FLNG a Viable Alternative for an Early Production Scheme

Trym Tveitnes, Chief Technical Officer, Flex LNG speaks exclusively to Oil & Gas IQ’s Bryan Camoens about the challenges, difficulties and untapped opportunities in the FLNG sector.

Could you please elaborate more on the Flex FLNG project and tell us about the economical and safety benefits of the projects?

FLEX LNG is an innovative company founded with the purpose of bringing LNG production offshore by commercializing the world’s first floating LNG production units (FLNG). The LNG industry has been constrained by slow development of new supply due to delays in onshore developments resulting from escalating engineering, procurement and construction costs as well as political uncertainty. The LNG Producer (LNGP) developed by FLEX LNG is designed to pre-treat, liquefy, store and offload LNG. The feed gas can be supplied either directly from a natural gas field, from a wellhead platform, as associated gas from a nearby oil FPSO, or from an onshore natural gas source or pipeline. FLEX LNG's LNGP will provide additional supply of LNG to the world market within an attractive timeframe. The LNGP benefits from a very attractive construction time compared to large onshore projects. It enables the un-locking of natural gas resources that until now have been commercially "stranded" and provide a lower CAPEX per ton of LNG production compared to onshore plants.

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The overall design principle for the FLEX LNG LNGP has been to maximize the use of proven and robust technologies to achieve a safe and reliable concept. Focus has been on simplifying the design and removing unnecessary complexity for successful implementation of onshore technology in a marine environment. An inherently safe and low complexity liquefaction design has been chosen in order to minimize technology risk when for the execution of the world’s first FLNG project.

What key factors must be taken into account when understanding the right FLNG technology for each field?

Key Factors that must be taken into account are, the size of field and well production rate, project timeline, required time to first LNG, metocean data (harsh, moderate or benign), single field, multiple field strategy or redeployment issues and well stream specification and LNG sales specification.

What are the challenges faced when maintaining a safe and efficient liquefaction process for FLNG?

Successful design of an LNG production facility incorporates a number of aspects, which must be integrated into a safe, reliable and cost-effective design. The feed gas must be treated to the standard required to meet LNG product specifications and to protect the liquefaction equipment. Liquids, if present, need to be processed and disposed of.

Products (primarily LNG) must be stored and offloaded for transportation.

There are a number of liquefaction technologies to choose from, and these are mainly distinguished by the type of refrigeration cycle which is utilized. For instance the Mixed Refrigerant (MR) cycles have an inherent efficiency advantage over N2 cycles, and that is reason that MR refrigerant cycles are overwhelmingly chosen for large scale shorebased LNG plants.

The use of hydrocarbons in the refrigeration cycle require significant inventories of flammable hydrocarbons which pose greater fire and explosion risk if applied in an offshore environment with space and separation distance constraints. In addition, refrigerant storage is required and import of refrigerant components may be necessary, requiring transfer operations which also represent a higher risk. Hydrocarbon refrigerant inventories not only impact on the risk to safety of personnel and the facility, but also require larger plot areas to allow for emergency response and to reduce explosion overpressures in case of ignition of a leak.

By contrast, nitrogen is an inert gas and poses no fire or explosion risk. An inherently safe liquefaction design can be achieved by using the N2 expander refrigeration cycle. In addition to the contribution to improved safety design the N2 refrigeration cycles provide for a less complexity both in terms of design, construction and operation, which inherently also results in lower plant CAPEX and improved reliability.

What are some of the initial difficulties faced when choosing the right offloading system for your field operations

The key considerations to be made when choosing the offloading system are:

• Site metocean conditions (wave heights, wind speed, current, etc) versus offloading availability given by side by side or tandem offloading solutions?
• Acceptable offloading availability versus design buffer storage capacity (tank capacity relative to LNG offtake carrier size) and slack in LNG offtake logistics.
• Required offloading rate (number of hours to offload).
• Number of products to be offloaded (Only LNG/Condensate or LNG/LPG/Condensate) and related terminal congestion issues.

What are some of the current untapped opportunities in the FLNG sector and how can these underutilized opportunities be taken advantage off?

Stranded gas field applications are typically located a significant distance from existing offshore (or onshore) production facilities or pipeline networks. Traditionally, such applications could only have been developed using new build offshore production platforms and long distance pipeline tie-backs to onshore facilities. Now however, the advent of floating LNG producer vessel technology means that such fields can be readily developed, both faster and more CAPEX efficiently than the traditional model. Through FLNG, production of LNG will be possible onsite and LNG offloaded to LNG shuttle vessels using a side by side configuration.

Associated gas applications provide an opportunity to monetize surplus gas production at source in the form of exported LNG, while minimising/eliminating flaring or gas reinjection from the host production facility. Capturing the flared gas adds economic value to an existing project, and provides an additional benefit to the environment by reducing emissions. Such applications typically involve the mooring of the FLNG adjacent to existing fixed or floating production facilities, with the export of the surplus gas to the FLNG via a pipeline network.

Floating liquefaction offers a fast-track project compared to an onshore plant. For FLNG, the development time from project definition until first LNG can be as short as approximately 50 percent of the time required for a traditional LNG development. Hence FLNG provides a viable alternative for an early production scheme generating revenues and creating value while the standard facilities are being approved and built. Building a smaller scale floating liquefaction plant has also proven to be less capital intensive than a larger plant and onshore developments. By utilising several medium scale LNG Producers, a large staged project, both onshore and offshore, would see greatly improved economics, lower technical risks and a better fit to the field production curve.

For developments where there is already an existing gas pipeline infrastructure such as an existing domestic pipeline grid, an FLNG unit can be located in a near shore location providing a scenario similar to onshore LNG plant, but with a significant costs savings to CAPEX and accelerated development schedule.

For deepwater developments with significant distances to tie-back into existing infrastructures, FLNG offers a viable solution to monetise the field at reduced CAPEX.

FLNG can offer a cheaper, quicker, and less complex solution for onshore gas fields where the is little or no existing infrastructure such as Papua New Guinea and CBM projects in Australia.