With an abundance of natural gas being recovered from the major shale plays, liquid natural gas (LNG) prices are nearly two-thirds of what they were as recently as 2014. At the same time, the proliferation of large LNG plants in the U. S. and around the world, together with abundant low-cost supply, has resulted in lack of demand for the new long-term commitments needed for the next wave of LNG export facilities to reach final investment decision.
Yet this isn't the case with small and midscale bunkering and peak shaving facilities. There, a host of needs have owner/ operators of these facilities working fast to meet present and expected demand. For ocean-going vessels, more stringent regulations that require they meet low sulfur standards in designated emission control areas have made LNG, which contains virtually no sulfur, the clean fuel of choice. In the U.S., Crowley Marine, Tote and Harvey Gulf International Marine are leading the way in LNG-powered vessels. With an additional 97 LNG-fueled ships being built, bringing the LNG-powered fleet to 200 worldwide, demand continues to grow. As such, additional bunkering facilities and other infrastructure will need to be built.
The same is true for other applications. Examples include small to midscale peak shavers for use in developed but fuel-constrained areas like New England, or to provide fuel for power plants in remote areas such as islands, mining facilities, upstream exploration and production fields, and elsewhere. One Caribbean island recently converted its gas turbine power plant to duel-fuel capability and is building two new power plants fueled by natural gas, provided in the form of LNG imported from the U.S.
Maximizing return on investment
In every instance -- whether in the liquefaction of natural gas, receiving and regasification, peak shaving storage or other applications -- developers, energy providers, fuel distributors, transportation companies and financing groups have all shared objectives in the design and construction of LNG infrastructure:
- Efficient, economical production or conversion of LNG with the lowest possible capital cost
- Reliable operation with competitive operating costs and minimal emissions
- Flexibility in operation
From concept to cooldown, getting there means minimizing design and construction time by partnering with firms or well-established teams that have a long history of success in this highly complex segment and that can provide all the needed services -- EPC management -- to integrate the complexities of liquefaction, regasification and/ or cryogenic storage technologies.
What to look for in an EPC management partner
Look for partners that understand the complexity of LNG projects and have proven expertise in front-end engineering design as well as detail engineering, procurement and construction of cryogenic tanks, the liquefaction or regasification process, and balance of plant construction. They should also have relationships and ready access to global resources -- key for critical components such as liquefaction modules or in-tank pumps -- but also with craft labor such as experienced welders certified in the welding of high-alloy steels such as 9-percent nickel. The contractor's project managers should possess decades of experience in managing complex projects with multiple critical path activities.
Ask about past historical performance and the provider's record of repeat business with existing customers. More importantly, inquire about its emphasis on safety and safety record.
Finally, look for a partner willing to support your operations after plant commissioning and willing and able to enter into a strategic alliance for long-term operations support. Doing so helps ensure dedicated resources and work flow predictability, commitment to safety, consistent performance and teamwork.
For more information, call John Hart at (832) 448-4370, email jhart@matrixservice.com or visit www.Matrixservice.com.
