LNG in North America Tommy Stone – Vice President, Operations & Engineering Trunkline LNG Company,...
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Transcript of LNG in North America Tommy Stone – Vice President, Operations & Engineering Trunkline LNG Company,...
LNG in North America
Tommy Stone – Vice President, Operations & Engineering
Trunkline LNG Company, LLC – Lake Charles, LA
Tommy Stone – Vice President, Operations & Engineering
Trunkline LNG Company, LLC – Lake Charles, LA
0105-0052
LNG Properties – A Means of TransportationLiquefied Natural Gas (LNG)• Temperature
– Minus 260 degrees Fahrenheit• Volume reduction of 620 to 1
620 Ships of Gas = 1 Ship of LNG• Composition
– Methane (85 – 98%)– Ethane (2 – 12%)– Propane (0 – 4%)– Butane (0 – 1%)– Others (0 – 1%)
• LNG is nontoxic• Odorless, colorless• Vapor is natural gas – lighter
than air as it warms
• Stored near atmospheric pressure (± 2 psig)
0105-0053
Government and Academics Agree, LNG is the Solution
• FERC changes U.S. policy towards LNG terminals
“The public interest is served through encouraging gas-on-gas competition by introducing new imported supplies of natural gas which will be accessible to all willing purchasers,” - FERC Order 12-18-02
“in a short time the commission had made changes to federal policies dealing with LNG licensing and seen a response from businesses interested in investing in terminals, which will contribute to alleviation of shortages of natural gas in the U.S.,” - Pat Wood III, FERC Chairman 09-10-03
• Energy Market ResearchLNG…will set the price of gas in North America for the foreseeable future… - Michael Economides, University of Houston
0105-0054
Rockies
Deep Gulf
$3.60 - $5.85
Arctic Gas
• Supply tightening– Demand growth– Traditional basins
in decline• New supply
must come from new areas
– But will only come at a price that supports development
• LNG has the opportunity to gain market share
LNG
LNG
Nation Needs New Sources of Supply
0105-0055
LNG Value Chain, Exploration & Production
$0.6 B$2.0 B$2.0 B$1.5 B 1 Bcf/dScenario
$6.1 B
$.50 – .75
$.60 – 1.60
$1.25 – 1.50
$1.25 – 2.00
Per Unit$/Mcf
$3.60 – 5.85
Regasification
Shipping*Liquefaction
Exploration &
Production
TOTAL
Reserves
9 Tcf
Scope $0.05B
Initial drilling
$0.05B
Develop-ment
$1.4B
Trains required
2
Cost per train
$1.0B
Distance
12,000 nm
Rd. Trip Time
30 days
Ships Required
12
Cost per ship
$0.17B
Port $0.14B
Storage $0.16B
Vaporization
.20B
Engineering & Other
.10B
*Shipping: West Africa to U.S. Gulf Coast.
% of Total9%33%33%25%100%
0105-0056
Proven World Natural Gas Reserves
Source: BP Statistical Review of World Energy, 2006
\\
~ 4.1% of World Reserves
0105-0057
LNG Value Chain, Liquefaction
$0.6 B$2.0 B$2.0 B$1.5 B 1 Bcf/dScenario
$6.1 B
$.50 – .75
$.60 – 1.60
$1.25 – 1.50
$1.25 – 2.00
Per Unit$/Mcf
$3.60 – 5.85
Regasification
Shipping*Liquefaction
Exploration &
Production
TOTAL
Reserves
9 Tcf
Scope $0.05B
Initial drilling
$0.05B
Develop-ment
$1.4B
Trains required
2
Cost per train
$1.0B
Distance
12,000 nm
Rd. Trip Time
30 days
Ships Required
12
Cost per ship
$0.17B
Port $0.14B
Storage $0.16B
Vaporization
.20B
Engineering & Other
.10B
*Shipping: West Africa to U.S. Gulf Coast.
% of Total9%33%33%25%100%
0105-0058
IndonesiaAlgeria
MalaysiaQatar
Trinidad Nigeria
AustraliaOman
BruneiAbu Dhabi
USALibyaEgypt
IranBoliviaYemenRussia
VenezuelaAngola
NorwayPeru
Eq. GuineaBrazil
Source: G.I.I.G.N.L,
Liquefaction Capacity is Large and Will Continue to Grow
0105-0059
Res./Liq. (yrs)
Growth Potential inAtlantic Basin Supply
500
1000
1500
2000
2500
Atlantic Basin Middle East Pacific Basin
Tcf
Reserv
es
0
2
4
6
8
10
Bcf/d
Liq
uefa
ctio
n
Tcf Reserves
Liquefaction
1015
9.6
2,546
5.6
527
11.5
AtlanticBasin
290 1,246 126
Source: BP Statistical Review, 2006 & G.I.I.G.N.L.
