LNG

South Korean steelmaker, LNG importer and trading company POSCO has formed a venture with research subsidiaries of US oil and gas major ExxonMobil to apply high-manganese steel to storage tanks for use in LNG and energy applications.

POSCO signed the accord with ExxonMobil's Research Engineering Company (RE) and ExxonMobil Upstream Research Company (URC) during an online ceremonyThe Korean group and the two ExxonMobil research units have agreed to make joint efforts to expand high-manganese steel's applications to global LNG projects and other energy-related sectors. 

ExxonMobil RE is in charge of basic research for materials for the US company and ExxonMobil URC is responsible for new material applications in existing facilities. 
Manganese steel refers to steel alloy containing 10 percent to 27 percent manganese to improve durability, strength and cryogenic toughness.

Due to its strength, the material is designed to be applied to cryogenic LNG and fuel tanks.

POSCO developed its high-manganese steel in 2013, containing 22.5 percent to 25.5 percent of manganese and it is capable of withstanding temperatures as low as minus 196 degrees Celsius.

The Korean group believes it is the world's first company to develop high-manganese steel for commercial use.

POSCO won government approval for using high-manganese steel for land-based LNG tanks and applied the material to LNG storage Tank No. 5 at POSCO Energy's LNG import terminal at Kwangyang in Korea’s southern Jeolla province.

The Kwangyang LNG terminal was Korea's first import facility not controlled by state-run Korea Gas Corp. when it opened in 2005 and currently has 530,000 cubic metres of storage.

The International Maritime Organization's Maritime Safety Committee has approved interim guidelines on applying POSCO's high-manganese steel in cryogenic LNG storage and fuel tanks.“This cooperation and commitment to long-term, strategic technology development combines ExxonMobil's expertise in metallurgy application with POSCO's expertise in world-class, high-quality steel manufacturing,” said ExxonMobil URC President Tristan Aspray.

The head of POSCO’s Technical Research Laboratories, Lee Duk-lak, said he was delighted with the cooperation venture.

“Along with steel alloy and its related technologies, we hope POSCO and ExxonMobil advance their work on reducing carbon-dioxide emissions and on other eco-friendly technologies,” said Lee.

POSCO said that this was not the first time that the Korea steel company and trader had teamed up with ExxonMobil on developing new materials.

In 2017, the two sides jointly developed high-manganese steel for pipelines carrying oil sand slurry.

“The energy dual challenge, supplying energy for modern life while minimizing the impact on the environment, is one of the most important issues facing society,” said ExxonMobil RE Vice President Vijay Swarup.

Air Liquide Engineering & Construction, a unit of France's industrial gases company, has signed a new contract with LNG importer, the POSCO Group and the leading steel producer in South Korea, to design and build an Air Separation Unit (ASU) at Pohang.

SK E&S, a leading South Korean LNG operator and utility company, has sold its entire stake in a Chinese private natural gas company to improve its own finances amid the demand and prices drop in the energy industry.

The energy unit of SK Group said it sold all of its remaining 10.25 percent stake, amounting to 535 million shares, in China Gas Holdings through a block deal on the Hong Kong Stock Exchange, according to a regulatory filing.

The sale price was 1.80 trillion South Korean won (US$1.47 billion).

China Gas is the largest independent Chinese city-gas distributor and owner of over 550 filling stations for gas-powered vehicles.

The Chinese company has been in a partnership with Kunlun Energy, a subsidiary of LNG importer PetroChina, to connect households and businesses to city gas in China’s northeast provinces.

SK E&S said the move to sell the Chinese shares was aimed at improving its own financial structure as it also increases its energy investments in Australia.

It had previously sold a 3.3 percent stake in China Gas in September 2019 for 786.8 billion won. Currently, only its subsidiaries own stakes in CGH, totaling 1.45 percent.

The company is a unit of the SK Group, the third-largest conglomerate in South Korea, and a competitor to Korea Gas Corp, the largest LNG importer.

SK E&S, which has booked volumes from Freeport LNG in Texas, also has capacity at two South Korean import terminals, the Boryeong and Kwangyang facilities.

It is additionally a shareholder in the Barossa natural gas field development in Australia’s Northern Territory that will provide feed-gas for the Darwin LNG export plant at Wickham Point.

The shareholdings for that venture and Darwin LNG have changed after ConocoPhillips agreed to sell its Northern Australian assets to Adelaide-based energy and LNG player Santos.

Santos has signed agreement to sell a 25 percent interest in Darwin LNG to SK E&S.

It also sold a 12.5 percent interest in the Barossa filed development to the largest Japanese LNG importer, JERA Co. Inc.

