You are here:

Liquefied natural gas

Dick Meurs (photo)

External opinion

“The construction of an LNG break-bulk harbour basin and LNG installations at the Gate terminal in Rotterdam began in late 2014. The new break-bulk services aim to split large-scale LNG shipments into smaller quantities. This will enable LNG to be distributed as a fuel for shipping, trucking and other industrial applications.

Its design and development has resulted from close cooperation among Shell, the Port of Rotterdam Authority, the gas infrastructure company, Gasunie, and the liquid bulk storage provider Royal Vopak.

As its launching customer, Shell will lead the use of LNG as a transport fuel in north-west Europe. The Gate terminal will be able to supply LNG to bunker ships in the North Sea, Baltic Sea and Channel as well as along the Rhine, Main and Danube. It will mean that cleaner, affordable fuel is available for transport companies all over Europe.”

Dick Meurs
Managing Director, Gate terminal, Rotterdam, the Netherlands

The liquefied natural gas (LNG) process enables natural gas to be easily transported from remote areas to markets around the world. To create LNG, natural gas is cooled to −162 ºC to turn it into liquid form which shrinks its volume by 600 times. At its destination, the LNG is converted back into gas for our customers. We were a pioneer of the LNG industry five decades ago and today we are one of the world’s largest LNG suppliers, owning a share in 12 operational LNG plants worldwide.

Sakhalin-2 (Shell interest 27.5%) is located off the east coast of Russia. It includes an LNG plant, the first in Russia, that provides more than 9% of Japan’s and 4% of South Korea’s LNG supplies. The plant is more energy efficient than an average LNG plant. This is due to liquefaction technology developed by Shell that uses the low temperatures of the subarctic environment more effectively to help cool natural gas for liquefaction. The process reduces the amount of natural gas used to run gas turbines, while the waste heat generated in the liquefaction process is used as heat for the treatment process.

LNG Canada (Shell interest 50%) is a joint venture announced in April 2014 to develop an LNG export project in Canada. The proposed project in Kitimat, British Columbia, includes the design, construction and operation of a gas liquefaction plant, and facilities for the storage and export of LNG. If the project goes ahead it will use hydropower to power the plant. A final decision to proceed with the project is yet to be taken by the partners. If constructed, it will connect the abundant supply of Canadian natural gas to markets around the world.

In Australia, the Gorgon LNG project (Shell interest 25%) is under construction on Barrow Island around 50 km off the country’s north-west coast. The gas discoveries in the Greater Gorgon fields are currently the largest in Australia. The project will capture CO2 produced with natural gas and store this more than 2 km underground. The project is expected to capture and store 3 to 4 million tonnes of CO2 a year when it reaches full capacity.

Floating LNG

Floating liquefied natural gas (FLNG) facilities enable LNG to be produced, liquefied, stored and transported at sea, without the need for pipelines, onshore plants and infrastructure. This makes it possible to reach offshore gas fields previously considered too expensive or too difficult to develop and reduces disturbance to land and marine life.

We are constructing our first FLNG facility, Prelude FLNG (Shell interest 67.5%) which will be located off the coast of Western Australia. The components for Prelude FLNG are being assembled in Geoje, South Korea.

Shell has partnered with the Challenger Institute of Technology (CIT) in Western Australia to develop a training programme for FLNG technicians. CIT is providing the training, assessment and assurance of technicians who will work at Prelude. The first technicians graduated in March 2014. We continue to work with the University of Western Australia’s Energy and Minerals Institute to strengthen research into the impact of weather and ocean conditions on offshore gas installations and operations.

LNG for transport

LNG can be used as an alternative transport fuel to diesel and heavy fuel oil. LNG for transport produces less sulphur and nitrogen oxide emissions which is better for local air quality. LNG powered trucks and ships are quieter and produce lower CO2 emissions.

Shell is investing in the development of LNG fuel infrastructure for the marine and heavy-duty road transport sectors. In 2013, we acquired Gasnor, a Norwegian company which provides LNG fuel for ships and industrial customers. Gasnor can supply up to 300,000 tonnes of LNG a year.

In 2014, Shell announced it will be the initial customer to use the new LNG transport infrastructure at the Gas Access to Europe (GATE) terminal at the Port of Rotterdam in the Netherlands. The new terminal will increase the availability of LNG as a transport fuel for vessels in north-west Europe. Once the construction of a new jetty is complete, Shell will operate a specialised LNG supply vessel to deliver to LNG-fuelled vessels in north-west Europe.

In the USA, Shell has signed an agreement with Travel Centers of America, a truck stop chain, to develop a network of LNG refuelling stations for trucks. The first LNG refuelling station opened in 2014. We also plan to open an initial network of refuelling stops for trucks at seven locations in the Netherlands.