets. That is the reason the terminal offers bunkering. The reason that the New Markets is developing is due to regulations etc. and should be mentioned but it is not the primary reason that the terminal introduces the flexibility.

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3.2.1.4 Cold Energy IntegrationWhy would an existing terminal do cold energy integration? Is it to be more efficient or is it to make $$$ from a new market? This could be moved also to the 3.2.2

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3.2.1.5 TrainingBy using KOGAS pilot LNG storage can provide a training course under actual service condition. Pilot tank was constructed for the in-house developed membrane application and its verification for commercial applications. It was constructed within in KOGAS Incheon receiving terminal and LNG supply is available. Furthermore, it is equipped with all facilities including DCS system to operate just like a real tank.

It’s a new business model that provides training for operators by using pilot LNG storage tank. On-the-job training is available in many places. There are very few places where trainees can be used and experience for pre-commissioning and commissioning using LNG in addition discharging LNG by pump operation.

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3.2.2 Improving Utilization / Efficiency

As these new services are growing and becoming a reality, this is implying a bigger utilizations of the existing infrastructures which is an important issue in order to make them profitable. It is expected that these new services will take an important role in the future replacing conventional use of those.

It is also relevant how these facilities are being more efficient with existing capabilities but also with the new ones. It is then necessary to put in place new technologies to adapt to the demand and to enhance to the new needs. In this matter, it has been a big progress in electrical consumption minimization, Boil Off Gas recovery, human resources and so on.

3.2.2.1 BOG ManagementIn case of low send out scenarios, with regasification lower than the design conditions, it is important the reduction of BOG not able to be recovered to minimize gas losses in the terminal.

Adaptation of terminal design to new LNG European market (decrease of LNG importation) makes the need to enhance the facilities to recover all the BOG.

In case of low inventory so the send out has to be stopped it is worthy to have the terminal in a good shape not to flare the BOG.

Minimize the BOG generated in the terminal changing operations & maintenance procedures and adapting the equipment to this purpose.

Optimize the BOG recovered changing operations & maintenance procedures and adapting the equipment to this target.

Make use of BOG not able to be recovered. In case it is not feasible to recover the BOG generated, to have equipment as vaporizers or gas motor or turbines to use it as a fuel instead of flaring it.

Keep in cold conditions LNG facilities ready for a quick start-up so the plant is able to reach operations conditions in a short time and generate as less BOG as possible in this situation.

Respect of the zero flaring policy (environment protection) and not affecting the environment not only with the associated emissions but also with thermal stress produced when flare is in service and, of course, with the gas losses.

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3.2.3 Increasing spot market trading

As LNG market is becoming more liquid, spot market trading is taking a more important significance so LNG import terminals have to be ready for this by, for instance, having high jetties availabilities, storage capacities

3.2.3.1 Storage enhancementThe spec of exiting LNG storage is due to restrictions of site, agreement of government, business model, and construction technology of LNG storage tank at that time. After the terminal commissioned, in the event of growth in demand, changing of business environment, and new business model, it will be necessary to enhance of LNG storage volume. If an additional LNG storage tank is built, the storage volume enhancement will meet the event. But it is difficult to prepare the site for additional tank. The innovative construction technologies enhance capacity of LNG storage tank in the same area. The replace of LNG storage tank in existing terminal is generally very costly and laborious to newly construction of LNG terminal.Increasing LNG storage capacity will expand the tank operation range and improve the flexibility of LNG receiving and sending out. For example, we can deal with acceptance from LNG carriers larger than before. Also, it is possible to respond flexibly to the interval of acceptance schedule from LNG carriers. Furthermore, it is possible to increase the handling volume of LNG and to respond to new demand.

On the other hand, the following challenge is necessary to advance this measure.If there is no empty site in the base, it is necessary to carry out the scrap of the existing LNG storage facility in advance, during which period the amount of LNG storage decreases. Since the flexibility of acceptance and sending out of LNG will decrease during that period, it is necessary to examine the implementation timing. In addition, in order to minimize the constraint period, it is important to shorten the removal work of the existing LNG storage facility and shorten the construction period of the new construction of the LNG storage. In addition, careful planning and implementation of construction plan is important so that there is no adverse effect on the operation of the existing facilities.

