Press Release - April 27, 2007 - Marine CNG Poised for Commercialization as Numerous Projects Reach Funding Stage, Conference to Examine Ramifications
Introduction
The CNG ocean transport industry has begun moving toward commercialization at a more robust clip after a couple years of relative quietude. Major classification society approval processes (ABS, DNV and Lloyds) appear to be gaining momentum, and strategic alliances and partnerships are being established to create not only critical mass, but also, sustainable competitive advantages in a burgeoning industry.
Leading technology developers include TransCanada,
in partnership with Overseas Shipholding Group (OSG),
Sea NG, EnerSea, in partnership with "K" Line,
and Knutsen. However, as serious interest in regional
applications plays harbinger to first ship orders, and
pilot-project developments take big steps forward, other
well-heeled competitors can be expected to enter the
field with a strong commitment to capturing share.
Driven largely by record-high petroleum prices and increases in gas prices, CNG appears to offer producer netbacks superior to those of LNG alternatives at distances of less than 1,500 nautical miles. Furthermore, in the currently tight construction market, CNG offers the comparative supply-chain advantages of considerably less infrastructure associated with loading and unloading facilities. Also, reduced upstream infrastructure CAPEX means less exposure to stranded capital. While questions still remain as to the risks (compared with LNG), CNG technology developers are having little difficulty attracting serious investors.
From the foregoing, CNG appears to hold promise on
the horizon as a viable means for monetizing smaller
gas deposits regionally and providing a path to market
for stranded and associated gas that would be flared,
reinjected or shut in.
In order to bring a well-balanced perspective on the final approach to commercialization, our conference speakers include representatives from the leading technology developers and operators, capital providers, suppliers, markets, classification societies and government. |