3000 12
0105-00510
Abundant LNG Supply
Nigeria
Angola
Venezuela
Trinidad
Algeria Libya
Norway
Middle East
Egypt
EquatorialGuinea
Middle East
0105-00511
LNG Value Chain, Shipping
$0.6 B$2.0 B$2.0 B$1.5 B 1 Bcf/dScenario
$6.1 B
$.50 – .75
$.60 – 1.60
$1.25 – 1.50
$1.25 – 2.00
Per Unit$/Mcf
$3.60 – 5.85
Regasification
Shipping*Liquefaction
Exploration &
Production
TOTAL
Reserves
9 Tcf
Scope $0.05B
Initial drilling
$0.05B
Develop-ment
$1.4B
Trains required
2
Cost per train
$1.0B
Distance
12,000 nm
Rd. Trip Time
30 days
Ships Required
12
Cost per ship
$0.20B
Port $0.14B
Storage $0.16B
Vaporization
.20B
Engineering & Other
.10B
*Shipping: West Africa to U.S. Gulf Coast.
% of Total9%33%33%25%100%
0105-00512
LNG FLEET HISTORY CAPACITY
LNG Vessel Historical Capacity
115,000
120,000
125,000
130,000
135,000
140,000
145,000
150,000
1970s 1980s 1990s 2000s Present(2006)
Construction Era
Ves
sel S
ize
(Cu
bic
Met
ers)
Avg.Capacity (Cu/M)
0105-00513
LNG VESSEL COST
Avg. Vessel Cost ($MM)
$0
$50
$100
$150
$200
$250
$300
1970s 1980s 1990s 2000s Present(2006)
Avg. Cost ($MM)
0105-00514
LNG Vessel Fleet LNG Vessel Fleet
• 228 Vessels - World Fleet • 136 Vessels On Book (New Builds)
– Deliveries Through 2010• 85% Membrane Containment• 15% Moss (Spherical)
– Avg. 10/12 New Orders Each Year
0105-00515
LNG SHIP TYPES
Membrane Tank Membrane Tank DesignDesignMembrane Tank Membrane Tank DesignDesign
MossMossMossMoss
0105-00516
LNG/C – Physical SizeLNG/C – Physical Size
• Length: 950 feet (3 football fields)• Width: 150’• Draft: 37’ (Underwater)
– 2615 m2 (28,000 sq/ft.)
• Air Draft: 195’ (Above Water)– 6,600 m2 (71,000 sq/ft)
• Displacement: 110,000 Metric Tons• Two Tractor Tugs Required for Berthing
0105-00517
VESSEL TRANSIT TO TLNG
• 6-8 Hour Transit – Approx. 52 Miles
• One Way Traffic for Deep Draft Vessels
• 24 Hour Transits• Lake Charles Pilots• Corp of Engineers
ProjectProject Depth = 40 feetOuter Bar = 800 ft. WidthInner bar = 400 ft. Width
0105-00518
LNG Value Chain, Regasification
$0.6 B$2.0 B$2.0 B$1.5 B 1 Bcf/dScenario
$6.1 B
$.50 – .75
$.60 – 1.60
$1.25 – 1.50
$1.25 – 2.00
Per Unit$/Mcf
$3.60 – 5.85
Regasification
Shipping*Liquefaction
Exploration &
Production
TOTAL
Reserves
9 Tcf
Scope $0.05B
Initial drilling
$0.05B
Develop-ment
$1.4B
Trains required
2
Cost per train
$1.0B
Distance
12,000 nm
Rd. Trip Time
30 days
Ships Required
12
Cost per ship
$0.17B
Port $0.14B
Storage $0.16B
Vaporization
.20B
Engineering & Other
.10B
*Shipping: West Africa to U.S. Gulf Coast.