3.2.3.2 Gassing up & Cool DownMain driver to offer this service to shippers / terminal’s customers the possibility to gassing up and/or cool down their vessels in a receiving terminal more available than a liquefaction plant and closer to shipyards

Also the possibility to load in a receiving terminal their vessels in warm or inerting conditions

3.2.3.3 Reloading / Transhipment.

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3.2.4 Different market destinations

More countries are introducing LNG in their energy portfolio requiring for LNG chain more flexibility to cover all the demand. In this scenario, import terminals have the opportunity to be adapted for operations as reloading, transhipment, bulk break.

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3.2.5 Provide a low cost solution and accelerate schedule

The introduction of new larger and more efficient LNGCs has led to a surplus of older vessels which are available for new roles. This emergent surplus has coincided with an upward trend in CAPEX, schedule and permitting challenges for new onshore LNG terminals.

Conversion of retired LNG carriers into floating terminals (FLNG/FSU/FSRU) provides an opportunity to develop projects with substantial lower unit cost compared to new-build offshore or land based facilities because the cost for new-build LNG vessels or LNG tanks onshore can be eliminated.

The modification costs required to allow the LNGC to be used as FSU are normally relatively minor. Typical changes may include additional BOG management capacity. Example: ...

For conversion of LNGCs into FLNGs, liquefaction modules need to be added to the topside design. The type of equipment that is required is typically dependent on the feed gas composition. When the feed gas composition requires relatively little processing (for example it is relatively lean and has few contaminants) then the equipment count is lower. It is in these cases where FLNG using a converted LNGC can be attractive. For example, this could occur when pipeline quality is to be liquefied. Example: Golar.

Utilizing LNGCs also allows for schedule acceleration as they eliminate the need for the construction of onshore LNG tanks which are often on the critical path for LNG projects.

In the case of LNG Import Terminal projects this can often allow for the development of a small gas market using an FSRU which can then be replaced with a larger Onshore Terminal once the market has grown.

As highlighted in section 3.1., the building of speculative vessels may be easier from conversion project compared to new-built. Although some project specific modifications may be required for deployment of these vessels, the availability of speculative vessels provides an opportunity to further accelerate project schedule and reduce project unit costs. This may in particular be interesting for gas reserve owners that are looking to quickly deploy an offshore (stranded) asset (FLNG), enter a new market (FSRUs) or develop a hub / break-bulk facility (FSU).

The extent to which LNGC conversion projects can offer a schedule saving over an onshore development is project and location specific. However, the risk of schedule delays as well as cost overruns, is likely to be reduced because the vessels are manufactured in shipyards.

Shipyards have a good track record of delivering major projects on time and on budget compared to onshore constructed plants which frequently

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experience delays as result of limited infrastructure, limited resources and extreme weather conditions.

3.3 Stakeholder influenced drivers

3.3.1 Changing Customer Requirements

EXPANDING JETTY & EQUIPMENT

REPLOYMENT OF FSRU

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3.3.2 Change in Gas Supply and LNG Quality

The number of LNG producers has increased but also the gas quality range. To meet with market demands, import terminals have to be adapted to be able to comply with.

Design of standard, functionality based floating terminals that are converted from LNGCs enables re-use and re-location of these facilities to other gas fields.

Case for export terminal to import terminal :

Why : Gas field depleted

Gas domestic demand increase

Case for Accommodate new gas field

Why : New gas field

Change in the composition during the life of gas field

Stop of reinjection gas to the field gas (ex : Algeria, Australia (north rankin, goodwyn) : change of the mode of field : Reinjection mode -> Depletion mode

Case for LNG quality adjustment (Export terminal) :

- For a new market, new customers

- For long distance (for instance : trip from Algeria to Japan)

- For spot cargo (mixt of LNG from different plants)

LNG BlendingIncrease quality range by blending can be used to maintain the heat value level. Natural gas has different components depending on the place of production. If natural gas with different calorific value is supplied, damage may result in end user’s gas facilities. Increasing heat value to satisfy the requirement by injecting LPG could supply the gas constantly.

Increasing the demand of natural gas, it needs to develop a diversification of natural gas production.

As the natural gas source is different, the composition may change and it would be a problem for trading. In most countries, natural gas is provided under the responsibility of gas importers. It should be also ensured that the heat value of gas is constantly maintained.

If the receiving terminal equipped with this caloric control facility, this is not a problem anymore and bring a profitable deal.

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Increase quality range by blending is the best solution to enable the variety of liquefaction plant. Diversification of imports is not possible without calorie control facilities.

