LNG

UK-based major Shell is completing a fourth-month maintenance turnaround of the “Prelude FLNG” production vessel that operates off the northwest coast of Australia and which has suffered shutdown over the last few years because of technical issues as well as industrial unrest among workers.

The FLNG vessel is moored 400 kilometres (250 miles) north of the town of Broome on Western Australia’s Kimberley coast and has 3.6 million tonnes per annum of production capacity.

Shell has attempted to tackle some long-term technical issues at the facility with maintenance and work that started in August 2023.

Demand window

“Prelude FLNG” will be coming back on stream to capture the winter demand surge in Japan, China, South Korea and Taiwan.

The LNG carrier “Symphonic Breeze” is expected at the “Prelude FLNG” production hull early in December.

Shipping data showed that the “Symphonic Breeze” departed from the Japanese port of Naoetsu on November 23 with the destination of the vessel with 145,500 cubic metres capacity given as the Shell export facility.

Prelude FLNG has suffered several outages since it started production in June 2019, including a fire that led to a full power loss in December 2021 and several other automatic shut-downs because of fire alarms going off.

“Prelude is a complex facility in a remote offshore location,” said Shell in a statement.

“This is its first major turnaround and we continue to work through the process methodically taking as much time as required to ensure safe execution of all activities,” said the London-headquartered company.

“During the turnaround, additional scopes of work were identified and a decision made to extend maintenance to complete these scopes ahead of restart,” Shell added.

Feed gas

For the Shell project, the Concerto gas field and the nearby Prelude field provide the feed gas for the LNG and the new Crux field is also being developed.

The “Prelude” joint venture is owned 67.5 percent by Shell and 17.5 percent by Inpex Corp. of Japan, operator of the Australian Ichthys project from where the carrier the “Symphonic Breeze” has lifted many cargoes for Japan.

The Inpex Ichthys plant is located at Bayden Point in the Northern Territory of Australia, close to the Darwin LNG plant operated by Santos.

The Santos facility is seeking to bring on stream more feed gas from the Barossa gas project.

A further 10 percent of “Prelude” is held by the South Korean LNG buyer Korea Gas Corp. and 5 percent by CPC Corp. of Taiwan.

North Sea Brent crude oil prices rose to their highest level in seven-and-a-half years as European natural gas and LNG cargo prices gained 20 percent after Russia said it was taking military action in neighbouring majority ethnic-Russian areas of Ukraine.

North Asian spot cargo prices declined on the week while remaining at seasonal highs through to the second quarter as cargo liftings fell and European values stayed above the Asia price with energy markets buoyed by crude oil over $90 a barrel.

Demand for liquefied natural gas remained firm worldwide along with seasonally high Asian spot prices over $13.00 per million British thermal units for September and with deliveries to China, Japan and South America still being preferred to European destinations.

Demand for liquefied natural gas cargoes increased around the world, underpinned by crude oil futures prices of $71 per barrel in a week that saw three global commodities firms sign long-term accords for Russian and US LNG cargoes and the prices of North Asian spot shipments rose along with European benchmark values.

ENN Group, the leading non-state energy company in China with LNG and city-gas assets, reported an increase in annual revenues and profits as its reach extended to 18 more large towns and cities in 2020.

Global liquefied natural gas export plants continued to send out a steady level of shipments, keeping US Gulf Coast LNG futures at seasonal highs, even as North Asian spot prices for China and Japan declined slightly along with European gas values amid an oil price plunge of more than 9 percent.

Japan’s liquefied natural gas imports soared by more than 21 percent last month, backed by a doubling of US supplies and more cargoes from Asia and Russia as stocks were rebuilt after the high winter season usage.

JERA Co. Inc., the largest Japanese liquefied natural gas buyer with 35 million tonnes per annum of volumes and control of a fleet of 20 LNG carriers, has launched the environmental impact process for upgrading one of its key power plants at Chita in Aichi Prefecture.

JERA is Japan’s biggest fossil-fuel generator being owned jointly by Tokyo Electric Power Co. and Chubu Electric, the two largest power companies.

The joint venture company currently operates and provides fuel for a total of 26 power plants in Japan and imports LNG into 11 of Japan’s network of 37 terminals.

