Infrastructure and Gas Monetisation
Infrastructure and Gas Monetisation
Infrastructure and Gas Monetisation
Gas Production/
Supply
Infrastructure and
Gas Monetisation
Gas export pipelines usage increased by 4.8% AAGR over last 10 years
LNG exports growing at faster rate, by 7.5% AAGR over last 10 years
LNG Liquefaction capacity is approx. 281 MMTp.a. in 2012 (floating LNG is nil)
LNG shipping fleet currently has 362 vessels, a combined capacity of 54 Bcm
LNG import (land and floating regas) capacity is 642 MMTp.a. in 2012 and
expanding- new facilities planned in UAE, Ukraine and Canary islands (Spain)
Gas import pipelines & distribution networks (political or commercial
investment decision)
Russia-China line is likely given Russias strategic gas marketing shift eastward
Plus at least one new line into southern/central Europe is likely to come to fruition
Nabucco or South Stream pipelines into southern/central Europe?
Chenieres
Contract Price
Potential
Delivered Cost
US$13.5/MMBtu
14.0
13.0
US$11.5/MMBtu
12.0
11.0
US$10.3/MMBtu
Shipping
Shipping
Liquefaction
Plant
10.0
Shipping
(via Suez)
$/MMBtu
9.0
6.0
3.0
2.0
1.0
0
Liquefaction
Plant Tariff
$3.0/MMBtu
Liquefaction
Plant
Gas
Pipeline
Upstream
Cost of
Pipeline
Gas
(115% of
Henry Hub
at US$4/
MMBtu)
Upstream
Gas
Pipeline
Gas Pipeline
Upstream
Generic USGC
LNG Exports
Shipping
Liquefaction
Plant
5.0
4.0
US$9.1/MMBtu
GTP & Liquids
8.0
7.0
Liquid Recovery
Improves Costs
East Africa
Australia (Offshore)
Asia Pacific
Phase 1
9 MMTPA
7 MMTPA
9.7 MMTPA
10
Petronas FLNG No.1 facility (2015-6): 1.2 MMTp.a. (FLNG No.2 project FID late in 2013?)
Shells Prelude FLNG (2016): 3.6 MMTp.a. and costs US$12 Bn
(this will be six times heavier than the world's biggest aircraft carrier!)
Santos Bonaparte FLNG (FID 4Q2014) 2-3 MMTp.a. and costs US$ 8-10 Bn
FLNG can avoid the nimbies and reduce costs compared to land based
Land-based LNG terminal are costly (US$0.81.2Bn) and have long construction schedules (4046 months)
Floating LNG storage and regasification units (FRSU)
provide a flexible and short term solution
Currently there are FRSUs operating in 8 countries
10
11
Quantity (MMscfd)
Pipeline
LNG
Power
Methanol/DME
Fertilizer or CNG
(Domestic Markets
12
GTL
13
End Use
MMscfd
Tcf
CNG
10,000 vehicles
0.03
Cement Plant
10
0.07
Fertilizer (Urea)
15
0.15
City gas
15-30
0.1- 0.2
Power
200 MW
50
0.5
Methanol
150
1.2
GTL
150
1.2
150
1.2
LNG
1360
10
LNG
GTL
Viable
Methanol/DME
Fertilizer
Power
Small scale LNG/GTL
illustration only
there are
always
exceptions!
developments
are project
specific
Manpower/skills availability
Requirement for strategic partners or
agreements from foreign governments
Project financing
Environmental approval
Where netback gas price and ROR ultimately influence the project however
ignoring other factors can lead to cost over runs and delays
Over 70% of oil & gas mega projects developed since 2000 have exhibited poor
cost and/or schedule performance
15
For small amounts of gas .you may also consider small scale GTL, i.e.
Compact GTL and Velocys
16
So the question at the pump may well be, liquid or gas, the one
thing that is clear is that NGVs of all sizes are here to stay
17
East Africa
The reserves are remote from the countrys population centres
Potential to set up domestic industrial zones to establish added
value petroleum liquids and petrochemicals
Export pipeline to neighbouring countries is challenging
compared to LNG?
18
Power
(200 MW)
Methanol
(5,000 T/d)
Urea
(1,000 T/d)
LNG
(9.0 MMTpa)
GTL
(16,000 Bpd)
Gas reserve
(20 yr size/
quality)
Small,
Sweet
(0.5 Tcf)
Moderate,
sweet
(1.2 Tcf)
Small,
sweet
(0.2 Tcf)
Large,
sweet
(8.5 Tcf)
Moderate,
sweet
(1.2 Tcf )
Market risks
Coal pricing
Possible
oversupply
Possible
oversupply
Export approval
Large liquid
market
Technology
constraints /risks
Proven and
available
technology
Proven and
available
technology
Proven and
available
technology
Proven and
available
technology
Limited
experience and
few plants
USGC LNG Terminal owners can target exports to Europe and S.E. Asia, via
the expanded Panama Canal from 2015, where netback gas prices are more
favourable
West Coast LNG export options (not included) to the Asia-Pacific market also
provide robust net-back prices
19
Mozambique Prospects
A larger anchor project is needed to underpin gas developments for smaller
consumption options such as power generation and methanol
Criteria
Power
(200 MW)
Methanol
(5,000 T/d)
Urea
(1,000 T/d)
LNG
(9.0 MMTpa)
GTL
(16,000 Bbl/d)
Small,
rich
(0.5 Tcf)
Moderate,
rich
(1.2 Tcf)
Small,
rich
(0.2 Tcf)
Large,
rich
(8.5Tcf)
Moderate,
rich
(1.2 Tcf )
Market risks
Hydro
competition,
Low pricing
Potential
market
flooding
Market
flooding
Strong export
market
Large liquid
market
Technology
constraints
/risks
Proven &
available
technology
Proven &
available
technology
Proven &
available
technology
Proven and
available
technology
Few existing
plants and
experience
Gas reserves put focus on LNG, GTL and potentially an export pipeline (not
shown here)
LNG is a natural fit but could GTL find a place in the mix?
20
Conclusions
Huge investments are required for the new wave of LNG and
21