Satisfy the consumer requirements in terms of calorific value. For example Korea standard is 10,800 kcal/Nm3. Depending on the region, especially in the United States; several sources have a lower value. The amount of calories supplied from the calorie control facility can satisfy the standard. This shows that the difference in calories according to the mountain is no longer a problem

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3.3.3 Changing Regulatory Requirements (Environmental, limited return)

In many countries, especially in Europe and America, environmental requirements are getting harder. This is pushing to change existing sources of energy and fuels to others more eco-friendly. In this context, LNG is increasing its use, not only in homes heating systems but also to be used in ships, trucks or buses.

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3.3.4 Public Acceptance – Social License

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4 Enablers and Challenges for enhancing facility flexibility

4.1 Export Facilities

4.1.1 Accommodate new feed gasesEnablers :

Challenges:

- Get money for Investment

- Units to be designed for the new field gas compositions

o Replacement equipment

o Adaptation of existing equipment (for ex : for absorber, change only the absorber)

- Training of the people

- Procedure modification

- Shutdown the plant for a long period while continue to produce LNG

- To combine with a lifetime extension campaign

- To accommodate the facilities with the pressure of new feed gases

- To fit with the design limits of facilities

- To find the right mixture between different field gas (all mixt are not possible)

:

4.1.2 N2/LPG/ethane/Helium extractionEnablers :

Challenges :

- To construct the nearby plant (N2, LPG, ethane, Helium)

- For ethane : More difficult to add in an existing plant. Big changes necessary. Better to do in a new plant.

- For Helium is less intrusive

- LPG is less difficult than ethane but more difficult than helium

It depends on how deep we want to go as extraction.

- To operate both facilities in the same time

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- But no impact on liquefaction plan if shutdown in the N2, LPG, ethane, Helium nearby plants

Lesson learnt : is to add since the beginning of new plants tie-ins for this purpose, or free place for additional equipment

4.1.3 LNG quality adjustmentChallenges:

- LNG Blending

To avoid rollover, mixt LNG in the tank : To be able to recover/manage all the BOG in the fuel gas system and not to burn it

Connexion lines between different storage tanks

Density/T° measurement in storage tank

To stay in the contractual LNG range

- LPG injection :

Facilities for that purpose (storage, lines)

- LNG segregation :

Enough Storage capacities

Connexion lines between different liquefaction unit / storage / jetties

4.1.4 Export to import conversionEnablers :

Challenges :

Space for additional facilities

To adapt jetties facilities (arms, check valves) for unloading

To connect plant to domestic gas network (is it possible to use the same line than for export terminal ?)

Training of people

Management of the people (less people) social acceptance

Change of mind-set of people

To put the liquefaction plan under nitrogen condition for facilities preservation

4.1.5 Plant abandonment:To do with other chapter (import terminal, LNGC)

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4.2 Flexibility in the Transportation of LNG

4.2.1 Conversion to FLNG/ FSRU/FSUEnablers

Given that there has been a step change in the size and efficiency of LNGCs, there is a significant opportunity for ship owners to utilize older LNGCs to provide storage in both new and existing LNG projects. This allows for older LNGs, which are often less efficient and therefore costlier to operate, to continue to be used when they would otherwise no longer be in service as LNG carriers.

As previously discussed in section 3.2.5, LNGC conversion projects provide an opportunity for substantial lower unit cost projects and are quicker to deploy and develop. This is one of the main drivers for the conversion of retired vessels.

Compared to new-built offshore vessels, the modification costs required to allow the LNGC to be used are normally relatively minor

Challenges

In order for a converted LNGC to be deployed economically as a FLNG terminal, there needs to be a restricted window of feed gas compositions. This is due to the available space for gas processing modules being limited and also there being only limited storage space for condensate or NGL products.

Regulations for floating LNG facilities also vary significantly between regions which can impose deployment challenges and less advantaged project economics.

In some regions there is a requirement for floating facilities to be sent to try dock for inspection every (5?) years. During this time, a replacement vessel needs to be found in order to continue facility operation. This may result in potentially high charter rates or a period of downtime which results in a loss of revenue.

Use of a converted LNGC in projects may lead to challenges when the resource holder desires significant amount of local content in a project.

As the majority of the manpower required to convert an LNGC to an FSRU, FSU or FLNG is carried out in a shipyard, the opportunities for local workers to be involved in project construction is significantly reduced. This driver may lead to government pursuing a traditional onshore development over a converted LNGC project.

Another challenges for the conversion of LNGCs into floating export or import facilities, is the limited deck space available for the addition of processing facilities and gas or LNG transfer arms to the topside design.