South Korea is seeking to reduce the operation of coal power plants because of rising levels of pollution and convert them to gas-fired plants using imported LNG shipments, though is being cautious about the timetable because of the higher fuel costs.

The Korean Trade, Industry and Energy Ministry announced it would regulate the operation of coal-fired power plants to reduce emissions of fine dust from coal as the country has faced its worst levels of pollution since early March.

The Ministry explained that it would move to have 60 coal-fired power plants scale down their operations to 80 percent of their capacity, an increase in restrictions currently imposed at 40 plants.

“Due to the disaster-level density of fine dust over recent days, the inconvenience and damage suffered by the people are becoming unbearable,” said Vice Minister Cheong Seung-il during a visit to the Yeongheung coal-fired power station located west of the capital Seoul.

“Although state-run power firms have been making efforts to cut fine dust emissions by 25 percent over the past three years through investing in facilities, more must be done to meet the demands of the people,” stated Cheong.

Analysts point out that fine dust particles are more likely to penetrate deeper into the lungs, while ultra-fine particles can be absorbed directly into the blood stream, posing serious health risks.

One additional problem for Seoul and its residents is the heavy pollution also brought across the border by winds from North Korea, which is just 50 kilometres away.

South Korean LNG imports rose 17.3 percent in 2018 to a record 44 million tonnes as shipments increased from traditional Middle East supplier Qatar and from new projects in Australia and the US.

The country already has ample LNG import capacity to replace coal and access to global LNG volumes as the current biggest recipient of growing US exports.

Korea Gas Corp. is the dominant LNG importer, though other companies also receive shipments at two of the nation’s six import terminals.

South Korea’s previous annual record of LNG shipments was set in 2013 when it faced a series of nuclear reactor shutdowns due to a safety scandal over faulty parts, leading to an increase in gas-fired power generation.

Four of Korea’s import terminals at Incheon, Pyeong-Taek, Samcheok and Tong-Yeong are operated by state-controlled Kogas and have huge storage tank capacity.

The two other terminals are owned by a utility and an industrial company. The Boryyeong terminal is operated by GS Energy and the Kwangyang facility by the steelmaker POSCO, whose shipments are organized by trading unit POSCO Daewoo.

The Industry Ministry said it would also be examining a plan to persuade existing coal plants to be converted to gas-fired plants using regasified LNG as fuel.

The Ministry believes that while South Korea can maintain a stable supply of power through 2026, it will have no choice but to build more plants beyond that period.

In the coming months the Ministry added that it would also partially suspend the operation of 48 coal-fired power plants from at least a week to 45 days over the March-June period, and fully shut down six other plants over the period.

“The Ministry will moreover promote the use of low-sulfur coal at local stations in order to reduce the emission of sulfur oxide, which accounts for three quarters of fine dust created from coal plants,” said the statement.

Concerning six old coal plants in the country, the Ministry said it would review closing them down earlier than planned.

The government plans to permanently shut down the six plants at some point between December 2019 and May 2022.

Almost 77 percent of the nation’s electricity is generated by plants using coal, nuclear or regasified LNG.

According to the Ministry, coal-based power is anticipated to take up 28.6 percent, or 36,031 megawatts of the total power capacity of 126,096 MW, in 2019.

Nuclear power supplied 27.5 percent of the country’s power in 2018 followed by plants using regasified LNG at 20.8 percent. The balance was made up of oil and other sources.

Under the government's present policy and outlook, South Korea is expected to depend more on coal in the future, with the figure increasing to 42,041 MW in 2022.

South Korean LNG imports rose to a record 44 million tonnes as shipments increased from traditional Middle East supplier Qatar and from new projects in Australia and the US.

South Korean liquefied natural gas imports rose 22.5 percent compared with the same month of 2017 as more shipments came in from Qatar, Australia and the United States and three cargoes were re-exported from Europe.

Korea Gas Corp., the South Korean network operator and owner of four LNG import terminals, said it received 3.8 percent more shipments in 2017 compared with the previous year.

Jan 2 (LNGJ) - The 174,400 cubic metres capacity carrier “Cesi Gladstone” is scheduled to unload a shipment on January 7 at the Tanghshan import facility in the northern Hebei province from the Gladstone export plant in the east Australian state of Queensland, according to shipping data. The 160,000 cubic metres capacity carrier “Asia Endeavour” will unload a shipment on January 10 at the South Korean Kwangyang import facility, owned by Korea Gas Corp., from the Dampier export terminal in Western Australia, operated by Woodside Petroleum. The 160,000 cubic metres capacity vessel “Asia Excellence”, owned by Chevron Corp., has docked at the Wheatstone export plant in Western Australia to lift a cargo for Japan.