LNG (liquefied natural gas)
What is LNG?
LNG, liquefied natural gas, is natural gas that has been rendered liquid by cooling. Another acronym for this liquefied fossil fuel is GNL, for the French term gaz naturel liquéfié. LNG consists mainly of the hydrocarbon methane, but can also contain a variety of other gases, especially carbon dioxide, nitrogen, ethane, ethene, propane, butane and small amounts of noble gases.
At temperatures of about -160°C, the gas transforms into its liquid state, in which it occupies only about 1/600th of the volume of its gaseous form. To do this, the gas is purified in a complex process in special facilities and then cooled. It can then be transported to its destination as LNG in pipelines or in special tankers with insulated storage tanks. At its port of destination, the liquefied natural gas is usually returned to its gaseous state by heating it in LNG terminals, and then transported via gas pipelines to the grid gas companies.
Why is natural gas liquefied?
The main reason the fossil fuel is liquefied is to transport it over routes that are not connected by natural gas pipelines. But as the process is complicated and requires up to 25% of the energy content of the gas, the transportation of liquefied natural gas is only worthwhile over long distances. However, increasing export activities from the United States and Australia could positively affect the trade and transport of LNG in the future.
Regulations for fuelling ships with LNG
Standard regulations for fuelling ships with LNG are currently being developed by several institutions and associations. The International Maritime Organization (IMO) has already defined the elements of the Bunker Delivery Note for LNG supplies. Safety and other regulations are being developed by the Society for Gas as Marine Fuel (SGMF) among others. With the adoption of the German Energy and Electricity Tax Act, liquefied natural gas – as well as other marine fuels – became exempt from tax in commercial shipping.
Costs and price of LNG
The costs of LNG are made up of the price of natural gas and its liquefaction, plus a premium for transport and fuelling. The total price can be linked to either oil or gas indices. In the oil industry, Brent is mainly used for this. In the gas sector, however, the Title Transfer Facility (TTF) Index or the National Balancing Point (NBP) Index are mainly used. In the U.S., LNG can also be linked to the Henry Hub (HH) Index.
LNG as a marine fuel
The importance of using LNG as a marine fuel is increasing. LNG tankers in particular also use the LNG they transport for their own engines. Due to efforts to greatly reduce emissions in the shipping industry in the next few years, LNG is also becoming attractive for powering other types of ships. In order to run on LNG, a ship requires insulated storage tanks and a dual-fuel engine that can run on LNG as well as oil-based fuels. Trucks can also use liquid natural gas as fuel when fitted with special tanks and engines.
Difference between LNG and LPG
(liquefied natural gas)
(liquefied petroleum gas)
|Heating and cooking, domestic and commercial applications, e.g. substitute for conventional oil-based fuel
|Mainly methane (CH4)
|Mainly propane (C3H8) and butane (C4H10)
|Specific gravity (gas)
|Lighter than air, disperses and rarefies very quickly below flammable limits
|Components are heavier than air, gas does not disperse (easily) and will remain longer within the flammable range
|Liquefied under atmospheric pressure at very low temperatures (approx. minus 160°C)
|Liquefied under high pressure and ambient temperatures or under atmospheric pressure and low temperature (approx. minus 1°C to minus 45°C)
Mabanaft is active in trading, supply and project development for NGLs and their derivatives from our offices in London and Singapore.
Mabanaft business unit New Energy, Chemicals & Gas
Status: December 2015
All information subject to change. Errors and omissions excepted.
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