Where it has been proven that regasification plant can be easily fitted on the main deck of a Moss LNG carrier that is converted into an FSRU together with the

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LNG loading and gas export system, for FLNG conversions the space on the hull of retired Moss LNGCs is limited. To fit the feed gas treatment facilities and liquefaction facilities on top of the hull, the hull can be extended via the addition of sponsons. These are floating side structures that are installed on the side of the tanker and provide space for the additional equipment but also stability to the floating structure.

Example: Golar...

Concerns have also been expressed about the lifetime expectancy of retired LNGCs being converted and re-used.

4.2.2 Redeployment of Floating TerminalsEnablers

Another opportunity for converted LNGCs is that they can often be redeployed to a different location if an LNG project is delayed or cancelled. This reduces the risk on sunk costs to the facility owners when in the event of projects being cancelled after FID has been taken.

Challenges

4.2.3 Flexibility shipping routes

Enablers

.

Challenges

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4.3 Import Facilities

General EnablersThis new function of HUB gives to LNG import terminals the opportunity to be in the middle of an extended LNG chain and no more at the end-up of the conventional LNG chain. Import terminals are now a connection point between the “upstream” conventional LNG chain and several “downstream” new “little” chains, thanks to their new functions, which are the LNG redistribution performed by sea, roads or rails.

These main changes in the import terminals allow terminal’s customers to create and develop new LNG markets, such as the use of LNG as fuel. Already mature in some countries like US or Canada, this market is booming in Europe, thanks to the environmental benefits of natural gas compared to other carbon products. Today, environmental protection is a necessary step for energy uses in the industry, transportation or domestic.

This change also make possible for LNG producers to give flexibility to their LNG by distributing it in a larger number of countries that were previously unable to access the LNG market, because were located far away from producing countries or because accessible only by low capacity tankers.

Finally, this change optimizes the use of liquefaction plants and LNG tankers by not linking them to a single LNG chain.

It is therefore the entire LNG chain, which is undergoing a transformation thanks to the evolution of LNG import terminals.

The main lesson learned through the mutation of terminals in recent years is not to mortgage the future by building a terminal too compact and space-free for its expansion and to predict tie-ins at several locations of the LNG/NG main headers.

The purpose of these tie-ins is to be able to develop terminal’s activities, avoiding stopping the plant for long time but also minimizing the cost.

On the other hand, it is also important to design the terminal for the predicted use avoiding unnecessary investment.

The terminal should be located close to the communication axes (road, train,...) in order to supply new LNG users.

In some activities as vessel reloading or ship gassing-up/cooldown it is worthy to develop from the beginning, even if these markets are not yet developed in the country, as this requires few capital cost.

Process and safety digital control systems and fire & gas detection system shall be adaptable and scalable to accommodate these evolutions.

Main mechanical / Electrical equipment as pumps, compressors or loading arms have to be adapted to a high variety of ranges so it can meet with demand and be able to do it also in an efficient way minimizing unavailability, maintenance and electricity cost.

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BOG management equipment must be sized to deal with the fluctuating gas market, with stop and goes gas emission, while limiting or even suppressing the emission of burnt gas to the terminal flare.

Equipment used for new LNG uses, for instance connection to LNG tanker trucks and/or LNG barges, should be standardized to make tanks and barges compatible at all import terminals and to standardize operators' practices in order to improve the safety of operations.

General Challenges This mutation of LNG import terminals requires radical changes in the terminal model.

The operators' mindsets are evolving because through LNG truck loading service, they are now directly in contact with customers and have to respond quickly to their needs.

The operation of terminal’s facilities also evolves. From a "routine" operation of unloading and regasification, it becomes a “fluctuating” operation mode linked to daily or hourly LNG market changes, which request more available and reliable facilities.

To meet with requirements, it will be needed also new skills so People will have to be trained.

From a maintenance perspective, equipment will work in different conditions to the design so this means more inspections and overhauls but also more failures and unavailability.

Also, the utilization of existing facilities increases and has to be managed to meet with all requirements.

In general, the whole organization has to be adapted to this new environment.

Terminal facilities shall also be designed for several activities, which are different in case of purpose, availability, reliability, redundancy. In some cases will require adaptation of existing facilities as for example jetty enhancement for small scale but in others it will be necessary to build new ones as in the case of truck loading stations.

But, as LNG is still a cold product (-162°C) to store, the management of BOG has become more critical by these changes in the operation of facilities and has required operators to make a major change in the way they operate.

Similarly, since facilities were designated for regasification, it was necessary to upgrade and enhanced the design of the terminal to meet these multiple uses of LNG without impacting the terminal's basic function, regasification and its availability.

