HYDROCARBON
ENGINEERING
22
most LNG markets, such as Japan, China and the US. In the Iberian
Peninsula it has been used on a large scale to supply non-grid
connected customers (around 12 TWh/y in Spain). In Northwest
Europe, this distribution mode was only used minimally as the natural
gas grid is well developed. Nevertheless, things are changing. As LNG
Figure 1.
LNG demand per user group in the Lower Rhine
region in 2020 and 2035 (IWT = inland water ways,
SSS = short sea shipping).
Figure 2.
Reach of truck loadings out of Rotterdam and
Zeebrugge. The stars indicate large scale import terminals,
the triangles indicate small scale import terminals, and the
colours indicate whether truck loading is operational, under
construction, or not yet available. Norway is not indicated.
Adapted from GLE.
Figure 3.
Market for truck loading in NorthWest Europe
(stacked) – author’s interpretation of publicly available data.
started to be used as a fuel in trucks, barges and ships in
Northwest Europe, it became necessary for large scale LNG
import terminals to offer LNG truck loading capabilities.
First, Fluxys offered this service in Belgium, followed by
Elengy in France, and later Gate in the Netherlands.
Recently, Grain in the UK also opened its truck loading
station.
As shown in Figure 2, the distance travelled by trailers
and containers can be up to around 1000 km. Combined with
truck loading at other terminals, such as in Norway and
Sweden, and upcoming in Poland and Lithuania, one can see
that there is essentially European-wide coverage.
As it becomes easier and cheaper to distribute 50 m
3
, the
market is stimulated to grow (Figure 3), resulting in even
more terminals looking to offer the service: a reversed
‘chicken or the egg’ situation with positive feedback has
emerged.
The creation of a network not only creates more
robustness in the LNG supply chain, it also allows LNG
haulers to reduce costs significantly, as shortening a round
trip by one day decreases costs by around
€
3/MWh. This
is significant in a low margin market, with gas prices at
around
€
18/MWh and very low prices for competing oil
products. Furthermore, the possibility to source from
different locations and from different market players
further reduces the cost of the commodity, making the end
product more competitive.
Further cost improvements also seem possible by using
railcars, as is being proposed by VTG.
Supplying 5000m
3
of LNG
While small multiples of 50 m
3
, as needed for the bunkering
of smaller ships, can be performed by multiple trucks, once
volumes of more than a couple of hundred metres cubed
are required, truck loading becomes impractical. In Sweden, a
small bunkering vessel, the
Seagas
, is operating to supply
200 m
3
LNG parcels.
In Norway, the 2004-built 1100 m
3
Pioneer Knutsen
is
capable of delivering volumes that trucks cannot deliver.
Until last year, it was unclear how larger LNG bunkering
volumes in Northwest Europe would be transferred. While a
couple of ports have developed tailor made and land-based
bunkering stations (Risavika, Hirtshals), the main development
now seems to be in bunker ships.
In 2014, GdFSuez, now Engie, announced that, as of 2016,
it will have a 5100 m
3
bunker ship stationed in Zeebrugge, and
Shell announced that, as of 2Q17, it will have a 6500 m
3
bunker ship stationed in Rotterdam. Skangas followed suit by
announcing it too will have a 5800 m
3
bunker ship operating
in the Baltic in early 2017. Each bunker vessel has also secured
at least one customer: UECC in Zeebrugge, Containerships in
Rotterdam and NEOT in the Baltic. Other companies such as
BominLinde are also close to a final investment decision (FID)
on a bunker ship in Klapeida. In the US, Clean Marine Energy
will have an LNG bunkering barge of 2200 m
3
as of
February 2016 to serve the TOTE vessels.
Just as for truck loading, the emerging network of
bunkering places (by truck, fixed land-based installations
and bunker vessels) should increase robustness and bring
costs down.
