In this second of a two-part series covering small- and medium-scale liquefaction, we consider how LNG-powered transportation and remote gas distribution are adding demand for downscaled plants, thus improving the market base overall.

New South Wales, Australia-based Energy World Corporation, Ltd. (EWC) is using its experience from 20 years operation of a 9,000 metric ton per year liquefaction plant at Alice Springs, Northern Territory, to build a 2,000,000 metric ton per year plant near its Sengkang Power Station on Sulawesi Island, Indonesia.  The first two trains with liquefaction capacity of 500,000 metric ton per year have been ordered and are slated to be onstream in mid 2009.  The company intends to demonstrate that knowledge and experience from a small-scale unit used for domestic markets (see photo) can be used to benefit development of a medium-scale export oriented plant (see schematic diagram). More...

Observations/Conclusions:

• The development of New East Coast North American terminals is moving ahead slowly.  Most projects are stuck in political wrangling.  Canaport, Neptune, Northeast Gateway (see article on page 6) are advancing the fastest, aside from expansions at existing terminals (i.e., Cove Point and Elba Island).
• Along the US Gulf Coast, terminal development is hindered by shortage of LNG supplies, not NIMBYism.  

Atlantic Sea Island Group Seeks Injunction Against New Jersey’s Veto Pen: The company seeks to block a potential veto of its proposed Safe Harbor Energy LNG deepwater terminal offshore New Jersey.  The terminal is proposed for siting on a 60.5-acre, man-made island some 23 miles (37 km) from New York Harbor and 19 miles (31 km) from the New Jersey shore. More...

Observations/Conclusions:

• In North America, success of public relations for LNG projects, whether import or export, depends most greatly on the state’s oil and gas reserves.  Citizens in Alaska, Texas, Louisiana and Mississippi, for example, which have substantial experience with oil and gas, seem to appreciate LNG investment and the boost it brings to their economies. 
• Oregon and Washington, which have limited oil and gas reserves, increasingly oppose LNG. 
• California, of course, rewrites the book.  While the state has a large oil and gas industry, it has rebuffed efforts to build terminals even tens of miles offshore.  Interestingly enough, however, Clean Energy Fuels, an alternative-fuel marketer, is building a liquefaction plant in the Mojave Desert near Los Angeles. Hundreds of LNG tanker trucks and thousands of LNG-powered tractors will be driving California highways in the coming decade.

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Observations/Conclusions:

• As with India, South America’s economic power houses, Brazil, Argentina and Chile, are having to get used to the idea of paying world prices for natural gas. A standoff between Bolivia and those three nations looms as the earth’s axis turns southward and winter approaches in the Southern Hemisphere. 

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