% of Total9%33%33%25%100%
0105-00519
North Americ
a
France
Spain North Americ
a
France
Spain
Italy
• North America becomes much more significant in the global LNG community
Atlantic Basin Regasification Capacity Growing
0105-00520
LNG Imports Relative to U.S. Demand
Quotes from EIA Energy Outlook 2006
• “Imports are expected to play an important role in U.S. natural gas markets, accounting for 21 percent of total U.S. natural gas consumption in 2030”
• “LNG imports are projected to grow from 650 billion cubic feet in 2004 to 4.4 trillion cubic feet in 2030, with net LNG imports rising from 17 percent of net imports in 2004 to 78 percent in 2030”
• “The most rapid growth in LNG import capacity will occur over the next decade, with peak annual capacity increasing from 1.4 trillion cubic feet in 2004 to 4.9 trillion cubic feet in 2015”
0%
2%
4%
6%
8%
10%
12%
2000 2001 2002 2003 2004 2005 2006 2015E
Percent of U.S. Demand
Source: EIASource: EIASource: EIASource: EIA
0105-00521
Distrigas, TractebelEverett, MA
CurrentExpandedSendout: (MMcf/d) 715 n/aStorage: (Bcf) 3.4 n/a
Cove Point LNG, DominionCove Point, MD
Current ExpandedSendout: (MMcf/d) 1,000 1,800Storage: (Bcf) 7.8 14.5
Elba Island, El PasoSavanna, GA
Current ExpandedSendout: (MMcf/d) 823 1,800Storage: (Bcf) 7.45 15.85
Trunkline LNG, Panhandle EnergyLake Charles, LA
Sustained PeakSendout: (MMcf/d) 1,800 2,100Storage: (Bcf) 9.0 9.0
SummaryTotal Existing U.S. Regasification
Current ExpandedSendout: (MMcf/d) 4,388 6,115Storage: (Bcf) 27.65 42.75
TLNG Currently Offers Greatest Flexibility of All Domestic Terminals
0105-00523
LNG in U.S. Gulf Coast Region
• U.S. Gulf region 45-55% of U.S. supply• Sufficient pipeline infrastructure• Blending and processing allow a broader
range of gas quality
• Low cost storage• Deepwater ports• Supportive state
& local govt’s• Reduced NIMBY
issues
*Source: US Department of Energy 0105-005
0105-00524
Texas/Louisiana LNG Projects
Approved by FERC or
MARAD/USCG
Proposed to FERC
Approved by FERC or
MARAD/USCG
Proposed to FERC
Sabine Pass LNGIn-service date: 2008-9Sendout: 2.6 – 4.0 Bcf/dDeveloper: CheniereCapacity Holder: Total & ChevronTexaco
Sabine Pass LNGIn-service date: 2008-9Sendout: 2.6 – 4.0 Bcf/dDeveloper: CheniereCapacity Holder: Total & ChevronTexaco
*Freeport LNG Development is composed of a General Partnership which has management control, but zero economic interest (Michael Smith 50% and ConocoPhillips 50%) and Limited Partners which have zero management interest, but have economic interest (Michael Smith 60%, Cheniere 30% and Contango 10%).
Creole TrailIn-service date: 2011Sendout: 3.0 Bcf/dDeveloper: CheniereCapacity Holder: TBD
Creole TrailIn-service date: 2011Sendout: 3.0 Bcf/dDeveloper: CheniereCapacity Holder: TBD
Energy BridgeIn-service date: 3/2005Sendout: 0.5 Bcf/dDeveloper: Excelerate Energy
Energy BridgeIn-service date: 3/2005Sendout: 0.5 Bcf/dDeveloper: Excelerate Energy
Freeport LNGIn-service date: 2008Sendout:1.5 Bcf/d (expand to 3.0 Bcf/d)Developer: Freeport LNG Dev.*Capacity Holder: Dow & ConocoPhillips & Mitsubishi
Freeport LNGIn-service date: 2008Sendout:1.5 Bcf/d (expand to 3.0 Bcf/d)Developer: Freeport LNG Dev.*Capacity Holder: Dow & ConocoPhillips & Mitsubishi