The choice and decision to invest is also a challenge, as unlike regasification, which is governed by high-income long-term contracts, new terminal activities are in short-term, spot and lower-income markets. The development of these new markets is less predictable and requires risk-taking from investors.

In addition, whatever the use of the terminal for large scale LNG or small scale LNG, the terminal must remain 100% safe since any incident on an LNG terminal would impact the entire LNG chain and the LNG market.

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Thus, the flexibility of LNG depends on the flexibility of the terminal, the flexibility of the people who operate it and the flexibility of the organizations.

4.3.1 Import to Export ConversionNew Segment – Suggest that import terminals group work on Storage and Loading aspects based on reloading experience. Support from export terminals group and Ted for Liquefaction section.

4.3.2 Truck Loading

Enablers

Truck delivery of LNG can replace conventional fuels such as gas oil, gasoline, LPG, coal and other fuels for its use in ships, trucks, cars and train for new machines but also for existing ones by replacing the motor or, in some cases, can be also adapted.

These applications of LNG can reduce environmental impact and assist in meeting environmental goals such as provisions of the COP 21 agreement as LNG is less pollutant than other conventional fuels not having any solid particles in their emissions and decreasing even a 30% the CO2 for an equivalent quantity of energy.

Lower prices of LNG compared with other fuels and with huge amounts of reserves already discovered.

Lower taxes for natural gas compared with conventional fuels due to its promotion by the governments to reduce the contamination.

In order to maximize facility development efficiency, integrate truck loading in to the construction of the facility at the design stage. Depending upon the estimation [of the total CAPEX, build the truck loading dockage and supporting structures at the time of facility construction or keep the connections space to be built afterward and for expansions.

Split process areas of the terminal from truck loading facilities and operations. Automatize the process to reduce human resources and time. Standardize connections should be included in the facility design and equipment

procurement. “Railway rights of way and track layouts to the terminal should be considered.” Low pressure pumps with low rates of flow that can be dedicated to truck loading

should be considered in the facility design. LNG quality measurement [approaches, such as installation of gas chromatograph

installations [should be included in the facility design and in conjunction with the truck loading operation].”

Challenges

Changing services requires different service capabilities and mindset. Truck loading require a more physical work and is also usually more discontinuous meaning that is required dedicated People for these operations but the workload is fluctuating between day and night and also depending on the day of the week or the weekend.

New training approaches and tools are needed. There are not complex operations but require to pay attention and be focused on them. A lot of connections and disconnections are done in a short time so safety is a major issue to avoid leaks.

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Physical facilities need to be adapted to the new demand installing the trucks dock stations, all the equipment associated and also the access of the trucks to the facilities: road, gates and so on.

Organizational adaptation is required as it is required People dedicated to this service.

These new services require optimization to achieve quality and speed. The truck expects to be loaded in the shortest time so the equipment and the People need to be prepared for that. It is also necessary to consider maintenance service to be fast when a failure occurs in order to minimize downtime.

Technical specifications for connections of equipment need to be compatible. To be able to provide a proper & fast service it is needed to define trucks connections and, preferably, standardize them avoiding waste time and sources of emissions,

Investment in new truck loading facilities and equipment need to be cost justified on the basis of profitability. For that it is important to know the demand so the infrastructures can be fitted to the needs.

Predictability of demand to adjust the resources to the needs.

4.3.3 Reloading / TranshipmentEnablers

To develop new LNG routes by using “intermediary” LNG terminals and all sizes of LNG vessels providing a big flexibility and possibilities for existing infrastructures.

To import LNG at terminal with limited berthing/storing design capacities so the vessel is adapted to destination restrictions.

To optimize transportation costs by using large LNGC from liquefaction plants to “intermediary” LNG terminals and split cargo into smaller LNGC going further and then attending more requirements and optimizing logistic chain at the same time.

Transhipment vs unloading/ reloading: To optimize the lay time duration for the 2 ships. As the LNG is moved from one vessel to the other, the total operation time is optimized and also operation costs as electrical consumption, BOG generation or Nitrogen usage.

To transfer LNG from a crashed vessel into another ship so it is avoided a major incident and the damaged ship can be repaired.

To perform Ship To Ship transhipment in safer conditions than in open sea and without any environmental impact as in a harbour environmental conditions like wind speed or wave front are usually lower and the control mechanisms are tougher.

To design single berth’s terminal for reloading since the beginning (ESD system, connecting line between sendout and reloading/unloading lines, by-pass on transfer arm’s check-valve or bi-directional check-valve / lift check-valve).