JERA’s power plants have 70 gigawatts of capacity and the company is in the process of upgrading existing LNG and steam plants and also proposes to close its 2.2GW of coal-fired plants by 2030.

The current project for Chita in the Chubu region, whose capital is Nagoya, is for the construction of new Units 7 and 8 at the plant which will use the most modern combined-cycle gas-fired plant technology to make more efficient use of LNG imports.

The new gas-fired plants are expected to come on stream in August and December 2027.

JERA is one of the world’s largest LNG buyers and traders, taking volumes from leading global liquefaction plants.

In its plans for Chita, the older parts of the plants, units 1 to 5 with a combined 3,112 megawatts and using steam and LNG, are being decommissioned over the next few years through fiscal 2026.

The new Units 7 and 8 will then operate alongside the existing Unit 6 gas-fired re-powering plant, giving combined capacity of 2,154MW.

“In order to reduce carbon-dioxide emissions, for new units 7 and 8 the plan adopts the latest high-efficiency combined-cycle power generation system (with gross thermal efficiency of approximately 63 percent),” said JERA.

“In addition, the environmental burden due to smoke and warm wastewater is expected to be lower when the plan has been carried out than for operations at the existing facility,” stated JERA.

JERA has submitted the Environmental Impact Assessment to Japan’s Minister of Economy, Trade and Industry (METI), the Governor of Aichi Prefecture, the Mayor of Chita City and the Mayor of Tokai City, in accordance with the Environmental Impact Assessment Law and Electricity Business Act.

JERA said the documents would be made available for public review at the administrative agencies listed above and public meetings in the relevant areas are scheduled for the 26th March, 2021.

“People with opinions from an environmental conservation standpoint are invited to submit them via post or to drop them in boxes available at the public review locations,” explained JERA.

“JERA will continue to move forward with the environmental impact assessment process, giving due consideration to the opinions of other stakeholders,” it added. 

Gaztransport and Technigaz, the French technology and engineering company for LNG storage, has signed an additional cooperation agreement related to the Tianjin Nangang LNG import terminal currently being developed in northeast China.

GTT and the developer, Beijing Gas Group, said their accord is for collaboration for the phase II and phase III parts of the terminal construction beyond phase 1 covered by the current agreement.

The second and third phases of the Tianjin Nangang construction will include building six additional storage tanks, each of 220,000 cubic metres capacity.

This agreement was signed at a ceremony held at the French Embassy in Beijing in the presence of French Ambassador Laurent Bili, Chairman of Beijing Enterprises Group Tian Zhenqing and Li Yalan, Chairwoman of the board of Beijing Gas, along with Adnan Ezzarhouni, General Manager of GTT in China.

“I am convinced that GTT, a company of excellence in the field of natural gas, has a great future in China, which has resolutely embarked on the path of energy transition,” state French Ambassador Bili.

The first firm agreement for Tianjin Nangang LNG followed a November 2019 accord between GTT and Beijing Gas on the occasion of the presidential visit to China of French President Emmanuel Macron for talks with his Chinese counterpart Xi Jinping.

GTT subsequently received an order in June 2020 for the design of two 220,000 cubic metres capacity membrane tanks.

Built as part of the Tianjin Nangang project, located east of the capital Beijing, these two tanks when completed will be the largest in China.

“In this new agreement, GTT will also support Beijing Gas in upgrading the National Standards of LNG onshore tanks,” explained GTT.

Beijing Gas Chairwoman Li Yalan said the Tianjin Nangang LNG project was progressing smoothly.

“I hope Beijing Gas and GTT continue to strengthen their cooperation and jointly promote the adoption of the lower carbon footprint membrane full containment technology among Chinese gas companies,” added Li.

The Tianjin Nangang terminal will be the third serving the northeast Chinese port supplying the gas needs of Beijing.

The existing facilities currently include the Tianjin North onshore terminal operated by China Petroleum and Chemical Corp. (Sinopec) and a separate floating terminal provided by Norway’s Höegh LNG in the form of a floating storage and regasification unit on long-term charter to China National Offshore Oil Corp. (CNOOC).

“We are very pleased to extend our partnership with Beijing Gas, proof that the membrane full containment technology meets expectations in terms of technological performance, cost competitiveness and level of safety,” stated Philippe Berterottière, Chairman and Chief Executive of GTT.