Golden PassIn-service date: 2009Sendout: 2 Bcf/dDeveloper: ExxonMobil
Golden PassIn-service date: 2009Sendout: 2 Bcf/dDeveloper: ExxonMobil
Cameron LNGIn-service date: 2008Sendout: 1.5 – 2.65 Bcf/dDeveloper: SempraCapacity Holder: ENI & Merrill Lynch
Cameron LNGIn-service date: 2008Sendout: 1.5 – 2.65 Bcf/dDeveloper: SempraCapacity Holder: ENI & Merrill Lynch
Trunkline LNGIn-service date: 2006 (expansions)Sendout: 1.8 Bcf/dDeveloper: Southern UnionCapacity Holder: BG LNG
Trunkline LNGIn-service date: 2006 (expansions)Sendout: 1.8 Bcf/dDeveloper: Southern UnionCapacity Holder: BG LNG
Corpus Christi Projects (3)
In-service dates: 2009-10Sendout: 4.7 Bcf/d (total)Developers: 4Gas, Occidental
Corpus Christi Projects (3)
In-service dates: 2009-10Sendout: 4.7 Bcf/d (total)Developers: 4Gas, Occidental
24
0105-005
0105-00525
Trunkline LNG Activity (2Q 2007)
Everett21%
Lake Charles40%
Lake Charles40% Elba Island
19%Elba Island
19%
Cove Point19%
Cove Point19%
LNG Imports by TerminalJan – June 2007
Total = 464.0 Bcf
*Source: US Department of Energy
Shell5%
BG LNG59%
BG LNG59%
LNG Imports by CompanyJan – June 2007
3.9% of U.S. Gas Demand (2 Qtr)
Suez LNG21%
Statoil6%
BP7%
Excelerate2%
Excelerate1%
0105-00526
Trunkline LNGExpansion Facilities
• Phase I– Construction Completed April
2006– Double sendout capacity to 1.2
Bcf/d• Peaking of 1.3 Bcf/d
– Increase storage capacity to 9.0 Bcf
• Phase II– Construction Complete July 2006– Increase sendout capacity to 1.8
Bcf/d• Peaking of 2.1 Bcf/d
• Trunkline Gas Company Loop– Construction Complete– 22 miles (new construction) of
36” pipeline loop
– Several (6+) new or expanded delivery points
0105-00527
Beeville
Edna
Cypress
Kountze Longville
Centerville
Patterson
Terrebonne
Lake Charles
LNG
2006 MMcf/dTGC Receipts: 2,494 TGC Mainline Capacity: 1,500Field Zone Supply Overage: 994
2006 MMcf/dTGC Receipts: 2,494 TGC Mainline Capacity: 1,500Field Zone Supply Overage: 994
1,500MMcf/d Mainline Capacity
1,500MMcf/d Mainline Capacity
TLNG & TGC Field Zone Supply with LNG Expansions
SeaRobin
Trunkline LNG Supply
• 2003 - 2006 (avg): 525 MMcf/d
• 2007+ (est): 1,500 +MMcf/d
Trunkline LNG Supply
• 2003 - 2006 (avg): 525 MMcf/d
• 2007+ (est): 1,500 +MMcf/d
0105-00528
LNG Value Chain – Total Project
$0.6 B$2.0 B$2.0 B$1.5 B 1 Bcf/dScenario
$6.1 B
$.50 – .75
$.60 – 1.60
$1.25 – 1.50
$1.25 – 2.00
Per Unit$/Mcf
$3.60 – 5.85
Regasification
Shipping*Liquefaction
Exploration &
Production
TOTAL
Reserves
9 Tcf
Scope $0.05B
Initial drilling
$0.05B
Develop-ment
$1.4B
Trains required
2
Cost per train
$1.0B
Distance
12,000 nm
Rd. Trip Time
30 days
Ships Required
12
Cost per ship
$0.17B
Port $0.14B
Storage $0.16B
Vaporization
.20B
Engineering & Other
.10B
*Shipping: West Africa to U.S. Gulf Coast.
% of Total9%33%33%25%100%
0105-00530
REGASIFICATION PROCESS
GASLIQUID
LNGLNGSTORAGESTORAGETANKSTANKS
PIPELINEPIPELINECOMPRESSORCOMPRESSOR
VAPORIZERSVAPORIZERS
DES
UPE
RH
EATE
R
DES
UPE
RH
EATE
R
BOIL-OFFBOIL-OFFCOMPRESSORCOMPRESSOR
PIPELINEPIPELINEREC
ON
DEN
SER
REC
ON
DEN
SER
0105-00532
Conclusion
“One of the benefits of LNG is that new supplies could enter
the market within the next few years, well ahead of other
opportunities, and begin to offer relief to American
consumers.”- Center for LNG