To design two berth’s terminal for transshipment since the beginning (ESD system, by-pass on transfer arm’s check-valve or bi-directional check-valve / lift check-valve).

According reloading flowrate, reloading should be performed by several arms to increase the availability of the service.

BOG compressors and BOG recondenser should be designed for reloading at low sendout flowrate without flaring.

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Reloading process can be occurring just after unloading process without necessarily having to stabilize unloaded LNG in the onshore storage tank.

If reloading market is mature: To design LNG tanks with dedicated reloading high flowrate in-tank pumps and associated LNG lines to separate send-out and reloading flows.

Send Out compressors installation or at least tie ins from the beginning to be able to recover all the BOG in any operational condition.

Challenges

It is a new service that is clear, but, in many aspects, very similar with ship unloading unloading. It is necessary to adapt terminal facilities for this new service. Generally, it is only required small changes:

o Additional ESD and change on existing ESD system / F&G system to stop in tank pumps when reloading operation is shutdown.

o Non return valves have to be removed or changed by others with a wheel to lock them open during reloading

o Splitting of LNG coming flow between sendout and ship reloading so there is no affection from one service to the other.

o In tank pumps can be used for reloading but then the pressure has to be reduced and they will be required several of them to reach a reasonable floe rate.

o BOG compressors compatible with recondenser but also capable to send it directly to the grid.

o BOG flowmeter

o Chromatograph sampler adaptation

Connections / vessels compatibility have to be checked but this is not normally an issue as they are the same used for unloading.

Investment cost profitability to assure income return ratios.

Predictability of demand which is very complicated as it is forecasted no long term contract for this type of service so reloading is in majority of cases with spot cargos.

It is required berth availability for unloading vs reloading so the berth utilization is increased by these operations

Adequacy between sendout flowrate and reloading flowrate to supply both service as required.

BOG recovery by existing terminal BOG compressors/ recondenser during reloading process.

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LNG quality management after reloaded ship voyage and unloading at the receiving terminal being able to measure LNG quality with existing equipment but also the BOG sent from the ship.

For transshipment it also required for the ship to have the crew trained as to have transshipment equipment and supervisor,

BOG quantity and quality measurement is a main concern as in many terminals there are no flowmeter to measure BOG coming from the ship to the terminal an gas chromatograph sampler have to be adapted.

Energy balance adjustment is an important issue especially if BOG flowmeter and BOG quality measurement are not available.

4.3.4 BunkeringEnablers

Berth design adapted to this service, or at least, prepared for the implementation (fender, hocks, hard/flexible arms).

Plant adapted to this service: tank pumps, BOG recovery. Compatibility of this service with vessels loading / reloading. Analyze incompatibilities

/ interferences.

Challenges It is a different service even when it is similar to vessel unloading, there are clear

differences related to loading systems, using hoses in many cases instead of loading arms, loading time being lower than big vessels, possibility to have a big number of operations. This triggers to change in People mindset.

People Training for the new facilities, especially if hoses are required. Adapt facilities to the demand in terms of connections, measuring and custody

transfer and so on. Berth availability (competition between unloading/reloading and bunkering/small

scale). As more services are offered as bigger berth utilization is done becoming more critical an optimum planning and also infrastructures availability

BOG management during LNG transfer having the capability to recover all BOG generated.

LNG pressure management in small scale tanker’s tanks and how to manage with the terminal

Adapt organization providing the adequate resources for this service. Service Optimization being able to deliver the service with Quality & Speed. Safety & Security of these operations is also a crucial concern as every other one in

a LNG facility Connections Compatibility is also one the issues that is going on in the market as it is

a relatively new service and many manufacturers are developing different solutions. Investment cost profitability to guarantee that the resources deployed are worthwhile. Predictability of demand is also one the objectives as it is a new market and it has

not much visibility.

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4.3.5 BOG management

Enablers

Process plant design in accordance with low send out scenarios: pumps, compressors, insulation, recondenser, regasification unit, metering unit, odorization unit, ORV.

Design recondenser with a precooler (HP LNG / BOG) since beginning. Design tie-ins for additional equipment for the zero sendout case scenario Use of BOG for internal consumptions: VCS, electrical generators, etc. Include these scenarios in business models.

Challenges BOG recovery optimization using the existing equipment but changing some

operation parameters as pressure or temperature. BOG compressors capacity becomes crucial not only for the maximum capacity but

also to adjust the exact load required.

Process plant modularity is key to heat those areas not needed and stay focused on the core.

Design case for low sendout or zero sendout to define and also taking into account other simultaneous operations as unloading, reloading, small scale, with truck loading or whatever.

Minimum flow of LNG pumps (Low pressure and High Pressure), use of VSD (Variable Speed Driver) to adjust operating point decreasing electrical consumption.

Minimum flow of regasification unit being able to reduce it as much as possible and transforming it in a more modular unit

OPEX optimization for low sendout (degradation of the ratio electrical power (kW) / LNG sendout (m3/h)) by changing operation parameters and / or adapting them

Send out compressors installation (additional compressors or bi-functional BOG compressors (LP for recondenser and HP for grid) to recover all the BOG in any operational condition.

BOG use in VCS in case that the terminal is no capable to recover that BOG. BOG use in electrical generators if any but then adapt it to BOG quality and build the

necessary pipe connections. BOG use in local grids if any by adapting pressure, temperature and quality. Pipe insulation improvements to decrease BOG generated. Optimization of keeping in cold conditions LNG facilities (unloading lines,

regasification unit, etc.) optimizing flows by installing restriction orifices. BOG quality has to be in accordance with legal requirements (Wobbe index,

odorization rate, etc.) so the necessary changes should be done to fit with it. Send Out Rangeability in the metering unit is also a requirement in the cases that

very lows flows are sent so it is possible that original design does not comply with needs.

Long term contract including BOG not recovered and/or sent to the grid

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4.3.6 Gassing Up & Cool DownEnablers

New services dictated by the fact that LNG vessels stay “on stand-by” longer due to LNG market change and proliferation of LNG vessels.

Evolution of LNG market and thus the LNG tankers use multiplies the stand-by of the ships between 2 rotations. This is an opportunity for the import terminals to carry out gassing-up and vessel cool-down so the vessel preparation can be done then in the same terminal

Availability of receiving terminal’s berths vs liquefaction plan’s berths as liquefaction facilities are overwhelm

Location of receiving terminal closer to shipyards than liquefaction plants so this is optimizing the overall time.

Service price proposed by receiving terminal vs liquefaction plants and giving more use to import terminal

Generally, no investment needed at the terminal since all equipment already installed in many cases or just small arrangements are required.

To design BOG compressors KO drum and BOG compressors for “heavy” BOG. To design LNG sampling for quality measurement at jetty head bi-directional. To install BOG quality measurement at jetty head. To design a jetty flare to avoid carbon-dioxide or “heavy” BOG into terminal BOG

system Infrastructures enhancement: Isolation of tanks & compressors.

Challenges

Different service, but similar with reloading and with some peculiarities

Terminal staff training for these operations

LNG vessels compatibility with

Predictability of demand.

Inert gas / nitrogen flaring during gassing up and BOG recovery during cool-down so the terminal equipment need enough capacity to do it.

Measure of carbon-dioxide concentration into gas return arm at the terminal to switch between flaring and BOG recovery when it meets with equipment requirement

Risk to block several terminal’s equipment if introduction of carbon-dioxide into terminal BOG system during gassing up.

Measure of LNG quantity used for gassing up and cool down so an accurate flowmeter is needed

Environmental impact as the vents & flare have to be used but it should be minimized.

Port authorizations for these type of operations that need the use of flares and vents

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4.3.7 Cold Energy Integration

4.3.8 Extension of Jetty and receiving facilities

Enablers① Q-MAXThe Jetty and receiving facilities has been designed for standard capacity’s carriers at the time of designing. However, in order to procure low cost LNG in trend of the capacity of LNG carriers growing, it is necessary to maximize the unloading volume.As an example, we will describe the situation of KOGAS with Q - MAX corresponding to 140000m3 to 260,000m3.②Expansion Jetty from small capacity’s carrier to standard capacity’s oneSmall capacity careers are operated as a long-term contract project with limited production area and consumption area, and the capacity of carriers are about 18000-20000m3 and 70000m3.As an example, we will describe expanding facilities for 20000m3 classes.

② For small bunkering vessels (For Reloading)Now checking for details.

Challenges①Q-maxThe items to be examined include the following.Tank capacityFenderReaction force → Drain increaseIncrease the number of hooks → Increase hook(BOG processing, RGB capability, piping capacity, number of alarms, etc.) Although it is necessary to consider the land tank capacity, the intake piping capacity, and the flow rate increase,

②Small capacity’s carrier to standard capacity’s

There is a long-term project that is operated by small capacity’s LNG carriers in Japan.There are only a few LNG carriers with capacities of 20000 m3 class in the world, and In Japan, Nihon Gas, Saibu Gas, Hiroshima Gas and others are participating in the project.

Among them, Saibu Gas establishes a new Terminal for large vessels (Hibiki Terninal, 2015). The Fukuhoku Terminal, one of the terminals for small carrier, was abolished (2016).

In addition, LNG middle carriers of the 70000 m 3 class which was active in the early stage of introduction of LNG in Japan are operated in the Brunei project now, and Tokyo Gas and Osaka Gas have special Jetty for Brunei Project.In Osaka Gas, large-capacities’ ship handling is realized by installing transfer piping with neighboring terminal instead of extending the berth. (See. 2.5.14)In this way, there are various ways to deal with receiving large vessels, not just extending the berth.In any cases, it was necessary to reinforce the Jetty under operation and to carry out the work while minimizing the impacts and taking into consideration safety considerations. For this reason, various ingenuities are necessary, and construction cannot be made step - by - step.There are some physical and financial difficulties in civil engineering, and it is necessary to consider the expansion on the design stage of the terminal.

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4.3.9 LNG BlendingEnablers

In order to maximize increase quality range by blending development efficiency, integrate heat value facility in the construction of the facility at the design stage. This facility is subject to the same safety standards as the import terminal. It should be designed to reflect operational and safety management plans at the initial design stage.

It is easy to operate when the design reflecting mutual review and comments of the parts where LNG and LPG are mixed with each other

Challenges

Increase quality range by blending is a process that requires construction and operation of additional facility. Costs increase due to the design, construction, operation and maintenance of facilities. Operator involvement and safety management are also required for operation.

In particular, supply facilities are needed to ensure stable supply of LPG. If there is a LPG storage terminal in the vicinity of the LNG receiving terminal, there is no problem, but it will be difficult. Even if they are supplied sufficiently by separate LPG companies, it may have different organizations and may have difficulty in cooperating with each other

The safety regulations for calorific control equipment shall be met. It should be operated in accordance with safety regulations and regularly inspected.

4.3.10 Training Enablers

“Training” Pilot LNG storage tank with capacity of 1000m3 was designed to verify the KOGAS type membrane system and completed its work successfully. Pilot tank has been reused the tank as a training institute. It is important for a facility to complete its objectives and find a new ways to use it. The pilot tank case shows good example of flexible use of facilities

Challenges

Pilot LNG storage tank for training tied in LNG receiving terminal for LNG can flow in both direction. However it has advantage of freely using LNG for training, close attention should be paid to operation and maintenance. In addition minimize the influence on the operation of LNG terminal

The safety regulations for Pilot LNG storage tank shall be met. It should be operated in accordance with safety regulations and regularly inspected.

The class covers fundamental theory of process, operation, basic functions of DCS (digital control system), and the operation of pre-commissioning, commissioning and operation. At

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the completion of this course the trainees will have experience, appropriate skills and knowledge to achieve a successful Start-up for LNG storage tank.

4.3.11 Storage Capacity Enhancement

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4.4 Peak Shaving[type foundation statement here]

[type supporting statement here]

[type supporting statement here]

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5 Case Studies[FOR EACH THEME PROVIDE AT LEAST ONE EXAMPLE OF A FACILITY WHICH DEMONSTRATES SOME OF THE FLEXIBILITY ARCHEYPES]

We can look at how to anonymise if required at a later stage.

5.1 Export Terminals

5.2 LNG Carriers

5.3 Import TerminalsIf this terminal has other examples of flexibility it could be an example for a case study?

"Re-load between terminals through pipeline."By accepting LNG in a pipeline, it is possible to respond to large-sized LNG carriers without expanding the jetty. Furthermore, we can cope with an increase in demand. In addition, it is possible to consolidate the receiving operations of LNG into one terminal.

On the other hand, the following challenge is necessary to advance this measure.Careful planning and implementation of a construction plan is important so that there is no adverse effect on the operation of existing facilities.Applying Invar alloy (36% nickel steel) enables straight piping without pipe looping, reduction of the inner diameter of the tunnel that connecting two terminals. Accordingly, not only the cost for piping but also that for tunnel will be reduced. In adopting Invar, technological development of SCC prevention and welding defect prevention was important.

5.4 Peak-Shaving

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6 Outlook on increasing flexibility in Industry (Import, Export, New market, Transport, Peak Shaving)

[type foundation statement here]

[type supporting statement here]

[type supporting statement here]

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7 Conclusions

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8 References

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9 Glossary (definition of terms and consistent language)

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Appendices

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